Medicaid Expansion in South Carolina: Why Access to Health Care Matters

Transcription

1 Medicaid Expansion in South Carolina: Why Access to Health Care Matters Katherine Record, JD, MPH, MA Senior Fellow Center for Health Law and Policy Innovation of Harvard Law School March 2013

2 OUTLINE Part 1: From Status Quo to the Affordable Care Act Part 2: Medicaid Expansion: South Carolina Implementation Challenges and Opportunities Part 3: Massachusetts Case Study: a Preview of the ACA s Impact

3 Part 1: From Status Quo to the Affordable Care Act

4 Where We Are: Status Quo = Access to Care Crisis Group Private health insurance is largely through employment and doesn t work for the unemployed or many part-time or low wage workers Individual Private health insurance is too expensive for most and often excludes those with pre-existing conditions Medicaid/ Medicare are lifelines to care, but disability standard means they are very limited 20% uninsured in South Carolina Discretionary programs don t keep pace with growth in demand

5 Rising Rates of Uninsured See: aspx?version=print

6 South Carolina: One of the Highest Rates of Uninsured in the Country

7 Affordable Care Act: Private Insurance Reforms Reduce Discriminatory Insurance Practices Cannot be denied insurance because of preexisting health condition, even if you don t currently have coverage (2014) Health plans cannot drop people from coverage when they get sick (in effect) No lifetime limits on coverage (in effect) No annual limits on coverage (2014)

8 ACA Promotes Access to Subsidized Private Insurance through Exchanges in 2014 Consumer-friendly Exchanges to purchase private insurance South Carolina will have a federally run Exchange Federal subsidies for people with income between % FPL (Up to ~$44K for an individual/~$92k for family of four) Plans cannot charge higher premiums based on gender or health Plans must include Essential Health Benefits

9 ACA Includes a Comprehensive Essential Health Benefits Package ACA Essential Health Benefits Ambulatory services Emergency services Hospitalization Maternity/newborn care Mental health and substance use disorder services Prescription drugs Rehabilitative and habilitative services Laboratory services Preventive and wellness services and chronic disease management Pediatric services For All Newly Eligible Medicaid Beneficiaries For Most New Individual and Small Group Private Insurance Beneficiaries

10 South Carolina: Federal Exchange South Carolina did not create a state exchange or opt to control part of a federally facilitated exchange Federal government will be responsible for plan management and consumer assistance - Plan Management includes: responsibility for all qualified health plan certification, management, oversight, monitoring and marketing - Consumer Assistance includes: overseeing the Navigator program, and providing other in person assistance to consumers Federal government is responsible for exchange web site and consumer hotline

11 Increased Medicare Drug Coverage & Free Preventive Services Part D donut hole phased-out by % discount on all brand-name prescription drugs Free preventive services E.g., mammograms, colonoscopies, other cancer screenings; diabetes screenings; tobacco cessation counseling; pre-natal care; alcohol abuse screening & treatment; depression and obesity screening & counseling; STI testing; vaccinations

12 Expanded & Improved Medicaid Income based eligibility - up to 138% FPL (~$15K for an individual; ~$32K for family of four) No longer need to be disabled before getting care Every low-income U.S. citizen and legal immigrant (after 5 years in U.S.) automatically eligible in Expansion states Expansion = optional, but fully federally funded for first 3 years; 90% federally funded thereafter

13 Improved Medicaid: Primary Care Providers, Health Homes, Free Preventive Services Increased reimbursement for primary care providers (up to Medicare reimbursement rate) for 2013 and 2014 State option to provide cost-effective, coordinated and enhanced care and services to people living with chronic medical conditions through Medicaid Health Home Program (90% federally funded for all Medicaid beneficiaries for 2 years) State option to provide free preventive services (increased federal funding) E.g., mammograms, colonoscopies, other cancer screenings; diabetes screenings; tobacco cessation counseling; pre-natal care; alcohol abuse screening & treatment; depression and obesity screening & counseling; STI testing; vaccinations Children - pediatric visits, vision and hearing screening, developmental assessments, immunizations and obesity screenings

