Amid the upheaval of insurance exchanges, the Department of Health and Human Services is also negotiating waivers with states, from highly integrated Medicaid policies, as in Oregon, to consumer-directed Medicaid models in the Midwest.
In Indiana, a high-deductible, subsidized HSA Medicaid plan for both parents and childless adults earning up to 200 percent of the federal poverty level is continuing on a federal waiver through 2014, with about 36,000 beneficiaries and an okay to expand to 45,000 -- as the legislature considers whether to try to extend the program to another 300,000 potentially eligible Hoosiers.
Started in 2008, the Healthy Indiana Plan is financed in large part through the state tobacco tax and is offset by beneficiary contributions, with a $1,100 deductible and HSA "Power Accounts," where each beneficiary receives a medical debit card with $1,100 funded by state and for some contributions based on a sliding scale of their income.At least $500 in preventative services are free for the beneficiaries, while emergency room visits include co-payments of up to $25.
"There wasn't any interest in expanding the existing Medicaid program," said Seema Verma, an independent consultant who helped design the Indiana plan in 2007. She said it's been able to be budget neutral, in part through a tobacco tax increase and in part because of it savings, while also increasing some reimbursement rates to providers through managed care plans, which the state hadn't done since 1995.
"From the state level, when you look at the cost of HIP versus a regular Medicaid program, the HIP program has higher reimbursement rates for providers. That was to ensure an adequate network," Verma said.
Over the past five years, rates of ER use among beneficiaries reduced significantly, and nonpayment rates have been relatively limited, between 3 to 10 percent, Verma said. There's currently a waiting list to enroll.
Trying to measure patient-consumer behavior, they've found that as many as 30 percent of beneficiaries will typically ask a provider about cost before making a decision.
Other states also led by Republicans are expressing interest in Medicaid policies with consumer-driven models.
Michigan's Medicaid expansion plans, as outlined in a federal waiver application, will introduce a sliding scale fee for non-emergency ER visits, with free or discounted preventative services -- those ideas now made possible by a CMS rule that will allow value-based cost-sharing designs in Medicaid.
Pennsylvania Governor Tom Corbett is proposing a similar policy, while Arkansas and Iowa, whom Verma is now advising, are expanding Medicaid via subsidized insurance exchange plans.
It's unclear whether CMS will be open to extending consumer-directed health plans to a broader low-income population, or whether that would be enough for some governors in states like Texas to agree to eligibility expansion.