PPACA’s “One-Stop Shopping”

The Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148) attempts to consolidate the application process for Medicaid, cash subsidies and tax credits for the purchase of insurance and coverage through the health insurance exchanges. The state agencies that run Medicaid and the Children’s Health Insurance Program (CHIP) will be required to coordinate with other agencies and the exchanges  to assure that consumers aren’t  bounced from one agency  to another.

Individuals who apply for any form of assistance, i.e., Medicaid, CHIP, premium assistance for employer-sponsored insurance, or advance payment of the tax credit for individual policies purchased through the health insurance exchange, will have to submit their information only once. If the exchange determines that their income is low enough to qualify for CHIP or Medicaid, the eligibility determination and information will be available to the Medicaid agency through integrated computer systems. Similarly, if the Medicaid agency finds that an applicant is not eligible for Medicaid or CHIP but qualifies for premium assistance with coverage purchased through the exchange, the information will be available to the exchange.

How will this work? HHS and CMS are helping states pay for updates to their computerized eligibility determination systems to assure compatibility and interoperability with the systems used by the exchange.

Why should application for  Medicaid be connected with the purchase of private insurance?

About half of the uninsured nonelderly adults work full time. A Georgia study showed that 57 percent of parents of children enrolled in PeachCare, the state’s CHIP, earned less than $2,500 per month, or $30,000 a year.  No more than half of these adults were eligible for employer-sponsored insurance. PeachCare covers children in households with incomes up to 235 percent of the federal poverty level (FPL). This population is likely to experience gaps in coverage; the Georgia study found that in 2008, nearly half of adults with incomes under 200 percent of FPL experienced at least one gap in coverage during the previous year.  Coverage gaps often result from income instability, as the  loss of a job will affect the availability of employer-sponsored coverage, and new employment may affect eligibility for Medicaid or CHIP.  Thus, these individuals cycle between private and public coverage, enrolling and disenrolling as their circumstances change. Coordination of eligibility determinations for Medicaid, CHIP, premium tax credits and reduced cost sharing should reduce the gaps in their coverage.

The health insurance exchanges also will provide one-stop shopping for individuals seeking information about affordable, qualifying  health plans (QHP). The law requires the HHS Secretary to set standards for the format exchanges will use to provide the information necessary for consumers to compare the advantages and disadvantages of qualified plans.  In a recent  Proposed rule,  HHS outlined requirements for the information to be made available. In addition to costs and coverage limits, the agency would require disclosure of the results of customer satisfaction surveys about each QHP, the medical loss ratio,  quality ratings and transparency of coverage measures. The required disclosures include the insurer’s practices concerning  payment of claims, enrollment, disenrollment, number of claims denied, rating practices, cost sharing and payment requirements for out-of-network services, and the rights of enrollees and participating providers.

What do you think of PPACA’s one-stop shopping?