Medicaid sign-ups now total 192,210

State: Policy cap is resolving itself

Almost 8,000 more Arkansans were approved for coverage under the state's expanded Medicaid program last month, bringing the total to 192,210, the state Department of Human Services reported Friday.

Meanwhile, department spokesman Amy Webb said the state no longer plans to seek an adjustment in a cap on spending under the so-called private option, which allows the state to use federal funds to buy coverage on the insurance exchange for those made eligible for Medicaid by the expansion.

The state's spending so far has exceeded the limit set under the federal waiver that authorized the private option, but Webb said officials expect the insurance companies' expenses for covering the enrollees to fall below projections.

That would allow the state to recoup money from the insurance companies, lowering the program's overall costs, she said.

"At this point, our folks and Medicaid are reviewing trends, and we feel comfortable at this time that we won't need to ask for" an adjustment in the cap, Webb said.

State officials have said the costs of the private option so far have been above projections because the average age of the enrollees has been higher than expected, leading to higher average premiums.

The terms of the waiver allow the cap to be adjusted if the state has information that the limits "may underestimate the actual costs of medical assistance for the new adult group."

The deadline for the state to request this year's spending limit to be adjusted is Oct. 1.

State Sen. David Sanders, R-Little Rock, and a sponsor of the law creating the private option, said Friday, "We've heard nothing from the carriers that would cause us to see a need to increase the budget cap amount."

He added that he expects costs to be lowered next year by planned changes that would limit nonemergency medical transportation and establish savings accounts for some enrollees.

Rep. David Meeks, R-Conway, who opposed Medicaid expansion, said the possibility of the state exceeding the enrollment cap is a "minor concern."

A bigger worry, he said, is sustaining the program after 2017, when the state is expected to begin paying 5 percent of the cost.

The state's share will then rise every year until it reaches 10 percent in 2020.

"Ultimately, what I wouldn't mind seeing is the feds just giving the people money in the form of the tax credit, and then let them purchase insurance however they want to," he said.

Authorized by the 2010 federal health care overhaul law and approved by the Legislature last year, the expansion of Arkansas' Medicaid program extended eligibility to adults with incomes of up to 138 percent of the poverty level: $16,105 for an individual, for instance, or $32,913 for a family of four.

Federal tax credit subsidies are available to those who don't qualify for Medicaid but have incomes of less than 400 percent of the poverty level: for example, $45,960 for an individual or $94,200 for a family of four.

Total Medicaid enrollment as of July 31 included 163,480 Arkansans who were enrolled in the private option and 20,335 who were assigned to the traditional, fee-for-service Medicaid program because their health needs were considered to be exceptional.

More than 8,300 others had been approved for coverage but had not yet completed enrollment.

As of Sunday, 38,712 people were enrolled in non-Medicaid plans on the exchange, an increase of 586 people compared with the total on July 6, Seth Blomeley, a spokesman for the Arkansas Insurance Department, said.

In addition, 3,659 non-Medicaid plans had been canceled, an increase of 394 plans compared with the total on July 6. A plan could be canceled because the enrollee stopped paying the premium or found other coverage, Insurance Department officials have said.

Enrollment in the expanded Medicaid program and insurance exchange began Oct. 1 for coverage that started Jan. 1.

In addition to paying the premiums for those on the private option, the state Medicaid program makes upfront payments to the insurance companies to eliminate plan deductibles and reduce or eliminate required copayments.

The Medicaid program also pays directly for some services, such as nonemergency medical transportation, required by federal Medicaid rules but not covered by the plans.

Through June 30, the state's monthly costs totaled $491.17 per enrollee, compared with a limit of $477.63 set in the waiver from the U.S. Department of Health and Human Services' Centers for Medicare and Medicaid Services.

Under the terms of the waiver, the federal government will pay the full cost of the private option through 2016 as long as the state's per-enrollee spending is below the cap.

The monthly per-enrollee limit used to calculate the overall cap rises to $500.08 in 2015 and $523.58 in 2016.

Webb said Medicaid officials expect this year's costs to be reduced by a provision in the federal health care law requiring insurance companies to issue refunds if they spend less than 80 percent of the premiums they collect on medical care, rather than administrative expenses or profits.

In the case of the private option, any refunds issued would go to the Medicaid program, offsetting the private option's cost.

If the companies' expenses for enrollees' medical care are below projections, the companies could also have to refund some of the upfront payments they received to reduce enrollees' deductibles and copayments.

Max Greenwood, a spokesman for Arkansas Blue Cross and Blue Shield, said it's too early to say how the company's expenses will compare with projections.

But she said: "I don't think that anything has drastically changed as far as our numbers."

"It's a population that before didn't have their basic health care needs met," she said.

"I know early on we saw very high utilization. Whether or not that's tapered off, I don't know."

Greenwood noted that although the Medicaid program reimbursed insurance companies $4,500 per birth for pregnant food stamp recipients who had been enrolled erroneously in private option plans, the payments covered less than half of what her company pays for deliveries.

As of June 30, about three-fourths of those enrolled in the private option were in plans offered by Arkansas Blue Cross or the national Blue Cross and Blue Shield Association, 22 percent were in Centene Corp. plans and 3 percent were in QualChoice Health Insurance plans.

Michael Stock, chief executive of Little Rock-based QualChoice, said the medical expenses for those who enrolled in his company's plans in October and November were "a little bit higher than we anticipated."

Enrollment in QualChoice plans was halted in November, after it reached 1,280, because of the company's pending acquisition by Englewood, Colo.-based Catholic Health Initiatives.

Stock said he didn't have information about the expenses of those who enrolled after the cap was lifted in May.

John Ryan, chief executive of St. Louis-based Centene's Arkansas Health and Wellness Solutions, which is offering plans on the exchange under the name Ambetter Arkansas, didn't return a call seeking comment Friday.

Included in the latest enrollment numbers were some of the almost 4,800 enrollees who were notified that their coverage would end on May 31 because their applications had been mistakenly approved.

More than 2,600 of the enrollees who received the cancellation notices were later found to be eligible, Webb said.

About 200 have already re-enrolled, and an additional 2,417 will be notified next week that their coverage will be restored.

Of the 1,310 people found to be ineligible for Medicaid, at least 600 have enrolled in non-Medicaid plans on the exchange, Webb said.

An additional 800 people will receive letters next week asking for information needed to verify their eligibility, Webb said.

A Section on 08/09/2014

Upcoming Events