1 Washington State Health Insurance Pool 2009 WAHU Symposium Presenter: Anne Mackie Executive...

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Washington State Health Insurance Pool

2009 WAHU Symposium

Presenter: Anne MackieExecutive Assistant

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Agents Make the Difference!

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Today’s Topics

1. The role of the high-risk pool in today’s market

2. The Standard Health Questionnaire (SHQ)

3. Information about WSHIP – the organization, benefit plans, and rates

4. Why Agents are important!

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Remember when the individual market collapsed…

1999-2000 – Most carriers stopped selling new individual products due to rapidly increasing claims losses

Consumers scrambled to find coverage 2000 – Health Insurance Access Act was

significantly amended with hopes of bringing carriers back into the market

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Past Legislative changes 2000: New legislation allowed enrollment in

WSHIP for people living in a county where individual coverage is not offered

2000: Medical underwriting approved for individual market, using the Standard Health Questionnaire

2007: RCW 48.41 modified to allow WSHIP to offer more choices in products – HSA plan, limited benefit plans with lower rates

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WSHIP’s role today Provides access to health insurance coverage to

all residents of Washington who are denied health insurance – the “safety net”

Provides comprehensive coverage to those unable to obtain it through group or individual coverage

Maintains a healthy individual market by screening out the 8% sickest, which…

Helps to keep individual market rates lower

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WSHIP’s role today (cont.) Individual market enrollment growth, since

implementation of the Standard Health Questionnaire for medical underwriting:

2000 = 120,647 to2007 = 279,329Percent increase since 2000 = 132%

Efficiently and effectively covers high risk people

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2008 Individual market enrollmentTotal individual market applicants = 99,197

Number / percent accepted for coverage = 94,539 (95.3%)

Number / percent rejected for coverage = 4658 (4.7%)

Number / percent rejected enrolled in WSHIP = 843 (18.1%)

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EfficiencyFor 2008: Administrative ratio was low – 6% Care management programs – $2.3 million

savings on closed cases Provider network – $14.5 million savings Pharmacy savings – $7.7 million Medicare SPAP savings – $7.2 million

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Effectiveness Scores from the Standard Health

Questionnaire help to identify WSHIP enrollees who can benefit from state-of-the-art care management programs

One local care manager Case management improves timely and

appropriate use of benefits and community resources

Disease management educates & facilitates enrollee’s self-management

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Effectiveness (cont.)In 2008 WSHIP added four disease management

categories for a total of six: HIV/AIDS Depression Diabetes Asthma Coronary artery disease (CAD) Congestive heart failure (CHF)

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Standard Health Questionnaire A 33-page “short form” with 218 conditions 99,197 people took the SHQ in 2008

51,987 “online” version

47,210 “paper” version It is the standardized “tool” for Washington

individual market underwriting

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Who develops the SHQ? State law mandates WSHIP Board of

Directors to be responsible for “…the form and content of the standard health questionnaire and the method of its application.” RCW 48.41.060

An independent actuary must certify that the questionnaire identifies the 8% of persons who are the most costly to treat who are under individual coverage in health benefit plans

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Standard Health Questionnaire SHQ must be recertified every 18 months SB5777/HB1713 – Bills in Legislature, now, to

expand time period – every 36 months, which will save limited resources

For recertification, carriers selling individual products must submit five years’ claims data (medical and Rx)

WSHIP’s own claims data also included Actuary analyzes data

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Standard Health Questionnaire Claims data processed through the Episode

Treatment Group (ETG) software to assign each claim to an “episode of care” (ETG)

Prospective risk score is attached to each ETG using cost relativities

Risk weights are used to calculate a “predictive” risk score for each individual

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“Off hand, I’d say you’re suffering from an arrow through your head, but just to play it safe, I’m ordering a bunch of tests.”

