TheImpactofthe PatientProtectionandAffordableCareActon LowIncomeIndividualsCurrentlyEnrolledin MinnesotasHighRiskPool

AProjectSubmittedtotheFacultyoftheDivisionofHealthPolicy&Managementofthe UniversityofMinnesotaSchoolofPublicHealthby

KerryLandry
SubmittedinpartialcompletionforthedegreeofMasterofPublicHealthAdministration andPolicyattheUniversityofMinnesota,SchoolofPublicHealth. May2011


Acknowledgements ThisresearchwouldnothavebeenpossiblewithoutthecontributionsoftheMinnesota ComprehensiveHealthAssociation(MCHA)andHallelandHabichtConsulting,LLC.Inparticular,I wouldliketothankLynnGruber,PeggyZimmermanBelbeckandtheBoardofDirectorsatMCHA fortheirsupportandforallowingmetousethe2010LowIncomeSubsidyProgram(LSP)database forthisproject. IwouldliketothankJeanneRipley,RyanBurtandKelseyBrodshoatHallelandHabichtfortheir help,expertiseandknowledgeoftheLSP.TheexpertiseandsupportoftheteamatSHADAC(the StateHealthAccessDataAssistanceCenter)attheUniversityofMinnesotawereirreplaceablein particular,IoweaspecialthankstoPeterGraven,MichelBoudreauxandJessieKemmickPintorfor theirassistanceandsupport. MysincerestgratitudeextendstoLynnBlewett,BryanDowdandKelseyBrodsho,membersofmy committee,fortheireditingandfeedback.IwouldalsoliketothankDonnaMcAlpineforsetting deadlines,providingconstructiveandhelpfulfeedbackandofferingunwaveringsupport throughoutthisprocess. Finally,IwouldespeciallyliketothankLynnBlewettforurgingmetopursuethisproject,providing invaluableexpertise,andforsupportingmeprofessionallyinmyworkbothinsideandoutsideof thisproject.

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Abstract

Objective.Toidentifythehealthinsurancecoverageoptionsforlowincomeindividualsenrolledin Minnesotashighriskpool,theMinnesotaComprehensiveHealthAssociation(MCHA),uponfull implementationofthePatientProtectionandAffordableCareAct(ACA)in2014. DataSources/StudySetting.Dataonapproximately26,000beneficiarieswereobtainedfrom enrollmentfilesofthe2010MCHALowIncomeSubsidyProgram.Thefilesaremaintainedbythe firmofHallelandHabichtforpurposesofadministeringthesubsidyprogram. StudyDesign.Dataobtainedfromapproximately26,000MCHAenrolleeswereusedtogenerate anestimationofthenumberoflowincomeenrolleesthatmightbeeligiblefornewcoverage optionsundertheACA.First,andestimateoflowincomeenrolleeswasgeneratedusingdatafrom 2,744individualsenrolledinMCHAs2010LowIncomeSubsidyProgram.Theseenrollmentfiles included2009grosshouseholdincome(whichmustbelessthan220%orlessoftheFederal PovertyLevel(FPL);$23,826foranindividual),age,plantype(bydeductiblelevelsfrom$500to $10,000),andhouseholdsize.WhilethereislimitedinformationonMCHAenrolleesabove220% FPL(approximately25,000enrollees)zipcodeisavailable.Asecondanalysisutilizeddatafromthe AmericanCommunitySurveytoimputeaproxyincomebasedonzipcodeforallMCHAenrollees. DataCollection/ExtractionMethods.Datawerecollectedduringthesummerof2010whenthe LowIncomeSubsidyProgramwasadministered. PrincipalFindings.UponfullimplementationofACA,mostoftheMCHAenrolleeseligibleforthe lowincomesubsidyprogramwillbeeligibleforeithertheMedicaidexpansion(upto138%ofthe FPL),thebasichealthplan(139200%ofFPL)orpremiumsubsidiesofferedthroughtheexchange (201400%FPL).ThisislargelyduetotheeliminationoftheassettestforeligibilityundertheACA. MCHAdoesnotcurrentlyhaveanassettestforthelowincomesubsidy. Conclusions.PreliminaryfindingssuggestthathealthcoverageoptionsundertheACAin2014will offerlowtonocostcoverageforlowincomeenrolleesthanwhatiscurrentlyprovidedunder currentMCHApolicy.TherewillbesubstantialmovementofMCHAenrolleestonewhealthplans optionsofferedundertheACAin2014. ImplicationsforPracticeorPolicy.AffordabilityofhealthcoverageforlowincomeMinnesotans withpreexistingconditionswillbeapressingissueasfederalhealthreformisimplemented.Upon fullimplementationoftheACAthestatewillneedtoconsidertheproportionofMCHAenrollees thatwillbetransferringtopubliccoveragebothMedicaidandsubsidiesintheExchange.Because MCHAenrolleesarebydefinitionhighrisk,theirnewenrollmentintoMedicaid,thebasichealth plan,andtheexchangewillincreaseaveragecostsforeachofthesenewoptions.Policymakerswill needtoassesstheimpactofenrollmentofcurrentMCHAenrolleesintermsofcosts,adverse selectionandpotentialmoralhazard.

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 TableofContents Abstract....................................................................................................................................................iii Introduction ............................................................................................................................................ 1 Background ............................................................................................................................................. 2 HighriskPools .................................................................................................................................. 2 TheMinnesotaComprehensiveHealthAssociation(MCHA) ............................................. 5 MCHALowIncomeSubsidyProgram......................................................................................... 6 AffordableCareActImplicationsforHighRiskPoolEnrollees........................................ 7 AffordableCareActImplicationsforMCHAEnrollees ......................................................... 9 Methods ..................................................................................................................................................13 Analysis ...................................................................................................................................................14 Results .....................................................................................................................................................16 Demographics ..................................................................................................................................17 Plantypes ..........................................................................................................................................18 IncomeestimatesfromLSPenrolleeinformation...............................................................19 IncomeestimatesfromtheAmericanCommunitySurvey(ACS) ...................................20 Discussion ..............................................................................................................................................21 PolicyImplications..............................................................................................................................22

