States that control their own insurance marketplaces – called state-based marketplaces (SBMs) – are leaders in providing affordability and choice, outperforming the federal marketplace on notable markers including higher enrollment, lower premium rate hikes, more participating issuers, and successfully attracting a young consumer base. These accomplishments are especially notable given recent federal policy actions that have unsettled insurance markets and a national rise in uninsured rates.
The success of SBMs results from years of hard work spent cultivating their markets while building operational and technical systems tailored to serve their states’ consumers. Thanks to the work of these SBMs and the evolution of new technology, it is now easier (and cheaper) for states currently using the federal platform to switch and adopt the SBM model.
As new states express interest in the SBM model, they can learn much from the leaders who have pioneered implementation of this model.
Earlier this month, the National Academy for State Health Policy (NASHP) hosted a webinar with SBM leaders from Idaho, Nevada, Massachusetts, and Washington, DC to showcase some of their lessons. Highlights are featured below, and a recording and slides from the webinar are available here.
Focus on the Basics (and Avoid Scope Creep)
SBMs provide more than “shop-and-compare” websites for consumers shopping for health insurance — SBMs are dynamic business enterprises. While their main objective is to make sure that individuals have “easy access to health coverage,” SBMs must also:
- Perform a series of complicated eligibility and enrollment functions easily;
- Work with the systems of partner organizations, including carriers, Medicaid, and outreach partners; and
- Be financially sustainable.
Rather than get carried away by bells, whistles, and complex policy aspirations, SBM leaders advise that future SBMs must first focus on building a functional, sustainable system. Once a working SBM is established with a long-term financing strategy, it can always grow and evolve to perform new functions.
Prioritize the Consumer Experience
Much of an SBM’s success depends on its ability to attract and retain consumers. Over the years, SBMs have worked diligently to improve the experience of its consumers. As Massachusetts Health Connector Chief of Policy and Strategy Audrey Gasteier explained, “Marketplaces require a lot of activity on the part of a consumer,” and it is important that consumers feel empowered. Outreach is a major component of this work — from providing educational materials to in-person assistance provided by brokers, Navigators, and certified application counselors. Earned press coverage and social media are also effective tools for SBMs to quickly spread the word about their products and policy changes at low cost. Speakers also noted the importance of call centers and recommended that states equip their centers with self-service capabilities so that consumers can easily resolve common issues over the phone.
Set Clear Expectations and Timelines
Heather Korbulic, executive director of Nevada’s SBM, presented an 18-month timeline for implementation of an SBM — from passage of enabling legislation to the marketplace’s first open enrollment period. While “out-of-the box” technology and adaptable systems make it easier than ever to for a state to build an SBM leaders cautioned states not to be too aggressive in their planning and timetables. As with any large-scale project, states should anticipate delays and challenges. For example, from the start states need to work closely with federal officials from the Center Consumer Information and Insurance Oversight (CCIIO) to establish their marketplace “blueprint.” While CCIIO experts serve as an important resource for states — providing years of technical and policy expertise to help guide states — implementation of an SBM requires strict federal oversight and approvals that may cause delays that are outside of the control of a state.
Throughout the SBM implementation process, leaders emphasized the importance of maintaining transparency so that stakeholders are not deterred by unexpected delays or issues. By keeping stakeholders informed of progress and expectations, an SBM will cultivate trust and maintain relationships critical to the marketplace’s long-term success.
Relationships Are the Foundation of an SBM
Any marketplace cannot function without engagement across a mix of stakeholders, which include:
- State policymakers who will establish the marketplace;
- Federal officials who will oversee and approve its implementation;
- Insurance carriers who will sell products through the marketplace; and
- Consumers whom the marketplace will serve.
Stakeholders will have different — and sometimes conflicting — interests and it is the job of the marketplace to balance those interests in pursuit of mutual goals. Leaders underscored the importance of insurer engagement, recognizing the central role of health plans in the success of the marketplace. Establishment of an SBM will require insurers in the state to establish new business practices. A state should not underestimate the uniqueness of how each carrier operates and the time it may take for each to adapt to the new SBM system.
Establish Clear Leadership that Can Take Quick Action
A state has the flexibility to choose how to establish its SBM — either as a state agency, a non-profit, or a quasi-public-private entity. Because an SBM must be responsive to changing consumer and insurer markets and be able to readily contract with vendors to develop needed services, it is best that an SBM assume a governance structure that can enable it to act quickly. Moreover, leaders directors noted the importance of leadership to any marketplace. While operation of an SBM takes a team, it is important to have one person who is clearly designated to establish priorities, take accountability, and make decisions to get the SBM “across the finish line.”
SBMs Serve as a “Hub” for Health Reform across State Agencies.
Regardless of the specific model chosen, SBMs must be able to work across existing state agencies including Medicaid, insurance departments, and other health policy agencies. SBMs are uniquely positioned to serve consumers who range from those on the cusp of Medicaid eligibility to those accustomed to various types of commercial market coverage. To ensure smooth processes for consumers, SBMs must be able to navigate between agencies to ensure that its policies and operations are consistent with what is being promulgated by its sister agencies.
