2

State Health Insurance
Exchanges—Overview

STATE HEALTH INSURANCE EXCHANGES:
HELPING CONSUMERS NAVIGATE AN
ENROLLMENT SUPERHIGHWAY

Alice Weiss, J.D.
National Academy for State Health Policy

Weiss opened by describing the National Academy for State Health Policy (NASHP) as a non-partisan, non-profit organization dedicated to helping states achieve excellence in health policy and practice (www.NASHP.org). NASHP conducts policy analysis and research, convenes forums for states to learn from each other, and assists executive and legislative branch officials, both at the state and federal levels. These activities help state decision makers assess opportunities for advancing effective policies. NASHP is unique as an organization insofar as it works across agencies and branches of government. Other organizations that are focused on state policies work selectively with certain decision makers, such as Medicaid directors, governors, or legislators. NASHP provides opportunities for state health policymakers to meet, learn from one another, and promote best practices.

NASHP has a growing body of work on eligibility and enrollment. Since 2008, NASHP has been the National Program Office for the Robert Wood Johnson Foundation (RWJF) initiative “Maximizing Enrollment.” NASHP is working intensively with eight states and less intensively working with all states on their efforts to enroll more eligible individuals



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2 State Health Insurance Exchanges—Overview STATE HEALTH INSURANCE EXCHANGES: HELPING CONSUMERS NAVIGATE AN ENROLLMENT SUPERHIGHWAY Alice Weiss, J.D. National Academy for State Health Policy Weiss opened by describing the National Academy for State Health Policy (NASHP) as a non-partisan, non-profit organization dedicated to helping states achieve excellence in health policy and practice (www. NASHP.org). NASHP conducts policy analysis and research, convenes forums for states to learn from each other, and assists executive and legislative branch officials, both at the state and federal levels. These activities help state decision makers assess opportunities for advanc- ing effective policies. NASHP is unique as an organization insofar as it works across agencies and branches of government. Other organizations that are focused on state policies work selectively with certain decision makers, such as Medicaid directors, governors, or legislators. NASHP provides opportunities for state health policymakers to meet, learn from one another, and promote best practices. NASHP has a growing body of work on eligibility and enrollment. Since 2008, NASHP has been the National Program Office for the Robert Wood Johnson Foundation (RWJF) initiative “Maximizing Enrollment.” NASHP is working intensively with eight states and less intensively working with all states on their efforts to enroll more eligible individuals 5

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6 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION into public coverage and publicly subsidized programs. This initiative has provided a great deal of information that can assist states as they design and implement their state health insurance exchanges. To disseminate their findings and foster communication, NASHP hosts an interactive venue on health reform topics for states and other policy makers called State Refor(u)m (www.staterefor(u)m.org). It is a website where states can post materials, share information, and engage in conversations about health reform. NASHP also provides technical assistance to the State Health Reform Assistance Network, a RWJF project that supports a number of organizations as they work intensively with 10 states to implement health reform. ACA Enrollment Reforms The Affordable Care Act (ACA) created a vision for an “enrollment superhighway.” Instead of a system that places the burden to navigate the array of public programs on the consumer, there is a single, uni- fied application that can be used to apply to any program. This seam- less, “one-stop” system would provide consumers with assistance and understandable information to guide them through the enrollment pro - cess. Individuals would present their enrollment information and then be guided through the eligibility process as states draw down their electronic information and match their information to various program eligibility requirements. This integrated approach to enrollment differs markedly from current systems, where there are different processes for enrollment. The new system is going to be integrated, not only within a state between Medicaid, the Children’s Health Insurance Program, private coverage options, and subsidized coverage, but also with federal programs, such as those offered through the Social Security Administration. ACA Eligibility Reforms The ACA replaces the existing multiple categories of Medicaid eligi- bility with a single eligibility category for individuals under 138 percent of the federal poverty level (FPL). There is also a much simpler process for determining eligibility. Instead of having a standard that depends on whether or not an individual fits into a certain category within his or her income, the ACA eligibility standard depends primarily on modified adjusted gross income. The other eligibility categories are set aside unless an individual meets certain criteria, such as being disabled or elderly. For individuals with incomes between 138 and 400 percent of the FPL, the ACA provides subsidies for health insurance coverage. The enroll - ment process is technology-enabled. In contrast to the usual paper-based

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7 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW application process, there is a movement toward electronic applications and links to allow applications through Internet portals. Privacy and security standards are in place to ensure that the consumer’s information is protected. Consumer Engagement The enrollment superhighway is predicated on the notion that con- sumers will be engaged in the process and have the information they need to make decisions about coverage. However, there is a large gap between where states are today and where they need to be to achieve the envisioned enrollment superhighway, Weiss said. One of the key challenges relates to how consumers experience and engage with enroll - ment systems.1 Most state systems are very antiquated; their systems are paper-based and not integrated. The burden is on the individual to go from agency to agency in order to enroll in programs for which they are eligible. Many people entering these systems are technology-savvy and are accustomed to technology-enabled environments. They are using their cell phones to order products online and to download music. Individu- als of all races, ethnicities, and economic backgrounds are increasingly accessing digital information through smart phones and other means. According to the Pew Research Center’s Internet and the American Life Project (www.pewinternet.org), 35 percent of American adults use a smart phone, and a quarter of them primarily use their phones to download information from the Internet. Latinos and black Americans are as likely, and in some cases more likely, to have a cell phone and are more likely to use their smartphones for these types of interactions. While an increasing number of Americans are relying on modern technologies, states have not yet engaged individuals using these tools. Enrollment Challenges for States With eligibility expansions under the ACA, states will have to accom - modate a high volume of applicants. In addition, the characteristics of the new applicants will differ from those who have traditionally accessed public programs. The expanded pool of applicants will include employed and middle-income populations. These clients will have different expecta- tions for customer service. Additional challenges will arise when address- ing the needs of a much more transient population. The increased eligibil- ity levels and the absence of the categorical eligibility requirements will result in greater access to programs on the part of homeless people and 1 For more information on challenges to enrollment, see Weiss and Grossman, 2011.