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Standard Health Questionnaire Work is underway for October 1, 2009,

recertified questionnaire A public process – input provided by:

Agents (12 provided comments) Carriers WSHIP Board OIC and interested parties

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Standard Health Questionnaire An industry “workgroup” reviews all feedback 80+ items on the SHQ “feedback” list for 2009

recertification Board “Tool” Committee reviews / approves

recommendations; forwards to the Board Committee chaired by (one of your own):

Bill Perkins, CEO, GHB Insurance, Olympia (Governor-appointed agent rep to the Board)

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SHQ not always used

Exception 1: if eligible for Medicare

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SHQ not always usedException 2: Your medical insurance ended during

the last 90 days for any of the following reasons:a. You have used up all of your available COBRA coverageb. Your former employer, who provided you with health coverage, gone out of business while you were on COBRA coveragec. You changed residences from one part of Washington state to another part where your current health plan is not offered

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SHQ not always usedException 3: You are adding a newborn, or

adopted child (regardless of age) during the last 60 days who you want to add to your existing policy

New issue: Coverage for 25 year-old dependent

(RCW 48.44.215) – to be included in revised SHQ for October 2009

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SHQ not always usedException 4: You have been covered by a

group health plan that is exempt from COBRA including church plans, for at least 24 continuous months, and: You will lose coverage under that plan

within the next 90 days You lost coverage within the past 90 days

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SHQ not always usedException 5: Your doctor or other health care provider stopped

being a part of the provider network on your current individual medical plan, and…

a. Your doctor or provider is on the new health plan you are applying for, and

b. You must have had some service from that provider during the 12 months before he or she left your current health plan, andc. You must submit your application to the new health plan within 90 days from the day your provider left your current health plan's network.

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SHQ not always usedException 6: You have been enrolled in the

Washington State Basic Health Plan (BHP) for at least 24 continuous months and…

a. You will lose your BHP coverage within the next 90 days, or

b. You lost your BHP coverage within the last 90 days

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New Exemption SHQ issues Economic downturn causing more businesses

to cancel group health insurance How does this affect the rules for who must

take the SHQ? How might COBRA rules be affected? Working with the OIC for clarification on

SHQ Exemption rules

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More about WSHIP Enrollment growth

2,333 in 2002 3,397 in 2008

Growth stunted by Lack of awareness about the Pool by people who are

eligible Concern about premium costs; lack of awareness about

lower-cost plan options

Agents can help!

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More about WSHIP 2008 Enrollment = 3,397 Evergreen Health Insurance Program (EHIP),

serving HIV/AIDS clients = 920 enrollees (or 28% of WSHIP’s enrollment)

Average age = 49 24% enrolled in Medicare due to age or

disability 75% of Medicare enrollees under age 65

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More about WSHIP Individual premiums are:

110% - 150% higher than “comparable” individual plans in the market (this is law)

Not nearly high enough to pay the actual costs. The difference between premiums and total costs

is made up through “ASSESSMENTS”

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How WSHIP is funded Because WSHIP premiums can be no higher than

150% of comparable commercial plans… And enrollees are the sickest and most costly… Premiums paid by enrollees have averaged 32% of

total costs of coverage over past five years The difference is paid by the carriers. They are

ASSESSED their proportionate share of the cost based on their share of the general health insurance market in Washington state

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Funding continued…Who gets assessed? “Member Plans” selling health insurance (group

or individual). This includes all: HMOs (Group Health) Service Contractors (Premera, Regence) Commercial Insurers (Aetna, United) Multi-employer Welfare (Timber Products) Stop-loss Carriers/UMP (Safeco, State plans)

(Special deal – ten cents on the dollar)

Life, dental, long term care, disability income and Medicare Advantage coverage excluded.

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Funding continued… WSHIP assessments become part of the premiums

paid in the individual and group markets. Assessments in 2008 were about $40.7 million. This works out to be about $1.12 per month, for each

person insured in the individual and group markets (roughly 3.6 million people).

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Funding continued… WSHIP received federal grants to help cover

losses and bonus grants to fund premium reductions In 2006 = $2.4 million ($1.5m for operational

losses; the balance for premium subsidies) In 2008 = $1.6 million ($1m for operational

losses; the balance for premium subsidies)

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Funding continued…

WSHIP Funding Sources - 2008

Federal Grant2.6%

Interest Income0.4%

Excess Claims Loss RatioPayments

0.1%

Premiums31.5%

Assessments65.4%

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Funding study proposed2009 Legislative proposal by WSHIP Board:

Solicit funds to study options for equitable, stable, and broad-based funding sources for the operation of the pool

Report findings, recommendations appropriate legislative committees

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WSHIP Organization WSHIP Board of Directors

Executive Director

Benefit Management, Inc. (BMI) – Plan Administration

First Choice Health Network

Medco (Pharmacy Benefit Manager)

Qualis Health (Care Management)

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Application Process Person applies for private coverage

Carrier application, along with the SHQ, are submitted to the carrier for scoring

Carrier has 15 business days after receipt to process/score and send notice of rejection

If carrier rejects, the rejection notice is sent to applicant along with a separate WSHIP application packet

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Carrier Rejection

The only way to get WSHIP coverage is if a carrier first rejects the applicant

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WSHIP Enrollment PacketApplication is 9 pages

Section I – Agent Information !!!

