The joint Public Health committee heard more than two hours of testimony from Medicaid director Andy Allison and other officials today on the nitty-gritty details of the so-called “private option” plan for Medicaid expansion. I won’t re-hash that here but a few highlights worth mentioning: 

12-month continuous coverage nixed: When the Department of Human Services submitted its final waiver application, it removed its request to offer the “private option” plans as year-long continuous coverage, a change which attracted a fair amount of interest and questions at today’s meeting (and also dismay from national observers such as Georgetown health policy expert Joan Alker, who had labeled the original DHS request a “thoughtful innovation” that “supported the rationale” of going with the “private option”).

DHS had hoped to guarantee eligibility for a full year after people signed up. In order to qualify, a beneficiary has to be below 138 percent of the federal poverty level – under the original DHS plan, that person would then have that coverage for a year, at which point they would re-apply and once again have income checked for eligibility (this was the source of Americans for Prosperity’s fixation with a Medicaid recipient winning Powerball). However, the feds advised DHS that the state would be financially liable for folks who had coverage for a year but actually didn’t qualify for some portion of that year because their income went above the line. So in order to avoid putting the state on the hook for those costs, the “private option” beneficiaries, like other Medicaid beneficiaries, will have to report a change in income at any time.

The result: people whose incomes change frequently, falling above or below the poverty line, will face additional hassle, as they will be legally required to go back and forth between the “private option” and the Health Insurance Marketplace. It’s also a massive (and potentially costly) administrative headache for the insurance companies, not to mention DHS. The good news is that unlike in other states, folks won’t be switching between Medicaid and private carriers; they’ll be able to stick with the same carrier and even the same plan.

Allison said that the state still hoped to move to continuous coverage but their hands were tied by the feds. “We continue to aspire to a more continuous enrollment process but not until we can resolve this issue of who’s financially responsible,” he said.

“Medically frail” will be determined by self-assessment questionnaire: Approximately 10 percent of the expansion population will go to traditional Medicaid instead of the “private option” plans, because they are determined to have a high risk of having greater service needs than private plans provide. The goal is to avoid having to coordinate additional services between Medicaid and the private carriers; it should also make for a less risky pool in the marketplace, helping to keep premiums down. So how will the state determine whether someone qualifies as “medically frail”? DHS has worked with researchers from the University of Michigan and the federal Agency for Healthcare Research and Quality to develop a 10-question questionnaire to screen applicants. A formula will then attempt to determine the riskiest/most costly beneficiaries based on their responses. A final draft of the questionnaire should be available next week.