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8 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION people without a fixed address. These shifts in the size and makeup of the eligible population will contribute to the need for a robust consumer assistance program that includes the “human touch” that people often need to navigate complex systems. Very few states have such personal - ized support for their eligible populations. The ACA has recognized this challenge and has provided grants to states to augment their consumer assistance programs. Many states have done fairly well in accommodating individuals with disabilities, Weiss said, but they have not yet adapted programs to meet the needs of individuals in terms of language and literacy. One in 10 Americans does not speak English as a first language. Consequently, states will need to implement translation programs and programs that will support the needs of individuals with limited English proficiency. Families that include individuals with different citizenship statuses will present a challenge to states. Some families may include one parent who is an undocumented immigrant, another parent who is a legal immigrant, and children who are American citizens. It will be difficult for states to communicate to such families how their right to coverage may vary by program. In addition, there will be families with one privately insured parent and other family members without dependent coverage under the policy who will need help accessing public programs. Helping people understand their eligibility is going to be particu - larly challenging, Weiss said. Coverage gaps have been well documented (Sommers and Rosenbaum, 2011). Half of low-income individuals under 200 percent of the federal poverty level experience income changes over the course of a year. Of these individuals, half will experience more than one, and as many as two to four changes in a year. Every time an indi- vidual’s income changes between 138 percent of poverty and above, there will be a potential transition in coverage. It will be challenging for states to manage these transitions, Weiss said. This will be especially difficult when individuals are required to reimburse the federal government at the end of the year for any subsidies they receive, such as when they are found to be ineligible for coverage for some portion of the year. The ACA requires states to adopt technology that allows individu- als to apply for health insurance coverage online, in person, by mail, or by telephone. All states have developed an online application for either Medicaid or the Children’s Health Insurance Program (CHIP); however, in many cases the application must be printed, signed, and then faxed or mailed for processing. Some states have a system for electronic submis - sion of the application; however, relatively few states allow the applicant to complete the entire process online. Fewer than 10 states have systems in place that electronically match information submitted by the applicant to administrative records, Weiss said. Such systems eliminate the need for

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9 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW paper documentation. States will need to innovate to progress from the status quo to what is expected of them by 2014. The degree of variation that exists among states in their adoption of streamlined eligibility and enrollment policies is another key issue for states. For Medicaid and CHIP most states require income documentation at enrollment and at renewal. Relatively few states have adopted pre- sumptive eligibility or 12-month continuous eligibility. More states have eliminated the face-to-face interview at enrollment and have eliminated the asset test for these programs. States will have to improve their compli- ance to existing best practices for eligibility and enrollment simplification, Weiss said. Furthermore, when eligibility rules and enrollment policies vary by state, consumers who move from one state to another may have to navigate a completely different program and set of rules. States will have to be able to effectively communicate to help people understand their policies regarding consumer rights and responsibilities. Another key challenge for states will be the dramatic influx of appli - cants their systems must process. Many states have Medicaid eligibility levels that are quite low, with an average of roughly 32 percent of the FPL. With the elimination of the categorical limits, most adult parents in low-income families will be eligible for Medicaid. In addition to grappling with this dramatic expansion of Medicaid, states will need to provide new tax subsidies for individuals up to 400 percent of the FPL. These aspects of ACA implementation represent a significant change in how states have traditionally operated. States will need to adapt and develop new policies to manage coverage through the state health insurance exchanges, Weiss said. The existence of different eligibility rules under Medicaid is going to create confusion. Some individuals newly eligible for Medicaid will be deemed eligible based on a new modified adjusted gross income (MAGI) standard.2 Other individuals will have their eligibility determined accord- ing to their “point-in-time” income. Confusion will likely arise, as indi - viduals will have to present their current income in some cases, but not in others. Adding to the complexity is the fact that the MAGI standard does not apply to individuals whose eligibility for Medicaid is based on disability or age. These individuals will have to provide additional docu - mentation and go through a completely separate eligibility and enroll - ment process. These differences may pose challenges for both states and consumers. 2The MAGI standard calculates income based on taxable income as defined by the Internal Revenue Service, and is the same methodology that will apply to eligibility for tax credits and subsides for the purchase of private health insurance.

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10 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION The Need for Consumer Assistance The state health insurance exchanges create a new marketplace for health insurance with new rules. Consumers will need assistance as they attempt to learn what types of health insurance they are eligible for and, when eligible, details regarding their financial responsibility, and how to enroll. Examples of questions that consumers will likely be asking include the following: • How do tax subsidies work? • How do I pay for my coverage? • What is my share of the cost versus the federal government share? What is the reconciliation process at the end of the year and how does it apply to me? • How do I select a health plan? • What is an open enrollment period and how does it work? In some cases the ACA requirements are in conflict with existing federal and state policy, Weiss said. For example, some states fingerprint individuals as they enroll in public programs. Such a requirement will be difficult to enforce if an online application is adopted. There are also rules related to medical child support where the federal government has to go through a process of trying to find the custodial parent and obtain reimbursement for health insurance coverage. The adoption of assistive technologies is a key strategy to help con - sumers navigate through the complexities of program enrollment. Certain states have achieved some success. Utah, for example, communicates with beneficiaries through e-notices. Individuals who sign up for this service may receive an e-mail or text message that says, “You are now eligible for benefits,” or “Your benefits have changed,” or “We need your new address.” Utah has also implemented an online chat system, where individuals can ask questions about benefits and receive answers in real time. Mobile applications hold promise. Passengers transiting through the Chicago-O’Hare airport can download an application for a smartphone that can help them navigate through the airport. States will need to con- sider how to use these technologies in the context of health insurance enrollment. A number of states have adopted a focus on improving the interface between the customer and the health insurance options. For example, Massachusetts, Utah, and Wisconsin have systems that allow individu- als to make a plan selection, check their accounts, check their benefits, and follow transactions. Such systems allow individuals flexibility and a sense of ownership, Weiss said. Some states have experienced promis - ing results with kiosks enabled with a translation function. The kiosks

