K A I S E R C O M M I S S I O N O N Medicaid and the Uninsured Figure 0 State Health Reform: Lessons for the Nation Jennifer Tolbert Principal Policy Analyst.

K A I S E R C O M M I S S I O N O N

Medicaid and the Uninsured

Figure 1

State Health Reform:Lessons for the Nation

Jennifer TolbertPrincipal Policy Analyst

Kaiser Commission on Medicaid and the UninsuredKaiser Family Foundation

for

Healthcare Leaders Forum Detroit Regional Chamber and Federal Reserve Bank of Chicago

Detroit, MIMarch 31, 2009



Figure 2

SOURCE: KCMU and Urban Institute analysis of March 2008 CPS.

298.2 million

Employer-Sponsored

53%

Uninsured 15%

Medicaid/SCHIP

13%

Private Non-Group 5% Medicare

14%

Military/VA 1%

45.0 million uninsured

Adults36.1

Children8.9

Health Insurance Coverage of the Total Population, 2007



Figure 3

IL

Uninsured Rates Among the Nonelderly, by State, 2006-2007

AZAR

MS

LA

WA

MN

ND

WY

ID

UTCO

OR

NV

CA

MT

IA

WIMI

NE

SD

ME

MOKS

OHIN

NY

KY

TNNC

NH

MA

VT

PA

VAWV

CTNJ

DE

MD

RI

HI

DC

AK

SCNM

OK

GA

TX

FL

AL

13-17% (19 states )

≥ 18% (18 states)

< 13% (13 states & DC)US Average = 18%

NE

SOURCE: Urban Institute and KCMU analysis of the March 2007 and 2008 Current Population Survey. Two-year pooled estimates for states and the US (2006-2007).



Figure 4

Availability of Employer-Based Coverage

Family Work Status of Uninsured, 2007

Total = 45 million uninsured

1 or More Full-Time Workers

69%

No Workers

19%

Part-TimeWorkers

12%

* Estimates are statistically different from each other within category (p<.05)SOURCE: KCMU/Urban Institute analysis of March 2008 CPS; Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2007

99%

67%59% *

36% *

Small Firms

(3-199 workers)

Large Firms

(200+ Workers)

Lower Wage Firms

Higher Wage Firms

Percentage of Firms Offering Health Benefits, 2007



Figure 5

Affordability of Health Coverage

400% FPL and Above10%

200-399% FPL24%

100-199% FPL29%

<100% FPL37%

Family Income of Uninsured, 2007

Total = 45 million uninsured

The federal poverty level was $22,050 for a family of four in 2009. SOURCE: KCMU/Urban Institute analysis of March 2008 CPS.

$721$3,354

$3,983

$9,325

Single Coverage Family Coverage

Employer ContributionWorker Contribution

$4,704

$12,680

Average Annual Premium Costs, 2008



Figure 6

Cumulative Changes in Health Insurance Premiums, Inflation, and Workers’ Earnings, 1999-2008

119%

34%

29%11%

22%

38%

57%

72%

88%

98%

109%

0%

25%20%17%14%

11%8%

4%

29%

3%7% 8% 11%

13% 17%21% 24%

0%

40%

80%

120%

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Health Insurance Premiums Workers' Earnings Overall Inflation

Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2000-2008. Bureau of Labor Statistics, Consumer Price Index, U.S. City Average of Annual Inflation (April to April), 2000-2008; Bureau of Labor Statistics, Seasonally Adjusted Data from the Current Employment Statistics Survey, 2000-2008 (April to April).



Figure 7

Role of Public Programs

Children6%

Children14%

Parents8%

Total = 45.0 million uninsured

*National median Medicaid income eligibility level for working parents in 2008.SOURCE: KCMU/Urban Institute analysis of March 2008 CPS.

Adults without Children

21%<200% FPL200% FPL +

200%

63%

0%

Children WorkingParents*

Childless Adults

Federal Poverty Line (For a family of four is

$22,050 per year in 2009)

Nonelderly Uninsured, 2007Median Medicaid/CHIP Income

Eligibility Thresholds, 2008

Adults without Children

35%

Parents 17%



Figure 8

Medicaid Enrollees are Poorer and Sicker Than the Low-Income Privately-Insured

49% 48%

61%

27%

15% 16%

0%

25%

50%

75%

100%

Percent of Enrolled Adults:

Poor Health Conditions that Limit Work

Fair or Poor Health

SOURCE: Coughlin et al, “Assessing Access to Care Under Medicaid: Evidence for the Nation and Thirteen States,” Health Affairs, July/August 2005.

