Health Plan Weekly
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Did Arkansas’ Medicaid Work Requirements Boost Employment?
Arkansas, the first state to add work requirements to its Medicaid program — asking residents ages 30-49 to work 20 hours a week or prepare for a job to maintain their coverage — dropped more than 18,000 people from its Medicaid rolls between June 2018 and April 2019, when a federal judge struck down the policy. A recent study published in Health Affairs found no evidence that the requirements increased employment either when they were in effect or over a longer term. By analyzing data collected from a survey performed in late 2019 of low-income adults in Arkansas, the researchers found that the Medicaid or marketplace coverage of Arkansans ages 30-49 dropped from 70.5% in 2016 to 63.7% in 2018, then rose to 66.1% in 2019, suggesting “most of the Medicaid coverage losses in 2018 were reversed in 2019 after the court order.” Moreover, the state’s low-income residents were confused about the requirements, with 70.8% unsure whether the policy was in effect.
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Survey: Employers Offer Caregiving Benefits, Aim to Manage Medical Utilization
A survey of employers and other private purchasers of health care conducted by the National Alliance of Healthcare Purchaser Coalitions (NAHPC) found employers are “staying the course or accelerating their health benefit strategies” going forward.
According to the survey, 71% of respondents intend to continue their current strategy in 2021 and 63% intend to do the same in 2022. Employer benefit manager respondents also indicated that they support health reforms by large margins, rating the following “very or somewhat helpful”: 94% supported drug price regulation, 90% supported hospital price transparency, 81% supported surprise billing regulation and 79% supported hospital rate regulation. Notably, 50% of respondents supported a public health insurance option.
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Pandemic Will Decrease Costs, But Deferral Impact Looms
Health insurers will probably have lower health care expenditures in 2020 and 2021 than before the COVID-19 pandemic, according to a new analysis from Willis Towers Watson. However, the white paper, which analyzed several scenarios of the severity of the pandemic, emphasizes that substantial risk is still possible, particularly from policy and politics — and says plan sponsors need to take proactive steps to blunt the future impact of deferred care.
The policy environment could change suddenly and dramatically depending on the outcome of California v. Texas, a suit that could lead the Supreme Court to overturn the Affordable Care Act, and the presidential election. Trevis Parson, Willis Towers Watson’s managing director and chief actuary for health and benefits, who coauthored the analysis, says that uncertainty in the policy arena dominated his research.
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Big Blues May Benefit From Tentative Antitrust Settlement
The Blue Cross and Blue Shield Association (BCBSA) has reportedly reached a tentative settlement in a lengthy legal battle over whether its member plans engage in anticompetitive business practices. And although it may seem like a counterintuitive result for an antitrust lawsuit, the settlement’s terms will likely give Blues plans more freedom to collaborate and consolidate, industry analysts say.
The lawsuit in question was filed in 2012 on behalf of employers and policyholders who took issue with Blues plans’ agreement to divide the country among the association’s 36 members and to restrict members’ ability to offer non-Blues products. A related lawsuit filed by health care providers, which was then consolidated with the employer/policyholder lawsuit, alleged that the Blues’ anticompetitive practices improperly depressed their reimbursement. In 2018, a federal judge delivered a boost to the plaintiffs’ case by deciding that the burden of proof falls on BCBSA to prove its practices are not anticompetitive (HPW 5/7/18, p. 9) — a decision that held up on appeal later that year.
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States’ Moves to Claw Back Funds Raise Medicaid MCOs’ Ire
As state budgets continue to be squeezed by the COVID-19 pandemic and related economic downturn — and as health insurers report large profits due to low utilization of routine health care services — state officials are perhaps understandably eyeing Medicaid managed care organizations as sources of extra funding. But at least one health insurer isn’t happy about a tactic states are using, with CMS’s blessing, to claw back money from MCOs.
The issue in question is the use of risk corridors in MCO contracts, according to Kamran Hashim, vice president of policy and planning at Molina Healthcare, Inc. In a Sept. 16 virtual session during the America’s Health Insurance Plans (AHIP) National Conference on Medicare, Medicaid & Dual Eligibles, Hashim explained that risk corridors typically are used when there isn’t enough data to make an accurate estimate of future medical utilization or costs. To solve that, risk corridors limit an MCO’s medical expenditures to a certain range — so if actual costs come in below that, they return the difference to the state, and if the MCO’s costs are above the cap, the state absorbs the excess.
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