WA Health Benefit Exchange Board prepares for House budget release

With the House of Representatives expected to release its budget at 11:30am today, the Washington Health Benefit Exchange Board of Directors are looking for ways to minimize spending and maximize revenues in anticipation of a limited budget allocation.

At Thursday’s Exchange Board meeting, Board Chair Ron Sims and Board member Mark Stensager spoke to a “frank and open” discussion that they had with the House Democratic Caucus,  alluding to the possibility that the Exchange’s funding the House budget proposal would not come close to their initial $127 million budget request. Because of this, discussion among board members almost exclusively focused on opportunities to cut costs and maximize revenues.

During a report on call center performance, staff reported significant improvements in average wait time, currently at one and a half minutes, down from an average of 49 minutes a year ago. While the reason for this improvement points towards a significant increase in call center staff, questions from board members focused on how the Exchange can maintain these improvements with less funding, less staff and increased use of technology.

In addition, this month the Exchange made the decision to shift part of the special enrollment eligibility process from the Exchange to carriers. Moving forward, carriers on the exchange will be responsible for verifying consumer claims of a special event that qualifies for a special enrollment period. These events include a change in residence or employment status, the birth of a child or significant change in income. Despite concerns raised by carriers that this switch will result in unnecessary confusion among consumers, staff reported that this switch would save approximately $500,000 in staff time. This comes in addition to the recent decision to cease premium aggregation, in which the Exchange invoices enrollees directly for plan premiums. By pushing premium invoicing back onto carriers, the Exchange anticipates saving approximately $10 million over the next two years.

The Board also heard from a panel of insurance brokers proposing a number of changes that would elevate the role of brokers and increase their access to the Exchange. The panel framed their proposals as opportunities to increase Qualified Health Plan (QHP) purchases while taking some of the load off of the Exchange call center. The proposals were appealing to many Board members. As such, Exchange staff intends to pursue them in the interest of cost reduction and increased QHP enrollment.

Board member Phil Dyer did point out that past efforts to implement similar broker changes have met stiff resistance from carriers because of its impact on carrier ability to choose which brokers to enter into an agreement with.

Facing a $26 million shortfall and declining legislative support, the Exchange is looking at ways to right the ship. The proposals discussed at Thursday’s meeting, coupled with a carrier assessment increase, point to solutions that continue to impact insurance carriers

While the House’s budget proposal will be far from the final document, the Exchange is clearly planning for the worst. Insurance carriers may need to prepare as well.