the utah health exchange ten lessons learned from the utah experience
TRANSCRIPT
The The Utah Utah Health Health ExchangeExchange
Ten Lessons Learned from the Utah Ten Lessons Learned from the Utah ExperienceExperience
Ten Lessons LearnedTen Lessons Learned
1. Support and Cooperation Within 1. Support and Cooperation Within and Across State Government is and Across State Government is KeyKey
2. Begin with the End in Mind2. Begin with the End in Mind
3. Develop a General Timeline3. Develop a General Timeline
4. Identify Specific Problems to be 4. Identify Specific Problems to be AddressedAddressed
5. Demography is Destiny5. Demography is Destiny
Ten Lessons LearnedTen Lessons Learned
6. Engage Stakeholders Early and 6. Engage Stakeholders Early and Often and in a Cooperative Often and in a Cooperative DynamicDynamic
7. Deadlines Can Be Your Friends7. Deadlines Can Be Your Friends
8. Consider A Phased Approach8. Consider A Phased Approach
9. Leverage Existing Resources9. Leverage Existing Resources
10. Commit to Systemic Change10. Commit to Systemic Change
Begin With The End In Begin With The End In MindMind
• Greater Choice• Expanded Access• Individual Responsibility• Increased Affordability• Higher Quality• Improved Health
Develop a consumer driven health care and Develop a consumer driven health care and insurance market that provides:insurance market that provides:
Develop a General Develop a General TimelineTimeline
1-3-6-10 Plan1-3-6-10 Plan
• During the 11st year, take specific actions to establish a foundation for future success
• Understand it may take as many as 33 years to fully develop a plan of action
• Focus on 66 critical areas of need• Further understand it may take as long as 1010 years to fully
implement reforms
Identify Specific Identify Specific ProblemsProblems
• Too Many Uninsured• Employers Dropping Insurance• Escalating Premium Costs• Consumers Increasingly Detached from the Market• Misaligned Incentives
Identify Problems: Identify Problems: Escalating Premium CostsEscalating Premium Costs
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Source: GOPB analysis of data from the Agency for Healthcare Research and Quality Medical Expenditure Survey and Kaiser Family Foundation Annual Employer Benefits Survey
Identify Problems: Identify Problems: Consumer DetachmentConsumer Detachment
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
Private Health Insurance PaymentsPrivate Health Insurance Payments
Source: GOPB Analysis of Centers for Medicare & Medicaid Services, National Health Expenditure Accounts
Consumer Out-of-Pocket PaymentsConsumer Out-of-Pocket Payments
Identify Problems: Identify Problems: Fewer Firms Offering Fewer Firms Offering
CoverageCoveragePercent of US Firms Offering Health Benefits
54%
56%
58%
60%
62%
64%
66%
68%
70%
2000 2001 2002 2003 2004 2005 2006 2007
Source: Kaiser Family Foundation
Identify Problems: Identify Problems: Fewer Firms Offering Fewer Firms Offering
CoverageCoveragePercent of Utah Firms Offering Health Benefits
40%
42%
44%
46%
48%
50%
52%
54%
56%
58%
2000 2001 2002 2003 2004 2005
Source: Agency for Healthcare Research and Quality Medical Expenditure Survey
Demography Is DestinyDemography Is Destiny
Utah’s Uninsured Population in 2007Utah’s Uninsured Population in 2007• 10.6% rate of uninsured in the state
– Roughly 300,000 individuals• Majority were employed• Many were part-time workers
– Workforce has a large percentage of part-time workers– Many had multiple part-time jobs
• Most worked for small firms– Less than 50% of small firms offering health insurance
as a benefit• Many were young immortals
– Age 18-34
Engage the StakeholdersEngage the Stakeholders
20072007 Formed CoalitionsFormed CoalitionsExecutive BranchLegislative BranchSalt Lake Chamber of CommerceUnited Way of Salt Lake
20082008 Formed Perspective-Oriented Work Formed Perspective-Oriented Work GroupsGroups
Community GroupBusiness GroupHospital GroupNon-hospital Provider GroupInsurance Group (carriers and producers)
