The final Covered California board meeting for the calendar year provided lots of updates on the happenings at the Exchange. At the meeting topics included a study on Californians’ awareness of the Affordable Care Act (ACA), the open enrollment launch and a marketing and enrollment update. There was also an update on Covered California for Small Business and the 1332 waiver process. Finally, there was an overview of the 2017 qualified health plans (QHP) recertification and other action items accepted by the Board.
To start the meeting off, Executive Director, Peter Lee gave an overview of some of the reports included in the meeting’s materials. To note, was Mr. Lee’s discussion of a recent Avalere report that categorized California’s exchange (Covered California) as having “restrictive access” to HIV drugs. Restrictive access, as defined by the Avalere report, meant states covered fewer than 7 of the 10 most common HIV regimens, or required cost sharing over $200 per month. Covered California’s Chief Actuary, John Bertko, on behalf of Covered California, has taken issue with this report and responded accordingly, enumerating the number of issues with the how the Avalere report was conducted. Additionally, Covered California offered a more detailed breakdown of each of the top 10 HIV regimens offered by Covered California plans, their tiers, and cost. Based on this more detailed information, it looks as though California would move to Avalere’s “moderate access” category in most cases for the 2015 year, and in some cases “full access” for the 2016 year plans. Covered California most notably stresses that 90% of Covered California members have access to AIDS Drug Assistance Program that pays for HIV costs. As affordability issues for consumers buying on the Exchange continues to be a headline, it is apropos for Covered California to make a counter statement against Avalere’s report, especially as it evokes in the discussion a vulnerable population, like the HIV/AIDS chronic disease population.
Californians’ Awareness of the Affordable Care Act
The University of Chicago National Opinion Research Center conducted a survey on the population reach of the ACA and Covered California. Overall awareness for the ACA and Covered California has increased since 2013.
Major points were:
• Awareness of the ACA is at 90% and awareness of Covered California is at 85%. Last year 79% of individuals were aware of Covered California
• Hispanics (76%) and Asian/Pacific Islanders (79%) were the least likely ethnic group to know about Covered California
• Both news coverage about Covered California (60%) and advertising means (56%) are ways Californians are made aware of Covered California
• More people are knowledgeable about the tax penalty (84%) than the premium subsidy (64%)
• Unfortunately, 36% of the uninsured are unaware of the premium subsidy
2016 Open Enrollment Statistics and Marketing Update
Open enrollment officially opened November 1, 2015. At this time Covered California reported that there has been more than 34,000 new sign-ups of individuals selecting a health care plan or approximately 2,000 individuals a day choosing a plan. Also, 33,000 individuals have chosen a family dental plan. The family dental option is new for open enrollment year three. Eighteen percent of the sign ups are new consumers choosing to enroll in dental coverage. More than 15% of individuals enrolled in the exchange are also enrolled in dental insurance, which is higher than Covered California’s internal projected number of 10%. High dental numbers are promising for Covered California’s budget as dental health plans will be assessed $0.83 per member per month that can then be used towards the Covered California operating budget. Covered California did not include any such revenue from this line of business in their most recent 2015-16 fiscal year budget.
During this third open enrollment, Covered California is utilizing store fronts to enroll people and has a map on its website of all their store fronts. An example of the map is shown below.
For this third open enrollment, the website is more consumer-friendly, clearly showing consumers their actual monthly cost whereas previously it was a somewhat ambiguous with gross, net and premium amounts shown. Finally, Mr. Lee noted that the biggest enrollment sign-ups take place during the first two weeks of December at the end of January (December 15th and January 31st are key dates for enrollment).
In order to generate these promising enrollment numbers, Covered California has implemented a strategic marketing plan. For example, they just concluded their Covered California bus tour. As Covered California research shows, the local media coverage generated by the bus tour is what consumers remember and recognize, hence this bus tour is a key marketing component. The bus itself is a moving billboard and the messages on the bus are main points Covered California wants to convey to potential enrollees. Spotlights of the Covered California emblem — similar to the Batman spotlight that lights up Gotham City — were featured on iconic California buildings and hospitals and community clinics around the state.