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Introduction HealthinsurancecoverageisakeyissueaddressedinthePatientProtectionandAffordable CareAct(ACA)passedin2010.AmongotherfundamentalissuesrelatedtoimprovingtheAmerican healthcaresystem,theACAaimstoincreasehealthinsuranceaccessforroughly34millionpeople, reducingthenumberofuninsuredfrom57milliontoapproximately23million(Foster,2010). IncreasedaccesstohealthinsuranceisaddressedintheACAthrough(1)theexpansionofstate Medicaidprograms;(2)thecreationofhealthinsuranceexchangesand(3)increasedsubsidiesfor bothpremiumsandcostsharing. InthestateofMinnesota,oneprogramthatwillbeimpactedbyhealthreformisthe MinnesotaComprehensiveHealthAssociation(MCHA).MCHAisMinnesotashighriskpool,an organizationthatprovideshealthinsurancecoverageforMinnesotasmedicallyuninsurable definedaspeoplewithpreexistingconditionswhoareunabletofindaffordablecoverageinthe privatemarkets.MCHAhasbeeninoperationforoverthirtyyearsandisoneofthenations longestrunninghighriskpoolprograms(NationalAssociationofStateComprehensiveHealth InsurancePlans[NASCHIP],2009).In2010,theprogramcoveredroughly28,000Minnesotans (MinnesotaComprehensiveHealthAssociation[MCHA],2010). TheACAbringsnewinsuranceoptionsfortheuninsuredandmoreaffordablecoverage optionsforthosewhoarecurrentlyinsuredincludingMCHAenrollees.Despitecappedpremiums andavailabilityofplans,manylowincomeMCHAmembersfindcoverageunaffordable. UponimplementationoftheACA,someMCHAenrolleeswillbecomeeligibleforpublic healthcoverageprograms.Eligibilityforpublicprogramswillcontinuetobebasedonincome,but willexpandtoincludealargerpopulationupto133%ofthefederalpovertylevel(FPL)forsingle adultswithnochildren.AlthoughMCHAenrolleesarescreenedforpublicprogrameligibilitywhen theyenroll,annualhouseholdincomeisnotroutinelycollectedduringtheapplicationprocess.


ThepurposeofthisstudyistoestimatethenumberofMCHAenrolleesthatwillbeeligible forthenewcoveragecategoriesestablishedtheACA.Specifically,thisresearchaimstoestimatethe householdincomelevelbasedonpercentageoffederalpovertyleveltopredictenrollees anticipatedeligibilityforMedicaid,thebasichealthplan,orsubsidies(i.e.taxcredits)providedin thehealthinsuranceexchange. IftheproportionoflowincomeMCHAenrolleesissignificant,theirtransitiontopublic coverageposesseriousimplicationsforthestateshealthcarespendingin2014.Duetothehealth needsandserviceutilizationoftheirparticipants,highriskpoolsrequiresubsidizationfor inevitableoperatinglosses(NASCHIP,2009).InMinnesota,considerationforthefutureofthese enrolleesiscrucialindeterminingwhowillbearthesecosts.Thisstudywillcontributetotheneeds ofthestateinassessingthepossibleinfluxofenrolleesintopubliccoverageprogramsandthe impactofhighriskhealthinsuranceconsumersenteringanewmarket. Background HighriskPools TherearecurrentlythirtyfivestatesthatoperatehighriskpoolsintheUnitedStates,

providinghealthinsurancecoveragetoapproximately200,000individuals(NASCHIP,2009).High riskpoolsareaimedatcoverageforthemedicallyuninsurable,butoftenextendcoveragetoother eligiblegroupsinordertomaintaincompliancewithfederallawandregulations.Mosthighrisk poolsincludepeopleeligibleforcoverageunderTheHealthInsurancePortabilityand AccountabilityAct(HIPAA)of1996(NASCHIP,2009).TheActprovidesthatindividualswith creditablecontinuouscoveragefor18monthscannotbedeniedcoverageshouldtheycareto transitiontoanothertypeofcoverage(NASCHIP,2009).Forexample,anemployeewholosestheir jobbutwhohasmaintainedcoveragefortwoyearswithoutlapsesmusthaveaccesstoahealth insuranceoption.


Anothergroupofpeopleoftenincludedinhighriskpoolsarethoseeligibleforthefederal HealthCareTaxCredit(HCTC).Individualsandtheirfamilymemberscanreceiveassistancein purchasinghealthinsurance(currently65%oftheirpremiums)iftheyreceivebenefitsthrough PensionBenefitGuarantyCorporation(PBGC)orthroughTradeAdjustmentAssistance(TAA) (InternalRevenueService,2010a;InternalRevenueService,2010b).TAAisafederalprogram aimedatassistanceforunemployedworkerswhohavebeenimpactedbytrade(UnitedStates DepartmentofLabor,2011). Allthirtyfivehighriskpoolsarefinancedthroughenrolleepremiums,butthereis significantvarianceinsourcesoffundingacrossstatesfrominsurerassessmentstospecificstate allocatedfunding.Sixteenstatehighriskpoolsoperateapremiumsubsidyprogram,funded throughfederaloperatingorbonusgrants(NASCHIP,2009).AsshownonTable1,statesutilize variousmechanismsforsubsidizingcoststotheirlowincomeenrollees.Minnesotaiscurrentlythe onlyhighriskpooltodistributethesefundsinaonetimelumpsumtolowincomeenrollees. Distributionofthesubsidyinthisfashionallowsforavoidanceofleftoverfundsthatcanresult whensubsidiesarebasedonenrolleepremiums.Bydeliveringthesubsidythroughaonetime reimbursement,thefundscanbeequallydistributedtoalleligibleenrollees.


Table1.Statehighriskpoolsthatadministerpremiumsubsidyprograms,2008.
State Alabama Arkansas Colorado Eligibility Monthlydiscount Percentof memberswho receiveasubsidy

*subsidyprogramimplementationtobeginin2009 *applyingforfederalsubsidyprogramin2009 Twolevels: Average:28% (1) AdjustedHouseholdIncomebelow Maximum:29% $40,000 (2) AdjustedHouseholdIncomebetween $40,000and$50,000 Indiana Memberswhoarenotreceivingsubsidy Average:40% fromanyothersource Maximum:45% Maryland (1) Income<300%FPL Average:40%or$183 (2) Income<200%FPL Maximum:70%or$345 Minnesota AnnualHouseholdIncomebasedon Onetimesubsidycheck numberofpeopleinthehouseholdthatis Average:$50.86 belowapredeterminedpercentofFPL Missouri BasedonFPL Average:$150 Maximum:$150 Montana MemberswhoqualifyforthePremium Average:45% AssistancePlan,asubplanofthe Maximum:45% Association(traditional)plan New (1) Income<200%FPL[receives20% Average:18%or$81 Hampshire discount] Maximum:20% (2) Income201%250%FPL[receives 10%discount] NewMexico (1) Income<200%FPL[75%discount] Average:66% (2) Incomebetween200and299%FPL Maximum:75% [50%discount] (3) Incomebetween300and400%FPL [25%discount] Oregon Mustbeboth: Average:95% (1) Uninsuredatleastsixmonthsprior Maximum:95% toapplication (2) Incomeatorbelow185%FPL Tennessee (1) FPL<100%=90%discount Average:82%or$582 (2) FPL100150%=80%discount Maximum:90% (3) FPL151200%=60%discount (4) FPL201250%=40%discount (5) FPL251350%=20%discount Utah Basedonincomelevel Average:36% Maximum:50% Washington (1) FPL<251%=upto27%discount Average:15% (2) FPL250300%=upto15%discount Maximum:27% *Noratesmaygobelow110%SRR Wisconsin Householdincome<$33,000 Average:33%or$157 Maximum:43%or$275 Wyoming Annualadjustedgrossincomebelow Average:30% 250%FPL Maximum:30%

30%

6% 26% 9% 12% 9% 10.7%

43%

9.9%

86%

21% 1.1% 19% 35%

Source:NASCHIP,HealthInsuranceforHighRiskIndividuals:AStatebyStateAnalysis.23rd edition:20092010.


