1. ROBIN LUNGE DIRECTOR OF HEALTH CARE REFORM NOVEMBER 18, 2011 Integration of Medicaid and the Exchange

2. Purpose & Agenda Overview of issues & options for how to integrate Medicaid and the Exchange Summary of analysis underway Your thoughts and input!

3. Goals Universal coverage (for low and moderate income Vermonters) Comprehensive High Quality Benefits / Innovative services to meet individuals’ needs Focus on Better Consumer Experience Provider Access and Quality Payment Reform Simplified Administration Controlling Health Care Costs

4. STAGE 3: Vermont Single Payer (2017 and beyond – 2014 if ACA waiver date changed in federal law) Two financing plans developed for universal coverage under: 1. Green Mountain Care (single payer) and 2. Exchange – report back to legislature in 2013 STAGE 2: Vermont Health Benefit Exchange becomes operational (2014) Integration Plan Developed for “Single Payer Exchange” – report back to legislature in 2012 STAGE 1: Vermont Health Benefit Exchange and Vermont Health Reform Board (established 2011) Stages of Vermont Health Reforms

5. Medicaid Changes in 2014 Medicaid income eligibility increases to 133% FPL  $1226/month Income calculation changes for some people  “MAGI” – modified adjusted gross income from tax return More verification done electronically  Reduction in paperwork, we hope!! Web-based enrollment  Can still do phone & in person

6. Health Benefits Exchange in 2014 Individuals without employer-sponsored insurance Small businesses & their employees Federal tax subsidies for people with incomes under 400% FPL  $3684/month

7. Medicaid & the Exchange in 2014 7 What happens to VHAP, Catamount Health, and employer-sponsored insurance assistance?  Individuals with incomes under 133% move to Medicaid  Individuals with incomes over this amount – either  Basic Health Plan (option – next slide more details)  Health Benefit Exchange with subsidies Very much like Catamount Health & ESIA What happens to coverage for individuals with disabilities and seniors?  This coverage need not change  Anticipate filing Medicaid waiver request to continue coverage for certain populations currently covered

9. Medicaid & the Exchange: 2014 Health Coverage Options

10. Exchange with federal subsidies 100% federal funds  In process of creating complete financial model Premiums are lower than VHAP/CHAP for very low income & for 2 person families Premiums are a bit higher at upper income levels of CHAP

11. Comparison of Subsidies: Exchange Subsidy & Current Vermont

12. Exchange with federal subsidies 12 Cost-sharing (deductibles, co-payments, co- insurance)  Higher in Exchange than for VHAP  Approx. 70-80% of people in VHAP move to Medicaid  VHAP has no deductible or co-insurance, limited co-pays  Hard to compare CHAP & Catamount  Need detailed benefit designs to compare deductibles, etc  Out of pocket maximums (total you MIGHT have to pay) higher in the Exchange w/ subsidy than Catamount Health Provider rates – by insurer

13. Possible solutions to cost-sharing issues State subsidy “wrap” in addition to federal subsidy  Similar to wrap for employer-sponsored insurance program now  Could provide additional assistance so people don’t have dramatic increases  In process of costing this out  Flexibility in income phase-out  60-40 if included in new Medicaid waiver request Basic Health Plan (see next slides)

14. Basic Health Plan 95% federal funds that would have been received in Exchange More protective of consumers financially More chance of people losing coverage due to transitions Impacts on Exchange financial sustainability & viability Provider rates uncertain at this point  Could be Medicaid; could be Catamount Health level; could be private insurance level

15. Medicaid Option above 133% May cover populations above 133% in Medicaid 60/40 fed/state split  More expensive – lose 100% fed funds Issues with Exchange viability and sustainability Provider rates at Medicaid level