14 Affordable Care Act: Tremendous Potential to Reduce Costs & Improve Outcomes; Requires Successful Implementation Medicaid: Expands eligibility (state option); provides essential health benefits (EHB) (federal and state regulations); improves reimbursement for PCPs (only ); health home (state option); free preventive services (state option for Medicaid) Private Insurance Exchanges: Subsidies if living b/w 100% - 400% FPL (federal and state regulation); eliminates premiums based on health/gender; guaranteed EHB (federal and state regulation); outreach, patient navigation and enrollment (federal and state regulation)

15 Part 2: Medicaid Expansion: South Carolina ACA Implementation Challenges and Opportunities

16 Medicaid Expansion Would Provide Early Access to Health Care to Low-income Individuals & Families Red = Uninsured Low-income Adults; Covered by Medicaid Expansion at Nearly Entirely Federal Expense South Carolina DHHS, Medical Affairs Committee Affordable Care Act PowerPoint,11/28/12

17 Challenge: Social Determinants of Health, Not Access to Care, Drive Disparities in SC Anthony Keck, SCAAP Conference SSDHHS View on Medicaid, July 29, 2012

18 Social Determinants of Health are the Biggest Cause of Health Disparities Social Determinants of Health: Jobs, education, nutritious food, safe housing, transportation, clean environment, access to culturally appropriate HC providers Differential Access to Social Determinants Create Health Disparities: Different health outcomes based on race, ethnicity, income, gender, sexual identity and orientation, disability status, geographic location (rural and urban) But determinants of health are intertwined with access to care Would you give up your insurance? State Legislators wouldn t

19 Expansion Directly Addresses Health Disparities Keck: [W]e are working to increase value by increasing efficacy and reducing cost per person through three major strategies: payment reform, clinical integration and targeting hotspots and disparities. Rather than indiscriminately expanding coverage based on income, it is our intent to layer Medicaid on top of other state and local government agency and private resources to address geographic, population and disease hotspots to improve health where it is needed most. Anthony Keck, South Carolina s View: the Affordable Care Act s Medicaid Expansion is the Wrong Approach, HealthAffairs Blog (Sept. 6, 2012)

20 SC s Disease Hot Spots are the Areas with Highest Uninsured Keck s Disease Hot Spots Distressed & Highly Distressed Tax Zones (Lowest Average Household Income) Anthony Keck, South Carolina s View: the Affordable Care Act s Medicaid Expansion is the Wrong Approach, HealthAffairs Blog (Sept. 6, 2012) Haynsworth Sinkler Boyd PA, 2012, available at

21 Being Uninsured Results In Delayed Medical Treatment South Carolina Public Health Institute, A Report on the Uninsured and Underinsured in South Carolina, August 2009

22 Early Access to Comprehensive Health Care Matters Improves overall physical, social and mental health status Prevents disease and disability Leads to detection and treatment of health conditions Improves quality of life Reduces preventable death Increases life expectancy Uninsured people are less likely to receive medical care, more likely to have poor health status, and more likely to die early See:

23 Continuous Access to Healthcare Reduces Disparities and Costs People with a usual source of care have better health outcomes (reducing health disparities!) and at lower cost Having a regular primary care provider increases the likelihood that a patient will receive appropriate care Access to evidence-based preventive services prevents illness by detecting early warning signs or symptoms before they develop into a disease and detects disease at an earlier, and often more treatable, stage See:

24 * Li Rui, et. al., Cost-Effectiveness of Interventions to Prevent and Control Diabetes Mellitus: A Systematic Review, 2010; ** Paul McCrone, Cost-effectiveness of an early intervention service for people with psychosis, 2010; *** William Weintraub, Value of Promordial and Primary Prevention for Cardiovascular Disease, 2011; **** E Long, et. al., The Cost-Effectiveness and Population Outcomes of Expanded HIV Screening and Antiretroviral Treatment in the United States, 2010 Early Intervention is Cost-Effective & Improves Individual and Public Health Outcomes interventions to prevent/control diabetes are costeffective and evidence-based* Early intervention for mental illness is highly costeffective when compared with standard care** pharmacological treatment of risk factors can prevent heart attacks and strokes*** increased screening and increased access to treatment could avert 300,000 HIV infections (17% - 24%) over 2 decades****