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11 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW provide opportunities for communication with populations or individu - als with low health literacy or limited English proficiency. In Alabama, individuals have access to kiosks that provide audiovisual assistance. The kiosks have improved service at eligibility offices experiencing long lines and wait times, as well as improving communication capacity. However, some individuals using the kiosk need assistance. The ACA includes substantial funding to support independent con - sumer assistance/navigator programs. Of the 51 states and jurisdictions that were eligible for consumer assistance programs, 36 states applied for funding. A promising model that states are considering is one that provides community-based organizations some financial support for each complete and successful application that is submitted. Massachusetts has a help line that is run by a community-based organization, Health Care for All. The help line provides a continuous feedback loop on con - sumer complaints to the state’s Medicaid program and its health insur- ance exchange. This program ensures that consumer voices are heard as the state implements its reforms. States need to ensure that their programs are accessible to individuals with limited English proficiency, Weiss said. Providing adequate transla - tion services may involve a contract with a translation company that has real-time translation capacity in multiple languages. States also need to ensure readability and audible access for populations with low literacy. States have made improvements by testing materials for readability and creating materials in multiple formats. Creating a national standard for educational materials would be of value and would obviate the need for each state to develop pamphlets and other materials. Training programs are also needed so enrollment workers are both culturally and linguisti - cally appropriate for the populations served. There are many opportunities to simplify and improve the consumer experience. Streamlining eligibility and enrollment policies will make a significant difference, Weiss said. Many states are attempting to rebrand health insurance coverage options so consumers do not necessarily asso - ciate state offerings with subsidized coverage (e.g., Medicaid, CHIP). Instead, the products are designed to be viewed as basic health insurance plans which vary by individual circumstances. Weiss said that policies will be needed to minimize coverage gaps and facilitate transitions when eligibility changes. Some states have looked at automatic transfers of eligibility. Promoting agency and worker culture change also is needed to enhance the consumer experience. Louisiana has had great success in this area. With culture change, the focus shifts from a gate-keeping function toward facilitating enrollment.

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12 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION There are several examples of “roadside assistance” to aid states as they embark on the enrollment “superhighway”: • The California HealthCare Foundation UX 2014 Project is focused on improving the user experience and helping states and the fed - eral government understand what consumers need and want. This project is developing a prototype to create a seamless, simple, and self-directed online experience. The prototype was expected in fall 2011. • The CHIP Reauthorization Act increased its support for states to implement translation and interpretation services. This should allow states to implement and bolster such programs. • The U.S. Department of Health and Human Services has a number of grants that are available to states: o Exchange planning/implementation grants o Early innovator grants o Medicaid Management Information Systems 90/10 federal matching assistance percentage (FMAP) for eligibility system upgrades • Private organizations are working with consumers and stakehold- ers to help them both understand these new rules and create mate - rials that will help them. For example, Community Voices for Cov - erage is working with advocacy organizations and helping them partner with states. Enroll America is working with stakeholder organizations to ensure that Americans know about coverage and are able to navigate systems to gain coverage. Conclusions Weiss concluded her presentations by pointing out that the ACA pres- ents opportunities for transformative change in health insurance eligibil - ity and enrollment, and the opportunity for consumers to engage in their health insurance coverage differently. She pointed out that state invest - ment and leadership is going to be critical, as will a focus on creating assistance, accessibility, and simplicity. States, if they want to make mean- ingful progress, can avail themselves of existing and evolving resources.

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13 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW LESSONS LEARNED FROM CURRENTLY OPERATING HEALTH EXCHANGES Sabrina Corlette, J.D. Georgetown University Health Policy Institute The majority of people who obtain health insurance through their employers often do not have a choice of plan, or if they do have a choice, it is among a standard set of products offered by one company, Corlette said. For many individuals, the human resources (HR) departments of their employers make the decisions relating to health insurance options. HR departments also provide guidance to employees regarding their plan choices. Individuals who buy insurance on their own, or work for small businesses without large HR departments, do not have this kind of support. The state health insurance exchanges will, in some ways, play a role similar to that played by HR departments. That is, the exchanges will give consumers information about the benefits offered and cost sharing assumed under the plan options, and then empower consumers to make informed choices. Corlette said that the underlying principle of state health insurance exchanges is that consumers, with appropriate information, can make value-oriented choices and coverage decisions that are right for their par- ticular situations. In addition, it is assumed that exchanges will encourage insurance companies to compete on their ability to deliver care that is high-quality and efficient. The Georgetown University Health Policy Institute recently com- pleted a study looking at existing exchanges in Massachusetts and Utah (Corlette et al., 2011). In each state, the leadership of these systems is constantly striving to improve operations in order to make the exchange more responsive to the consumer. As part of the Georgetown study, these two exchanges were examined from a consumer and employer perspec - tive in terms of: • Choice and quality of coverage, • Affordability of the coverage, and • Ease of enrollment for consumers and employers. Utah and Massachusetts are often identified as two divergent models that states can emulate as they implement their own exchanges, Corlette said. Utah is considered a free-market model where any health care insurer is allowed to participate, and consumers are afforded a very broad array of choices. The exchange helps consumers choose coverage that fits their particular situation. Conversely, the Massachusetts exchange is characterized by some as representing a regulatory model. It is more