20092009 Formed Task-Oriented Work GroupsFormed Task-Oriented Work GroupsAffordability and Access GroupTransparency and Quality GroupOversight and Implementation Group
Utah Health Exchange Utah Health Exchange TimelineTimeline
March 2008March 2008 HB 133 HB 133 establishes the Utah Health Exchangeestablishes the Utah Health ExchangeOn-line mechanism that allows consumers to compare, shop for, and On-line mechanism that allows consumers to compare, shop for, and enroll in a health planenroll in a health plan
Will incorporate All Payer Database so patients may access info about Will incorporate All Payer Database so patients may access info about providersproviders
Includes a multiple source premium aggregatorIncludes a multiple source premium aggregator
March 2009March 2009 HB 188 HB 188 establishes the Utah Defined Contribution establishes the Utah Defined Contribution MarketMarket
Employer offers a pre-determined level of funding, rather than a pre-Employer offers a pre-determined level of funding, rather than a pre-determined benefitdetermined benefit
Utah Defined Contribution Risk Adjuster Board establishedUtah Defined Contribution Risk Adjuster Board established
Three carriers announce participation in the Exchange (Select Health, Three carriers announce participation in the Exchange (Select Health, Regence BlueCross Blue Shield, Humana)Regence BlueCross Blue Shield, Humana)
August 2009August 2009 Utah Health Exchange Limited LaunchUtah Health Exchange Limited LaunchExchange is open to limited number of small employers (2-50 Exchange is open to limited number of small employers (2-50 employees)employees)
Purpose is to test dynamics of the new defined contribution market as Purpose is to test dynamics of the new defined contribution market as well as the processes of the Exchange technology well as the processes of the Exchange technology
Utah Health Exchange Utah Health Exchange TimelineTimeline
March 2010March 2010 HB294 includes provisions intended to correct and HB294 includes provisions intended to correct and enhance the defined contribution market and the Exchangeenhance the defined contribution market and the Exchange
Pricing parity between traditional small group market and defined Pricing parity between traditional small group market and defined contribution marketcontribution market
Two additional carriers (Altius, United Healthcare) announce Two additional carriers (Altius, United Healthcare) announce participation in the Exchange (total of 5 carriers) participation in the Exchange (total of 5 carriers)
April 2010April 2010 Large Group Pilot Project launchesLarge Group Pilot Project launchesFull year earlier than anticipated, per requests from large employers Full year earlier than anticipated, per requests from large employers (50 or more employees)(50 or more employees)
Approximately 50,000 covered livesApproximately 50,000 covered lives
August 2010August 2010 Full scale launch to all Utah small employersFull scale launch to all Utah small employers
Leverage Existing Leverage Existing ResourcesResources
TechnologyTechnology• Private-sector vendors
– Enrollment and Plan Selection—bswift, Inc.– Financial/Banking Function—HealthEquity, Inc.
Marketing and OutreachMarketing and Outreach• Chambers of Commerce• Professional and Trade Associations• Earned Media
Education and AdoptionEducation and Adoption• Brokers and Consultants• Human Resource Managers
Commit to Commit to Systemic ChangeSystemic Change
Six Areas of EmphasisSix Areas of Emphasis
• Health Insurance Reform• Personal Responsibility• Transparency and Value• Maximize Tax Advantages• Optimize Public Programs• Modernize Governance
Advantages of the Advantages of the Utah Health ExchangeUtah Health Exchange
EMPLOYERSEMPLOYERS
• Simplified Benefits Management
• Predictable costs• Expanded Coverage
Choices• Preserve Tax Benefits
EMPLOYEESEMPLOYEES
• Individual Control and Choice
• Pay with Pre-tax dollars• Plan Portability• Premium Aggregation
How does the Exchange How does the Exchange work?work?
