“Commonwealth Choice” & the Health Connector Exchange: Design Issues & Lessons Learned...

“Commonwealth Choice” & the Health Connector Exchange:

Design Issues & Lessons Learned

Kevin CounihanChief Marketing Officer

MA Conference on National Reformand State Exchanges

January 21, 2010

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Agenda

1. Overview

2. Enrollment in Health Connector Exchange

3. Preliminary Design Issues for Exchanges

4. Lessons Learned

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Commonwealth Choice Roles of Health Connector

Regulator Procurement

Distributor

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Commonwealth ChoiceRole of Health Connector

Complex Roles:• Regulator

– Minimum Creditable Coverage (MCC)– Affordability Schedule– Section 125 Regulations

• Procurement– Health Plans– Seal of Approval Benefit Plan Designs– “Subconnector” administration

• Distributor– On-line Distribution and Enrollment– Broker support

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Commonwealth Choice –Role of Health Connector

• Establish and administer Commonwealth Choice™, a commercial insurance “exchange:”– Evaluate and recommend health plan offerings – Standardized benefit plans & provide Seal of Approval– Provide more affordable coverage options (small group/non-

group market merger)

• Facilitate access to unsubsidized access to coverage for:– Individuals earning above 300% of FPL– Part-time employees – Young adults (age 18 – 26)– Small groups (1 – 50 ees)

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• Make Policy Decisions as Authorized by Health Reform law

• Educate individuals, employers, brokers/ consultants about law and Connector products

• Digital Marketing– Search Engine Marketing– Pay-per-Click– Social Networks

Commonwealth Choice –Role of Health Connector (cont.)

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Subsidized Uninsured

Small Employers

Other?

Non-Group

Commonwealth Choice Exchange and Target Markets

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Commonwealth Choice: Unsubsidized Marketplace for Non- & Small-group

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Enrollment Process

Vince

•Age 37•Lives in Shrewsbury•Uninsured•Wants Non-Group, Single Coverage

•Wants Good Value in Insurance Purchase•Sensitive to Monthly Costs•Wants MD Choice•Wants Easy Access to Information

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•What benefits do I What benefits do I want? want?

•How much do I How much do I want to spend?want to spend?

•Location of Location of MDs/hospitalsMDs/hospitals

•Plan APlan A•Plan BPlan B•Plan CPlan C•Plan DPlan D

•Selects Health Selects Health Plan APlan A

•Completes Completes Online Online EnrollmentEnrollment

•Picks a PCPPicks a PCP•Pays 1Pays 1stst Month Month

PremiumPremium

•Collects PremiumCollects Premium

•Sends Vince’s Sends Vince’s Enrollment Enrollment

Information to Information to Health Plan AHealth Plan A

Online Vince: Sub-Connector

Vince Decision Support Tools: Health Plan Choices:

•Processes Processes Vince’s Vince’s

EnrollmentEnrollment•Issues Vince ID Issues Vince ID

Card to EOCCard to EOC•Prepared to Pay Prepared to Pay

ClaimsClaims

Health Plan A

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Starting List of Design Issues

1. Carrier Bidding & Selection

- “Managed Competition”

- Transparency

- Long-term Relationships

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Starting List of Design Issues

2. Benefits Specification- Market Research

- Encourage Innovation

- Standardize for Easy Comparison

- Manage Change

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Starting List of Design Issues

3. Remember Customer Needs:

- Comprehensive coverage

- Understandable benefits (“I bought what?”)

- “Affordable” cost

- Reduce insurance jargon, (where possible)

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Starting List of Design Issues

4. Administrative Functions

- Outreach & Marketing

- Eligibility Determination

- Enrollment & Premium Billing

- Customer Service

- Appeals

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Likely Functions of Exchanges

1. Offer Coverage for Target Market Segments (non-group, small group, other?)

2. Specify Plan Designs & Coverage Tiers for unsubsidized coverage

3. Contract with & Sell Health Plans

4. Education, Outreach & Marketing

5. Oversee/Ensure Risk Adjustment

6. Ensure Compliance with Benefit Offering Rules and Requirements- Benefits determined by Feds (MCC?)- States must reimburse Feds for extra costs due to mandates

beyond MCC

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Potential Value of Exchanges

1. Protecting/representing enrollees

2. Prudent purchasing of health insurance

3. Choice & “managed competition”

4. Scale economies in distribution

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Lessons Learned

• Hire Staff who Know Health Insurance Business

• Communication Never Ends

• Minimum Coverage / Affordability

• For Consumers, Keep it Simple → Less = More

• Nurture Stakeholder Relationships

• Leverage Public/Private Practices