March 21, 2011 - California Healthline
How Can California Exchange Minimize 'Churning'?
Veterans of the Medi-Cal system in California -- providers, counselors, state
officials and beneficiaries -- have said for years that one of the keys to
making the Medicaid program work is continuity of care. But in most lives --and
perhaps especially in low-income lives -- things change. People move, they
change or lose jobs, their family situations evolve. When change happens,
eligibility for subsidized coverage shifts and health care is often
interrupted.
Health care officials who work with large Medi-Cal populations say
fluctuations in eligibility cause quality of care to decline and the cost of
care to increase because of added administrative expenses. Medi-Cal
beneficiaries moving in and out of coverage -- known as "churning" -- is not a
new phenomenon, but it may become more prevalent under health care reform.
The Affordable Care Act's two primary weapons aimed at reducing the number of
uninsured -- expanded Medicaid eligibility and subsidies for buying private
coverage through state health insurance exchanges -- could produce considerable
churning if they're not carefully implemented.
According to a study published last month in Health Affairs,
income fluctuations in the first year of expanded coverage under the new law
could produce eligibility shifts for as many as 28 million people who will
become newly eligible for subsidized health insurance. According to
researchers' predictions, after four years of expanded coverage under ACA, 19%
of adults initially eligible for Medicaid will have been continuously eligible.
About 31% of adults eligible for insurance subsidies will have remained
continuously eligible, researchers predict.
In California, nearly five million uninsured Californians will gain access to
health insurance in 2014. State officials and the board of the newly formed
health benefits exchange are working on constructing a system to get ready for
them as well as the millions of low-and middle-income Californians who will be
eligible to participate in the exchange.
We asked stakeholders and experts: What strategies should state
officials employ in the building and operation of the exchange to minimize
churning and promote quality and continuity of care?
We got responses from:
- Maya Altman, CEO, Health Plan of San Mateo
- Margaret Murray, CEO, Association for Community Affiliated Plans
- John Grgurina, Jr., CEO, San Francisco Health Plan
- Bradley Gilbert, CEO, Inland Empire Health Plan
- Elizabeth Darrow, CEO, Santa Clara Family Health Plan
Basic Health Program May Be
Best Bet
Maya Altman
CEO, Health Plan of San Mateo
The Basic Health Program, one of the options given to states in the health
care reform law, is a great opportunity to ensure continuity of coverage and
care for individuals and families that will shift between the exchange and
Medicaid. The Affordable Care Act gives states flexibility to create a dedicated
Basic Health Program for exchange-eligible consumers with incomes between
133% and 200% of the federal poverty level. Based on the limited
information available so far, the Basic Health Program appears to be a better
option than the exchange in dealing with continuity issues for three
reasons:
- Initial estimates indicate that consumers would have lower out-of-pocket
costs in the Basic Health Program, compared with the exchange. So when
individuals and families lose eligibility for Medicaid because of gains in
income, the Basic Health Program would present a less dramatic transition as
opposed to a potential cliff with the exchange. We know that those at or
around 133% FPL are much more sensitive to costs than their higher income
counterparts, so any reductions in out-of-pocket costs -- no matter how small
the difference -- will reduce the number of times consumers forgo needed
services because of high out-of-pocket costs.
- A Basic Health Program would likely attract existing Medi-Cal managed care
plans to participate. This would give consumers who flex between Medi-Cal and
the Basic Health Program an opportunity to remain in their existing health
plan, which means the ability to see the same doctor, have similar benefits,
use the same insurance card, be helped by the same care coordinator and call
the same phone number for assistance. So with a Basic Health Program in place,
income changes that move consumers above and below 133% FPL can mean coverage
AND care will be continuous and seamless for consumers and providers.
- The Basic Health Program is focused only on the exchange population that
is most vulnerable to churning and gaps in care. As research by Sara Rosenbaum and Benjamin Sommers verified,
income changes are more prevalent for consumers at 133% FPL than at 200% FPL.