TheMinnesotaComprehensiveHealthAssociation(MCHA) TheMinnesotaComprehensiveHealthAssociation(MCHA)isthelargeststatehighrisk pool,covering27,645enrolleesin2009(MCHA,2010b).MCHAisalsooneofthelongestrunning poolsinthecountry,inoperationsince1976whenitwascreatedbythestatelegislature(NASCHIP, 2009).AlthoughMCHAcurrentlyreceivesnostatefunding,theMinnesotaStateLegislaturehas allocatedfundingtoMCHAtooffsetlossesinthepast(Blewett,Spencer&Burke,2011).Premium ratesaresetbystatelaw,whichrequirespremiumstoremainbetween101%and125%ofthe averagepremiumrateforacomparableplanintheprivatemarket(NASCHIP,2009). Minnesotaspoolcoversresidentswithpreexistingconditionsthathavebeendenied insuranceontheprivatemarketbutalsoincludesHIPAAeligibles,HCTCeligibles,peoplewhoare ineligibleforMedicareorwhohavebeendiagnosedwithaspecificmedicalcondition,referredtoas apresumptivecondition(MCHA,2010a).Individualswiththeseconditionsarepresumedtobe uninsurableontheprivatemarketandmustshowproofofdiagnosistobeeligible.Diagnosesthat wouldfitthiscriterionincludeleukemia,AIDSorHIV,paraplegiaorquadriplegia,historyoforgan transplantorcysticfibrosis(MCHA,2010a). CurrentlyMCHAoffersdeductibleplansandMedicaresupplementplans.Mostenrollees havedeductibleplans(97%),orhealthplanswheretheenrolleepaysaninitialamountoftheirown healthcarecostsbeforetheinsurerbeginstocontribute.Plandeductiblesrangefrom$500to $10,000,includingafederallyqualifiedhighdeductiblehealthplan(HDHP)thatallowsenrolleesto openaHealthSavingsAccount(HSA)(MCHA,2010c).Planswithlowerdeductibleshavehigher premiums,butgender,smokingstatusandagearealsousedinassessingpremiumamount(MCHA, 2010c).


MCHALowIncomeSubsidyProgram TheMCHALowIncomeSubsidyProgram(LSP)hasdistributedgrantfundssixtimestolow incomemembers,startingin1998.TheCentersforMedicaidandMedicareServices(CMS)is currentlythesourceofthisfundingandhasofferedgrantstohighriskpoolssince2006underthe StateHighRiskPoolFundingExtensionActof2006(UnitedStatesDepartmentofHealth&Human Services,[HHS]2010).CMSawardsthreetypesofgrantstohighriskpools:(1)seedgrantstostates lookingtoimplementqualifiedhighriskpools;(2)operationallossesgrants;and(3)bonusgrants forthedevelopmentofconsumerprogramssuchasdiseasemanagementorsubsidyprograms (HHS2010). MCHAsLowIncomeSubsidyProgram(LSP)hasbeenfundedprimarilythroughthefederal bonusgrant.Thisgranthasnotbeenofferedeveryyear,butMCHAhasappliedforiteachyearit hasbeenoffered.GrantfundshavebeendistributedtolowincomeMCHAmembersthroughthe subsidyprogramin1998,2005,2006,2007,2008and2010(HallelandHabichtHealthConsulting, 2010). Initially,MCHAadministeredthelowincomesubsidyprogrambasedonannualpremium contribution.Enrolleeswithlowincomesqualifiedforthesubsidyandaspecificamountbasedon thepremiumstheypaidtheprioryearwasdistributed.Subsidyamountsbasedonpremiumswere establishedpriortotheapplicationperiod,whichresultedinfundsthatwereleftoverfromthe federalgrantthatwerenotdistributed.In2006,MCHAchangedthedistributionmethodinorderto effectivelydistributetheentireamountofgrantfundingreceivedforadministrationofthesubsidy program.Insteadofthesubsidyamountreflectingthetotalpremiumspaidbythemember,each memberwouldreceivethesameamountofsubsidy.Afterapplicationshadbeenprocessed,the totalamountoffundingwasdividedequallyamongsteligiblemembers.Table2detailsthe variationinfundingfrom2005to2010andthechangeindistributionmethodin2006.Income eligibilityforthesubsidyhasalsoincreasedfrom2005from180%FPLto220%FPLin2010.


Thenumbersofapplicantsthatqualifyforthesubsidyaswellasthosethataredeniedhave stayedrelativelythesamefrom2007to2010(SeeTable2).Commonreasonsfordenialinclude inadequatedocumentationofincome,incorrectreportingofincomeorhouseholdsize,oran incompleteapplication. Table2.MCHALowIncomeSubsidyProgramFundingandEligibilityInformation,2005 2010. 2005 2006 2007 2008 2010 AmountDistributed $267,040 $2,700,000 $2,000,000 $1,250,000 $1,674,608 #Applications 26,885 24,000 24,709 24,512 23,000 Mailed IncomeEligibility 180%of 180%of 200%of 220%of 220%of Poverty Poverty Poverty Poverty Poverty Applications 1,860 1,767 2,988 2,896 2,778 Received #Qualifying 1,558 2,707 2,422 2,427 2,399 Applications Distribution Determined Total$ Total$ Total$ Total$ Method bypolicy dividedby# dividedby# dividedby# dividedbyl# holder ofqualified ofqualified ofqualified ofqualified premium members members members members SubsidyAmount $171.40 $857.69per $716.08per $438.59per $610.28per (averageper member member member member member) ApplicationsDenied 302 440 566 469 379 (%oftotal (16.2%) (25%) (19%) (16%) (14%) applications received) Source:HallelandHabichtConsulting,LLC.MinnesotaComprehensiveHealthAssociation.2010 LowIncomeSubsidyProgramFinalReport. AffordableCareActImplicationsforHighRiskPoolEnrollees ThePatientProtectionandAffordableCareAct(ACA)includesprovisionsthatdirectly impacthighriskpoolenrollees.ExpansionofinsurancecoverageisamainobjectiveoftheACAand isaddressedthroughtheexpansionofpubliccoverageandregulationoftheprivatemarket. Currently,statesareobligatedtoprovideMedicaidcoverageforselectpopulationsincludingSocial SecurityIncome(SSI)recipients,lowincomechildrenandpregnantwomen.Foradultswithout


