Publicly Funded Healthcare: Challenges Solutions

1. Publicly Funded Healthcare:Challenges & Solutions

2. 2 Public Health Coverage Programs Medicaid CHIP Looking Ahead Increasing Access to Care for Public Health Coverage Covering the Uninsured Improving Health Outcomes

3. 3 Public Health Coverage Programs MEDICAID Medicaid is a jointly funded state-federal program that provides medical coverage to eligible needy persons The federal government pays 60.77% of Medicaid medical care expenditures Medicaid is an entitlement program, meaning: Guaranteed coverage for eligible services to eligible persons Open-ended funding based on the actual costs to provide eligible services to eligible persons Medicaid serves: Low-Income Families Children Pregnant Women Elderly People with Disabilities Texas Medicaid does not serve: Non-Disabled, Childless Adults

4. 4 Public Health Coverage Programs The Legislature approved a two-year budget of $39.5 billion for Medicaid Medicaid currently comprises about 26% of the entire state budget Medicaid will serve about 2.9 million Texans per month in fiscal year 2009 The Medicaid program currently provides health coverage for 1 of every 3 children in Texas, pays for more than half of all births and covers two-thirds of all nursing home care

5. 5 Public Health Coverage Programs

7. 7 Public Health Coverage Programs CHIP CHIP is a joint state-federal program that provides medical coverage to eligible children up to age 19, who are not already insured The federal government pays 72.55% of CHIP medical care expenditures Federal law and regulations: Requires each state to set eligibility guidelines, service levels, and delivery systems; and Requires each state to operate a state plan listing these elements CHIP is not an entitlement program

8. 8 Public Health Coverage Programs The Legislature approved $2 billion to fund CHIP for the biennium $1 billion increase over the FY 2006-2007 funding levels $698.5 million included for CHIP Perinatal coverage, which expands the availability of prenatal coverage for pregnant women and also provides CHIP coverage for the baby after birth HB 109 changed eligibility standards for CHIP. The new requirements are expected to enroll almost 130,000�more children in CHIP during FY 2008-2009 Coverage is extended to one year Income is reviewed in the 6th month for families earning more than 185% of the federal poverty level 90-day waiting period is eliminated for most children Net rather than gross income is counted; allows families to deduct child care expenses Allowable assets are increased

9. 9 Looking Ahead:Access to Care Frew Lawsuit Agreement: In 1993 a lawsuit was filed by families of children on Texas Medicaid challenging the State�s provision of EPSDT services; a judicial agreement on corrective actions was reached in the case in July $707 million in GR ($1.8B all funds) was appropriated for an agreement over utilization of preventive services by Medicaid children Most of the funding, $512 million, will be used to provide rate increases to dentists, physicians and other health professionals who provide Medicaid services to children to increase access to preventive and specialty care Rates for 48 specific dental codes identified by dental professionals will be increased by up to 100% Increases to physicians and other professionals include targeted increases for preventive services and moving toward the Medicare rate methodology for all codes The agreement also addresses outreach and information to potentially eligible children as well as maintaining an adequate supply of health care providers Provider Rate Increases: Acute care providers not covered by Frew will also be given rate increases Increases for physicians, dentists, home health providers, ambulance and pharmacy services Hospital Rebasing $150 million in GR was appropriated to rebase hospital rates

10. 10 Looking Ahead:Covering the Uninsured

11. 11 Looking Ahead:Covering the Uninsured Citizen and Legal Permanent Resident Adults with Incomes Below 200% FPL: 60% (2.1 million) of the total adult uninsured population have incomes at or below 200% FPL Parents: 51% of these adults (1.1M) are between the ages of 19 and 34 45% (960,000) are parents 62% (592,000) of all uninsured parents are females Uninsured parents are generally employed: 88% of male parents 50% of female parents 50% (483,000) of all uninsured parents have children enrolled in either Medicaid or SCHIP These parents are generally older, 56% (272,000) are between 34 and 64 years of age 63% (306,000) of these parents are females Childless Adults: 55% (1.2M) are childless adults 60% (642,000) of all uninsured male adults are childless Uninsured childless adults are less likely to be employed 64% of male childless adults 41% of female childless adults

12. 12 Looking Ahead:Covering the Uninsured SB 10, 80th Session, created several Medicaid reform initiatives designed to reduce the ranks of Texas� uninsured: Establishes a Health Opportunity Pool (HOP): Will be a separate fund in the state treasury to hold UPL and DSH monies, as well as currently unmatched state and local funds Protect funds used to provide care to the uninsured as the federal government moves away from lump sums given to states for uncompensated care the HOP may be used to: Fund an insurance premium payment assistance program Make contributions to health savings accounts of eligible individuals Provide financial assistance to eligible individuals through alternate mechanisms established by local hospitals or political subdivisions Directs HHSC and the Texas Department of Insurance to study a small employer premium assistance program to provide financial assistance for the purchase of small employer health benefit plans; the study must address: Options for funding, including use of HOP money Coordination with any other premium assistance effort Recommended program design Report to the Legislature November 1, 2008

13. 13 Looking Ahead:Covering the Uninsured Provides for premium payments for employees who are Medicaid eligible but choose to enroll in employer-sponsored health insurance: Information will be collected to help identify eligible enrollees at the time of Medicaid eligibility determination May allow Medicaid recipients to leverage premium payments to cover dependents rather than just receiving individual coverage Provides authority for local and regional multi-share programs: Known as multi-share programs, these local or regional programs provide health care coverage to enrollees who pay a portion of the care costs; other shares are paid by different entities Example: a county health program chooses to establish a multi-share program and enroll local employers The health care premium costs are divided into 3 shares with the employee, employer and county program each paying equal shares SB 10 provides authority for a grant program to assist local and regional programs in development and implementation HHSC is currently exploring funding options and the feasibility of such a grant program

14. 14 Looking Ahead:Improving Health Outcomes SB 10 also provides direction for several initiatives aimed at improving health outcomes for Texans with public health coverage The Health Opportunity Pool may be used to support local entities to implement innovative measures to provide primary and preventive care A pilot to reward health behaviors, such as completing weight loss or smoking cessation programs Program infrastructure improvements such as encouraging the development and use of electronic health information standards and electronic health records to improve patient care

15. 15 Health Opportunity Pool Trust Fund Allocation

16. 16 Looking Ahead:Improving Health Outcomes Tailored benefits packages for children with special health-care needs to better meet the complex needs of this population. Packages must be designed to provide benefits that are customized to meet the health care needs of specified recipients improve health outcomes for recipients improve recipients� access to care achieve cost containment and efficiency reduce the administrative complexity of delivering Medicaid benefits HHSC is also directed to study other groups of Medicaid recipients that may benefit from a tailored benefits package.