Insurance Exchange

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THE INSURANCE EXCHANGE

August 15, 2013

Harold Ingram

Enrollment will begin October 1, 2013, in the federally administered Insurance Exchange for Mississippi. Currently there are still a lot of questions to be answered. How much will insurance cost through the Exchange? Will there be only two insurers to participate? Will patients have to give up current insurance plans because of the Affordable Care Act (ACA) and participate in the Exchange? Is a provider required to participate? Who will be the “Navigators” to help enroll people in the Exchange?

One of the objectives of the Exchange is to provide individuals and families without insurance coverage the opportunity to obtain coverage at a competitive price. Under the program, individuals would be placed in a pool large enough to share risk across a broader spectrum of patients and thereby command lower premiums. The key to this philosophy is the requirement for younger, healthier people to enroll. However, reduced premiums may not actually be realized. Other aspects of the ACA affecting coverage requirements may influence a rise in insurance costs, especially for those people with high deductibles and limited coverage plans.

The Exchange offers insurers the opportunity to offer four different levels of coverage at varying levels of expense to people seeking coverage through the Exchange. Also, there will be subsidies to patients based upon income level. The individual expense for the levels of coverage have not been set at this time.

Currently, two insurers, Humana and Magnolia Health Plans (Centene), have agreed to participate. However, the only counties in which both will offer coverage are Desoto, Hinds, Madison, and Rankin. Included in Appendix A is a list of the counties covered by each carrier.

The Humana plan will be administered through First Choice. Providers currently enrolled with First Choice received letters earlier indicating that First Choice would have a network company that would be participating in the Exchange. At that time, the carrier was not identified. The letter indicated that unless a provider specifically opted out, it would be assumed that the provider would offer services to patients covered by the Exchange plan at a 5% reduction of the First Choice fee schedule. For providers choosing to participate but not currently enrolled in First Choice, they should initiate enrollment activity soon. Participation approval can take several months.

Although Magnolia Health Plans (Centene) participation activity can be addressed directly with the company, Mississippi Physicians Care Network (MPCN) will also be facilitating participation activity and should probably be contacted initially by interested providers. MPCN issued letters in the latter part of May to their network providers who were participating in MScan program with Magnolia Health Plans. This letter was accompanied by an addendum which the provider was required to sign if he chose to participate. As with First Choice, providers who have not signed the addendum and wish to participate with Magnolia Health Plans need to act quickly, contacting MPCN for enrollment.

As information continues to trickle in, more is being understood about the impact of the ACA, including the Exchange. One exchange issue that is causing concern focuses on patients who stop paying premiums to an exchange participating insurer. Under current guidelines, the insurer must continue to offer coverage to the patient for up to 90 days after the patient becomes delinquent in premium payments. However, the insurer is only required to provide benefit payments of the first 30 days. It is the insurer’s responsibility to notify participating providers that a patient is delinquent and has the potential to have his coverage terminated. The specifics on how the insurer will notify providers is unclear at this time.

If services are provided to an exchange patient after being delinquent for more than 30 days and the patient is terminated, those provider claims could be denied by the insurer. Under those circumstances the provider would have to seek payment directly from the patient. Administratively, processes would need to be implemented to address this issue. For example, it may be necessary to verify the status of each exchange patient each time they visit the clinic, assuming the insurer had a means of identifying delinquent patients. Whereas it is good office policy verify insurance coverage for each patient every visit, it may not be practically feasible to do so. The degree of risk associated with such circumstances will probably not be known until the process to notify providers of delinquent patients is presented and evaluated.

As an unintended consequence of the ACA, it may have removed an incentive to encourage patients to keep premium payments current. In circumstances where pre-existing conditions exist, prior to the ACA, it might prove difficult for a patient to obtain other insurance coverage because of pre-existing condition exclusions. That would encourage the patient to keep the insurance from lapsing. Some have speculated that savvy patients may even try to game the system by making 9 premium payments but getting a full year’s benefit because of the 90-day termination specification.

The State will soon see a major push to enroll people in the Exchange through groups known as “Navigators”. A navigator is someone who can assist people in the enrollment process, helping them understand the various options and associated expenses. Navigators will also reach out to communities informing them of the Exchange (also referred to as the Marketplace). The Navigator Organizations receiving grants to provide this service for Mississippi are:

Oak Hill Missionary Baptist Church Ministries (anticipated grant amount $317,742)

University of Mississippi Medical Center (anticipated grant amount $831,986)

Oak Hill will service the lower Delta area training clergy to be health ambassadors reaching out to uninsured residents to assist in the enrollment process. UMC will cover the entire State educating and assisting in enrollment in Medicaid, CHIP, and the Exchange.

Providers need to decide as soon as possible whether or not they want to participate. In some areas the Exchange may offer providers a significant opportunity to acquire additional insured patients if prices are reasonable. The cost to patients for the various levels has not been identified and will be impacted by patients’ income. As mentioned earlier, First Choice will assume a provider will participate unless the provider replied to a previous letter from First Choice indicating he wished to opt out. However, First Choice may allow providers to opt out now if the provider notifies First Choice prior to October.

Unlike First Choice, providers wishing to participate in the Magnolia Health Plans program will need to initiate enrollment activity. It is not automatic even if the providers currently participate in the MScan Magnolia Health Plans program. MPCN should be contacted as a first step in the participation process.

As with the Insurance Exchange or Marketplace, it is important that providers and clinics maintain vigilance as the full impact of the ACA unfolds. There may be a number of unanticipated and unintended consequences as full enactment of the ACA is realized.

Appendix A

Counties Served by Exchange Providers

Humana

Adams Grenada Leflore Smith

Alcorn Hancock Lincoln Sunflower

Amite Hinds* Madison* Tallahatchie

Attala Holmes Marion Tishomingo

Bolivar Humphreys Montgomery Walthall

Carroll Jefferson Pearl River Washington

Choctaw Jefferson Davis Pike Wayne

Covington Jones Rankin* Wilkinson

Desoto* Lawrence Scott Winston