25 Challenge: Medicaid Expansion Merely Inflates a Broken Healthcare system [E]xpansion will hurt the poor, hurt South Carolina, and hurt the country by doubling down on a system that already delivers some of the lowest value in the world - Keck, Director, DHHS The primary cost-driver is the size of the Medicaid population. Senator Tom Davis Anthony Keck, South Carolina s View: the Affordable Care Act s Medicaid Expansion is the Wrong Approach, HealthAffairs Blog (Sept. 6, 2012) Columbia, We Have a Problem, FitsNews (Oct. 25, 2012)

26 Medicaid Expansion is a New Program We are creating a whole new Medicaid program, while maintaining the existing disability program. Expansion is not disability program. It is a prevention-based early access to affordable health care program.

27 Current Medicaid Program = Disability Program (Not a Health Care Program for Low-income Uninsured) % of Medicaid Expenditures by Type of Service Kaiser Family Foundation. Analysis of 2007 MSIS data provided by the Urban Institute

28 Expansion is Not Just for the Unemployed / Disabled: SC Workers and Small Business Owners are Increasingly Uninsured & Will be Eligible South Carolina Public Health Institute, A Report on the Uninsured and Underinsured in South Carolina, August 2009

29 Being Uninsured is Not a Short-Term Problem South Carolina Public Health Institute, A Report on the Uninsured and Underinsured in South Carolina, August 2009

30 There is Time to Give Expansion a Trial Run House Democrats proposed expansion with a mandatory reauthorization before 2017, when the 100% federal match rate ends Would allow for cost efficacy analysis Kirk Brown, SC House Republicans Reject Democrats Effort to Expand Medicaid Program, IndependentMail (March 12, 2013)

31 Challenge: We Need to Shift Resources, Not Spend More If more money and more government produced healthier citizens, Americans should be the healthiest population on the planet but we re not. SC House Speaker Bobby Harrell There is sufficient money currently in the health care system -- we need to do the hard work to shift it from non-productive to productive uses. -DHHS Director Tony Keck Adam Beam, SC House Rejects Medicaid Expansion, Island Packet (March 12, 2013) Anthony Keck, South Carolina s View: the Affordable Care Act s Medicaid Expansion is the Wrong Approach, HealthAffairs Blog (Sept. 6, 2012)

32 The US Spends More than Other High-Income Countries, with Far Worse Outcomes Average per capita health spending % of GDP In all other industrialized democratic countries, costs are lower & outcomes are better because every citizen is guaranteed access to health care

33 SC Plan is to Continue Down the Path That s Not Working: Medicaid Expansion June Percent Change in Medicaid Enrollment The Kaiser Family Foundation, statehealthfacts.org. Data Source: Kaiser Commission on Medicaid and the Uninsured. CHIP Enrollment: June 2011 Data Snapshot, Medicaid Enrollment: June 2011 Data Snapshot

34 This Path is Hurting the State South Carolina moved from 41st to 46th in United Health Foundation s America s Health Ranking survey Past Decade: The uninsured population grew from 15.4% in 1994 to 21.3% in 2012* The % of obese adults jumped from 22% to 32% The number of people with diabetes rose from 7.1% to 10.7 % Increase in rates of uninsured vary by survey but all show a significant rise in un-insurance in SC from 1995 to Data shown based on US Census Data (1995) and Gallup Poll Data See:

35 Challenge: United States in Debt We Cannot Afford Expansion Federal government has $16.6 trillion debt If federal matching rate drops below 90%, SC will assume higher cost of expansion than estimated Many states share this concern, and are expanding with explicit opt out provision South Carolina can expand without committing to ever fund more than 10% of the expansion

36 FY2013 Alternative to Expansion Would Drive State Further into Deficit Gov. Haley & House Republicans propose spending $83 million to avoid expansion would go to hospitals as incentive to divert ER patients into free clinics They are going to spend $80 million and insure no one. We are going to spend zero dollars and insure half a million people. Rep. Rutherford (D) Kirk Brown, SC House Republicans Reject Democrats Effort to Expand Medicaid Program, INDEPENDENT MAIL (March 12, 2013). Adam Beam, Exclusive: SC Democrats Push 3-Year Test of Medicaid Expansion, THE STATE (March 9, 2013)