If the lower-income group is part of the full exchange, issues of quality and
continuity unique to this lower-income group must be balanced with issues that
impact other populations in the exchange, such as unsubsidized consumers and
small businesses. Coverage alone does not equal access, and disruptions in
care will persist if we don't address the transition process. I believe the
Basic Health Program is an attractive option to mitigate the negative outcomes
from churning.
Fulfilling Promise of
Health Care Security
Margaret Murray
CEO, Association for Community Affiliated
Plans
The promise of the Affordable Care Act is to provide greater health care
security, filling in gaps in a system that has left millions without coverage.
But to fulfill that promise, we must ensure that those served by the cornerstone
of reform -- Medicaid and the state health insurance exchanges – enjoy the same
continuity of care most of us take for granted.
The problem of "churning" has long plagued Medicaid, as millions of
individuals cycle on and off the rolls, even though they remain eligible,
because of inefficient administrative practices and cumbersome paperwork
requirements. As a George Washington University report put it, "Medicaid
enrollment is like a leaky sieve." Churning will adversely impact millions more
when Medicaid expands and the exchanges start operating. Income fluctuations
will push people on and off Medicaid and will alter eligibility for premium tax
credits for coverage in the exchange, causing people to move back and forth
between the two programs -- potentially triggering changes in health plans
and financial uncertainty for enrollees and government.
Movement between health plans, even without gaps in coverage, can have
negative health consequences and increase administrative costs. Having Medicaid
safety-net health plans participate in the exchange, the federal Children's
Health Insurance Program (Healthy Families in California) and Medicaid will
allow more people to remain with the same plan if they move across the
Medicaid-exchange divide. So, we must avoid erecting barriers for
safety-net health plan participation in the exchanges.
The most rational policy for addressing Medicaid churning is to make all
beneficiaries continuously eligible for 12 months. Congress should
harmonize the coverage periods for public and private health coverage by making
12-month continuous eligibility the standard for Medicaid. In the interim, the
secretary of Health and Human Services can facilitate remedies. ACA
authorizes the secretary to streamline eligibility practices, reduce barriers to
enrollment, and improve the interaction between Medicaid and exchange-based
coverage, including through waivers for state innovation.
The interplay between Medicaid and the exchanges makes developing a strategy
for curtailing churning complex. But we must act before the problem becomes
more complicated and widespread. Patients pay too high a price when they
forgo needed medical care. Keeping the promise of reform requires making
health care security a reality for those who need it most.
Eliminate Churn
Through Continuous Coverage
John Grgurina, Jr.
CEO, San Francisco Health Plan
In an ideal world, Medi-Cal beneficiaries would appropriately inform the
state of any changes in their lives that impact income or family status. In
that world, beneficiaries would be transitioned immediately into an alternative,
equally effective health care program, while retaining their current provider
and circumventing any interruption of care. In that world, state resources,
finances, and maybe even a few trees would not be squandered on needless
paperwork.
We don't live in that world.
Our reality is that redetermination and the unintended consequence of "churn"
are a sinkhole for budgets, but more importantly compromise the health and
safety of the beneficiaries our system is designed to protect. According to
a June 2007 study by the Center on Budget and Policy Priorities, even temporary
lapses in health care coverage can cause beneficiaries to delay needed care or
worse, shun it altogether.
People who continue with a full-year of uninterrupted health care coverage
have lower rates of unmet health care needs and stable access to quality
care.
It's no secret that state Medi-Cal renewal mandates unintentionally disenroll
many beneficiaries due to the required frequency of
redeterminations. Complicated renewal forms and sometimes incomprehensible
verification requirements also serve to discourage the pursuit of coverage by
those who are most in need.
Adopting a process of continuous eligibility for one year would help create
an exchange in which the delivery of stable access to preventive and chronic
care programs are paramount. Beneficiaries would see a doctor more often,
which in turn would lead to reduced hospitalization and
emergency department visits.
From a pure cost-saving standpoint, should California's exchange opt to adopt
a strategy of continuous coverage, it would very likely discern a
significantly reduced number of disenrollments and reenrollments due to the
elimination of gaps in coverage. A recent study of Medi-Cal beneficiaries showed
that more than 600,000 children were disenrolled from the program within three
years, only to be re-enrolled ("churned") at a later date. The cost to
California in re-processing fees alone was $120 million.