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14 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION proactive in terms of setting minimum benefit levels, standardizing the benefit options, selectively contracting with plans, setting criteria and standards through its contracting process, and being selective about the plans that are allowed to participate. The Georgetown study found that the features of these two exchanges are actually far more nuanced and complex than the usual stereotypes used to characterize them. For example, the Massachusetts exchange has been very open to including plans in the exchange and has actually tried to recruit plans to participate. Utah has made a number of regulatory changes to try to make its marketplace more hospitable to its exchange. Each state modifies its policies to make its exchange viable. The George - town study suggests that there are positive aspects of both models from which states can draw. Utah and Massachusetts embarked on their exchanges with two very different visions, Corlette said. In Massachusetts, the exchange was cre - ated to be a tool to achieve universal, or near-universal, health insurance coverage. In contrast, Utah developed its exchange in response to a prob- lem, that of small employers who were struggling to provide coverage to their employees. The goal of the Utah exchange was to make it easier for small employers to provide health insurance coverage. The Utah exchange wanted to improve the flow of information among plans, employers, bro - kers, and consumers. It used a defined contribution approach to give small employers more predictability in their cost exposure. In Massachusetts, the Connector Authority of Massachusetts takes a fairly active role in the marketplace. It selectively contracts and sets standards for participating plans. All plans must offer an essential benefit package to meet what is called the Connector Seal of Approval. Any participating plan must also be accredited by the National Committee for Quality Assurance (NCQA). Massachusetts has made a significant investment in public education as well as one-on-one consumer assistance, Corlette said. Both a top- down and bottom-up approach have been used to publicize the program. Prominent Red Sox baseball players and other public personalities were engaged as part of a public relations education campaign to talk about access to coverage through the exchange and the shared responsibil- ity people would have to purchase insurance under the Massachusetts Health Reform Law. The state also provided about $3.5 million annually for a “boots on the ground”–style campaign. A community-based orga- nization, Health Care For All, responded to telephone calls about health insurance access and enrollment. Outreach workers at community health centers and other clinical access points were marshaled to go door-to-door in communities to provide information and help people enroll. These investments were critical to the huge expansion in coverage in Massachu - setts through enrollment in the exchange.

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15 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW In some states, community-based organizations charged with out- reach, education, and enrollment assistance have come into conflict with private insurance brokers and agents. Competition between these groups was not much of an issue in Massachusetts, Corlette said, because in the individual market, which was the focus of the coverage expansion early on, brokers and agents did not play a large role. They were much more involved in the employer small group market. Massachusetts fairly quickly started to standardize the benefit pack- age and, in addition to setting minimum benefits, it defined certain benefits and cost-sharing arrangements. The state did extensive market research. According to this research, consumers found the level of choice available in the exchange to be overwhelming (Corlette et al., 2011). They wanted an easier, streamlined shopping experience. A benefit of stan- dardizing the benefit choices was that it allowed people to make better “apples-to-apples” comparisons. It was, for example, easier to compare deductibles for hospitalizations and cost sharing for doctor’s visits and lab tests. Allowing these apples-to-apples kind of comparisons narrowed the opportunity for health plans to compete based on risk selection or risk segmentation, and encouraged them to compete more on their ability to provide quality care more efficiently, Corlette said. There are few similarities between the Utah exchange and what is envisioned in the ACA, Corlette said. Table 2-1 summarizes what the Utah health insurance exchange does and does not do. The Utah exchange will be required to change considerably under the ACA. Currently, it covers about 3,500 people, and they are all in the small group market. The Utah exchange does not cover individuals who are purchasing health insur- ance as individuals. It also does not extend to large groups, although such coverage has been under discussion. The Utah exchange provides enrollees with a wide range of plan choices. For example, in 2010 it provided 146 different plan options for TABLE 2-1 T he Utah Health Exchange: What It Does and Does N ot Do The Utah Health Exchange Does: The Utah Health Exchange Does Not: • over approximately 3,500 enrollees C • S ubsidize the purchase of coverage • rovide enrollees with over 100 plan P • C over individuals or large groups choices • S et minimum benefit levels • llow small employers to make A • S tandardize benefit offerings defined contributions • ary rates based on group experience V and an individual’s age, location, and family size SOURCE: Corlette, 2011.