Packet includes:Eligibility informationSummaries of Benefits (all plan options)Rate chartsLow-income applicationAppeals & Grievance Policy

Online at: www.wship.org

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WSHIP Non-Medicare Plans

Standard Plan - 410 enrollees in 2008

Deductibles: $500, $1,000, or $1,500 80/20 coinsurance Three-tiered Rx copays, that vary with

deductible “Passive PPO” overlay, First Choice

Network (WA, OR, ID, MT & Beechstreet nationally)

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Non-Medicare Plans (continued)

Preferred Provider Plan - 2,034 enrollees

Deductibles: $500, $1000, $2500, $5000 First Choice Health Network (WA, OR, ID,

MT & Beechstreet nationally) 80/20 network coinsurance; 40% non-network Three-tiered Rx copays that vary with

deductible

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HSA Qualified PPO Plan - 60 enrollees

Deductible $3,000 (medical and Rx) 80/20 network coinsurance; 40% non-network 20% Rx coinsurance Combined medical and Rx out-of-pocket expense

limit (individual):

$5,250 network; $10,500 non-network

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Limited Preferred Provider Plan “A” – 3 enrollees Deductible: $1,500 80/20 network coinsurance; 40% non-network Rx 50% non-preferred brand; 30% brand; $10

generic copay; Rx maximum $3,000/year Reduced benefits for:

medical supplies/equipment; reduced visits/days for rehab therapies, skilled

nursing facility, spinal manipulations.

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Limited Preferred Provider Plan “B” – 11 enrollees Deductible: $1,500 Coinsurance: 20% network; 40% non-network Rx 50% non-preferred brand; 30% preferred brand;

$10 generic copay; Rx maximum $2,000/year Reduced benefits: No maternity benefit;

reduced medical supplies/equipment allowance; reduced visits/days for rehab therapies, skilled

nursing facility, spinal manipulations.

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“There’s really no need for confusion with this Medicare stuff. Page 95, section 33, paragraph L in the instructions quite clearly says…”

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Medicare Advantage Proposed Legislation

Limit WSHIP enrollment for new Medicare-eligible persons to only those who do not have access to a reasonable choice of comprehensive Medicare Part C plans

Must have access to at least three different HMO or PPO carriers in their county of residence

Plan options must include coverage at least as comprehensive as a Plan F Medicare supplement plan combined with Parts A and B

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Medicare Advantage Proposed Legislation (continued)

Access to a stable provider network in place for at least two years

Easily accessible provider directories either online or hard copy

If no plan includes the provider from whom health care services were received in the past twelve months, not considered reasonable access

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Medicare PlansMedicare Basic Plan – requires enrollment in

Parts A & B - 190 enrollees No deductible Secondary to Medicare Parts A & B - acts as a

Medicare wraparound No coinsurance for benefits covered by Medicare 20% coinsurance for other benefits Coverage for Part B Rx drugs; no coverage for Part

D Rx drugs

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Medicare Plans (continued)

Medicare Basic Plus Plan – 603 enrollees Closed to new enrollment. Must be enrolled in Medicare Parts A, B, and

D. Pays 100% of deductible, copay, and

coinsurance for Medicare benefits. Enrollee pays 20% of benefits not covered by

Medicare.

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WSHIP Premiums

By law, monthly premiums can be: No higher than 150% of the “comparable”

commercial plans, except… Network Plan (PPO) can be no higher than

125% of the “comparable” commercial plans A, and

NO premiums can be lower than 110%

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2009 Non-Medicare Premiums Standard Plan base rates are 150% of the

Standard Risk Rate (SRR) Preferred Provider Plan base rates are 110%

of SRR with no additional discounts available (statutory minimum)

<65 age-rated in all plans by 5-year brackets Rates vary by plan and deductible choices Gender/smoking status do not apply

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2009 Non-Medicare Rate ExamplesStandard Plan (age 45)

Base Rate:$500 deductible = $1,170$1000 deductible = $1,009$1500 deductible = $900