The official marketing campaign for open enrollment was launched November 2nd. In order to emphasize holistic care, the main slogan this year is pushing the idea that coverage is more than just health care, but life care. The main points of the campaign are below.
New commercial ads have been developed and, depending on the commercial, are played in English, Spanish, Mandarin, Cantonese, Korean and Vietnamese. A number of different media outlets are being used, with specific attention paid to outlets that reach ethnic communities including African Americans, Asians and Latinos. The media outlets are shown below.
Covered California for Small Business
Since August, Covered California for Small Business has grown by about 500 additional members, bringing the October member count to 19,973. Agents’ commission payments are now up to date and paid regularly.
Covered California has had an uptick in interest by agents and small businesses in the plans Covered California for Small Business offers. There are increases in request for quotes, response to advertising and new leads. Although, Covered California has had a rocky start since its inception, this open enrollment is likely to result in an increase in sign ups as employers with less than 100 employees must provider health insurance coverage and plans offered by employers must be ACA-compliant.
1332 Waiver Process Update
The 1332 waiver is an opportunity available to states to make some changes to the ACA, while maintaining the basic protective provisions and not adding to the current costs of the ACA. Waivers can start to be submitted in January 2017. The waiver must be approved through the state legislature and must be approved by the federal government. The waiver, if approved, would be in place for five years. There is no deadline for when a state has to submit a waiver and states may elect to make no changes in how the ACA works in its current form. See Dr. John Connolly’s, Opportunities for California under ACA’s §1332 Waiver (ITUP, September 10, 2015) at www.itup.org for more information about the waiver.
Covered California will only entertain potential waivers that are in line with their mission, are either cost saving or achieve administrative simplification, and improve current processes. No proposals will be reviewed that lead to an increase in the federal government’s deficit or infringe upon California’s general fund.
Covered California stated that this waiver process will require significant time and resources and will divert resources from current operations at Covered California. Before deciding on diversion of these resources, Covered California, in collaboration with the Department of Health Care Services, will engage stakeholders and the public about possible proposals and begin to narrow down ideas for the waiver. This will take place between January and April 2016. After this point, during the summer of 2016, a decision will be made for next steps, if any, in terms of the waiver by the Board.
With this in mind, advocates are still excited about the possibilities the waiver brings in making improvements to ACA legislation. Areas of improvement that could be addressed in the waiver that were brought up during public comment at the meeting include: affordability of plans, the family glitch component of the ACA, and opportunities for the undocumented to buy coverage in Covered California, to name a few.
2017 Quality Health Plan Recertification and New Entrants
Much of Covered California’s recertification work will take place during early January. A multi-year contract term is proposed, from 2017 through 2019, with annual plan re-certification. New plans would be allowed to enter in 2018 and 2019 only if they are newly licensed or bring value (likely more plan competition) to Covered California regions. There have been ongoing meetings among stakeholders on benefit design changes and increased health plan quality requirements. Also up for discussion is whether the per member per month assessment should change from a flat rate to a percentage of premiums. One board member raised questions on whether this is a change that should be made, and a more thoughtful discussion of the implications of this switch will be needed. Dental health plan recertification is similar to that laid out for the health plans, except that only newly licensed insurers would be allowed in the Exchange with a multi-year contract in place.
Small group plan’ proposed recertification would allow all licensed health plans to apply for inclusion in the Exchange and not just those QHPs offering plans in the individual market. A multi-year contract is also proposed. Covered California is also asking to make immediate changes that will impact small business groups, including, 1) allowing a new health plan to enter the Exchange outside the annual certification process if they are already on the individual market and, 2) allowing quarterly changes in rates products, plans and networks.
Below is a preliminary timeline of the 2017 recertification process.
Finally, the Board approved re-adoption of individual eligibility and enrollment regulations with some changes including clarity of language with regards to appeals, timeframes for appeals and the addition of attestation to filing taxes.
The next board meeting will be Thursday, January 21, 2016.