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16 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION about 436 enrollees. The exchange enrollment has expanded, but it is not yet near the goal of 25,000 enrollees by the end of 2011. In the traditional, small group market, employers were required to contribute at least 50 percent of the premium for their employees. The Utah exchange allows employers to set a defined contribution, such as $100 or $200, toward the cost of the insurance plan’s premium. Employer contributions vary dramatically, Corlette said. Some employers are con - tributing very little, some are still contributing 50 percent (as previously required), and one employer is contributing 100 percent to the employ- ees’ premiums. The defined contribution can be considered a premium voucher that is given to the employee, who then makes the choice among the various plan offerings. Utah’s health insurance carriers are still allowed to underwrite their policies. Carriers rate the employer group based on its experience, and they also vary rates according to the individual employee’s age, location, and family size. The ability to underwrite will be discontinued under the ACA when health plans will no longer be allowed to experience rate their policies. There are no state subsidies for the Utah exchange. Unlike the ACA health insurance exchanges and the Massachusetts exchange, people are not getting subsidies to participate, Corlette said. While the carriers have to be licensed, the exchange does not set a minimum benefit standard or require accreditation. The Utah exchange uses “Plan Chooser” software to help people organize their choices, but, unlike Massachusetts, there has been no attempt to standardize the offerings from carriers. One reason that enrollment in the Utah exchange has been fairly low relates to price. In some cases, employers in Utah found that prices were actually higher inside than outside the exchange. It is possible, Corlette said, that such price issues may be because carriers were responding to the uncertainty associated with an “employee choice” kind of approach, that is, an approach where people were able to choose a plan based on their particular circumstances. Some of the regulatory changes that Utah has made have been in response to these price differences. The Utah exchange requires each individual employee to fill out a detailed questionnaire about his or her health history and the family’s health status. This has been unpopular because it is burdensome, time consuming, and there is a fairly short time frame within which people have to enroll. In a survey conducted by the Utah exchange in 2010 (Corlette et al., 2011), 55 percent of people reported that choosing a plan was not an easy process. Seventy-four percent needed the help of a broker or agent to complete the process. And many enrolled in a default plan that was the most similar to the one they had been in before.

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17 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW The approach of handing people a check to cover at least some of their health insurance costs and then asking those people to shop for a plan using Plan Chooser software has not met expectations in Utah, Corlette said. People were still very dependent on their insurance brokers to make a decision. They often chose the default plan because it was the easiest choice to make. The ACA addresses many of the challenges observed in Utah by eliminating health status rating, providing subsidies, and requir- ing the display of coverage tiers, Corlette said. In terms of policy lessons, Corlette indicated that the experience in Massachusetts suggests that the insurance exchange can be used as a mechanism to encourage more value-oriented purchasing. Plans with a lower cost structure have had a greater market share inside than outside the exchange. Blue Cross-Blue Shield of Massachusetts (BC/BS), a plan with high-quality products, has a higher price structure largely because it has a much broader network and relatively high marketing expenses. BC/BS has a lower market share inside than outside the exchange. In Massachusetts, Corlette said, consumers have the ability to shop with con- fidence. They know the plans offered on the exchange have NCQA star ratings and the exchange’s seal of approval. Consumers are able to make apples-to-apples comparisons knowing that every plan on the exchange, even one without a well-known “brand name,” is a quality plan. Corlette concluded that to have a successful exchange, market research is critical. The exchanges must know what consumers want and what consumers are experiencing. If benefit designs are going to be standardized, exchanges have to offer consumers what they want, par- ticularly in the small group market and for unsubsidized individuals who can vote with their feet. Public education and assistance are also critical, including one-on-one enrollment assistance, she said. Enrollment has to be simple. In Utah, the long, detailed health questionnaire and a fairly complicated enrollment process was a deterrent to a number of employ- ers and employees. Since the Georgetown study was completed, both the Massachusetts and Utah exchanges have made changes to try to improve the consumer experience. Massachusetts has added a provider search function so when consumers are comparing different plan options they can search and see whether their doctor is in the plan’s network. Utah has simplified its questionnaire to make it easier and quicker to complete and then enroll. The Utah exchange has also added some helpful information, particu- larly for people participating in the nongroup market. These individuals would not be going through the exchange to obtain coverage, but they have access to relevant information about coverage options through the exchange.

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18 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION DISCUSSION Workshop moderator and roundtable chair George Isham observed that the health insurance exchanges in both Utah and Massachusetts were learning from their experiences and making changes. He asked Corlette if there are any requirements for the exchanges to focus on the customer experience and to have in place an improvement process that includes a report on their performance. Corlette responded that there is no requirement in the ACA for exchanges to conduct market surveys, focus groups, or to obtain any kind of feedback from consumers. They are, however, required to fund a navigator program. Navigators provide public education and outreach, and consumer assistance. Corlette said that although there is no specific requirement for exchanges to obtain feedback from consumers, she felt that if a state is invested in the success and sustainability of their exchange, it will invest in market research so it can be responsive to consumers. Unfortunately, such research is fairly resource intensive. Weiss added that in her discussion with states on their implementation efforts, exchange representatives stated they want their exchanges to be viable and attract consumers. They want to encourage healthy people, in addition to those who may have immediate health problems, to purchase coverage. There is, therefore, an incentive for states to understand their potential consumers and to conduct market research on an ongoing basis, Weiss said. Benard Dreyer, roundtable member, raised the issue of the cognitive load that individuals face as they purchase insurance through health exchanges. He asked if there are ways to decrease this load to make it easier for individuals to make appropriate choices. Corlette suggested that states need to make sure their web interface with consumers is designed so individuals receive essential information easily and then are able to proceed through the system to obtain more information as desired. This “friendly” interface can be achieved through navigation panes and a layering of information. Plan-to-plan comparisons need to allow the consumer to easily judge plans on the basis of plan characteristics most relevant to them. Typically, when consumers make health insurance deci - sions, they are interested primarily in price, and then secondly in whether or not their doctor is in the plan’s network. One goal of the exchanges is to help consumers evaluate plans on the basis of value, and not just on the basis of price. Will Ross, roundtable member, commented on the advantages of sim- plifying the process of determining eligibility for programs, and observed that a presumptive eligibility determination for Medicaid and CHIP cov - erage is likely an efficient mechanism. Given its efficiency, he asked Ms. Weiss why only 10 to 15 states have adopted presumptive eligibility. Weiss said that presumptive eligibility is indeed efficient and is an

