A review of incremental state reforms to expand coverage in Arkansas Presenter: Kevin W. Ryan JD, MA Associate Director SCI Workshop for State Officials

A review of incremental

state reforms to expand coverage

in ArkansasPresenter:

Kevin W. Ryan JD, MA

Associate Director

SCI Workshop for State Officials

August 3 & 4, 2006

Today

• Arkansas demographics

• History of state based reform efforts

• Current status of Arkansas initiatives

Arkansas at a glance

The Insured in Arkansas

Number and percentage of all Arkansans by insurance status (2001 vs. 2004)

Data source: ACHI. Arkansas Household Survey of Health Insurance Status. Little Rock, AR: ACHI; 2001 and 2004.

2,191,288 2,192,804

391,594 455,798

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

2001 2004

Nu

mb

er

of

all A

rkan

san

s

Uninsured

Insured

85% 83%

15% 17%

0%

20%

40%

60%

80%

100%

2001 2004

Perc

en

t of

all A

rkan

san

s

Uninsured

Insured

Percentage of insured Arkansans by age group (2004)

89.6%75.6%

98.5%

10.4%24.4%

1.5%

0%

20%

40%

60%

80%

100%

0–18 yr 19–64 yr 65+ yr

Perc

ent by a

ge g

roup o

f all

Ark

ansa

ns

Uninsured

Insured

Data source: ACHI. Arkansas Household Survey of Health Insurance Status. Little Rock, AR: ACHI; 2004.

Sources of health insurance for adult (19–64 years) Arkansans (2004)


Employer71%

Individual9% Group

(non-employer)4%

Former employer

1%

CHAMPUS3%

Medicaid8%

Medicare4%

15%15%

14%14%

Percentage of private sector firms that offer health insurance (2003)

42%26%

93%

56%43%

95%

0%

20%

40%

60%

80%

100%

All privatesector firms

<50employees

50+employees

Private sector firm size

Perc

ent of fir

ms

that offer

health

insu

rance

AR US

Data source: 2003 Medical Expenditure Panel Survey-Insurance Component. Table II.A.2(2003) Percent of private-sector establishments that offer health insurance by firm size and State: United States, 2003. Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends. Available at www.meps.ahrq.gov [accessed 08/24/05].

Number of Arkansans employed by business type and size

269,442

687,710

115,62060,093

20,9440

250,000

500,000

750,000

<50 employee

s

50+ employee

s

Local State Federal

Private sector Government

Nu

mb

er

of

em

plo

yees in

Ark

an

sas

Data source for private sector firms: 2003 Medical Expenditure Panel Survey-Insurance Component. Table II.B.1(2003) Number of private-sector employees by firm size and State: United States, 2003. Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends. Available at www.meps.ahrq.gov [accessed 08/24/05]. Data source for government employees: Arkansas Employment Security Department. Arkansas Covered Employment & Earnings. Fourth Quarter 2004. Little Rock, AR: Bureau of Labor Statistics Programs, Arkansas Employment Security Department. June 2005.

The Uninsured in Arkansas

Employment status of uninsured adult (19–64 yr) Arkansans (2004)


Full-time employed

34%

Full-time self-employed

11%Part-time employed

12%

Part-time self-

employed4%

Unemployed39%

45%45%

16%16%

Uninsured rates by region for all ages (2004)

North-west

16.4%

Delta15.8%

RuralRural 15.9%15.9%

SuburbanSuburban16.0%16.0%

Mountain22.6%

UrbanUrban6.3%6.3%


Percentage of uninsured Arkansans by age group and gender (2004)


19–64 yr

uninsured = 24%

10%

30%17% 2%

0%

20%

40%

60%

80%

100%

0–18years

19–44years

45–64years

65+years

Perc

en

t b

y a

ge g

rou

p o

f all A

rkan

san

s

Insured

Uninsured

0–18 yr9.2%

19–64 yr40.1%

65+ yr1.0%

65+ yr0.3%

19–64 yr42.8%

0–18 yr6.6%

Females (50%)

Males(50%)

19–64 yearsUninsured = 24%

Impact of Self-Pay (Uninsured) Patients on Hospitals, 1999-

2003Indicator 1999 2000 2001 2002 2003 Percent Increase

Number of Self-Pay Patients Admitted

17,815 20,545 26,843 28,899 30,063 68.75%

Self-Pay As Percent of all Patients Admitted

4.90% 5.50% 6.80% 7.30% 7.01% 43.06%

Total Uncovered Charges ($ Million)