Medicaid Low-Income andPrivately Insured



Figure 9

Cutting Back Care Due to Cost

12

21

27

30

34

22

37

41

61

71

Uninsured under 65

Insured under 65

Put off or postponed getting health care you needed

Skipped a recommended medical test or treatment

Not filled a prescription

Cut pills or skipped doses of medicine

Had problems getting mental health care

Percent of nonelderly adults who say because of cost they or a family member has:

SOURCE: Kaiser Health Tracking Poll: Election 2008, October 2008 (conducted October 8 – 13, 2008)



Figure 10

States Tackle Health Reform

• Initially, states focused on improving coverage through public program expansions and private market reforms

• As economy deteriorated, efforts broadened to address system reform

– care coordination

– system efficiency

– quality improvement

• Most states remain committed to implementing coverage expansions



Figure 11

Public Program Expansions

• Expanding coverage for children

– 11 states pursuing universal coverage for children

• Raising Medicaid eligibility levels for parents (examples: Maryland, New Jersey)

• Using/expanding Medicaid waivers to cover childless adults (examples: Wisconsin, Minnesota)

• Using Medicaid funding to purchase private insurance (examples: Indiana, Vermont)



Figure 12

Employer Incentives and Requirements

• Partnering with small employers – three-share models to assist employers in offering coverage

– tax incentives for small employers

– state examples: Maine, Montana, Oklahoma, Tennessee

• Employer Section 125 requirements– Allows employees to pay premiums on a pre-tax basis

• Pay or Play requirements – Require employers to provide coverage to employees or contribute

toward the costs of coverage

– Massachusetts, Vermont, San Francisco



Figure 13

Pay or Play in San Francisco Upheld

• San Francisco requires employers to make defined contribution toward health care for employees

• 9th Circuit Court of Appeals upholds requirement, saying no ERISA violation

• Implications for other states– cannot require employers to provide health coverage– must create universal coverage programs funded partly with

employer assessments– cannot specify what employer coverage must look like to

qualify for credit against the assessment



Figure 14

New Options for the Uninsured

• Premium subsidies for state-administered plans

– Plans offered through contracts with private insurers

– state examples: Connecticut, Massachusetts, Vermont

• Benefit plan redesign

– Wellness plans: emphasize preventive care, with financial incentives for participation in wellness programs

• state examples: Maryland, Rhode Island

– Low-cost plans: preventive benefit packages (usually include service limits and some do not cover hospitalizations)

• state example: Florida



Figure 15

Improving Access to Care

• Medical homes

– link patients with provider teams responsible for coordinating full range of care

– enhanced payment for care coordination

• Improving reimbursement for primary care

• Strategies to address primary care workforce shortages

– Scope of practice for non-physician providers

– Loan forgiveness programs



Figure 16

Improving System Efficiency and Quality

• Cost and quality transparency

– require provider reporting of cost and quality data

– comparison tools for consumers

• Inpatient quality initiatives

– non-payment for “never” events

– reporting of hospital-acquired infections

• Promoting HIT adoption

– statewide HIT infrastructure and standards for EHRs

– e-prescribing

• Provider payment reform???



Figure 17

Comprehensive Reform—The Massachusetts Model

• Individual Mandate– Mandate enforced through tax filings

• Employer Assessment– Employers with >10 employees that don’t offer coverage must

pay $295 per employee per year

• Subsidized Coverage– Sliding scale subsidies for individuals <300% FPL– Full subsidies for those <150% FPL

• The Connector– Links consumers & small employers to insurance– Establishes affordability standards and certifies insurance

products

• Medicaid Expansion to Children <300% FPL



Figure 18

Massachusetts Health Reform Successful in Improving Health Coverage

SOURCE: Massachusetts Division of Health Care Finance and Policy, Health Care in Massachusetts: Key Indicators, November 2008.

Private Insurance

33%

MassHealth18%

Individual Insurance

9%

Total = 442,000 Newly Insured

Commonwealth Care40%



Figure 19

Minnesota: Focus on System Improvement

• Comprehensive reform passed May 2008

• Expands MinnesotaCare to 250% PFL for childless adults

• Requires employers to establish Sec. 125 plans

• Provides tax credit for uninsured with access to Sec. 125 plans

• Requires care coordination for people with chronic conditions

– Will establish standards for medical homes and pay care coordination fee

• Creates tools for comparing providers on cost and quality measures; available to providers and public

• Establishes “baskets of care” to promote transparency and payment reform

• Requires e-prescribing by 2011



Figure 20

Looking Forward

• Economic picture remains bleak

– 8.1% unemployment in Feb. 2009 (up from 4.9% in Dec. 2007)

– 46 states facing budget shortfalls of $350 billion for the rest of 2009 through 2011

– Growing uninsured and increasing Medicaid and CHIP enrollment

• Federal legislation will help states

– CHIP reauthorization: bonuses to enroll currently eligible children in Medicaid plus federal funding for expansions

– American Recovery and Reinvestment Act: increased federal Medicaid matching funds for states

• Despite challenges, state continue to innovate and lead the way on health reform

– many health reform strategies being discussed at national level are currently being tested in the states



Figure 21

For more information

www.kff.org

www.kaisernetwork.org

www.kaiserEDU.org

Coming soon…Health reform webpage on kff.org

K A I S E R C O M M I S S I O N O N Medicaid and the Uninsured Figure 0 State Health Reform: Lessons for the Nation Jennifer Tolbert Principal Policy Analyst.

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