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19 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW option under the ACA. A provider who has been designated as a quali- fied provider by the state can classify an individual as presumptively eli - gible. These designated providers can temporarily assume that a patient is eligible for services, and then start the application process with the understanding that that individual will then complete the application process with the state. One of the key challenges facing states is that the qualified providers have an incentive to use presumptive eligibility as a way to get paid for services that would otherwise be unpaid because the individual was not enrolled in Medicaid or CHIP. In addition, providers may not have an incentive or opportunity to follow through on complet - ing the applications. In some states, Weiss said, presumptive eligibility has become emer- gency Medicaid. The state and the providers use this mechanism as a way to pay for services. Another issue has been the difficulty of processing an increased volume of incomplete applications. Some applicants are indi- viduals who are transient or who are not able to provide reliable informa - tion. These applications pose an administrative burden. Under the ACA, presumptive eligibility may follow a slightly different model, Weiss said. That is, when a person walks in the door, he or she is presumed eligible for some coverage. The issue will be not whether someone is eligible, but rather for what coverage someone is eligible. States will need to stream - line the enrollment process to get people into the system, obtain as much information as possible, and then have a default position of gaining access to a program. As the information is completed, the challenge will be to determine the appropriate payment structures, Weiss said. If an indi- vidual receives subsidized coverage and it is later determined that he or she is not eligible for the subsidy, the individual will have to pay back that subsidy. This amount can be substantial from the perspective of a low- income individual. The determination of presumptive eligibility is facili - tated in a system that supports electronic records and communications. Cindy Brach, roundtable member, asked Weiss for clarification on how an individual interacts with the state health insurance exchange to obtain health insurance coverage. Weiss said that the processes of eli - gibility determination and of plan enrollment through an exchange are different but related. The first step is determining eligibility for coverage and the type of coverage that eligibility confers. In many cases, states first screen individuals for their eligibility for Medicaid. After eligibility for either public or private insurance is determined, the second phase of the process is the choice of plan. Typically, if an individual is determined to be eligible for Medicaid, he or she has between 15 days to a month to select a health plan. If a choice is not made, a default plan is chosen for the beneficiary. Ideally, the eligibility and enrollment process could occur con- secutively in real time. The Centers for Medicare and Medicaid Services

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20 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION (CMS) is discussing the feasibility of a 15-minute eligibility determination and enrollment process. Much progress needs to be made to arrive at this ideal streamlined process from the status quo, Weiss said. Corlette said that the proposed Department of Health and Human Services (HHS) regulation relating to exchanges leaves somewhat open the question of whether a consumer would need to navigate away from the state’s exchange website. For example, a consumer who wanted to obtain a particular plan’s summary of benefits form may need to navigate from the exchange website to a particular carrier’s website. Brach said that there is a parallel with Medicaid and Medicare Man- aged Care, because both populations have health literacy levels that are similar to those of the uninsured. These similarities were evident in the National Assessment of Adult Literacy. She asked Weiss if there are les- sons learned from the experience of helping Medicaid and Medicare beneficiaries make plan choices that could be applicable to the exchanges. Weiss replied that states have applied different models in providing plan choices to beneficiaries. Some states only have a few choices, a Plan A or Plan B. States that offer more choices sometimes use an independent enrollment broker who serves some of the same functions as the naviga- tors, that is, providing information about plan options and helping clients understand which choice may best suit their circumstances. Some states have had positive experiences with independent enrollment brokers. However, consumers need to be protected from any conflicts of interest and make plan choices freely and without coercion, Weiss said. Brach pointed out that CMS’s 2012 call letter to health plans indicated there will be a greater degree of standardization of the products that are offered to beneficiaries. Such standardization will help consumers make better comparisons and informed choices. There may have been evidence that plans were using benefit design to try to attract certain kinds of ben - eficiaries, and the call letter to plans addressed this issue as well. There are some good lessons to be learned from Part D and Part C in the Medicare program. Ruth Parker, roundtable member, discussed a challenge that the roundtable has tried to address in the last 5 or 6 years: to transition from discussing the definitions of low health literacy and how many individu - als can be enumerated as having low health literacy to focusing on orga - nizations and asking how health literate they are in terms of what they ask people to do. How navigable is the system? How understandable is it? How actionable and how clear are the system requirements? In the recent roundtable meeting, where an overview of the ACA and oppor- tunities within it were reviewed, some of the questions that arose were “How can health literacy be monitored and policed?” and “Where are the enforcement tools?” (IOM, 2011). In this context, the Plain Language Act

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21 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW of 2010 is relevant, Parker said. It has implications for communications from federal agencies, specifically CMS and the role CMS is playing in the states, the state exchanges, and the flow of funds that will come from the federal government to the state. Parker asked if there are any enforcement tools or “teeth” in the Plain Language Act mandate that information be in plain language that is accessible and usable. Corlette pointed out that the ACA requires plans that participate in the exchanges to use a uniform enrollment form and a standard summary of benefits form. The National Association of Insurance Commissioners has been working with a multistakeholder group to develop consumer- friendly language. A readability expert has reviewed the materials, and further work is under way. HHS will issue a proposed rule relating to these standardized forms. The proposed rule that HHS recently issued on exchanges includes a requirement to use plain language as they develop their web portals.3 The proposed rule allows considerable state flexibility and discretion; therefore, there may not be firm requirements related to plain language. Firm requirements could be built into the final regulation, Corlette said. One audience member asked if a mechanism exists for sharing the findings from market research and program development across the states. Lessons learned from states as they develop training programs for navigators and materials for consumers would avoid duplication of effort on the part of states. Weiss replied that the National Academy for State Health Policy has developed a tool to help states share resources. States will be able to share both their experience with a vendor and the product of that experience so states can learn from one another. Other oppor- tunities for sharing and peer learning are available through the early innovator grants. HHS has created these grants to provide seed money for states to implement exchange work. States with grants that achieve accelerated exchange implementation can serve as models for other states. The grant stipulates that grantees share products, materials, and tools. A website will be developed to facilitate the sharing of resources. HHS is also supporting a learning collaborative to address these types of issues. There should be several opportunities for learning and sharing among states, Weiss said. There are also opportunities for sharing best practices in the private sector. Enroll America (www.familiesusa.org) is a service for stakeholders that are participating with states to share materials and make them more broadly available. The resources needed to implement a successful exchange are intensive, and so it is imperative that states do not “reinvent the wheel.” 3 HHS released the proposed rule on August 17. As this report is being prepared the comment period is still open so no final rule has been issued.