37 Medicaid Expansion Brings Significant Federal Funding to South Carolina South Carolina v. Federal Medicaid Expansion Spending Based upon best estimate participation. Source: Milliman ACA Impact Analysis 12/3/12

38 With or Without Medicaid Expansion, Federal Reimbursement for Uncompensated Care Will Decline ~$14 billion decline over 5 years Rising cost of uncompensated care in non-expansion states will be detrimental to the economy. - Republican Gov. Brewer, AZ Source: National Association of State Mental Health Program Directors, 2012

39 Lack of Insurance Leads to Uncompensated Care in Hospitals and Free Clinics South Carolina Public Health Institute, A Report on the Uninsured and Underinsured in South Carolina, August 2009

40 Without Expansion, Premiums Will Rise for all South Carolinians If SC doesn t expand Medicaid, SC costs will increase hospitals will have to pass cost of uncompensated care on to privately insured patients If you ve got a private insurance card in your pocket, look for your premiums to go up. Rep. Harry Ott Adam Beam, Exclusive: SC Democrats Push 3-Year Test of Medicaid Expansion, THE STATE (March 9, 2013)

41 Without Expansion, Employers Will Face Higher Tax Penalty for Failure to Offer Coverage Tax penalty: If large employer (50+ full time employees) doesn t offer affordable minimum essential coverage (employee share < 9.2% of income; plan covers at least 60% cost of HC services) Tax = $2,000 / employee who gets federal subsidy to buy individual coverage on exchange if no coverage offered; $3,000 if inadequate coverage offered Without Expansion: workers earning % FPL are eligible for exchange subsidy; if on Medicaid, employer would not be taxed

42 Expansion is the Fiscally Conservative Option We have an obligation to provide an adequate level of basic health care services for those most in need in our state. However, we also have an obligation to ensure our state s financial security. -New Mexico Gov. Martinez (R) New Mexico Medicaid Expansion Will Move Forward, Republican Gov. Susana Martinez Announces, HuffPost Business (Jan. 10, 2013)

43 Challenge: If Economy is Improving, Medicaid Enrollment Should not be Increasing Many newly eligibles are working FULL TIME, or senior citizens (currently choosing between paying utilities or filling prescriptions) Gov. Haley visiting her mother in the hospital as the House debated Expansion tweeting her gratitude that House Republicans were fighting to protect South Carolina from the looming public policy nightmare and fiscal disaster that is ObamaCare s Medicaid expansion 54% of Seniors in South Carolina support Expansion Adam Beam, Exclusive: SC Democrats Push 3-Year Test of Medicaid Expansion, THE STATE (March 9, 2013) Kirk Brown, SC House Republicans Reject Democrats Effort to Expand Medicaid Program, Independent Mail (March 12, 2013)

44 Challenge: Economic Benefits of Expansion are Not Important Growth in health care sector employment should not be a goal of health reform. - Keck Over $14 Billion in federal dollars will flow into South Carolina through the Medicaid expansion. It will result in significant increases in new business activity and job creation (40,000 new jobs) Adam Beam, Exclusive: SC Democrats Push 3-Year Test of Medicaid Expansion, THE STATE (March 9, 2013) Anthony Keck, South Carolina s View: the Affordable Care Act s Medicaid Expansion is the Wrong Approach, HealthAffairs Blog (Sept. 6, 2012)

45 Federal Money has a Multiplier Effect on State Economies Every $1 billion federal Medicaid investment generates up to $4.7 billion in new business activity and nearly 47,000 new jobs in SC Most conservative estimate of effect: state s $1.5 billion cost estimate from and only a 2:1 multiplier effect: $29B in new federally funded business activity Hundreds of thousands of new jobs * Klein, et al, Medicaid: Good Medicine for State Economies, May 2004, using Milliman ACA Impact Analysis Data, December 2012

46 If South Carolina doesn t expand Medicaid, South Carolinians federal tax dollars will go to states that do

47 We try to leave the politics out in the hallway when we make these decisions. In the end, it comes down to are you going to allow your people to have additional Medicaid money that comes at no cost to us, or aren t you? We re thinking, yes, we should. New Mexico Gov. Dalrymple (R) Jeffrey Young, North Dakota Medicaid Expansion Favored by Republican Governor, HUFFPOST BUSINESS (Jan. 15, 2013)