Surely there are more advantageous ways for California to spend $120
million.
The Association for Community Affiliated Plans (ACAP) is working with
Congress and other key stakeholders to write legislation that would standardize
continuity of care and eradicate churn through a proposal called the Medicaid
Continuous Quality Act (MCQA). As the exchange board begins its process to
establish our state's exchange, I strongly recommend continuous Medi-Cal
coverage as a systemic approach to delivering consistent, quality care.
Streamline, Make
Eligibility Last a Year
Bradley Gilbert
CEO, Inland Empire Health Plan
To ensure that the health exchange succeeds, we need to implement strategies
that will help mitigate churning due to income changes and protect patients'
continuity of care.
As a result of frequent income fluctuations, people could move from one
government-subsidized insurance program to another. For example, they could
move from a health exchange product to Medi-Cal or Healthy Families. As the
churning occurs, their ability to keep the same provider network will likely be
limited because not all health plans offer a complete continuum of
government-subsidized products. Therefore, it is vital to include Medi-Cal
managed care health plans in the health exchange. These plans have more
than 15 years of experience in serving millions of Medi-Cal and Healthy Families
enrollees. By incorporating them into the health exchange, you secure continuity
of care. This would give individuals who have income the ability to stay with
their health plan and keep their same doctor, specialists and care management
teams.
Another strategy that can efficiently manage churning and keep people covered
is to streamline the eligibility determination process. This must be done both
at the initial application and transition points. First, eligibility should be
processed by a system whereby people could apply for any insurance program, such
as the health exchange, Medi-Cal and Healthy Families. Whether people are
looking for health coverage online or at a local office, they could apply for
any program. Currently, California has multiple eligibility systems that fail to
communicate and exchange data. This should not happen with the health exchange.
It must seamlessly communicate with the Medi-Cal and Healthy Families systems.
When an individual reports an income change, the system should seamlessly
move this individual from his or her current program to a new qualified program
without requiring the individual to resubmit base application information.
Furthermore, when an individual applies for coverage, the health exchange,
Medi-Cal and Healthy Families should use the same documentation requirements for
all programs. These agencies could also maximize existing federal and state
databases to verify eligibility information like an applicant's income or
citizenship requirement, helping the health exchange run more efficiently.
Once an individual is enrolled in a program, coverage should be guaranteed
for at least one year without any status report requirements during that period.
This would remedy the problem of people losing coverage because of
administrative issues.
By including health plans that serve all low-income programs in the exchange
and using a streamlined eligibility process, we will ensure individuals not only
stay covered, but maintain their provider relationships and continuity of
care.
Simplify, Stabilize,
Standardize Eligibility
Elizabeth Darrow
CEO, Santa Clara Family Health Plan
There are certain elements of eligibility that critically impact a plan's
ability to minimize churning and manage the quality and continuity of a member's
care. Currently a Medi-Cal member can elect to change plans in a two plan model
county at any time. In the commercial world, annual election creates a compact
between the member and the plan that encourages cooperation and dialogue to
provide a quality experience throughout the year.
In Medi-Cal, a member's moving in and out of a plan truly hinders any ability
to coordinate care. Complex redetermination requirements also present a
roadblock to continuing eligibility. A Medi-Cal member is often faced with the
chore of redetermination that includes a trip to social services, assembly of
documents and time. If that person does not currently need medical services,
there is little motivation to complete redetermination.
As we have seen, the more often redetermination is required (quarterly,
semi-annually, annually), the less likely it is to be pursued. So, an important
component of the exchange will be its ability to simplify, stabilize and
standardize eligibility across the state.
Santa Clara Family Health Plan helps members maintain their eligibility in
one of our three products as seamlessly as possible every day. We assist
families as their income changes to move between Medi-Cal and Healthy Families
so that care is not interrupted.
On a small scale, with lots of staff support, local health plans can ease
members' transitions. But with the advent of health care reform and the
establishment of the exchange, the landscape will change for these members who
move in and out of eligibility between government programs and the exchange
plans.
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