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22 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION Dreyer asked Weiss what progress states were making in implement- ing the enrollment superhighway and whether there are any estimates of the cost of doing so. Weiss replied that the states are very actively engaged in implementation. She mentioned there is a great deal of politi- cal discussion and action at the state level with regards to the legitimacy and constitutionality of the reforms. However, states understand that until the federal law is successfully challenged, they must adhere to the law. Many states see the ACA as an opportunity to make desired changes to their systems. States of all political persuasions are moving forward with implementation. Weiss cautioned that states’ capacities to imple - ment reforms successfully are in question. Many states are proceeding as though success is an option and are trying to follow very closely the requirements in federal law. Weiss recounted her experience at a recent Robert Wood Johnson Foundation meeting. The foundation is intensively working on implementation with 10 states. The states are at different stages of development but are all committed to the goals of the ACA. In terms of the costs associated with implementation, Weiss said they could be minimized by federal encouragement and support of cross-state sharing. The transition will be expensive, she said, especially if it is not completed efficiently and effectively. Some opportunities to minimize expenses may be lost because of the time pressure that states are under. Perhaps the most efficient way to proceed with implementation would be to have the federal government create a model and then allow states to access and adapt it, Weiss suggested. In some cases legacy eligibility systems that have been in place for almost 30 years need to be updated. This will be a costly investment for many states. Sharon Barrett, roundtable member, asked Corlette about the role of the individuals who will be trying to explain the different insurance options to consumers. She asked about training and certification require - ments to ensure that the information shared is correct and that communi - cations with individuals of low literacy are treated with respect, allowing informed choice. Barrett raised concerns regarding the reliance on com- puters as aids to consumers. She pointed out that individuals with low health literacy are often not computer literate. Corlette said the law requires states to set up navigator programs, funded through grants or contracts. The health insurance exchange would be able to provide outreach and consumer assistance and help people sign up for qualified plans. The law enumerates the duties of the navi- gators, but it does not specify the kind of training the navigator must have. The law says that the navigator has to show he or she has contacts with particular communities, such as people who are historically under- served. One model for a navigator program is in Massachusetts, where the community groups that were getting grants from the exchange were

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23 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW required to attend quarterly training sessions. States are also looking at licensing navigators as insurance brokers or agents, which would require them paying a fee and, in some cases, a more rigorous level of training. Insurance agents and brokers can also be navigators. However, if such a navigator were to be compensated by health insurance companies, concerns arise regarding potential conflicts of interest, Corlette said. A conflict would exist if there was a financial incentive for the navigator to steer an applicant to a certain plan instead of a plan that was best suited to the consumer. Every state is looking at different ways to train navigators and ensure their neutrality, Corlette said. Navigators need to be trained in the various private insurance options as well as the federally supported programs such as Medicaid and CHIP. For the public programs, states have reached out to community organizations that serve as intermediaries on applica - tion assistance. States have provided such organizations with either up- front grants or reimbursement on a pay-as-you-go basis. In many cases states use a standard training protocol to train and certify an initial cohort. They then provide train-the-trainer opportunities. Corlette said there will be a steep learning curve for some who will be providing counseling regarding health insurance options. Medicaid eligibility workers need to be trained in private health insurance coverage because with the expan- sion of insurance options, they will need to know about the full range of products that are available. A standard training protocol is needed that goes through all of the insurance options so navigators are well versed and understand both public and private insurance options. In addition, performance standards training will have to be developed to specify how often navigators will have to be certified and what sort of oversight is needed to ensure they are following protocols and operating in a fair and reasonable manner. This is an area where a basic set of standards could be developed and adapted by states. Brach asked Corlette and Weiss to discuss opportunities, within the navigator programs and elsewhere, to incorporate consideration of health literacy into the state health insurance exchanges. Brach said that states are overwhelmed with the task of launching these exchanges, especially with recruiting the plans and moving forward with exchange implemen- tation. She expressed concerns that health literacy may not be a priority, and yet it is fundamental to getting people to enroll and choose suitable plans. In terms of opportunities within the navigator programs, Corlette said that the National Association of Insurance Commissioners (NAIC) is discussing the feasibility of developing a model training certification program for navigators. This association represents the nation’s state insurance commissioners who typically have the responsibility to license