children,statesretaindiscretionovertheoperationoftheirpubliccoverageprogramsandthelevel ofcoverageoffered(CentersforMedicareandMedicaidServices[CMS],2005).TheACAintroduces anationalstandardforMedicaid,requiringstatestocoverresidentswithincomesupto133%of thefederalpovertylevel(138%FPLincludinga5%disregard).Thenewlawalsorequiresthat Medicaidexpandeligibilitytoallindividuals,includingchildlessadults.Italsoeliminatestheuseof anassettestfordeterminationofeligibilityinpubliccoverage.ForlowincomeMCHAenrollees,the ACAopensupMedicaidasanewoptionforhealthinsurance. UnderthenewACAprovisions,incomeeligibilityforallMedicaidprogramswillbebasedon thehouseholdsModifiedAdjustedGrossIncome(MAGI)withoutanassettest(KaiserFamily Foundation,2010).Thiscarriessignificantimplicationsforpeoplewhohavelittleannualhousehold income,butmighthaveannuities,savingsorassetsthatputthemovereligibilitylimitsforpublic coverage.ManyMCHAenrolleesarefarmers,selfemployedindividualsorsmallbusinessowners whoseassetswouldexceedtheselimits.MCHAeligibilitydoesnotincludeanincometestorasset testsothesegroupsareabletopurchasecoverageaslongastheymeetothercriteria.Because theseindividualsareunabletoenrollinpubliccoverageandhavebeendeniedinsuranceonthe privatemarket,coveragethroughMCHAistheironlyhealthinsuranceoption. Highriskpoolsexisttoprovidecoverageforpeoplewhohavebeendeniedinsurancebased onhealthstatus,orpreexistingconditions.TheACAeliminatestheabilityofinsurance companiestodenyapplicantsinsuranceforthesereasons,openinganewmarketforhighriskpool enrollees.ThisprovisionbecameactiveforchildrenonSeptember23rd,2010,banninginsurance companiesfromdenyingchildrenhealthinsuranceforhavingapreexistingcondition(ThePatient ProtectionandAffordableCareAct[ACA],2010).Thereactionfromhealthinsurershasbeento droptheirchildonlypolicies,meaningthatchildrencanonlygetcoverageiftheyareaddedas dependentsonanotherenrolleesplan(Ramshaw,2011).Unfortunately,untilthisprotectionis effectiveforadultsonJanuary1st,2014,highriskchildrenwhodonothaveaccesstoprivate


insuranceandarenoteligibleforpubliccoveragewillcontinuetohavelimitedoptions.Withthe eliminationofunderwriting,orpricesettingbasedonhealthstatus,thosepreviouslydenieddueto chronicconditionsorpreexistingconditionswillbeabletoaccessprivatehealthinsurancein 2014. Finally,thelawaddsnewfederalpremiumandcostsharingsubsidiesforlowincome individualsnoteligibleforMedicaidbutwithincomesof139%400%FPL.TheACArequiresthat eachstateoperateahealthinsuranceexchange,orHeathBenefitExchange,whereconsumerscan purchaseplansandcomparethemacrossbenefitsets.Stateshavesomeflexibilityinhowthey establishexchangestheycandevelopmultipleregionalexchangeswithinthestate,operatea statewideexchange,orcollaboratewithotherstates(Carey,2010).TheACAenablescreationof SmallBusinessHealthOptionsPrograms(SHOPs),orexchangesforsmallgroupsthatstatescan choosetooperateindependentlyortogetherwithHealthBenefitExchangesattheirdiscretion. Peoplewhopurchasehealthinsuranceintheexchangeandwhohaveincomesbetween 201400%FPLwillbeeligibleforfederalsubsidies.TheACAalsoallowsstatestocreateabasic healthplanforpeoplewithincomesof139%200%FPLthatwouldalsobesubsidizedbythe federalgovernment.Itiscurrentlynotknownhowthesubsidiesinthebasichealthplanandthe exchangewillcomparewithsubsidyprogramsinhighriskpools,butitispossiblethatthebasic healthplanandplansintheexchangewouldyieldalternativeandpossiblymoreaffordablehealth insuranceoptionforlowincomehighriskpoolenrollees. AffordableCareActImplicationsforMCHAEnrollees MinnesotashighriskpoolwillcertainlybeimpactedbytheACA.Themostsignificant impactwilllikelybeonlowincomeenrolleeswhoareconsideringdroppingcoverageduetohigh cost.Currently,manylowincomeenrolleesinMCHAarenoteligibleforpubliccoverageprograms likeMedicaid(calledMedicalAssistanceinMinnesota)becauseofincomethresholdsandasset


limits.BothincomeandassetcriteriamustbesatisfiedtobeeligibleforMedicalAssistanceor MinnesotaCare.Furthermore,incomeandassetlimitsvarydependingonthepersonenrollingfor example,adultswithoutchildrenareonlyeligibleforMinnesotaCareandhaveanassettestof $10,000or$20,000dependingonthenumberofpeopleintheirhousehold(seeTable3).In contrast,pregnantwomenandchildreneligibleforMedicalAssistancearenotrequiredtomeetan assettest.Becausethepubliccoverageeligibilityismoregenerousforparentsandchildren,low incomeMCHAmemberstypicallyimpactedbythesecriteriaarechildlessadults. Table3describescurrentpublichealthcoverageprogramsinMinnesota,theireligibility criteriaandwhethereligibilityisdeterminedusinganassettest.

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Table3.EligibilityDeterminantsforCurrentMinnesotaPublicHealthCoveragePrograms.
Medical Assistance (Medicaid) PopulationsEligible PregnantWomen Children Parentswithchildren under19 Elderly,blindand peoplewith disabilities Employedpersons withdisabilities MinnesotaCare Adultswithout children Pregnantwomenand childrenunder21 Parents,legal guardians,foster parentsandrelative caretakersof childrenunder21 General Assistance MedicalCare IncomeEligibility byFPL Atorbelow275% Atorbelow280% (underage2) 150%(age218) 100%(age1920) Atorbelow100% AssetLimit Noassetlimit Noassetlimit $10,000(one) $20,000(twoor more) $3,000(one) $6,000(twoor more) $200foreach dependent $20,000per enrollee $10,000(one) $20,000(twoor more) Noassetlimit Beneficiarieswhofit newMedicaid(Medical Assistance)eligibility criteriawillbe transitionedtothat program. Eligibilitytoincludeall peopleupto138%FPL withnoassetlimit. Incomeeligibilitytobe determinedusingnew ModifiedAdjustedGross Income(MAGI) methodology. ChangesAnticipated withACA

Atorbelow100%

Noincomelimit Atorbelow250% Atorbelow275%

Atorbelow275%

$10,000(one) $20,000(twoor more)

Allpopulations

Atorbelow75%

$1,000per household

Transitionedto Medicaid(Medical Assistance)aspartof earlyMedicaidoptinon March1,2011.

Source:MinnesotaDepartmentofHumanServices,2010.Availableat https://edocs.dhs.state.mn.us/lfserver/Public/DHS4346ENG. TheMedicaidexpansionto133%FPL(138%FPLincludingthe5%incomedisregard)will requireashiftingofpubliccoverageprogramsinMinnesota,primarilytheshiftingof MinnesotaCareandGeneralAssistanceMedicalCare(GAMC)populationstoMedicalAssistanceso thatthestatecanreapfederalmatchingfundsforthoseindividuals.Throughrepositioningofthese programs,Minnesotawillbeabletoconsolidatepopulationsandgainadditionalfundingpreviously notavailableforthesegroups.