For instance, SBMs are required to generate many different types of notices to consumers, such as information related to a consumer’s eligibility for coverage programs. SBMs coordinate closely with their Medicaid agencies on the language and process for sending these notices to help reduce confusion for consumers who might otherwise receive duplicative or misaligned information from both agencies. Additionally, because SBMs serve consumers who are eligible for federal tax credits, they serve an important role in informing state and federal policymakers about how policy changes may directly impact their consumers. To serve this role, it is important that SBMs have sufficient analytic capacity to process data on their consumers and advise on the implications of changing federal and state policies.
Let SBMs Adapt Over Time
Insurance markets and marketplace consumers are not static, and SBMs must be able to adjust to changing needs and consumers. They must constantly work to engage new consumers who may be coming in and out of other coverage programs (e.g., leaving parental coverage, employer-sponsored insurance, or Medicaid), while also adapting to evolving expectations as consumers interact more and more with e-commerce and advanced technology. Through consumer surveys and testing, SBMs are constantly learning and adapting their services. One benefit of their flexible structure is that SBMs are also becoming more sophisticated and efficient in navigating this process. Some have even been able to cut operational expenses and lower the assessments they charge to carriers who sell on their exchanges, which, in turn, results in lower consumer premiums. For example, Mila Kofman, executive director of DC Health Link, estimates her SBM was able to save approximately $2 million annually by moving its data servers to a cloud-based system in 2016.
Most notably, leaders point out that each SBM has taken a unique approach in how it has operationalized its marketplace. In the process, each has learned lessons from their SBM peers — from simply sharing effective marketing strategies to full partnerships, like Massachusetts’ adoption of Washington, DC’s technology for its small business marketplace. In this spirit, speakers advised states to learn from their peers as they work through their own challenges on the road to implementing SBMs.
NASHP and the SBMs are ready and eager to help support states as they contemplate establishing their own SBMs. For additional resources about SBM models and implementation, explore NASHP’s State Exchange Resource Hub.
The Arizona Health Care Cost Containment System (AHCCCS), the state Medicaid agency, included an emphasis on the development of medical homes to increase beneficiaries’ health security as part of their 2010 Quality Assessment and Performance Improvement Strategy Report. AHCCCS has also prepared a draft state plan amendment to create a medical home program for fee-for-service American Indians.
Currently, Medicaid recipients enrolled in UnitedHealth’s Medicaid managed care plan are eligible to participate in a patient-centered medical home program developed by UnitedHealth and IBM.
Federal Support: Arizona has received a planning grant from the Centers for Medicare & Medicaid Services (CMS) to develop a state plan amendment to implement Section 2703 of the Affordable Care Act (ACA), establishing health homes for Medicaid enrollees with chronic conditions. The state is in the process of developing a state plan amendment targeting adult patients with severe mental illness in Maricopa County, which incorporates multiple major metropolitan areas including Glendale, Mesa, Phoenix, Scottsdale and Tempe. To learn more about Section 2703 Health Homes, visit the CMS Health Homes webpage.
Last Updated: April 2014
Many states began moving forward with their plans to expand Medicaid even before the Supreme Court’s 2012 ruling on the ACA. Other states have more recently decided to pursue expansion, with a number pursuing non-traditional Medicaid alternatives. This webinar will provide a closer look at the various ways states are expanding Medicaid to those who are newly eligible for the program. State panelists will discuss issues related to the expansion, including:
- Coordination with state or federal marketplaces;
- Education and outreach efforts for newly eligible individuals;
- Benefit design and development of the Medicaid Alternative Benefit Plan;
- Provider capacity needs for new and current enrollees; and
- Implications and opportunities for delivery system reform
Please register to join us for this lively discussion.
Alan Weil, Moderator
Executive Director, National Academy for State Health Policy
Policy Specialist, National Academy for State Health Policy
Assistant Director, Arkansas Division of Medical Services, Director of Continuity of Care and Coordination of Coverage Unit
State Medicaid Director, Deputy Commissioner, State of New York Department of Health
Deputy Director, Arizona Health Care Cost Containment System
- As of July 1, 2011, there were 1,351,988 beneficiaries enrolled in Arizona Medicaid. Of these, 1,198,818 were enrolled in Medicaid-only managed care organizations providing physical and oral health benefits, and 124,491 were enrolled in a prepaid inpatient health plan for mental health and substance use disorders.
- The state Medicaid agency contracts with the Department of Health Services to provide behavioral health services. The Department of Health Services contracts with Regional Behavioral Health Authorities (RBHAs) to administer care.
- Roughly 25,000 Medicaid eligible children with complex health needs receive care through the Children’s Rehabilitative Services (CRS) program. CRS beneficiaries receive preventive and primary acute care from their Medicaid managed care plans and specialty care related to their CRS-eligible condition through a CRS provider. Arizona is currently working to create a specialty health plan for CRS children that would manage both behavioral and physical health services.