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24 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION insurance agents and brokers. The NAIC could be approached regarding the need for training in health literacy. Another opportunity to ensure that health literacy is considered as the state exchanges are launched is in the area of rule-making at HHS. HHS is responsible for the traditional rules and regulations and, in addition, has what is called subregulatory guid - ance as well as one-on-one training opportunities with the states. The staff at the Center for Consumer Information and Insurance Oversight (CCIIO) could be approached about the need to incorporate health literacy and plain language considerations into the rules and regulations, the subregu- latory guidance, and the one-on-one training with states. Weiss said that under the ACA there is one section (section 1561) that deals with health information technology (HIT) eligibility and enroll- ment standards. A workgroup at the Office of the National Coordinator promulgated standards that have become the foundation for the HIT guidance from CMS and the CCIIO. These standards govern how states manage their HIT under ACA reforms. There is a provision that addresses accessibility and communication and includes specific information about populations with limited English proficiency. Weiss suggested that discus- sions be held with CMS and others about the need to consider the digital divide and issues around low literacy. States need to have standards and plans in place to accommodate individuals with low literacy skills. Melissa Houston, an alternate to the roundtable, asked Corlette and Weiss about the development of performance standards and how the public will know if the exchanges have accomplished their goals. Corlette said that some accountability has been built into the law. HHS Secretary Sibelius must determine by January 1, 2013, whether a state exchange is ready to operate and is in compliance with federal standards. The HHS proposed rule suggests there will be flexibility in this requirement so states may be able to operate with a conditional compliance certification. States are developing their exchanges with planning grants, Corlette said. Additional resources are available through 1-year establishment grants. To be eligible for establishment grants, states must meet certain requirements. So in some sense, the grant process provides a degree of accountability. The establishment grants will no longer be available after 2014. By 2015, the exchanges are to be self-sustaining. Corlette said there is little in terms of accountability once the grant program ends, except to the extent that if an exchange fails to meet the basic ACA requirements, the federal government can step in and run the state’s exchange. It is unclear what capacity exists at the federal level to operate a state exchange. Weiss added that the grant-making process, both for the early innova- tor grants and the exchange planning grants, has standardized processes in place to ensure that states meet certain obligations to receive additional support. There are gate reviews that must be successfully completed

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25 STATE HEALTH INSURANCE EXCHANGES—OVERVIEW before the grantee can proceed to the next phase of a project. These grant review processes provide some degree of oversight and accountability in the short term. On an ongoing basis, there are standards that are written into the law. At issue is who within the administration will enforce these standards, and how enforcement will be operationalized, Weiss said. States will have a fair amount of oversight, just as they do under the Medicaid program. Laura Shone, an audience member from the University of Rochester, asked if the state health insurance exchanges would help newly enrolled consumers understand how to use their benefits. Many people entering the insurance systems will lack experience accessing care and understand- ing their coverage. Corlette said that state exchanges have some discretion in how they set up their consumer assistance function. The exchanges are supposed to have a mechanism for handling consumer complaints and referring people to appropriate state agencies or services when problems are found. The exchanges will not be duplicative of health plan consumer call centers. The ACA requires health plans to have an internal and exter- nal appeals process to handle complaints. Corlette said that while these mechanisms exist, it is unclear at this stage how much of this consumer assistance function will be done within the exchange, by a state depart - ment of insurance, or other state agency. Some issues could be handled by an external appeals process, such as through an insurance company or employer-based plan. Shone asked if consumers would be assisted in navigating the health care system. This could involve helping people understand the role of a primary care doctor and how to optimize interactions with providers. She said “People don’t know what they don’t know,” and a helpline has limited utility in helping people make their way through a complex health care system. Studies of the Medicaid and CHIP programs indicate that the major reason families do not reenroll in CHIP is that the reenrollment process is confusing, Shone said. This is counterintuitive insofar as the program should be a familiar one. Shone expressed concern that there is an underestimation of how difficult and intimidating engaging in health care can be. Corlette agreed with Shone’s observation and said that in Massachu- setts, reenrollment was much more difficult for consumers when they went through the exchange, in part because their initial enrollment was through a health clinic or hospital. Aside from the navigator program, Corlette said that there is no particular requirement in the ACA that exchanges provide ongoing, hands-on assistance, once enrolled. Rima Rudd from the Harvard School of Public Health discussed the importance of reports that document the progress of states in meeting their ACA obligations. It is especially important for evaluative studies to

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26 FACILITATING STATE HEALTH EXCHANGE COMMUNICATION include well-specified criteria, she said. Criteria that are used to gauge progress in a study may be adopted as benchmarks that are internalized within organizations or plans. These criteria could relate to aspects of nav- igation, to reenrollment, or to ease of reading and literacy-related issues. Isham concluded the session by highlighting some of the points made during the discussion period, including • The need to acknowledge the cognitive load facing consumers as they make complex choices through health insurance exchanges; • The applicability of the Plain Language Act to the operations of the exchanges; • The importance of meeting the needs of the diverse populations seeking assistance through the exchanges; • The importance of transparency and ensuring accountability of the exchanges in terms of their customer performance; and • The necessity of learning from government programs that have experience and have succeeded in helping customers, such as Medicare beneficiaries learning of their insurance options. REFERENCES Corlette, S. 2011. Lessons learned from currently operating health exchanges. PowerPoint pre- sentation at the Institute of Medicine Workshop on Facilitating State Health Exchange Communication Through the Use of Health Literate Practices. Washington, DC. Corlette, S., J. Alker, J. Touschner, and J. Volk. 2011. The Massachusetts and Utah health insur- ance exchanges: Lessons learned. Washington, DC. http://ihcrp.georgetown.edu/pdfs/ Mass%20Utah%20Exchanges%20Lessons%20Learned.pdf. IOM (Institute of Medicine). 2011. Health literacy implications for health care reform: Workshop summary. Washington, DC: The National Academies Press. Sommers, B. D., and S. Rosenbaum. 2011. Issues in health reform: How changes in eligibility may move millions back and forth between Medicaid and insurance exchanges. Health Affairs 30(2):1-9. Weiss, A. M., and L. Grossman. 2011. Paving an enrollment superhighway: Bridging state gaps between 2014 and today. Washington, DC: National Academy for State Health Policy.