Navigating the ACA Exchange Environment: A Customer Perspective
June 21, 2011
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Topics of Discussion
• Introductions
• Health Insurance Exchanges (HIXs/Exchanges) in operation and in the Affordable Care Act (ACA)
• Impacts on Community-Affiliated Plans and Lessons Learned
• What’s happening now—and looking forward
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Introductions
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Bringing Innovation to a Changing Payer Market
• Support the creation of a sustainable insurance marketplace for individuals, employers, and employees
• Help payers navigate uncertainty by identifying opportunities and risks
• Support alignment of core business functions with the Exchange environment
• Provide policy and technology consulting to state governments
• Help commercial and Blue Cross Blue Shield customers transition to a consumer-centric model
• Facilitate Web-based transactions among all constituents to strengthen relationships
We support more than 100 insurers, and the only operating Exchange in the industry, with standard and custom solutions.
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Dell Services Capabilities From product support to business solutions, we help our customers achieve their business outcomes.
• Document Management
• Data Capture
• Knowledge-Based and Transaction Processing
• Contact Center
• Engineering Services
Business Process
Business Process Services
Consulting
• End User
• Data Center
• Enterprise Architecture
• Data Center Infrastructure
• End-User Computing
• Data Management
• Business Continuity/ Disaster Recovery
IT Consulting
• Strategy and Transformation
• Organizational Change Management
• Process Reengineering
• Supply Chain Management
• Customer Relationship Management
Business Consulting
• Hardware Warranty
• ProSupport
• Accidental Damage
• Value-Added Services
Support
Support Services
• Custom Development
• Testing
• Applications Management
• ERP and Industry Applications
• Business Intelligence
• Modernization
Applications
Applications Services
Infrastructure
• End User
• Data Center
• Network
Configuration and
Deployment
• Virtual Desktop
• Virtual Data Center
• X-as-a- Service (Platform, IT, Mgt. S/W, Apps, Software)
Cloud Services
• End User
• Data Center
• Hosting
• Information Assurance
• Network
Infrastructure Managed Services
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Denver Health & Hospital Authority
Mission
To provide access to the highest quality of health care, whether for prevention or acute and chronic diseases regardless of ability to pay.
“Level One Care for All”
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Denver Health & Hospital Authority
• Academic, community based, integrated health system, located in Denver, Colorado
• Political subdivision of the State of Colorado
• Since 1860, DHHA has served as Colorado’s “safety net” healthcare system and has provided care to Denver’s most vulnerable populations
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Denver Health Medical Plan, Inc.
• Established in 1997 as a non-profit HMO, a wholly owned subsidiary of Denver Health & Hospital Authority
• Created to fill a need for affordable healthcare
• Product portfolio includes: Commercial, Medicare, Child Health Plan Plus and Medicaid Choice
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Health Insurance Exchanges in both operation and the Affordable Care Act (ACA)
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Changes to Healthcare We are currently facing the greatest changes to healthcare in more than a generation and Exchanges are at the heart of those changes.
New records regarding the number of covered lives
New member demographics
New channel partners
New market mechanism
New product designs
New rules for managing members
New budget hit for states
Health Insurance Exchange
11 Confidential Services
Initial Health Insurance Exchange Implementation Timeline
2010 2011 2012 2013 2014 2015 2017
HHS to certify states on-target for Exchange operation; Exchanges go live for open enrollment
Ban on large-group participation ends
Federal subsidy for Exchange operations ends
Exchanges go-live for full operations; Individual and Employer mandates and low-income tax credits begin
Plan and Engage Design and Build Certify and Launch Operate and Sustain
Innovator grants awarded; Level I and II build grants announced; Initial vendor RFPs out
Establishment of non-profit insurance co-ops to compete with commercial plans
$1M planning grants awarded; Initial guidance from CMS
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Goal of the Exchange Create a sustainable insurance marketplace for individuals, employers and employees
Create
Sustain
Insurance
Marketplace
Individuals
Employers/ Employees
• Launch a multi-channel (paper/phone/web) marketplace, with all necessary front and back-end infrastructure
• Develop an approach that is attractive to all stakeholders and is easy to use, meets federal and state requirements and generates sufficient revenue
• Certify plans as meeting Exchange coverage and access requirements
• Support (and even drive) competition among plans and provide a choice to consumers (individual and small group members) and employers
• Use competition to promote choice, quality of plans and providers while reducing costs
• Use competition to promote choice, quality of plans and providers while reducing costs
• Make it easy for employers to contribute to and support their employees’ health
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What is an Exchange and Who Comes Closest Today?