With 18 months prior continuous coverage:$500 deductible = $975$1000 deductible = $834$1500 deductible = $750

Rate Tables online at: www.wship.org

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2009 Non-Medicare Rate Examples Preferred Provider Plan (age 45)

$500 deductible = $858$1000 deductible = $740$2500 deductible = $399$5000 deductible = $315

No additional discounts available for the PPO Plan

At 110% of the Standard Risk Rate, the rates are as low as the law allows

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2009 Non-Medicare Rate Examples

HSA Qualified Preferred Provider Plan $3,000 deductible = $382 (age 45)

No additional discounts available for the PPO Plan At 110% of the Standard Risk Rate, the rates are as

low as the law allows

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Limited Preferred Provider Plan “A” $1,500 deductible = $618 (age 45)



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Limited Preferred Provider Plan “B” $1,500 deductible = $552 (age 45)



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2009 Medicare Premiums

65+ Basic Plan base rates are 150% of SRR

65+Basic Plus Plan rates are 150% of SRR

<65 rates are 110% of SRR (based on Medicare disabled population)

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Medicare Plans 2009 Rate Examples

Medicare Basic Plan

age 45 = $195; age 65+ = $293

Medicare Basic Plus Plan

age 45 = $323; age 65+ = $487

(additional discounts may apply for over age 65)

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WSHIP Premium DiscountsStandard Plan Premium Discounts for Low

Income: Two levels, based on family income:

Greater than 250% to 301% of the Federal Poverty Level Guidelines

Less than 251% of the Federal Poverty Level Guidelines

Available ONLY if state funds for WSHIP are available.

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WSHIP Premium Discounts

Additional Premium Discount for Standard Plan and Medicare over 65 if:

Have been enrolled in a prior plan for at least 18 months (15%)

Have been enrolled in WSHIP for more than 36 months (5%)

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Combined Premium Discount on Standard Plan 1 and Over 65 Medicare for:

Coming onto a WSHIP plan with 18 months of prior continuous coverage AND

Being enrolled in WSHIP for more than 36 months

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In No Case

can the WSHIP premium

be lower than 110% of the

“Standard Risk Rate”

(i.e., the rate for “comparable” plans)

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Why agents’ help needed Standard Health Questionnaire – challenging!

WSHIP’s Application process can be confusing!

People surveyed report difficulty in understanding both the SHQ and the application process.

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Agent Compensation Agents are paid $75 commission for each

applicant accepted to WSHIP Copy of Agent License must be on file with

WSHIP or included with application Page 1 of the WSHIP application must be

included with the Agent name, signature and tax I.D. , W-9 form (See next slide)

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Agent Information

AgentName: Firm or Agency:

Agent Address: AgentPhone: ( )

Agent email address:

I certify I have verified that all persons applying for coverage are eligible. I further certify, to the best of my knowledge, the information on this application and the Standard Health Questionnaire (if applicable) has been completed truthfully by the Applicant(s).

Agent Signature Date

Agent’s Washington State License No:

Copy of License Attached Copy of current license on file with WSHIP

Agent’s Tax I.D. Number: Contact Person: ( )

Pay commission to agent OR

Pay commission to firm

A

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Final Details Any licensed agent can get paid by WSHIP

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This training gives you the opportunity to be listed on the WSHIP Agent Directory Directory is posted on WSHIP website Downloaded 1,000+ times in 2008 Directory mailed out by carriers with WSHIP

applications Receive quarterly WSHIP “Agent Bulletin”

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Agent Directory Complete and sign the listing form. Mail it to:

WSHIPPO Box 329 Bow, WA 98232-0329

Or fax to: 360-734-2577; or email to:[email protected]

Include a copy of your Agent license.

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Agent Directory Listing Form

I have completed the WSHIP agent training, and I would like to be listed as an agent for assisting WSHIP applicants.

NAME____________________________________ License No.___________________

FIRM_________________________________________________________________

ADDRESS_____________________________________________________________

CITY________________________________ STATE ____ ZIP ________________

PHONE _________________________ FAX _________________________

EMAIL _________________________

SIGNATURE__________________________________________ DATE ____________

You must submit a copy of your agent license to WSHIP with this form Email to: [email protected]; or mail to WSHIP, PO Box 329, Bow, WA 98232-0329

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Questions?Contact WSHIP

360-734-2577

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