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LowincomeMCHAenrolleeswithincomesatorbelow400%FPLwillhaveaccesstonew healthinsuranceoptionsasaresultoftheprovisionsintheACA.Tofurtheridentifytheimpactof thesenewoptionsontheMCHApopulation,thisstudywillprovideestimatesofthenumberof enrolleeswhowillbeeligibleforeachnewcoverageoptionestablishedbytheAffordableCareAct. Specifically,estimateswillbegeneratedforthenumberofMCHAenrolleesthatwillbeeligiblefor Medicaid(withincomesbetween0138%FPL),forthebasichealthplan(139200%FPL)andfor subsidiestopurchaseinsuranceintheexchange(201400%FPL). Inadditiontotheincreaseinincomeeligibility,themethodologyforhowincomewillbe determinedwillalsochangein2014asaresultoftheACA.Statescurrentlyholdsomediscretionin howfamilyincomeisdetermined,buttheACAmandatestheuseofModifiedAdjustedGross Income(MAGI),ataxbasedmeasureofincomedefinedbytheInternalRevenueCodeof1986 (SocialSecurityAdministration,2010).PartofthereasonfortheintroductionofMAGIisthatthe subsidiestopurchaseinsuranceintheexchangewilloccurthroughataxcredit(Czajka,2011).In anticipationoftheneedtodeliverthetaxcredit,ataxbasedmeasureofincomewasintroduced. MinnesotasMedicaidprogram,MedicalAssistance,currentlydefinesincomeasnet countableincomeaftercertainallowabledeductions(Aves,2010).Incomeincludeswages, salaries,unemployment,selfemploymentincome,childsupport,SocialSecurityandincomefrom othersources(MinnesotaDepartmentofHumanServices,2011).Incontrasttocurrenteligibility determination,MAGIincludesincomebasedonthetaxfilingunit,includingdependentsofthetax filer.OneofthemajordifferenceswithMAGIisthatitutilizesannualincomeinsteadofcurrent income.Indeterminingeligibilityforlowincomeresidents,statesanticipateguidancefromthe CentersforMedicareandMedicaidServices,whichisforthcoming.

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Methods ThisstudyanalyzedMCHAenrolleedatafromthe2010LowIncomeSubsidyProgram (LSP).Thedataiscomprisedofapproximately25,000recordscontainingallactiveMCHAmembers withdeductibleplansonMarch1,2010.EnrolleeswithMedicaresupplementplanswerenot eligibleforthelowincomesubsidyin2010andwereexcludedfromthedata.Furthermore,thenew ACAcoverageoptionsaddressedinthisstudyexcludeMedicarebeneficiariessotheirinclusionis unnecessary. DataongeneralmembershipwereobtainedfromMCHAandwereusedforadministration ofthe2010LSP.Thedataincludegender,age,plantype(deductibleandpremium),zipcode,and whethertheenrolleewasapolicyholderordependent.Applicantssubmittedhouseholdsizeand documentationofhouseholdincometoconfirmtheireligibilityforthesubsidyprogram.For2,398 qualifiedapplicantswhoreceivedthesubsidyin2010,totalgrossincomeforthehouseholdin2009 andhouseholdsizewererecorded.Anadditional376dependentswhowerelistedontheplansof qualifiedapplicantsalsoreceivedthesubsidy,butincomeandhouseholdsizewasnottracked. Eligibilityforthesubsidywasbasedonhouseholdincomeatorbelow220%ofthefederal povertylevel(FPL).Applicantswererequiredtosubmitproofofhouseholdincome,preferably throughaForm1040FederalIncomeTaxReturnforeachmemberofthehouseholdoralternative documentationtosupporttheirincomeclaim.Additionally,applicantswithnontaxableincome suchasSocialSecurityorunemployment(in2009thefirst$2400ofunemploymentincomewas nottaxed)wereaskedtosubmitdocumentationofthatincome. Figure1describestheMCHApopulationandtheLSPpolicyholdersubgroupforwhom incomedatawasavailable.Asshown,theLSPpopulationrepresentsonlyaportionofthetotal MCHApopulation.

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Figure1.MCHAPopulation,2010.

Table4describesMCHAenrollmentnumbersindeductibleplansandMedicaresupplement plans.Asshowninthetable,2,398policyholdersand376dependentsqualifiedforthesubsidy. Table4.MCHAEnrollmentbyPlanTypeandParticipationinthe2010LowIncomeSubsidy Program,20092010. EnrolleeswithMedicare EnrolleeswithDeductiblePlans SupplementPlans Policyholders=22,196 Dependents=3,569 LSP 2,398 Analysis Nosubsidy 19,798 LSP 376 Nosubsidy 3,193 819

Source:MCHA2010LSPdataandMCHA2009HealthCareReport.

EstimatesofthenumberofMCHAenrolleeswhowillmeetthenewincomeeligibility criteriaundertheACAweregeneratedintwoways.First,estimatesweregeneratedusingtheLSP dataonly.Asecondestimatewasgeneratedusingthe2009AmericanCommunitySurvey,anannual householdsurveyconductedbytheUnitedStatesCensusBureau. InordertoidentifyfuturecoverageoptionsforlowincomeMCHAenrolleesundertheACA, enrolleeswereidentifiedbasedonwhethertheircurrenthousheoldincomewouldmeetthenew

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incomeeligibilitycriteriaforMedicaid,thebasichealthplanandsubsidiesintheexchange.Oneof themajorcoverageinitiativesincludedintheACAistheexpansionofMedicaidtoincludeall individualswithincomesupto138%ofthefederalpovertylevel(FPL).Theneweligibilitycriteria includesafivepercentincomedisregardsothenumberofMCHAenrolleeswithincomesfromzero to138%FPLwillbeestimated(ACA,2010). MCHAenrolleeeligibilityforthebasichealthplanwillbeestimatedbasedonincomesfrom 139%to200%FPL.Finally,thenumberofenrolleeswhowouldbeeligibleforfederalsubsidiesto purchaseprivateinsuranceintheexchangewillbepredictedbyestimatingincomesrangingfrom 201%to400%FPL. AlthoughalimitedsourceofincomedataforMCHAenrollees,theLSPdataprovidetheonly availablerecordsofexactgrosshouseholdincometogeneratetheseestimates.Therulesregarding determinationofincomeeligibilityforpubliccoverageorsubsidieshavenotyetbeenreleasedby theCentersforMedicaidandMedicareServices(CMS),howevertotalgrosshouseholdincome includingtaxableandnontaxableincomewasusedtodetermineeligiblityfortheLSP.Basedon informationcurrentlyavailableaboutincomecalculationusingMAGI,itappearsthetotalgross householdincomecalculationusedfortheLSPwillalignclosely.Estimatesoflowincomeenrollees usingtheLSPdatarepresentMCHAmemberswithincomesfrom0to220%FPL,asthesewerethe memberswhosuppliedhouseholdinformationforapplicationtotheLowIncomeSubsidyProgram. HouseholdincomeestimatesforallMCHAmembersweregeneratedusingthe2009 AmericanCommunitySurvey(ACS)PublicUseMicrodataSample(PUMS).TheACSisanannual surveyconductedbytheUnitedStatedCensusBureauthatcollectsinformationondemographics, income,education,education,employment,occupationandothertopics.Thesampleusedforthis analysisincludedciviliannoninstitutionalizedresidentsofMinnesota,whichresultedinasample sizeof1,917,748for2009(UnitedStatesCensusBureau,2010).Fivedigitzipcodeswere aggregatedtoPublicUseMicrodataAreas(PUMAs),thegeographicunitofanalysisintheACS,using