48 [W]e can bring our tax dollars back to Missouri to strengthen Medicaid and reduce costs for employers and families, or we can send these dollars to other states and see these costs skyrocket. If we fail to act, those jobs and those investments will go to those other states: they ll get the benefit, we ll get the bill. - Missouri Gov. Nixon (R) Press Release, During Visit to Warrensburg Chamber, Gov. Nixon Discusses Plan to Protect Taxpayers, Create Jobs by Strengthening Medicaid (March 15, 2013).

49 Moral Obligation to Support the Poor It is our moral obligation, it is a duty that all of us are bound, because we are Christians, we believe in God and God tell[s] us to treat the least of these as you would him. Denying them access to health care, denying them insurance, is not how anyone should be treated. SC House Minority Leader Todd Rutherford I know it s controversial. [But] we re not ignoring the weak the Lord doesn t want us to ignore them. Ohio Gov. Kasich (R) Adam Beam, SC House Rejects Medicaid Expansion, ISLAND PACKET (March 12, 2013) Joe Vardon, Kasich Implores GOP to Expand Medicaid, Columbus Dispatch (Feb. 20, 2013)

50 Part 3: Massachusetts: A Preview of the Impact of the Affordable Care Act

51 Massachusetts: A Post Health Care Reform State in a Pre-Reform Country Expanded Medicaid to individuals living with HIV living at or below 200% FPL (2001) Heavily subsidized insurance for individuals living at or below 300% FPL (2006) Robust Medicaid benefits just like ACA Massachusetts = Window into Impact of ACA

52 Expansion Improve Health Outcomes Notes: MA outcomes are based on Massachusetts and Southern New Hampshire HIV/AIDS Consumer Study Final Report, December 2011, JSI Research and Training, Inc.; National outcomes are based on Cohen, Stacy M., et. al., Vital Signs: HIV Prevention Through Care and Treatment United States, CDC MMWR, 60(47); (December 2, 2011); For both MA and national outcomes, the percentages used are taken from a baseline of those infected, using the same estimated percentage diagnosed (82%) both nationally and for Massachusetts, based on the MMWR. The definition of In Medical Care may differ slightly between the MA data and the MMWR.

53 Expansion Reduces New Infections and AIDS Mortality Percent Change in HIV Diagnoses and Death Rates (MA v. U.S.) 10% 0% -10% -20% 2% MA U.S. -30% -40% -25% -33% -50% -44% Percent Change in HIV Diagnosis Rate ( ) Percent Change in HIV Death Rate ( ) Sources: MA Dept of Public Health, Regional HIV/AIDS Epidemiologic Profile of Mass: 2011, Table 3; CDC, Diagnoses of HIV infection and AIDS in the United States and Dependent Areas, 2010, HIV Surveillance Report, Vol. 22, Table 1A; CDC, Diagnoses of HIV infection 53 and AIDS in the United States and Dependent Areas, 2008, HIV Surveillance Report, Vol. 20, Table 1A.

54 Expansion Reduces Costs reforms reduced HIV health care expenditures by ~$1.5 billion in past 10 years (MA DPH) Source: MA Office of Medicaid, data request

55 Applying MA Experience to South Carolina HIV Epidemic 16,378 South Carolinians living with HIV in 2010 (nearly 20,000 including undiagnosed) 38% of diagnosed received NO medical care in ,697 received prescription drugs through ADAP in 2010 ($27,856,243) 1,428 (39%) will be newly eligible for Medicaid 1,091 (30%) will be eligible for subsidies on exchange HEALTH RESOURCES AND SERVICES ADMINISTRATION, US DEPT HEALTH & HUMAN SERVICES, South Carolina SOUTH CAROLINA RYAN WHITE 2012 STATEWIDE COORDINATED STATEMENT OF NEED AND COMPREHENSIVE PLAN (June 2012) NATIONAL ALLIANCE OF STATE & TERRITORIAL AIDS DIRECTORS, NATIONAL ADAP MONITORING PROJECT ANNUAL REPORT (Aug. 2012)