CLEVELAND, OH (WOIO): A proposal that would affect approximately 1.66 million Medicaid recipients in Ohio has drawn ire from local non-profits, with many accusing it of being a costly, impractical and politically motivated method of rebelling against President Barack Obama's Affordable Care Act (ACA). The Healthy Ohio Program would require many adults on Medicaid to pay premiums for their care, and many believe it could lead to disastrous results.
The program requires that all non-disabled, Medicaid-eligible adults over the age of 18 contribute to a health savings account (HSA), called the "Buckeye Account." Every individual would be responsible for depositing 2 percent of family income, up to $99 a year, into their HSA, with the Ohio Department of Medicaid also contributing $1,000.
What is a the Healthy Ohio Program?
According to the proposal, the Healthy Ohio Program aims at building on Ohio's history of helping people transition away from Medicaid and other public health care assistance towards private insurance. The program, it says, "not only ensures the long-term stability of the Medicaid expansion in the State, but also introduces several key enhancements that will empower members to become active participants in their healthcare."
The foundation of the plan comes in the Buckeye Account, made up of two pieces: the core portion and the non-core portion. The core portion of the Buckeye Account, the part that the individual deposits money into, can be used to pay copays and services not included in the member's benefit package, while the non-core portion is used for initial health care expenses, such as deductibles.
Individuals also have the opportunity to earn monetary incentives, added to their Buckeye Account, for engaging in specific healthy behaviors. These points are awarded by the Ohio Department of Medicaid or by the member's primary care physician, with the opportunity to earn up to $320 per year.
At the end of each year, the non-core portion of an individual's Buckeye Account resets, with any remaining state-contributed dollars and incentive points expiring, unless the individual has completed pre-determined preventative care programs throughout the year. In this case, they are able to carry forward the entire remaining balance of their Buckeye Account.
An individual who goes 60 days without depositing into their Buckeye Account would experience a disruption in coverage. In order to re-enroll in the program, they would need to pay all missed monthly contributions. Re-enrollment payments can be paid up to 75 percent by a non-profit health care provider.
The Healthy Ohio proposal describes this system as a way to "actively engage members in managing their health care expenses while exposing the individual to the cost of care," with the promotion of member engagement and personal responsibility as one of four listed goals for the program.
The program also aims to increase the use of preventative services by members, increase provider engagement in members' healthy behaviors and increase the number of commercially insured individuals. The last goal, they hope, will be accomplished by offering referrals to workforce development agencies for all members working less than 20 hours a week and by offering a Bridge Account for members who successfully transition from Medicaid to individual market or employer-sponsored insurance. The Bridge Account would contain the entire balance of the member's Buckeye Account and could be used to cover copays, deductibles and coinsurances.
"The Healthy Ohio program design, which promotes personal and financial responsibility, prepares members to actively participate in commercial health market plans," says the proposal. "However, the Healthy Ohio Program is unique as it also actively assists members to obtain and maintain private market coverage."
How did this proposal start?
The proposal comes after a time of Medicaid expansion in Ohio. In 2013, after the state legislature voted against accepting funds from the ACA, Governor John Kasich turned to the Ohio Controlling Board, a non-partisan body made up of one governor appointee, three members of the state House of Representatives and three members of the state Senate. Two of the members from each chamber are from the majority party, while one is from the minority.
The Controlling Board, which has the power to authorize use of federal funds, accepted the money, expanding Medicaid to more than 600,000 Ohioans. Now, in total, more than 3 million Ohioans are insured by the ACA, with about one-third of them potentially affected by this proposal.
The program is a more extreme version of what was initially put forward by Kasich during a 2015 biannual budget review. Kasich proposed charging Medicaid premiums of approximately $20 per month, not to exceed two percent of household income, for non-disabled adults with income above 100 percent of the federal poverty line, with a disruption in coverage after three months without payment. After looking at at Kasich's proposal, the House and Senate decided instead to propose the Healthy Ohio Program, which applies to all individuals on Medicaid despite their income.
Kasich signed Healthy Ohio into law on June 30, 2015. As per Section 1115 of the Social Security Act, the program had to go through a period of public comment before being shown to the federal government for approval, which took place from April 15 to May 16, with public hearings held April 21 in Columbus and April 26 in Cincinnati. Comments are also accepted by mail, email, fax and in person at the Ohio Department of Medicaid.
The full text of all of the comments received is available on Ohio Medicaid's website. The 1,566 page document features hundreds of comments, most of them in opposition of the law. According to the Ohio Department of Medicaid, 84 percent of commenters thought the program would be unaffordable for Medicaid recipients and 72 percent thought it would result in decreased in Medicaid enrollment. Only one percent were supportive of the plan.
