Managed Healthcare Executive - February 2009 - (Page 14) {EX EC U T I V E PROFIL E} gets, rising unemployment and dropping employer-sponsored coverage rates, HIP is certain to see a sharp rise in applications and greater need for added funding. “My biggest fear is that we’re going to have the same amount of resources with 15% growth in the next two years,” McBeth says. “I’ve been at MDwise for 10 years, and each year the medical loss ratio inches up. The rate increases you get in Medicaid don’t keep up with the increase in utilization and the increase in prices on pharmacy.” Because HIP operates on a Medicaid waiver, it must be budget-neutral to the federal government and carries a per capita cap on federal funds. Indiana’s eligibility expansion to include adults without children must be o set by savings or redirection of funds. The state plans on saving costs among its traditional Medicaid categories and will use a portion of Disproportionate Share Hospital (DSH) allotment funds. The state also passed a tobacco tax increase to fund HIP. McBeth says the tobacco tax and other funding has been su cient for the rst year of HIP, but there’s no forecast for how long the funds will sustain the program. “The way this bill is structured, when we run out of money from the tobacco tax, we stop putting people in the program,” Verma says. “That was something Governor Daniels felt strongly about—that this was a scally sound program. It’s not open-ended.” Clearly, HIP must be cost-e cient to remain sustainable for Hoosiers, and by that achievement, it would more likely become an example that HHS reform leaders in Washington might replicate. It’s interesting to note that, according to a brief from the Kaiser Family Foundation, the state pays HIP providers at the Medicare rate, which is higher than what it pays under its regular Medicaid program. According to Verma, there could be a point perhaps in ve or 10 years when HIP spending exceeds funding. In ad14 FEBRUARY 2009 Healthy Indiana Plan Launch: January 2008 Duration: Five-year federal waiver; approved under President Bush’s Affordable Choices Initiative of 2007 Eligibility: Individuals under 200% of Federal Poverty Level who also do not have access to employer, Medicare or other Medicaid coverage, and have not been insured for six months or more Enrollment (Dec. 4, 2008): 12,528 adults with dependent children 22,452 adults with no children 34,980 total Enrollment Potential: 120,000 Model: Subsidized high-deductible plan and savings account; enrollees contribute up to 5% of income annually and can qualify for account rollover by meeting preventive care obligations Deductible: $1,100 Benefit Cap: $300,000 annually and $1 million lifetime Preventive Care Benefit: $500 annual minimum, not subject to deductible dition to stopping new enrollment, the signed on. Its call center, which logs HIP bene t package could potentially inbound and outbound calls, also added be modi ed to bring costs under con- more sta to serve the organization’s trol, she says. Removing bene ciaries new members. from the rolls would be a last resort. “We had historically been in the large urban areas, so a signi cant part Growth From HIP of our growth has been outside those As of November 2008, 45.9% of the areas,” she says. “There’s a lot of pro111,000 HIP applications had been vider contracting that had to go on for denied, with the top reasons for de- our traditional Medicaid plan and for nial being: lack of information from the Healthy Indiana Plan. We’ve had the applicant; failure to verify income; to create a capacity for new members ineligibility due to access to employer in some areas where there are primary coverage; income above 200% of the care shortages. That’s been one of our federal poverty level; and less than six growth challenges.” months of uninsured status. Last year, As states continue to experiment the Indiana Family and Social Services with models to increase coverage and Administration doubled its original HIP access for underserved populations, sta to 100 workers to handle the ap- many will face di cult policy choices plication process at the state level. in the next two years. Federal policy McBeth says MDwise covers more makers have come to recognize the than 10,000 HIP members now, and it leading role states will play in healthcare has signed on more than 1,000 primary system reforms, and new opportunities medical providers to the HIP network. are likely to emerge to improve the reAn additional 2,000 specialists also lationship between the two. MHE
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