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acrosswalkavailablethroughtheMissouriCensusDataCenter(MissouriCensusDataCenter, 2010).SomezipcoderegionsinthecrosswalkspannedmultiplePUMAs.Inthesecases,thezipcode wasassignedtothePUMAwhichencompassedthelargestproportionofthezipcodearea.For example,azipcodeareathatcrossedthreePUMAs40%inonePUMAand30%intwoothers wouldbeassignedtothefirstPUMA.Therewere36recordsforwhichzipcodecouldnotbe identified.ThesezipcodeswereoutsidethestateofMinnesotaandsotherecordswereremoved fromtheanalysis. DepartmentofHealthandHumanServices(HHS)PovertyGuidelineswereusedtoidentify incomegroupsofinterestrelatedtoimplementationoftheACA.TheHHSguidelineswere consideredtobemoreappropriatethanthepovertythresholdsincludedwithintheACSastheyare usedforfinancialdeterminationforprogrameligibility(HHS,2011).

Asingleimputationmethodwasusedtogenerateincomeaspercentageofthefederal

povertylevelusingnumberofMCHAenrolleesineachPUMA.Percentageofthepopulationwithina povertylevelthresholdwasidentifiedforeachPUMAandusedtoestimateincomefortheMCHA population.Forexample,if20%ofresidentsinonePUMAhadincomesfrom0to138%FPL,we estimatethat20%ofMCHAenrolleesinthatPUMAhavesimilarincomes.Becauseincome eligibilityforMedicaid,thebasichealthplan,andsubsidiesintheexchangewillnolongerrequire anassettestin2014,wecanestimateincomeeligibilityfromtotalgrossincomereportedinthe ACS. Results The2010LowIncomeSubsidyProgramdistributed$610.28toeachof2,774eligibleMCHA enrolleestotaling$1,674,608.ForthepurposesoftheLSP,eligibilitywastrackedonlythrough policyholders.Althoughbothpolicyholdersanddependentsreceivedthe$610.28subsidy,theLSP

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dataidentifiedonlypolicyholdersassubsidyrecipients.Incomeandhouseholdsizewerenot documentedforthe376dependentsthatreceivedthesubsidy,butwereincludedintheestimates. Demographics TheMCHApopulationconsistsofslightlymorefemaleenrollees(53.4%)thanmale

enrollees(46.6%).LSPgenderdistributionissimilar(52.5%women;47.5%men).Mostenrollees areoverage45,withover40percentofMCHAenrolleesandLSPrecipientscomprisingages55to 64.Figure2showsthat45%ofMCHAenrolleesand42%ofLSPenrolleesbetweenages55and64. Asshown,theseMCHAenrolleesrepresentanolderpopulationthatisnotyeteligibleforMedicare benefits,butwhohaveahigherlikelihoodofbeingdeniedhealthinsuranceontheprivatemarket duetoageandhealthstatus.MostpeopleintheUnitedStatesbecomeeligibleforMedicareatage 65,yetaverysmallpercentageofenrolleesage65andover(0.4%or101enrollees)areenrolledin MCHAdeductibleplans.TheseindividualsarelikelynoteligibleforMedicareandsochooseto purchaseMCHAcoverage.ReasonsforMedicareineligibilityarenothavingcitizenshipor permanentresidentstatusintheUnitedStatesornothavingworked10yearsinMedicarecovered employmentforentitlementofMedicarebenefits(HHS,2011).

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Figure2.AgedistributionoflowincomesubsidyrecipientsandMCHApopulation,2010.
50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 018 1925 2634 LSPrecipients 3544 Age MCHApopulation 4554 5564 65+ 2% 8% 5% 6% 9% 8% 13%12% 0.4% 0.4% 25% 24% 45% 42%

Plantypes ThemajorityofMCHAenrolleesarepolicyholders,approximately86%ofallenrollees.

MCHAallowsfamiliestoenrollspousesandchildrenononeplan,however,manyfamilieschooseto holdindividualplansforeachfamilymembertocatertowardstheirdeductibleandpremiumlevel preferences.Ofthe2,744enrolleeswhoreceivedthesubsidyfor2010,2,398wereindividual policyholders,orroughly86%ofrecipients. Figure3identifiesthedistributionofdeductiblelevelsforlowincomesubsidyrecipients andallMCHAenrollees.Lowincomesubsidyrecipientshaveplanchoicessimilartothegeneral MCHApopulation.Adeductibleof$2,000isthemostcommonplanforbothgroupsofenrollees (33.7%and31.6%,respectively).Asshown,15.3%orsubsidyrecipients(367enrollees)haveplans witha$10,000deductible.

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Figure3.2010LowincomesubsidyrecipientandMCHApopulationhealthplandeductible levelon3/1/2010.
40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% $500 $1,000 $2,000 HDHP $5,000 $10,000 5.9% 7.6% 19.7% 19.3% 13.9% 6.7% 19.1% 16.2% 33.7% 31.6%

15.3% 10.9%

DeductibleLevel PercentageofLISPrecipients
IncomeestimatesfromLSPenrolleeinformation Almosthalfofsubsidyrecipients(0220%FPL),or49.1%,werefoundtohaveincomes

PercentofMCHApopulation

betweenzeroand138%ofthefederalpovertylevel(FPL).UnderACA,theseenrolleeswouldbe eligibleforMedicaid.Table5providesinformationonincomeforpolicyholderrecipientsand estimatesfordependentrecipients. Table5.EstimatedincomelevelofLowIncomeSubsidyProgramrecipientsusing2010LSP incomedata. Percentof Federal NumberofLSP Poverty (Policyholder) Level Recipients (FPL) 0138% 139200% 201220% Total 1,177 829 392 2,398 %LSP Policyholder Recipients 49.1% 34.6% 16.3% 100% Estimateof LSP (Dependent) Recipients 185 130 61 376 Estimateof TotalLSP Recipients 1,362 959 453 2,774 %MCHA Enrollees

