Tuesday, March 22, 2016

Hawaii's ACA enrollment mystery

In the 38 states using HealthCare.gov, the federal ACA marketplace, just 3% of enrollees have incomes below 100% of the Federal Poverty Level (FPL), a threshold below which most applicants are ineligible for premium subsidies.  In Hawaii, 29% of enrollees have incomes under 100% FPL. No other state has more than 4% of enrollees in that income category. What gives?

Under the ACA, legally present noncitizens who are barred from Medicaid are eligible for private plan premium subsidies even if their income is below 100% FPL.  The 1996 welfare reform legislation barred legally present noncitizens from federally-funded Medicaid eligibility if they had been in the country less than five years.  While subsequent legislation gave states the option of covering children and pregnant women with a federal contribution, the bar is still in place for most adults.

While those subject to the five-year bar (or even longer-term bars passed by some states) make up the bulk nationally of subsidized ACA enrollees under 100% FPL, there are other categories of legally present noncitizens barred from federally funded Medicaid. Hawaii home to a substantial share of one such group: Pacific islanders who are legally present under the Compact of Free Association. (COFA) which governs relations between the U.S. and three Pacific Island Nations -- the Federated States of Micronesia, the Marshall Islands, and Palau. The federal government will not fund Medicaid for COFA residents.

Until 2015, Hawaii was providing Medicaid to COFA residents with incomes under 100% FPL on its own dime. In early 2015, the state ended their eligibility (with the exception of the pregnant and the aged, blind or disabled), instead rendering them eligible for premium subsidies in the ACA marketplace and adding an additional state-funded subsidy. A state DHS report published in late 2014 explains:
DHS will stop providing state-funded benefits to adult noncitizens who are not ABD. These individuals can purchase federally subsidized health insurance through the Connector [the state health exchange, since junked in favor of HealthCare.gov]. They may also be able to receive state-funded premium assistance if they are enrolled in a 94% actuarial value Silver level plan (i.e., receiving the maximum cost-sharing reduction), and have a household income of less than 100% FPL, provided information necessary to verify household income is provided by the Connector to the individual’s qualified health plan. DHS will make these payments directly to the health plan in which the eligible individual is enrolled. This will ensure continued coverage of the individual, and reimbursement at commercial rates for services provided to these individuals. The premium assistance program will not pay for any deductible, co-payment, co-insurance, or other cost-sharing arrangement.
Hawaii's ACA private plan enrollment population is small, mainly because the state requires employers to provide very affordable insurance to employees who work more than 20 hours per week. As of the end of open enrollment on Jan. 31 of this year, 14,564 Hawaiians were enrolled in marketplace plans. The COFA population as of 2014 was about 12,000, if I read this report in the Asian American Policy Review correctly (according to the report, Guam's 18,305 COFA migrants are 32.5% of the whole; Hawaii has 21.4%, but no raw number is specified). Perhaps 8,000 of them are adults aged 18-64. Their average household income, according to the AAPR report, is $42,150, comparable to a very low income state. If the COFA migrants account for a quarter of Hawaii's marketplace enrollees under 100% FPL, then about 3,300 are enrolled in marketplace plans.

The state apparently feared losing some COFA enrollees in its transition to HealthCare.gov for the 2016 open enrollment period.  In December 2015, the state instituted a Special Enrollment Period (SEP) for COFA enrollees, running from Dec. 18 through Feb. 16, with coverage retroactive to Jan. 1. The announcement of the SEP cited language barriers, as well as difficulties verifying residency status:
COFA migrants in Hawaii face an additional level of complexity enrolling in 2016 coverage due to significant language barriers that have elongated and sometimes prevented the successful completion of Marketplace applications and enrollment into coverage. COFA migrants, who are from the Federated States of Micronesia, the Marshall Islands, and Palau, speak a diverse set of languages that are not commonly spoken elsewhere in the United States. Since many COFA migrants do not speak English or Spanish, interpreters are needed to assist COFA migrants with completing Marketplace applications.

In addition, some COFA migrants are facing additional barriers verifying their identity when attempting to create Marketplace accounts because they lack credit histories and there are no electronic records available to verify either their identity or annual household income. This adds to the number of actions needed and time it takes for them to successfully complete their Marketplace applications
It's a big diverse country, with a lot of punitive and counterproductive barriers erected for immigrants of various types. That necessitates a Byzantine array of workarounds, with lots of people falling through the cracks. But some states  do make creative efforts to reach excluded populations, leveraging federal dollars where possible.

Speaking of such leverage, the COFA population might provide Hawaii with an opening to obtain generous federal funding for a Basic Health Plan (BHP), as New York has done. Under the ACA, a state can apply to HHS to form a BHP, a Medicaid-like low-cost plan for residents with incomes up to 200% FPL who would otherwise have been eligible for private plan subsidies. Like New York, Hawaii could transfer to the BHP a noncitizen population to which it was previously providing Medicaid with no financial contribution from the federal government. The feds do fund BHP enrollees, providing 95% of what it would have paid to provide private plan premium subsidies to BHP enrollees. The COFA residents would provide something of a windfall (as has transferring those who accept the offering to subsidized private plans).  While their numbers are small, so is the overall population of the Hawaii marketplace. And more COFA people would probably sign up for BHP coverage, which generally costs enrollees little to nothing, than have taken up private plans, which require comparatively high cost sharing.

For more info about ACA enrollment in Hawaii, see Louise Norris's state report at healthinsurance.org

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