• Step 1Step 1 – Employer signs up
• Step 2Step 2 – Employee enters information
• Step 3Step 3 – Premiums are generated
• Step 4Step 4 – Employee comparison shopping and open enrollment period
• Step 5Step 5 – Finalize enrollment
• Step 6Step 6 – Plans go into effect on designated date
Employees use the Employees use the Exchange to begin the Exchange to begin the health plan selection health plan selection
processprocess
The Exchange The Exchange includes a includes a Premium Premium
Aggregator; Aggregator; here, here,
employees employees may combine may combine contributions contributions
from from additional additional sources. sources.
The Exchange provides a tool that helps The Exchange provides a tool that helps employees compare health plan options. employees compare health plan options.
3) The 3) The employee employee may choose may choose up to four up to four plans for a plans for a more more detailed detailed side-by-side side-by-side comparisoncomparison
1) Employees can narrow down choices or see 1) Employees can narrow down choices or see all available plans. At this stage, employees all available plans. At this stage, employees may:may:
•filter plans by preference for doctor, filter plans by preference for doctor, hospital, or insurance carrierhospital, or insurance carrier•select applicable family statusselect applicable family status•opt to display only HSA-qualified health opt to display only HSA-qualified health plansplans•waive coveragewaive coverage
2) Employees 2) Employees may sort plans may sort plans according to according to priorities or priorities or preferencepreference
Those plans Those plans selected by the selected by the employee are employee are displayed in a displayed in a side-by-side side-by-side
matrix for matrix for summary-level summary-level
or detailed or detailed comparison comparison purposes.purposes.
Employees may estimate total cost for health care Employees may estimate total cost for health care expenditures (premium, deductible, co-pays, etc.) expenditures (premium, deductible, co-pays, etc.)
based on each family member’s health status. based on each family member’s health status.
The The Exchange Exchange provides a provides a tool to help tool to help employees employees track their track their monthly monthly payroll payroll
deduction as deduction as they go along they go along
in the in the process.process.
If the If the employee employee selects a selects a qualified qualified HDHP, an HDHP, an
HSA option is HSA option is presented.presented.
Employees are provided with detailed plan cost Employees are provided with detailed plan cost information, including the total monthly information, including the total monthly
premium, the employer’s monthly contribution, premium, the employer’s monthly contribution, and the employee’s monthly cost.and the employee’s monthly cost.
The employee The employee confirms confirms covered covered
individuals individuals and saves and saves
selected plan.selected plan.
The final step The final step is to simply is to simply
enroll.enroll.
Similarities: Similarities: MassachusettsMassachusetts and Utahand Utah
MassachusettsMassachusetts• State-based solution
designed to be responsive to state-specific issues, customs, business practices, etc.
• Consumer-centered approach
• Achieved broad, bipartisan consensus supporting the basic reform elements
UtahUtah• State-based solution
designed to be responsive to state-specific issues, customs, business practices, etc.
• Consumer-centered approach
• Achieved broad, bipartisan consensus supporting the basic reform elements
Differences: Differences: Massachusetts and UtahMassachusetts and Utah
MassachusettsMassachusetts• Individual mandate• Employer mandate• Government role is
contracting agent• Established Massachusetts
Connector Authority with broad regulatory responsibilities
• Acted first on public sector reforms; now rolling out private insurance market reforms
UtahUtah• No individual mandate• No employer mandate• Government role is market
facilitator• Regulatory authority
strictly limited to establishment of electronic data standards
• Began by implementing private market reforms first; public sector reforms to follow
Differences: Differences: Massachusetts and UtahMassachusetts and Utah
MassachusettsMassachusetts• No risk adjustment
mechanism included
• Upfront appropriation of $25 million; ongoing funding through retention of a portion of premium
• Staff of approximately 45
employees
UtahUtah• Risk adjustment
mechanism established to deal with adverse selection issues
• Upfront appropriation of $600,000; ongoing funding through annual appropriation and technology fees
• Staff of 2 employees