5.3% 3.7% 1.8% 10.8%

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AssumingLSPrecipientsrepresentallMCHAenrolleeswithincomesfrom0220%FPL,the percentageofMCHAenrolleeswithincomesatthislevelwouldbe10.8%.Becauseweknowthat someenrolleeswithincomesbetween0220%FPLdidnotapplytotheLSP,thiscalculationlikely representsaconservativeestimateofthenumberofMCHAenrolleeswithincomes220%FPLor below.Forthisreason,asecondanalysistoestimatealllowincomeMCHAenrolleeswas conducted. IncomeestimatesfromtheAmericanCommunitySurvey(ACS) TheestimatesgeneratedusingtheAmericanCommunitySurveyfoundamuchhigher

proportionoflowincomeMCHAenrolleesthantheestimatesusingLSPenrolleesonly. Approximately16.7%(comparedto5.3%)werefoundtofallinthelowestincomecategory (138%FPLorbelow).Table6illustratesthenumberofenrolleesestimatedtobeeligiblefor Medicaid(0138%FPL),forthebasichealthplan(139200%FPL),orsubsidiesintheexchange (201400%FPL)basedonACSdata.Asshown,58%ofenrolleescouldbeeligibleforsubsidizedor freehealthcarecoveragein2014astheirincomesreflectpovertylevelthresholdsbelow400%FPL. Table6.EstimatedincomedistributionofMCHAEnrolleesbyfederalpovertylevel(FPL) using2009AmericanCommunitySurveyestimates. PercentofFPL 0138% 139200% 201400% 401%FPL+ Total NumberofMCHA Enrollees 4,288 2,387 7,504 10,811 25,730 %MCHAEnrollees 16.67% 9.28% 32.04% 42.02% 100%

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Discussion Theresultsofthisstudyprovideevidencethatamajorityofhighriskpoolenrolleesin MinnesotacouldbeeligiblefornewcoverageoptionsundertheAffordableCareAct.Ataminimum, roughly2,800MCHAenrolleeswilllikelybeeligibleforsomeformofsubsidizedhealthinsurancein 2014,determinedfromparticipationintheLSP.Thisisundoubtedlyanunderestimateduetothe voluntarynatureofparticipationinthelowincomesubsidyprogramforMCHA.Because participationintheLSPisvoluntary,weknowtherearelikelymoreMCHAenrolleesatanincome levelbetween0220%FPLthanappliedforthesubsidy. EstimatesfromtheAmericanCommunitySurveyyieldamuchlargerpercentageofMCHA enrolleesthatcouldbeeligiblefornewsubsidizedcoverageoptions.TheACSincomeestimates showathreefoldincreaseinthenumberofenrolleesthatwouldbeeligibleforMedicaidin2014. Thenumberofenrolleesexpectedtobeeligibleforthebasichealthplan(139200%FPL)werealso markedlyhigherwiththeACSestimate. MCHAdoesnothaveanincomelimitoranassettestfordeterminingeligibility,butdoes

screenapplicantsforeligibilityinMinnesotaspubliccoverageprogramsatenrollment.Itis possible,however;thatsomeenrolleeswhowerenoteligibleatthetimeoftheirenrollmenthave sincebecomeeligibleduetoachangeinincomeorassetlimits.If,basedonACSestimates,over 4,000MCHAenrolleescurrentlyhaveincomesatorbelow138%FPL,thisposesquestionsabout theirlackofparticipationinthesubsidyprogramaswellasthepossibilitytheymightcurrentlybe eligibleforpubliccoverage.Currenteligibilityinpubliccoveragemightbelimitedduetotheasset testusedforMedicaid(MedicalAssistance)andMinnesotaCare.In2014,however;theassettest willbeeliminatedandMCHAenrolleeswithincomesatorbelow138%FPLwillbeeligible regardlessoftheirassets. OnelimitationoftheseestimatesisthelackofguidancecurrentlyavailablefromtheCenters forMedicareandMedicaidServicesonthenewincomedeterminationmethodologyusingModified

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AdjustedGrossIncome(MAGI).IncomefortheLSPwasdeterminedusingtotalgrossincomeor moneyenteringthehousehold,includingnontaxablesourcesofincomesuchasSocialSecurity, alimony,andpensions.Althoughthisalignscloselywiththetaxableandnontaxableincome includedinMAGI,theLSPrequiredinclusionofallindividualsinthehouseholdinsteadofbeing basedontaxfilingstatusreflectedinMAGI.TherearealsoconsiderationsforhowMAGIwillbe usedforlowincomeindividualsbelowthetaxfilingrequirement($9,350forasingleindividual underage65)andwhetherannualincomeusedfortaxpurposeswillbeutilizedindetermining currentincomeforpubliccoverageeligibility(IRS,2011). Affordabilitywillbekeytowhetherindividualschoosetopurchaseinsurancethroughthe exchange.Medicaidcoveragewillundoubtedlybeamoreaffordableoptionforhighriskpool enrollees,astheywillnotberequiredtopaypremiums.Itiscurrentlyunknown,however;howthe subsidiesofferedintheexchangecomparewiththehighriskpoolsubsidyandwhetherthiswill makeinsurancecoverageintheexchangeamoreaffordableoptionin2014. PolicyImplications InMinnesota,theMinnesotaComprehensiveHealthAssociation(MCHA)providescoverage forroughly27,000enrollees.Althoughitsimpactseemssmall,MCHAisanimportantsafetynetfor highriskMinnesotans,providingacoverageoptionforapopulationthatmightnothaveanyother options.ItshouldberecognizedthattheMCHApopulationhasspecificneedsintheinsurance market.MostMCHAenrolleesaremedicallyuninsurable,meaningtheyhavechronichealth conditionsthatrequireroutineandspecializedcare.Enrolleeswiththesetypesofhealthneeds oftenhavedifficultymaintainingemployment,whichresultsinstrainedfinancesandlowerincome. TheexpansionofpubliccoveragetoincludeMCHAenrolleesposesimplicationsforstate spending.In2008,totalhealthcareclaimsforMCHAtotaled$245,773,335forapproximately 28,107enrollees,orabout$8,744perenrollee(MCHA,2010b).Thesecosts,currentlypaidfor

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throughenrolleepremiumsandinsurerassessmentsinMCHA,wouldbetransferredtothestate andfederalgovernmentforthoseenrolleestakingupMedicaidcoverage. Medicaidisfinancedthroughfederalandstategovernmentcontributions.Thefederalshare isknownastheFederalMedicalAssistancePercentage(FMAP)andisdeterminedforeachstatein TitleXIXoftheSocialSecurityAct(Chun,2010).TheoriginalFMAPforMinnesotais50%,which wasraisedtoover60%during2008,2009and2010intheAmericanRecoveryandReinvestment Act(ARRA).Startingin2011,theFMAPreturnedtoitsoriginal50%. TheAffordableCareActestablishesa100%federalmatchfornewlyeligiblepopulationsin 2014,butthisfinancialassistanceisscheduledtolastonlyuntil2016(ACA2010).After2016,the statemustgraduallyassumemoreofthecostforthenewlyeligiblepopulationastheFederal MedicalAssistancePercentage(FMAP)decreases.In2017,theFMAPbecomes95%anddecreases 1%fortwoyears.Startingin2020,theFMAPwillbe90%andremainthere(ACA2010).Althougha 90%FMAPrelievessomeburdenonthestateascomparedtotheoriginal50%FMAP,therearestill additionalcoststhatwillbeincurredbythestatewithahighrisk,highcostpopulationentering Medicaid. Thousandsofhighriskenrolleesenteringnewinsurancemarketswillcertainlyhold implicationsfortheriskprofilesoftheexchangepopulationaswellasthoseinpubliccoverage programs.CostcontainmentisanongoingconcernforMCHA,especiallyconsideringthehigher ratesofincreaseforhealthcarespendingforthispopulationwhencomparedwithaveragecostsin thestateofMinnesota(Blewettetal,2011).Introductionoftheseenrolleesintotheexchangecould impacttheaffordabilityofplansforhealthyindividualsconsiderably.IndevelopingtheHealth BenefitExchange,thestateshouldconsidertheuniquehighriskpopulationandthechangingrisk profilefortheexchangemarket.Blewettetal(2011)suggeststhatthetransitionofhighriskpool enrolleestotheexchangewillrequiresubstantialsubsidiesinordertopreventadverseselectionby healthplans.Developmentofariskadjustmentmechanismintheexchangethatincentivizeshealth