PPACA Requirements for American Health Benefit Exchange (AHBE—Individual) Utah Mass
Provide both an individual and a small group insurance exchange website (or portal)
Certify health plans that participate in the Exchange
Present plan options in a standardized way (i.e., Platinum, Gold, Silver, Bronze)
Provide web resources (i.e., cost calculator) and toll-free call center support to users
Administer the exemption process for individual mandates
Determine eligibility and enroll applicants in Medicaid/SCHIP
Determine eligibility for new tax credits and cost-sharing reductions for persons with income 100-400% FPL
Facilitate advance payments by Treasury to insurers of individual premium assistance tax credits
Determine if employer-sponsored insurance is “affordable,” and if individuals with access to employer-sponsored coverage are eligible to purchase insurance via the Exchange
Receive and process “free choice” vouchers for employees with unaffordable employer-sponsored coverage
Operate a consumer assistance (or “Navigator”) program
Report user and employer data to Treasury
Generate sufficient revenue to be self-sustaining by 2015
Fully meets Mostly meets Partially meets Minimally meets Does not meet or NA
Currently meets or performs a similar function:
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States will Use Flexibility from CMS to Tailor the Exchange that Best Meets Their Needs
Light Pragmatic Robust
• Lighter regulatory role • More “free market” by
promoting economic growth
• Satisfied with level of competition and quality
• More developed policy infrastructure
• Thinking beyond traditional (e.g., regional exchange)
• Highly developed policy and regulatory model
• Tradition of leadership and oversight
• Use to promote policy goals
• May receive waiver to create a simpler vision
• Primarily aggregates information
• Limited services to plans and members
• Some market management
• Commercial, off-the-shelf and low-risk solutions
• Remains flexible due to political shifts
• Active purchaser of insurance
• Standardized products • Robust functionality • Substantial support for
education and outreach
Sta
te
En
vir
on
me
nt
Exc
ha
ng
e
Ch
ara
cte
rist
ics
Utah? Maryland? California &
Massachusetts
Exchange Development Maturity Model
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Every Exchange will Go Through Some Version of Four Primary Phases
• Pass legislation • Assess capabilities
and market • Create road map
to 2014
• Select vendors • Design
architecture • Create standards • Develop risk
adjustment
• Obtain federal readiness
• Certify plans and products
• Engage consumers
• Market Exchange • Serve members • Monitor/regulate
performance
Phase 1: Plan & Engage (2011)
Phase 2: Design & Build
(2011-2013)
Phase 3: Test, Certify & Launch
(2012 – 2014)
Phase 4: Operate & Sustain
(2013 – 2014+)
• Provide input • Assess impact to
membership • Assess market/
characteristics of newly insured
• Provide input to design and architecture
• Create internal process/system change roadmap
• Make participation decisions
• Begin marketing • Prepare for
operations
• Enroll and serve members
• Receive and reconcile payment
Cri
tical A
cti
vit
ies
for
Exc
han
ge
C
riti
cal A
cti
vit
ies
for
Pla
ns
Impacts on Community-Affiliated Plans and Lessons Learned
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Payers Should Explore Opportunities and Challenges that Range from the Operational to the Strategic
People
• Understanding each other’s worlds
• Managing stakeholders
• New members that may be significantly different from current customers
Process
• Administrative simplification
• Plan certification
• Member enrollment
Technology
• New integration partners (e.g., federal government)
• New integration points
• New shopping portals
Strategy
• Rethink channel & distribution strategy
• Product portfolio
• Re-balance risk portfolio
• Re-define business model
This is a significant opportunity to collaborate and join with states eager to test new strategies and reduce risk — take control now, or take the chance of losing it for good
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New Opportunities Are Created By Exchanges
Growing Existing Markets
• Individual members: – Newly insured
(subsidized and unsubsidized)
– Shift from employer-sponsored to individual
– Medicaid growth – Volume – States shifting to
managed care
• Small business: – Add coverage to
capture tax subsidies – Identify newly defined
contribution opportunities
Entering New Markets
• New lines of business: – Extend product
portfolio up or down the market
• New Populations: – Different member
types (family, invincibles)
• New geographic markets – Within the same state – New states
Engaging New Channels
• Self-service via the Exchange – Individuals shopping
for coverage – Small businesses
offering coverage, often for the first time
• Navigators helping individuals and small businesses shop
• Brokers via the Exchange
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Exchanges May Provide Opportunities to Reduce Costs
Enable and encourage self-service through Exchange web portal
Move more members to standard HIPAA transactions
Advocate for default enrollment within your products instead of churn when
changes in members’ life circumstances drive eligibility category shifts
Create products to ease transition across membership / subsidy categories
Align internal processes to support new members and shifts in eligibility
• Brokers • Employers • Individuals
• Support Exchange’s effort to seamlessly enroll members
• Lower cost of member acquisition • No “disenrollment” costs • Continue to recoup investment in medical
management
• Similar benefits • Similar networks
• Opt-out for electronic communications (e.g., paperless EOBs)
• Membership card updates • Eligibility inquiries from providers
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Significant Investment May Be Required to Operate in the HIX Environment Each plan should carefully assess its own corporate structure inclusive of operational, financial, and regulatory environment prior to committing to an Exchange.
