The Arizona Health Insurance Exchange and Medicaid Expansion

Linda Skinner

Director

Health Care Innovation Infrastructure Management

What is a Health Insurance Exchange (HIX)?

Government regulated marketplace of insurance plans with different levels of coverage, offered to individuals, families or small businesses.

Administered by a government agency or nonprofit organization.

Legal residents are eligible to purchase insurance through the HIX, and lower-income residents can get Medicaid or tax credits to help them afford insurance.

Health Insurance Exchange HIX Requirements

Affordable Care Act (ACA) requires every state have HIX 1/1/14. States can run these exchanges or CMS can or states can

partner with CMS. Qualified Health Plans (QHP) offer coverage for individuals &

families, who do not qualify for or want Medicaid. Families & individuals with income between 100% and 400% of

FPL, who do not qualify for Medicaid, can obtain tax credits & cost sharing reductions to purchase insurance on the exchange.

Applicants must screen Medicaid ineligible to qualify for tax credits or cost sharing reductions.

Medicaid Expansion

Medicaid eligibility expands to individuals under 65 (without Medicare) up to 133% (really 138%) FPL January 1, 2014.

Eligibility determination based on Modified Adjusted Gross Income (MAGI).

MAGI bases household composition and income on IRS requirements, with some exceptions.

Must convert current income standards for children, families, pregnant women and childless adults to reflect a higher % of FPL that incorporates deductions.

What Changes for State Agencies with the HIX?

Public applies for and renews Medicaid eligibility through the HIX. Determine eligibility for Medicaid as close to real time as possible. Use electronic matching first, self attestation second and paper last

for verification. Simplify verification requirements and submission of documents. Significant streamlining of renewal process. Store and reuse eligibility information. Determine eligibility for all insurance affordability programs,

seamlessly and simply.

Insurance Affordability Programs

Insurance Affordability Programs (IAP) are a new category of programs within the health insurance exchange.

IAP includes:Medicaid (AHCCCS)CHIP (KidsCare)Coverage in a QHP w/Tax CreditsCoverage in a QHP w/Cost Sharing Reductions

Eligibility for Tax Credits

Available to eligible individuals enrolled in qualified health plans through the HIX.

Family income between 100 and 400% FPL (or < 100% FPL for lawfully present individuals, who are ineligible for Medicaid).

Not eligible for Minimum Essential Coverage (MEC) from government sponsored coverage or private coverage costing less than 9.5% of family income.

Tax Credits limit the cost of premiums to 2% of income for families up to 133% FPL to 9.5% of income for families at 300-400% FPL.

Eligibility for Cost Sharing Reductions

Eligible to enroll in QHP. Eligible for Tax Credits. Family income between 100% and 250% FPL. Determined ineligible for Medicaid. Enrolled in a QHP at the silver level of coverage. American Indians with family income between 100% and 300%

FPL are eligible for cost sharing reductions. American Indians receiving services at ITUs have no cost

sharing reductions.

Small Business Health Opportunity Program (SHOP)

Businesses under 50 employees Arrange health insurance for employees Backend office business tools Management of payments Stabilize premium costs from year to year

What Should We Achieve Through These Changes?

ACA requires everyone under age 65, without Medicare, to have health insurance.

HIX helps US citizens & legal immigrants obtain health insurance, no matter their income level, by providing or reducing the cost of coverage under IAPs, or enabling them to purchase coverage either privately or through their employer.

Processing eligibility real time, selecting & enrolling in a QHP and paying for coverage with easy to use tools via a highly streamlined process encourages people to acquire coverage while they are on the HIX, helping to reduce the uninsured population.

Core Exchange Responsibilities

Plan Management SHOP Consumer Assistance Eligibility Enrollment Financial Management

We Need a Lot of IT Support for the Exchange! What Do We Already Have In Place?

Health-Arizona: meets most ACA architecture requirements

PMMIS, ACE and AZTECS TIPS (electronic data exchange) Electronic signatures Electronic data interfaces between systems Submission of documents electronically Call Centers

What Are We Missing for the HIX?

Plan Management Plan Selection Financial Management SHOP Master Data

Management Data warehouse &

analytics

Tax Credit & Cost Reduction Programs

Medicaid Expansion Programs

NIEM compliance Real time eligibility On line appeals process A HIX agency

What Are Our Options ForRunning An Exchange?

Turn it over to the federal governmentPartner with the federal governmentRun it ourselves

Under State and FederalPartnerships States Can Elect to:

Operate plan management, or Oversee in-person consumer assistance, outreach and

education, or The State can elect to do both, and The Federal government would manage everything else:

including Medicaid and CHIP eligibility determinations under MAGI, the exchange website, call center and written notification to consumers.

The State can also turn over risk adjustment to the Federal Government.

The Arizona Health Insurance Exchange

While legal issues are pending the state will move ahead with the development of an exchange.

Leverage Health-e-Arizona and Arizona’s current infrastructure to handle screening, tax credit, Medicaid and CHIP eligibility components of the exchange.

Award a contract to build Plan Management, Plan Selection, SHOP, Master Data Management, Data Warehouse and Financial Management components of the exchange.

Multiple Tracks

Phase I: Develop system design and architecture. Identify how much current

infrastructure can be leveraged to build the HIX. Begin development.

Phase II: Competitively procure a vendor (and partners if necessary) to develop

the rest of the exchange.

Phase III: Integrate Phases I and II. The HIX must look like one product and go

live by October 1, 2013.

Funding HIX Development

Establishment Grant to pay for QHP and SHOP components of the exchange, Level I submitted 9/29/11.

Enhanced federal funding (90/10) to pay for Medicaid components of the exchange, approved 11/7/11.

Both of these funding sources to pay for integrating all of the components, and cost allocation is required.

90/10 will also pay for SNAP and TANF changes, if they are the same as Medicaid.

Regular CHIP administrative funding for KidsCare development.

FMAP for Medicaid Expansion

Enhanced federal funding for new Medicaid eligibles– 100% 2014-2016– Phasing down to 90% 2020 and ongoing

States are required to identify newly eligible 3 proposed options to claim FMAP for newly eligible

Next Steps

Initiate Phase I system design, planning and development, which is underway.

Release RFP for Phase II by 2/1/12. Award contract for Phase II and begin development by

6/1/12. CMS certifies exchange by 1/1/13. Plan Management (including SERFF) tools ready to use

1/1/13 Complete all testing by 9/13/13. Open enrollment and system live by 10/1/13.

Issues for State Agencies

Significant changes to eligibility policy, process and operations

Insufficient guidance Significant changes to Health-e-Arizona, AZTECS, ACE and

TIPS Very short timelines to complete planning, design,

development, testing and implementation Requires careful prioritization and severe limitation on

changes to the scope of work Other projects are competing for resources

Opportunities for State Residentsand for State Agencies

All legally present Arizona residents will have access to health insurance.

Reduced administrative burden on small employers who want to provide health insurance.

One stop shopping for health insurance whether you pay privately or qualify for publicly funded coverage.

Enhanced federal funding to improve state eligibility systems.

HIX plan selection and financial management components could be used by AHCCCS (Medicaid agency).

Questions?