The Ohio Department of Medicaid (ODM) decided to still move forward with the program, submitting an application to the federal legislature on June 30. They noted that, although there were many changes requested to the waiver, they were unable to modify it without a state statutory charge. With the reapplication to the federal government, public commentary has opened again, with people able to express opposition or support on Medicaid's website until Aug. 7.
So far, no state has received federal approval to terminate the Medicaid eligibility of a person with income below 100 percent of poverty for not paying premiums or contributing to an HSA. Only Indiana has received federal approval to test the use of HSAs in Medicaid. Still, Kasich is hoping to get approval and implement the plan in January of 2018.
What are the potential pitfalls?
Prominent politicians and non-profits have continued to speak out against the plan throughout the process, citing increased concern as the proposal moves to federal government consideration.
"With the choices that poor people have to make amongst necessary spending, like do you buy food or do you buy medicine or pay rent or pay a health care premium, the health care premium falls to the bottom," said Wendy Patton, who works on tax and budget issues at Policy Matters Ohio. "This plan is wrong for the segment of people that Medicaid serves. It's the wrong plan in every way for serving the poor."
Many worry that the premiums, which come out to about $8.25 a month, would cause patients to utilize emergency room care as opposed to primary care.
Problems with disenrollment extend beyond just a higher reliance on emergency room care. Patients who are not able to consistently see a primary care doctor find it difficult to know which medicine to take to manage their illnesses, making it harder for both them and their health care provider to manage their diseases.
Indiana state Representative Jim Butler denies this, saying their state's similar program caused participants to use preventative services at much higher rates, with less reliance on emergency room care, based on survey data.
Although the proposal says that it is designed "to increase enrollee engagement, thereby improving health outcomes for members and reducing overall program costs," many disagree that it would lead to an increase in members' personal responsibility.
"That's an argument that blames the sick or unhealthy person for bad personal choices," said Patton. "In our opinion, personal responsibility is shown when you enroll in Medicaid, get medications, see a doctor and control your disease. This is facilitated by what Ohio Medicaid does now, which is the strongest reason we feel the Healthy Ohio Program is very unhealthy for the people of Ohio."
Alex Kimmel, a 41-year-old who is a part of a Medicaid HSA in Indiana, says that he does not mind the premiums and supports the idea of added personal responsibility. Kimmel became eligible for Medicaid after the ACA expansion in his state.
"If it were simply a freebie, we wouldn't pay as much as attention," he said. "We don't have to pay anything out of pocket for services, and even though it doesn't cover a lot, it's better than nothing, which is what we would have without Medicaid."
The plan also comes with hefty overhead costs, which Loren Anthes, a fellow with the Medicaid Policy Center at The Center For Community Solutions, believe could be more expensive than they're worth.
"In Virginia where they have something similar, for every dollar collected in premiums they spent $1.39 to operate the program," he said. "In Arkansas, which had a waiver just like this, they recently gave up because it was very expensive. None of these costs are outlined in the proposal."
Anthes also worries about the potential for fraud within the system, especially with regards to incentive points.
"If a hospital is able to use a point system and offer money directly to patients, that's potentially an area of abuse, because you could have patients self-refer to receive services from you, which would be a potential law violation," he said.
Another possible cost issue comes from the idea that non-profits and hospitals can contribute up to 75 percent of a member's re-enrollment fee, if needed. Gutowski cautions that this would function as more of a backward tax on hospitals, forcing them to make a payment back to the state of Ohio on behalf of their low income patients.
Additionally, the proposal's removal of retroactive eligibility, which gives hospitals 90 days after patients come into the emergency room to get them insured and still have any services incurred paid for through their new plan, could force hospitals to deliver care to critical patients for free.
"We have folks with low financial literacy to begin with and we are expecting them to manage their own health care spending, dealing with complex bureaucracy and HSAs," said Gutowski. "They could easily get kicked off or charged a fee or forced to pay a banking fee, which could increase the likelihood of accruing medical debt and potentially damage their credit report."
Democratic Ohio Sen. Sherrod Brown has been vocal about his opposition to the plan and has spoken out against Healthy Ohio on numerous occasions, calling it "politics at its worst" in an April 7 call with reporters.
In a statement released earlier this week, Brown said that the proposal would be more aptly called the "Unhealthy Ohio Program" and that it would "disrupt coverage and increase costs for the more than one million adult Ohioans who are currently enrolled through the program, going beyond the state's expansion population and affecting other vulnerable individuals who rely on Medicaid, including foster youth, low-income 19- and 20-year-olds, low-income parents and caretaker relatives, and individuals eligible for the Breast and Cervical Cancer project."
"If these changes are approved, Ohio will fall backwards in the number of individuals insured, with the most disproportionate impact falling on minority populations," he said. "This is unacceptable."
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