Product Development
• Actuarial Support
• Regulatory submissions
• New product set-up (EOC, Contracts, etc.)
Marketing & Sales
• New channel set up
• New market segment communications
• Market outreach to uninsured
• Existing customer education
Operations
• New member set up
• Sending / Receiving HIPAA Transactions
• Benefit / Claims Payment Set –Up
Med Mgmt / Care Delivery
• Capacity management
• ER Triage development
• Medical home integration
Finance / Contracting
• Receiving / reconciling individual payments
• Revised / expanded provider contracting
• Reinsurance
Quality / Reporting
• HEDIS
• CAHPS
• NCQA (if required for participation)
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To be Successful, Plan Leaders Must Engage a Variety of Stakeholders
Health Insurance Exchange
State Government
Federal Government
Internal Stakeholders
Local Stakeholders
Exchange Vendor(s)
Brokers Members
Providers Employers
Plan Internal Stakeholders:
• Marketing & Sales
• Community Relations
• Product Development / Actuarial
• Operations
• IT
• Compliance / Legal
• Finance
• Medical Management
• Clinical Delivery (if appropriate)
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Churn Movement of members between eligibility categories/subsidy levels
Customer Service Continuity between call centers
Outreach Educating newly insured on how to use insurance
Risk Adjustment & Product Design Sustainable approved products
Biggest Challenges Identified at the Connector
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Lessons Learned from Massachusetts
• Plans tend to have lots of iterations – need to work from defined benefits while at the same time trying to innovate
• Don’t expect the Exchange to build around you
• Need to meet them halfway, and sometimes further
• Likely to be mostly healthy, but do not know how to use insurance
• Education and outreach, in partnership, will be critical
Overly Complex Plan Design
Unwillingness to Change
Siloed Customer Service Models
Misunderstanding the Newly Insured
• Understand what the Exchange governance model is trying to achieve
• Understand the challenges Exchange leadership/staff face
Undervaluing the Relationship
• There will be multiple challenges under the new model: they need to be solved together
• Leverage both call centers and web portals
What Plans Should Be Doing Now
Engage
Educate
Evaluate
Prepare
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What’s Happening Now—and Looking toward the Future
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What to Expect Over the Next Six Months
Continued uncertainty
Unpredictable implementation
progress at federal and state
level
State-specific agendas and
hybrid solutions are emerging
Heightened levels of
engagements and scrutiny
Helping small businesses and
job growth
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Planning for the “What Ifs” Helps Reduce Risk What if all or part of the Patient Protection and Affordable Care Act (PPACA) is blocked sometime between now and 2014?
Ways the law could be significantly “impeded”
• Defunded by GOP Congress
• Partially repealed or key provisions declared unconstitutional
• Fully repealed or entire law declared unconstitutional
What still exists if the law is impeded?
• Rising healthcare costs • Significant uninsured/
underinsured population • Stagnant quality • Badly fragmented
subsidized care/insurance • Powerful hospital/ACO
groups going directly to employers
• Strong political support for Exchanges on both sides at a national and local level
Ways an Exchange can still help
• States: – Provide an easy way to
apply subsidies – Encourage innovation by
carriers – Provide a counterweight to
consolidating hospital groups/ACOs
• Plans: – Capture a potentially very
attractive risk pool – Attract employers with
defined contribution health plans
– Grow share to increase leverage with providers
– Manage churn with appropriate “gap” products
How We Can Help?
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Dell Services Bringing Innovation to a Changing Health Payer Market
• Administrative application and outsourcing services
• More than 40 million members supported
• Business process services
• Implement open source technology solutions to increase efficiencies
• Aid disease management
• Help commercial and BCBS customers transition to a consumer-centric model
• Facilitate web-based transactions among all constituents to strengthen relationships
We support more than 100 insurers - and the only operating individual Exchange in the industry - with standard and custom solutions.
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Next Steps • Contact the Dell Services Payer Team with questions:
– [email protected] or
– Industry thought leadership: › Conference speakers (www.dell.com/speakers-bureau)
› Future webinars
– Insight
– Strategy
– Execution
• Attend the National ACAP meeting – The Fall Health Insurance Exchange Meeting, October 12-13,
Houston, TX
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Key Takeaways
This is potentially the biggest change in healthcare since 1965
There are both opportunities and risks for health plans in this change
The impacts of change will be felt across the health plan
Key implementation decisions will have to be made before political uncertainty is resolved
Plans can participate in this change or have it thrust upon them
Thank You LeAnn Donovan (303) 602-2001 [email protected]
Karl Haught, Jr. (303) 602-2004 [email protected]
Andy Arends (630) 708-2521 [email protected]
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