Oregon Health Insurance Plan May Require Use of Multiple Federal Funding Options – State of Reform
Members of Oregon Bridge Healthcare Program Task Force discussed the possibilities of building and funding a Basic Health Plan (BHP) to provide health insurance to low-income Oregonians on Tuesday.
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The state of health emergency (PHE) is expected to end on July 15th if the Biden administration does not extend the declaration for another 90 days. The task force was formed to create a bridging program to provide coverage for people leaving the Oregon Health Plan (OHP) when the PHE ends and his suspension from Medicaid redeterminations is lifted.
Task force members have previously discussed federal funding options to support a health insurance plan for low-income residents during a May 10 meeting. They considered three financing options, including the implementation Item 1115 of the Social Security Act, the Affordable Care Act (ACA) Item 1331and the ACA Section 1332. They revisited those options on Tuesday.
Jeremy Vandehey, director of the Oregon Health Authority’s Division of Health Policy and Analysis, said he was working with CMS officials to determine the most viable avenues for securing federal funding for a coverage plan for people below 200% of the Federal Poverty Level (FPL) who are not eligible for OHP.
Section 1115 provides a quick and simple path to implementation. But that forces the state to pay 40% of that cost, which falls short of budget targets, Vandehey said.
Section 1331 is designed to provide states with a BHP for people who are between 138 and 200 percent of FPL, and maximizes federal contributions, Vandehey said. If implemented, it would remain in place unless removed by the state.
“Section 1115 is the quickest and easiest route, but funding is a significant hurdle,” Vandehey said. “With section 1131, there is no option, there is less flexibility, but the journey is direct.”
A viable path to creating a plan that covers affected residents and providing that coverage before they lose their current coverage could involve implementing different phased funding options. The first step would be a short-term 1115 waiver to provide cover quickly, followed by the gradual introduction of a 1331 BHP as a permanent cover option.
“That would be allowed with a commitment from the state to implement a full BHP,” Vandehey said.
Although task force members should plan coverage options with the expected July 15 end date of the PHE in mind, waiver 1115 may not be necessary if extended. A 1115 waiver would serve as a safety net, said Sen. Elizabeth Steiner Hayward (D-Portland), who co-chairs the task force.
“If the emergency extends into December, we probably won’t need a 1115 waiver until we have 1331 in place,” Hayward said. “But we are going to apply for a 1115 waiver, so we have that as a safety net in case the PHE ends before our 1331 is operational, so people don’t lose their coverage and we have to reinstate them. ”
The working group was formed after the adoption of House Bill 4035. The bill directs task force members to create a transition program with lower reimbursable costs than current market options and to consider a plan with no reimbursable costs. It does not provide specific guidelines for monthly premiums. Minnesota and New York both have BHPs, and OHA health policy analyst Tim Sweeney discussed their benefits to members.
Minnesota has a sliding scale for premiums for people who are between 160 and 200 percent of FPL, ranging from $4 to $28 per month, Sweeney said. There are no deductibles and modest co-payments for members. New York recently eliminated all premiums and there is no deductible in its BHP, he said.
Kirsten Isaacson, a member of the task force, said deductibles pose significant barriers for low-income residents.
“Seeing New York and Minnesota with plans without a franchise, I appreciate that,” Isaacson said. “And I lean towards that area. I would like to leave deductibles and co-payments off the menu.
An Oregon bridge plan could also provide a dental coverage option, if that becomes practical as task force members identify priorities. Task force member Matthew Sinnott noted that the Minnesota and New York BHPs include dental plans and said he would like Oregon to include dental coverage as well.
“We pride ourselves on being pioneers,” Sinnott said. “I wouldn’t want the bridge to be a bridge too far.”
Members of the working group will review coverage services and member costs that would be included in an Oregon BHP at future meetings. They will also decide on a federal funding option. Their next meeting is scheduled for June 14.