Earlier this month, Representative Hullinghorst, the Speaker of the Colorado House of Representatives, appointed Jay to the Connect for Health Colorado board of directors. Jay and I have always worked as a team, and we’re honored and excited to have the opportunity to help guide the exchange going forward. We welcome feedback from the rest of the broker community in Colorado, and look forward to bringing a hands-on broker voice to the exchange board.
Jay has been working with Connect for Health Colorado since the exchange first went live in the fall of 2013. He helps clients enroll, figures out work-arounds when glitches arise, and works with our clients to sort out problems and questions that arise after their coverage is in force. The majority of our business has been on the individual market for more than a decade, so Connect for Health Colorado (which primarily serves the individual market) is a major part of what Jay does, day in and day out. He’s got a very in-depth understanding of how the exchange works, and where it has strengths and weaknesses.
Jay’s first meeting as a member of the board was yesterday, and he presented a variety of issues for consideration:
1. The fact that Connect for Health Colorado’s plan browsing tool displays catastrophic plan options in the plan results for a 30-year-old (30-year-olds are only eligible for catastrophic plans if they’ve got a hardship exemption – the browse tool should only return catastrophic plan options for applicants up to 29 years old).
2. The fact that Colorado has such low uptake of cost-sharing subsidies. Cost-sharing subsidies are only available to applicants with incomes up to 250% of the poverty level, and they’re only available if those applicants select a “silver” plan. In Colorado, 26.9% of exchange enrollees are receiving cost-sharing subsidies. Obviously, states with higher average incomes will see fewer people qualifying for cost-sharing subsidies, since they only apply to enrollees with incomes up to 250% of poverty. And also, states that have expanded Medicaid should be expected to have a lower percentage of exchange enrollees eligible for cost-sharing subsidies, since eligibility in Medicaid expansion states (like Colorado) is limited to incomes between 133% and 250% of poverty, whereas in states that have not expanded Medicaid, eligibility for cost-sharing subsidies runs from 100% to 250% of poverty.
Fourteen states (plus DC) have higher average household incomes than Colorado. Of those fourteen states, only four have not expanded Medicaid (AK, WY, UT, and VA). The other eleven have the same eligibility guidelines for cost-sharing subsidies as Colorado, and they all have higher average household incomes.
And yet only three states had lower cost-sharing subsidy uptake than Colorado: MN, VT, and DC.
VT and DC both have a very clear explanation though. In both cases, individual market plans are only available through the exchange. There is no off-exchange market in VT or DC. So everyone – including higher-income enrollees who don’t qualify for any subsidies at all – shops in the exchange.
So realistically, that leaves only MN with lower apples-to-apples uptake of cost-sharing subsidies than Colorado. And among most of the more wealthy states, cost-sharing subsidy uptake was significantly higher than it is in Colorado. EDIT: Thanks to Andrew Sprung of xpostfactoid for reminding me that Minnesota has implemented a Basic Health Program that covers people with incomes up to 200% of the poverty level. So the only people in MN who are eligible for cost-sharing subsidies are those in the 200% to 250% of poverty range, and cost-sharing subsidies are minimal at that level.
Silver plans are particularly important to combat the problem of “underinsurance,” and they make it much more realistic for lower-income enrollees to actually use their health insurance. But if applicants are enrolling without a broker or health coverage guide, the Colorado exchange doesn’t do a lot to guide eligible enrollees towards silver plans. There’s no pop-up warning if an eligible enrollee puts a bronze plan in the shopping cart instead of silver (bronze plans are cheaper, but they don’t come with cost-sharing subsidies, regardless of income). The default is to display plans based on premium, from lowest to highest. So to see silver plans, applicants who are eligible for cost-sharing subsidies have to scroll through many of the bronze plans first. Many other exchanges and healthcare.gov have taken steps to guide eligible enrollees towards silver plans, but Colorado has not. And it shows in our enrollment numbers.
EDIT: To be fair, Connect for Health Colorado also has a significantly lower rate of premium subsidy eligibility than most other states. The exchange is doing an excellent job of attracting higher-income enrollees who could otherwise shop outside the exchange. But the fact remains that with some minor tweaks to the enrollment software, we could make the availability of cost-sharing subsidies more obvious to applicants, and more efficiently steer eligible enrollees towards silver plans.
3. During the 2015 open enrollment, Connect for Health Colorado’s website had a design flaw that would disenroll insureds (who had been told their plan would auto renew) if they shopped around and put a different plan in their shopping cart. Although they had been notified that their accounts were eligible for auto-renewal, the act of simply putting a plan in the shopping cart would essentially turn off the auto-renewal that had been scheduled for 1/1/15. So even if they didn’t end up buying the alternate plan, their existing plan terminated at the end of 2014 instead of auto-renewing. Since the customers didn’t complete the check-out process for their new plans (thinking they were opting instead to just keep their existing coverage), they were left with no coverage at all when January rolled around. This happened to some of our clients, and although Jay was eventually able to get it fixed, it was a mess at the time. Jay brought this up at yesterday’s board meeting, noting how important it is to make sure that this issue is fixed before the next open enrollment period starts on November 1. If an insured would like to disenroll from their plan, they should not only need to click a button that says “disenroll”, but they should also be presented afterwards with a prompt requiring them to confirm that is what they want to do.
4. Jay also mentioned some ideas the state could consider if it ends up submitting a 1332 innovation waiver under the ACA. He mentioned adding copper plans, as well as the possibility of adjusting the three month grace period for enrollees who are receiving premium subsidies. This issue has caused considerable – and understandable – backlash from providers who are worried that they’ll be left holding the bag if the insureds don’t ultimately end up paying their past-due premiums. Insurers can pend claims during the second and third month of the grace period, or can require providers to pay back reimbursements that are made during that time if the policy ends up lapsing at the end of the three months. The three month grace period makes sense from a continuity of coverage standpoint. Since loss of coverage due to non-payment of premiums doesn’t trigger a special enrollment period, an insured whose coverage lapses is not eligible to enroll again until open enrollment comes around. So it’s a good idea to give people three months to get caught up on their premiums in order to avoid coverage lapses. But maybe it would be more logical to treat the policy for all intents and purposes as if it has been terminated when the premiums are 30 days past-due. When providers called in to check the status of the coverage, it would show as “not in force” and there would be no grey area for providers. But the insureds would still have three months to get caught up on their past-due premiums and reinstate their coverage.
Jay is looking forward to working closely with the rest of the board and Connect for Health Colorado’s leadership. The fact that we have a state-run exchange already puts us among the front of the pack, since most states simply use Healthcare.gov and leave the details up to HHS. Colorado has taken an active role in shaping healthcare reform at a state level, and we’re proud to have been part of that process over the last several years – and to continue it going forward.
We welcome feedback from the rest of the Colorado broker community, as well as our clients. And thanks for all the supportive comments we’ve received following Jay’s appointment to the board.