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planstoofferplansthatenrollhigherriskpeoplewillalsobeimportantindiscouragingadverse selectionandensuringplanscompeteonconsumerchoice(Lueck,2009). ParticipationintheLSPhasremainedrelativelystableoverthelastthreeyears,with approximately2,800applicationsreceivedand2,400qualifyingindividuals,despitetheeconomic downturnandrecession(HallelandHabichtHealthConsulting,2010).Furtherresearchonthe impactoftheeconomyforMCHAenrolleescouldshedlightonthenumberofnewlyeligiblehigh riskcandidatesin2014.Itispossiblethatsubsidyparticipationhasremainedstableduetolow incomeMCHAenrolleesdroppingcoveragetheycannolongerafford,andotherMCHAenrollees fittingthenewlowincomeeligibilityforthesubsidyduetoeconomichardship. ThemostcommonplanforMCHAenrolleesisa$2,000deductibleplan.Lowincome enrolleeshadsimilarchoicesinplantypesasthegeneralMCHApopulation,buttheirusabilityof theplanvariesdrasticallyastheirdeductiblerises.Forhouseholdsofoneinthe$10,000deductible group,averageincomewas$11,306.Thismeansthatforanadultwiththissalary,averaging$942 permonth,aroutinevisitforpreventivecareisntcoveredbytheplanuntiltheyhavepaid$10,000 outofpocket.Thishighriskindividuallikelyhasunmethealthneedsandonlyuseshealth insurancewhenabsolutelynecessaryorwhentheyhavethefundstopayfortheircare.Forlow incomeenrolleeswhocannotaffordthepremiumsforlowdeductibleplans,theonlyoptionfor coveragebecomesthehigherdeductibleplantheycantaffordtouse. ThecomplicatedneedsofthelowincomehighriskpoolenrolleesoftheMinnesota ComprehensiveHealthAssociationarevastandvaried.Asthestatestartsitsoutreachtoanewly eligibleMedicaidpopulationandnewlyeligiblebasichealthplanpopulation,considerationforlow incomehighriskpoolenrolleescouldbeadvantageousinfurtheridentifyingnewpopulationsthat areunfamiliarwithpubliccoverageprograms.Healthplansintheexchangewillrequireastructure thatsupportstheneedsofthechronicallyill,allowingthemaffordableaccesstocarewhile controllingfortheadditionalcostsoftreatingtheirconditions.Lowincomehighriskpoolenrollees

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willcertainlyhavenewoptionsunderimplementationoftheACAanditwillbeimportantforthe state,forMCHAandfortheprivateinsurancemarkettoensuretheytransitionsmoothly.

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13. LueckS.(2009).Rulesoftheroad:Howaninsuranceexchangecanpoolriskandprotect enrollees.CenteronBudget&PolicyPriorities.March31,2009.AccessedMay8,2011at http://www.cbpp.org/files/33109health.pdf. 14. MinnesotaComprehensiveHealthAssociation.(2010a).Eligibility.AccessedApril3,2011at http://www.mchamn.com/html/eligibility.html. 15. MinnesotaComprehensiveHealthAssociation.(2010b).MCHA:HealthCareDataReportfor ReportingPeriodJanuary1,2009December31,2009. 16. MinnesotaComprehensiveHealthAssociation.(2010c).MCHAStandardPremiumRates. AccessedApril3,2011atwww.mchamn.com/docs/10_std_rates.pdf. 17. MinnesotaDepartmentofHumanServices.(2010).IncomeandAssetLimitsbyProgram. AccessedMay3,2011athttps://edocs.dhs.state.mn.us/lfserver/Public/DHS4346ENG. 18. MinnesotaDepartmentofHumanServices.(2011).IncomeEligibility.AccessedApril3,2011 at http://www.dhs.state.mn.us/main/idcplg?IdcService=GET_DYNAMIC_CONVERSION&Revisio nSelectionMethod=LatestReleased&dDocName=id_052537 19. MissouriCensusDataCenter.(2010).MABLE/Geocorr2K:GeographicCorrespondence EnginewithCensus2000Geography.Version1.3.3(August).AccessedFebruary18,2011at http://mcdc.missouri.edu/websas/geocorr2k.html. 20. NationalAssociationofStateComprehensiveHealthInsurancePlans(NASCHIP).(2009). HealthInsuranceforHighRiskIndividuals:AStatebyStateAnalysis.23rdedition:2009 2010. 21. ThePatientProtectionandAffordableCareAct.(2010).ConsolidationofPatientProtection andAffordableCareActasamendedthroughMay1,2010.AccessedApril22,2011at http://docs.house.gov/energycommerce/ppacacon.pdf. 22. RamshawE.(2011).Childonlyinsurancevanishes,ahealthactvictim.TheNewYorkTimes onbehalfofTheTexasTribune.March31,2011.AccessedApril22,2011at http://www.nytimes.com/2011/04/01/us/01ttinsurance.html. 23. SocialSecurityAdministration.(2011).20CFR418.1010.Definitions.AccessedApril3,2011 athttp://www.ssa.gov/OP_Home/cfr20/418/4181010.htm. 24. UnitedStatesCensusBureau.(2010).AmericanCommunitySurvey.SampleSizeData. AccessedFebruary18,2011at http://www.census.gov/acs/www/methodology/sample_size_data/index.php. 25. UnitedStatesDepartmentofHealth&HumanServices.(2010).ReporttoCongressonthe HighRiskPoolGrantProgramforFederalFiscalYears2008and2009.AccessedFebruary18, 2011athttp://www.politico.com/static/PPM187_highriskpool.html.

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26. UnitedStatesDepartmentofHealth&HumanServices.(2011a).FrequentlyAskedQuestions RelatedtothePovertyGuidelinesandPoverty.Availableat http://aspe.hhs.gov/poverty/faq.shtml#differences. 27. UnitedStatesDepartmentofHealth&HumanServices.(2011b).MedicareEligibilityTool. AccessedApril3,2011at http://www.medicare.gov/MedicareEligibility/Home.asp?dest=NAV|Home|GeneralEnrollme nt#TabTop. 28. UnitedStatesDepartmentofLabor.(2011).TradeActProgramOverview.AccessedApril3, 2011athttp://www.doleta.gov/tradeact/ProgramOverview.cfm

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