$151 $168 $248 $307 $354 134.50%

Uncovered Charges As Percent of All Charges

3.99% 4.11% 5.25% 5.89% 5.63% 41.10%

Insured vs. Uninsured Hospital ChargesDRG Hospital Billed

Charges

Allowed Amount by HMO

Savings by the Insured

Vaginal Delivery w/o Complicating Diagnosis (373)

$8776.09 $2000 77.2%

Cesarean Section w/o Complicating Diagnosis (371)

$14,250.75 $2500.00 82.5%

Chest Pain (143) $10,268.25 $950.00 90.7%

Coronary Bypass (109) $49,741.00 $17,907.75 64%

Esophagitis, Gastroenteritis, and Misc. Digestive Disorders (183)

$13,398.49 $2299.00 82.9%

History of state based reform initiatives

Select state based reform efforts• Arkansas Healthcare Reform Taskforce

• Legislative efforts

• Arkansas Health Insurance Expansion Initiative Roundtable

Arkansas Health Policy Roundtable

• 21 private-citizen members• 7 Consumer representatives• 7 Employer representatives• 7 Insurance / provider representatives

• Goals• Assess health insurance challenges facing Arkansans• Develop a 5-10 year strategic plan• Increase the number of Arkansans covered by health insurance AND

promote marketplace stability

Arkansas Health Policy RoundtableStakeholders and strategic partners

• Arkansas Advocates for Children and Families• Arkansas Hospital Association• Arkansas Medical Society• Arkansas Chamber of Commerce• Community Health Centers• Department of Human Services• Department of Health• Service Employees International Union• Arkansas Farm Bureau• Department of Insurance• Academia• Healthcare providers / health insurance carriers

Roundtable principles

• Stabilize current coverage

• Maximize use of available public funds

• Focus on those with greatest need first

• Ensure saleable / affordable solutions

• Create joint responsibility / ownership

• Include prevention / wellness

Roundtable assumptions

• Most employers want to offer coverage.

• Cost thresholds exist regarding employer capacity to offer.

• Most families want / need coverage.

• Cost thresholds exist regarding family capacity to purchase.

Health insurance coverage in Arkansas

Income

Age

Medicaid w/ Disability

Private Insurance

100% FPL

200% FPL

0 10 20 30 40 50 60 70

300% FPL

ARKidsFirst B Medicaid for

Pregnant Women/Family

Planning

Currently Uninsured:~

Med

icar

e

ARKids First A

(Medicaid)

Income

Age

Medicaid w/ Disability

Private Insurance

100% FPL

200% FPL

0 10 20 30 40 50 60 70

300% FPL

ARKidsFirst B Medicaid for

Pregnant Women/Family

Planning

Currently Uninsured

Med

icar

e

ARKids First A

(Medicaid)

The Arkansas Roundtable Strategic Plan for Coverage Expansion • Created in 2001

• A study in “passionate incrementalism”

Roundtable Strategic Plan (2001)

• State actions– Establish HIPGs

– Increase ARKids enrollment for eligible children

– Increase Medicaid eligibility for pregnant women

– Expand safety net benefits to very low income adults

– Create employer / state partnership (HIFA waiver)

– Encourage optimal management of insurance products

– Encourage employee wage / benefit education

– Encourage inclusion of evidence based preventive benefits

– Optimize federal funds for healthcare coverage

Roundtable Strategic Plan (2001)

• Federal actions– Achieve income tax neutrality

– Modify Medicare to include prescription drug coverage

– Encourage linking of MSA / HSA products to group plans

– Encourage federal research into healthcare delivery, costs, utilization and quality of care

Current status of Arkansas initiatives / activities

Percentage of insured Arkansans by age group (2004)

89.6%75.6%

98.5%

10.4%24.4%

1.5%

0%

20%

40%

60%

80%

100%

0–18 yr 19–64 yr 65+ yr

Perc

ent by a

ge g

roup o

f all

Ark

ansa

ns

Uninsured

Insured


Number and percentage of all Arkansans by insurance status (2001 vs. 2004)

Data source: ACHI. Arkansas Household Survey of Health Insurance Status. Little Rock, AR: ACHI; 2001 and 2004.

