Tuesday, July 19, 2016

Whither the 70,000 Louisiana marketplace enrollees who are newly Medicaid eligible?

Louisiana's Medicaid expansion continues apace, with a bit over 250,000 state residents gaining coverage since the program went live on July 1. As I noted in a prior post, most of those enrollees, about 190,000, were transferred from existing public limited-benefit plans. At present, about 2,500 people per day are enrolling. The state is aiming for about 375,000 new enrollees overall.

According to Andrew Tuozzolo, Chief of Staff at the Louisiana Department of Health, that target does not include enrollees in ACA marketplace plans rendered newly eligible for Medicaid. (In states that refused to implement the ACA Medicaid expansion, which included Louisiana until this year, eligibility for private plan subsidies begins at 100% of the Federal Poverty Level. In expansion states, residents with incomes up to 138% FPL are eligible for Medicaid, and not for private plan subsidies.)

Thanks to enrollment data released by CMS early this month, we now know that almost 85,000 Louisianans who had enrolled in private plans in the ACA marketplace as of the end of Open Season on Jan. 31 -- 40% of all enrollees -- reported incomes in the 100-138% FPL range. Most of those 85,000, though not all, should now be eligible for Medicaid, the chief exceptions being legally present noncitizens subject to the federal "five-year" bar to Medicaid eligibility.  About 15% of the state's marketplace enrollees had dropped out (or in most cases, probably, never paid a premium) as of March 31.  Most likely, then, about 70,000 current private plan enrollees are now Medicaid eligible (as well as perhaps 10-15,000 dropouts).

So far there has been no active outreach to this group -- except, erroneously, by Blue Cross Blue Shield of Louisiana, which estimates that 20,000 to 30,000 of its marketplace enrollees may be newly Medicaid-eligible.  BCBS told those enrollees that if they were Medicaid-eligible and did not disenroll from their private plans, they could lose their subsidies and so be billed for the full premium after July 1.

That was erroneous: Blue Cross is now clarifying that enrollees can keep their subsidies through 2016 as long as they don't double-enroll. The state is not actively encouraging private plan enrollees to switch if eligible for Medicaid.  According to Tuozzolo. there's strong evidence that very few of the new Medicaid enrollees to date were previously insured. Of the roughly 20,000 new enrollees who were targeted because SNAP (food stamp) data indicated they should be Medicaid eligible, he added, very few have the cash to pay even the low premiums paid by marketplace enrollees in the 100-138% FPL range.

Private plan enrollees with incomes in the 100-138% FPL range should make the transition to Medicaid in 2017, if their income doesn't rise.  Those who log on to Healthcare.gov and update their information will be determined eligible for Medicaid (it their income remains in range), and will lose access to private plan subsidies. Many marketplace enrollees are passive, however: they do not update their information during open enrollment, and allow their insurer to "auto-enroll" them. Auto-enrollees will not lose their subsidies -- though they could be on the hook for any premium increases their plan imposes.

Those transitioning from private plans to Medicaid will benefit -- sometimes greatly -- from lower costs -- Medicaid has no premium in Louisiana, and no copays for most services -- Tuozzolo is concerned, however, that some may suffer from network disruption. In the switch to the Medicaid managed care plans offered by five insurers, he says, "There may be people whose doctors took their private plan but will not take their Medicaid. We don't want that to happen. I hope our network adequacy program, our efforts to make sure more primary care doctors take Medicaid, is effective."

Mid-year is actually a good time to execute a Medicaid expansion. Enrollees in marketplace plans who may be newly eligible for Medicaid should have a good idea whether their existing plans are affordable to them. They also have plenty of time to learn of and prepare for a shift in 2017, and to make the shift without needing to actively disenroll from their private plans. In the meantime, quarterly enrollment updates from CMS should give a sense whether large numbers of marketplace enrollees are dropping out.

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