Arizona Administrative Code defines medically necessary to mean a covered service provided by a physician or other licensed practitioner of the healing arts within the scope of practice under State law to prevent disease, disability or other adverse conditions or their progression, or prolong life.
As outlined in the AHCCCS Contractor Operations Manual, managed care plans are required to develop and maintain a provider Network Development and Management Plan to assure AHCCCS that services are being provided as specified.
The Arizona Health Care Cost Containment System (AHCCCS), Arizona’s Medicaid agency, provides EPSDT Tracking Forms that must be used by providers to document all age-specific, required information related to EPSDT screenings and visits. Providers may choose to use an electronic EPSDT Tracking Form generated through AHCCCS or the provider’s electronic health record system if the electronic form includes components on the AHCCCS EPSDT Tracking form, such as:
Behavioral health services are carved out of Medicaid managed care in Arizona. The state Medicaid agency contracts with the Department of Health Services to provide these services, which in turn contracts with Regional Behavioral Health Authorities (RBHAs) to administer care. The state is divided into 6 geographic areas, with an RBHA responsible for administering care in each region.
Arizona’s Medicaid agency had made available to primary care providers three Childhood and Adolescent Behavioral Health Tool Kits for:
Arizona released a Request for Information in December 2013 to seek input for an integrated health care service delivery system to provide physical and behavioral health care services to maximize care coordination statewide.
|The Arizona Health Care Cost Containment System (AHCCCS), Arizona’s Medicaid agency, maintains a “Health Insurance for Children" web page that outlines eligibility criteria and covered services for enrollees.|
Arizona Medicaid’s Medical Policy Manual outlines care coordination responsibilities of Medicaid participating primary care physicians, including:
The manual also outlines care coordination responsibilities for contractors delivering Children’s Rehabilitative Services (CRS):
“The CRS Contractor must establish a process to ensure coordination of care for members that includes:
Arizona’s Medicaid agency and the Arizona Early Intervention Program jointly developed a process for coordinating EPSDT and early intervention services. These guidelines outline procedures for coordinating care when concerns about a Medicaid-enrolled child’s development are identified by either a primary care physician or by the Arizona Early Intervention Program.
Arizona also released a Request for Information in December 2013 to seek input for an integrated health care service delivery system to provide physical and behavioral health care services to maximize care coordination statewide.
Primary care providers are required to conduct an oral health screening as part of an EPSDT screening, and make referrals to dentists as needed.
By Scott Holladay
The goal of evidence-based supported employment is to place individuals with serious mental illness in real, competitive jobs. This evidence–based practice (EBP) is highly effective, resulting in competitive employment at nearly three times the rate of other vocational services. Studies comparing supported employment with day treatment have shown similar results. Despite this strong evidence, the practice has been slow to take hold, but 17 states are now using Medicaid to expand its availability. As a major payer for behavioral health services, Medicaid support is crucial to implementation of EBPs.
- What progress have they made so-far in simplifying and automating enrollment and renewals? What are some of the toughest remaining issues?
- How are they coordinating state or federally facilitated health insurance exchanges to prevent coverage gaps?
- Do they plan to roll out a Medicaid benchmark plan and what will it look like?
- How do they plan to provide consumer assistance?
NASHP’s Accountable Care Activity map is a work in progress; state activity pages will be launched in waves throughout Fall 2012.
At this time, we have no information on accountable care activity that meets the following criteria: (1) Medicaid or CHIP agency participation (not necessarily leadership); (2) explicitly intended to advance accountable or integrated care models; and (3) evidence of commitment, such as workgroups, legislation, executive orders, or dedicated staff.
If you have information about accountable care activity in your state, please email email@example.com.
Last updated: October 2012
Report 1 in a Series of State Case Studies
Arizona began providing acute care services to Medicaid eligible residents in 1982 through the Arizona Health Care Cost Containment System (AHCCCS), a Section 1115 Research and Demonstraction Waiver demonstration program approved by the US Health Care Financing Administration (HCFA). Long term care services were covered under the Arizona Long Term Care system (ALTCS) beginning in December 1998 under an amendment to the 1115 demonstration waiver.
ALTCS provides acute care, behavioral health and long term care services to the elderly, the physically disabled and people with developmental disabilities with incomes up to 300% of the federal SSI benefit standard ($1374 in 1995). Members must also meet the nursing facility level of care criteria to participate. Enrollment in the managed care long term care system is mandatory (members cannot choose a fee for service system).
This report, prepared by NASHP for the federal Agency for Healthcare Research and Quality, summarizes how leading states analyze state and federal race/ethnicity data in strategic plans and reports aimed at reducing racial and ethnic disparities in health status and health care. It features Colorado, Connecticut, Georgia, Maryland, New Jersey, New Mexico, Rhode Island, and Utah, but also notes activity in Arizona, California, Massachusetts, Michigan, North Carolina, Ohio, and Virginia. Lessons from leading states can provide guidance for others exploring ways to launch or enhance health equity, consumer engagement, quality improvement, or cost containment initiatives.
Read full report here.