Oregon health insurance plan could call for use of multiple federal funding options
Members of Oregon’s Bridge Health Care Program Task Force discussed possibilities for building and funding a Basic Health Plan (BHP) to provide health insurance for low-income Oregonians Tuesday.
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The public health emergency (PHE) is scheduled to end on July 15th if the Biden administration doesn’t extend the declaration for another 90 days. The task force was formed to create a bridge program to offer coverage to people leaving the Oregon Health Plan (OHP) when the PHE ends and its suspension of Medicaid redeterminations is lifted.
Task force members previously discussed federal funding options for supporting a health insurance plan for low-income residents during a May 10th meeting. They considered three options for funding, including implementing Section 1115 of the Social Security Act, the Affordable Care Act’s (ACA) Section 1331, and the ACA’s Section 1332. They revisited those options Tuesday.
Jeremy Vandehey, Director of the Oregon Health Authority’s Health Policy and Analytics Division, said he has been working with CMS officials to determine the most viable paths to acquiring federal funding for a coverage plan for people below 200% of the federal poverty level (FPL) who do not qualify for the OHP.
Section 1115 provides a quick and simple path to implementation. But it requires the state to pay 40% of that cost, which does not fall in line with budget goals, Vandehey said.
Section 1331 is designed to offer states a BHP for people who fall between 138-200% of the FPL, and maximizes federal contributions, Vandehey said. If implemented, it would remain in place unless withdrawn by the state.
“Section 1115 is the fastest, easiest pathway, but financing is a significant barrier,” Vandehey said. “With Section 1131, there is no optionality, there is less flexibility, but the journey is direct.”
A viable path toward creating a plan that covers intended residents, and providing that coverage before they lose their current coverage, could involve implementing different funding options in phases. The first step would be a short-term 1115 waiver to provide coverage quickly, followed by the phasing in of a 1331 BHP as a permanent coverage option.
“This would be permitted with a state commitment to implementing a full BHP,” Vandehey said.
While task force members must plan for coverage options keeping the PHE’s July 15th scheduled end date in mind, the 1115 waiver may not be needed if it is extended. An 1115 waiver would serve as a backstop, Sen. Elizabeth Steiner Hayward (D-Portland), who co-chairs the task force, said.
“If the emergency extends through December, we likely won’t need a 1115 waiver until we get 1331 up and running,” Hayward said. “But we’re going to apply for a 1115 waiver so we have it as a backstop in case the PHE ends before we have our 1331 up and running, so people don’t lose coverage and we have to get them back on again.”
The task force was formed after the passage of House Bill 4035. The bill directs task force members to create a bridge program with lower out-of-pocket costs than current marketplace options, and to consider a plan with zero out-of-pocket costs. It does not provide specific directions regarding monthly premiums. Both Minnesota and New York have BHPs, and OHA Health Policy Analyst Tim Sweeney discussed their member benefits.
Minnesota has a sliding scale for premiums for people who fall between 160-200% of the 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 are no deductibles in its BHP, he said.
Task force member Kirsten Isaacson said deductibles cause significant barriers for low-income residents.
“Seeing New York and Minnesota with no-deductible plans, I appreciate that,” Isaacson said. “And I lean towards that area. I would like to leave deductibles and co-pays off the menu.”
An Oregon bridge plan could also provide a dental coverage option, if that becomes practicable 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’s to include dental coverage as well.
“We laud ourselves on being trailblazers,” Sinnott said. “I would not want to see that be the bridge that’s one bridge too far.”
Task force members will consider which coverage services and member costs would be included in an Oregon BHP during future meetings. They will also decide on a federal financing option. Their next meeting is scheduled to be held on June 14th.