Many states considering a Medicaid buy-in public option have expressed the hope that it will provide an affordable coverage option for individuals, noting that insurance remains highly costly even for those individuals receiving Federal premium subsidies or employer contributions. States across the country have or will be exploring the feasibility and options available to them this upcoming legislative cycle. In many instances, stakeholder groups convened to provide input on state approaches have discussed and expressed support for exploring options to control health costs with Medicaid Buy-In a proposed avenue to do so. This past fall, the topic was frequently mentioned on campaign trails, with Minnesota Governor Walz publicly expressing support for MinnesotaCare buy-in, and Wisconsin Governor Evers indicating he would be in favor of “BadgerCare for All”. It is likely we will see a revival and refiling of buy-in legislation, particularly in those states that previously expressed interest, and recently underwent a change in administration, including Illinois and New Mexico. As states continue to grapple with how best to provide healthcare to constituents and quell rising healthcare costs, the spectrum of buy in options continues to be an attractive concept for many.
In a recent poll conducted by researchers at Harvard University and Boston University, researchers looked at the support for the spectrum of buy in options—specifically polling on Medicare for All and a Medicaid Buy-In program. When asked what was most surprising about these poll results, Emma Sandoe, participating researcher on this poll and Health Policy Ph.D. student at Harvard University, indicated that researchers were surprised by the demographics of respondents responses. While Baby Boomers indicated support for Medicaid buy-in, they did not respond as favorably to Medicare for All. The poll also found that people under age 64 have a 7.8% more likelihood of supporting Medicaid Buy-In compared to people over 65. While a majority of participants were in favor of a buy-in plan (51.3 % of poll respondents), the respondents also indicated they believed that expanding Medicaid would keep healthcare costs low—with 49.6% agreeing with this statement. The full poll results and report are forthcoming, with the highlights available here.
Many of the details of how a public option would work in a particular state are under study or were not fully outlined in legislation proposed in recent cycles. In February 2018, New Mexico authorized a study on the implications of a Medicaid buy-in proposal intended to lower healthcare costs and expand affordable coverage to residents, a particular concern for those earning less than 200% of the federal poverty level (FPL). The study was instructed to examine, in part, the policy and fiscal implications of offering a Medicaid buy-in coverage option, including the cost of offering a buy in plan as a commercial insurance product as compared to Medicaid managed care. Health Policy News produced a report this past summer on this topic, but limited details were available on how exactly states would approach buy-in options. Some specificity is now available, with the New Mexico report accessible online for other states to review as they begin to craft legislation or continue their own study of options.
New Mexico Report
The December 2018 report on the options and feasibility of a Medicaid Buy-In program in New Mexico represents Phase 1 of the study—a qualitative assessment of several Medicaid buy-in options for New Mexico, with a Phase 2 actuarial assessment of a subset of these options forthcoming. Until the report from New Mexico was released last month, the details of how states would approach a program of this type generally included offering the buy-in with benefits based on existing plans (either mirroring public program benefits, as or a Silver-level commercial product) with buy-in plans leveraging an existing Medicaid or Marketplace eligibility portals. In many instances, enrollees would be charged premiums for the full cost of the plan, though states are exploring utilizing State and / or Federal funds to provide subsidies to low-income enrollees.
The New Mexico Phase I report outlines four approaches:
- Targeted Medicaid Buy-In: New Mexico would offer Medicaid like coverage off the Marketplace to those not eligible for Medicaid, Medicare or subsidized Marketplace coverage, with the option to subsidize coverage.
- Low Cost Marketplace QHP Plan: New Mexico would offer a lower-cost QHP product (likely by one existing issuer) on the Marketplace to individuals and small employers, with a waiver to ensure affordability and savings.
- Basic Health Plan: New Mexico would create a basic health plan for individuals with incomes up to 200% FPL who are not Medicaid-eligible (including people who would be Medicaid eligible but for their immigration status), with an option to expand eligibility for the plan over time.
- Medicaid for All: New Mexico would allow everyone not otherwise eligible for Medicare to purchase a low-cost health plan option off marketplace, with premium subsidy eligibility enrollees applying those to the purchase of this plan type.
The report evaluates the options based on the effort’s three key goals: reducing the uninsured rate and increasing enrollment, increasing affordability while protecting reimbursement rates, and simplifying coverage options for families and beneficiaries. With pros and cons for each option, the Basic Health Plan option is highlighted as the one that would provide the most assistance to individuals within 138-200% of the FPL, while the Targeted Buy-In would cause the least disruption to the current marketplace. Two of the four options (Basic Health Plan and Medicaid for All) would likely require development and submission of a Section 1332 State Relief and Empowerment Waiver—a timing consideration that pushes the implementation and operationalization of a major reform further down the line. Phase 2 of the report is forthcoming and will include the actuarial modeling of one option, with New Mexico’s potential approaches further refined and examined.