Wednesday, October 29, 2014

In Mississippi ACA rollout, one big disaster, one small success

Politico's Sarah Varney has a beautifully reported, infuriating account of how Tea Party government in Mississippi sabotaged the state's ACA rollout, leaving Mississippi "the only state in the union where the percentage of uninsured residents has gone up, not down."

The tale has three parts: 1) the state's Tea Party governor elected in 2012, Phil Bryant, undercut and induced the closure of the state's home-built insurance exchange, a project in which the state insurance commissioner (and Haley Barbour crony) Mike Chaney was deeply invested, and which was briefly operative before full ACA implementation. 2) The state refused to participate in outreach to the uninsured and, by closing its exchange, forfeited substantial federal aid for outreach. 3) The state rejected the ACA's Medicaid expansion, which would have extended Medicaid eligibility to an estimated 333,000 uninsured residents. Mississippi was also among the poorest performers in attracting competition to the exchange: most counties had only insurer, Humana, offering plans.

I would add a footnote. Of those three factors, the refusal to expand Medicaid in the nation's poorest state was by far the most consequential.  As part of Healthcare.gov, Mississippi's state exchange did not ultimately perform so badly.  The state exchange enrolled 61,494 people in private plans, 20.6% of the estimated 298,000 uninsured residents eligible to buy insurance on the exchange. That's not great, but it's a higher percentage than that achieved in several states that built their own troubled exchanges, and better than 17 states overall.

Had Mississippi achieved the national average percentage of eligible signups, 28%, another 22,000 residents would be insured. An estimated 138,000 Mississippians, by contrast, fell into the so-called Medicaid gap -- that is, they would have been eligible for the blocked expansion but earn too little to qualify for subsidized coverage on the exchange. Again, 333,000 state residents were estimated to be newly eligible for Medicaid under the expansion. And many states that expanded Medicaid actually exceeded their target enrollments.

In one respect, for whatever reason, Mississippi's exchange performed well: the overwhelming majority of plan buyers, 79%, bought silver-level plans. That's best in the country -- nationally, 65% bought silver. Silver plan takeup is important, because only silver plan buyers are eligible for Cost Sharing Reduction (CSR) subsidies that reduce deductibles and out-of-pocket costs for buyers with household incomes under 250% of the Federal Poverty Level (FPL). The subsidies are particularly generous, and therefore important, for buyers under 200% FPL. In Mississippi, among those eligible for any kind of subsidy, 83%  bought silver, and the number was doubtless even higher for those eligible for CSR.  Among the subsidy-eligible -- fully 94% of buyers in the state --  just 7% bought bronze plans, which have high deductibles and out-of-pocket costs.

I don't know why so many Mississippians wisely choose silver plans. For a single person earning $19,000 a year, eligible for generous CSR with a silver plan, the monthly premium differential between bronze and silver is stark in that state. For a 35 year-old in Adams county, the cheapest bronze plan is just $23 per month, with a monstrous $6,300 deductible. The cheapest silver plan for the same person is $70 per month -- a heavy lift -- but the deductible is just $1,100. A plan available for $76 has a $750 deductible. The choices were essentially the same in the several counties I spot-checked, each of which had a total of just five plans available. The price spread between bronze and silver is wider than in other states I've checked.

So there's a bit of a mystery. What induced the vast majority of Mississippians to forego the temptation of a low premium, high deductible bronze plan? Any ideas, readers?

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