2,191,288 2,192,804

391,594 455,798

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

2001 2004

Nu

mb

er

of

all A

rkan

san

s

Uninsured

Insured

85% 83%

15% 17%

0%

20%

40%

60%

80%

100%

2001 2004

Perc

en

t of

all A

rkan

san

s

Uninsured

Insured

Percentage of uninsured Arkansans by age group and gender (2004)


19–64 yr

uninsured = 24%

10%

30%17% 2%

0%

20%

40%

60%

80%

100%

0–18years

19–44years

45–64years

65+years

Perc

en

t b

y a

ge g

rou

p o

f all A

rkan

san

s

Insured

Uninsured

0–18 yr9.2%

19–64 yr40.1%

65+ yr1.0%

65+ yr0.3%

19–64 yr42.8%

0–18 yr6.6%

Females (50%)

Males(50%)

19–64 yearsUninsured = 24%

Impact of Self-Pay (Uninsured) Patients on Hospitals, 1999-

2003Indicator 1999 2000 2001 2002 2003 Percent Increase

Number of Self-Pay Patients Admitted

17,815 20,545 26,843 28,899 30,063 68.75%

Self-Pay As Percent of all Patients Admitted

4.90% 5.50% 6.80% 7.30% 7.01% 43.06%

Total Uncovered Charges ($ Million)

$151 $168 $248 $307 $354 134.50%

Uncovered Charges As Percent of All Charges

3.99% 4.11% 5.25% 5.89% 5.63% 41.10%

Current Activities• Roundtable meetings ongoing

• Market reforms / expansion options

• Expanded eligibility for Arkansas Medicaid– Children

– Pregnant women

• Arkansas Health Data Initiative

• Joint Interim Committee on Health Insurance / Prescription Drugs

• Arkansas State Teachers / State Employees Health Insurance Plan

• Arkansas Safety Net Benefits Program

Heath care made available for small businesses

Tuesday, Mar 7, 2006Little Rock -- Mar. 7 -- Gov. Mike Huckabee announced a new state and federal partnership that will allow hundreds of small businesses in Arkansas to offer health coverage to their employees. The governor made the announcement Tuesday during

a news conference at the State Capitol.

“There is no doubt that one of the most serious problems facing our state is that most small businesses simply cannot afford health coverage for the workers who most need it," said Huckabee. "If we are going to promote a culture of health and lifestyle changes, we

have to make health coverage available to more businesses and more families.”

The U.S. Department of Health and Human Services approved of the waiver for the program which was designed by the Arkansas Department of Health and Human Services and the Arkansas Center for Healthcare Improvement. Building on the success of the ARKids First program, the waiver expands state health coverage for uninsured children to now include uninsured adults who are

employed.

"The health care needs of hard-working Arkansans are not being met," said Dr. Joe Thompson, director of the Arkansas Center for Healthcare Improvement. "This new partnership between small employers and government will provide coverage and protect our most

valuable asset, which is the health and productivity of our citizens."

The program is targeted at businesses with fewer than 50 employees that have not offered health care coverage in at least one year prior to enrollment. Funding for the program is provided by fees collected from participating employers, state tobacco settlement funds

and federal matching funds.

Enrollment in the program is expected to begin in 2007. Employers seeking information about the program should call (501) 682-8946 or go to the DHHS web site at www.arkansas.gov/dhhs.

Arkansas waiver timeline

• 10/02 – waiver concept paper submitted

• 1/03 – waiver application submitted

• 1/03 – 3/06 – negotiations

• 3/06 – waiver approved

• 7/25/06 – RFP released

• 9/06 – Legislative approval

• 10/06 – Employer recruitment begins

• 11/06 – Employee enrollment

• 1/07 – Coverage initiated

Details of the Arkansas Strategic Plan to follow

• Kevin W. Ryan JD, MA

Associate Director• Arkansas Center for Health Improvement

Assistant Professor• UAMS College of Public Health

501.526.2244

[email protected]

www.achi.net

Documents

A review of incremental state reforms to expand coverage in Arkansas Presenter: Kevin W. Ryan JD, MA Associate Director SCI Workshop for State Officials