Medicaid and SCHIP Expansion Innovations Philip M. Bonaparte, MD Chief Medical Officer, HNJH National Medicaid Congress Thursday June 5, 2008

NJ FamilyCare Advantage: The New Public-Private SCHIP Expansion Program Full Cost Buy-In Program for Uninsured Children in New Jersey

Company Overview – Horizon NJ Health Established in October 1993 as a Medicaid Managed Care Organization for the publicly insured Based in West Trenton, NJ Wholly-owned subsidiary of Horizon Blue Cross Blue Shield of New Jersey More than 344,600 members & 45% market share –Includes members from following categories: AFDC/TANF; Aged, Blind and Disabled (ABD) With/ Without Medicare; Division of Youth and Family Services (DYFS) and NJ FamilyCare (SCHIP) Recognized by MERCER as most effective Medicaid Managed Care plan in NJ 3

Mission Statement Horizon NJ Health is a healthcare management company committed to expanding access and enhancing the quality of health for the publicly insured 4

Medicaid Managed Care/NJ FamilyCare As of 5/2008, there are 765,818 NJ residents enrolled in Medicaid/NJ FamilyCare –AFDC – 218,724 –ABD with Medicare – 15,437; ABD without Medicare – 57,473 –DYFS – 14,388 –NJ FamilyCare – 458,837 (113,952 are Parents, Adults, Aliens) Five managed care plans make up the market – Horizon NJ Health; AmeriChoice; Amerigroup; University Health Plan/Centene; Health Net of NJ. Two new plans scheduled to enter market on 7/1/2008 – Healthfirst and WellCare 5

Family Health Care Act (2005) In September 2005, NJ implemented the Family Health Care Act, sponsored by Sen. Joseph Vitale The Family Health Care Act not only made more children and some parents eligible for NJ FamilyCare (SCHIP), it also called for the creation of a buy-in program for families not eligible for NJ FamilyCare –80,000 adults over a four-year period and 100,000 children over a three-year period –Since October 2005, more than 120,000 individuals have enrolled in Medicaid managed care/NJ FamilyCare 6

Family Health Care Act (2005) The Senator’s plan was for the NJ FamilyCare Buy-In program to be implemented in 2006 It took two years to get one of the five Medicaid managed care plans to participate

What is NJ FamilyCare Advantage? In December 2007, NJ Governor Jon Corzine announced the NJ FamilyCare Advantage would start in January 2008 The program is offered solely by Horizon NJ Health, “the only plan to step up to the plate” Health insurance for NJ children whose families do not qualify for traditional NJ FamilyCare or Medicaid, (Coverage for children in household over 350% FPL) –At no cost to the State: program is member premium-based 8

What is NJ FamilyCare Advantage? Provides families the opportunity to “buy-in” to the traditional NJ FamilyCare (SCHIP) plan The State estimates between 16,000 to 50,000 children may be eligible for the NJ FamilyCare Advantage Program

Risks That Need to Be Considered New Product to Market –No way of knowing what the interest/demand will be Adverse Selection –Will only sick people sign up; what will be the mix of members? Abandoning Existing Coverage –Will people cancel current insurance for less expensive coverage? Pent Up Demand for Services –Most new members will utilize services right away –Eligibles have to be without insurance for at least six months prior to enrolling in Buy-In program 10

So Why Do It? Besides being the right thing to do (and in-line with the company’s mission) – it is also the right time to do it There are 1.3 million NJ residents without health insurance, including 242,000 children According to a recent AARP survey of NJ residents –79% “strongly agree” that all New Jersey residents should have access to affordable quality health care –90% said the Governor should make health care reform a priority 11

The Future? On March 17, 2008, Senator Vitale unveiled a plan to provide universal health care to New Jersey within three years by requiring uninsured residents to buy coverage and using state-funds to provide reduced-cost policies –Proposal would be phased in; Initial phase to focus on “Kids First”

Who is Eligible? For Children only - Adults are not eligible –Uninsured children under the age of 19 years old –Families with more than one child must enroll all of their children –Children must be uninsured/without health insurance coverage for previous six months If there was a loss of Medicaid or traditional NJ FamilyCare eligibility-children are immediately eligible Legal resident of NJ Family income must be above 350% of the Federal Poverty Level: $36,400 13

What are the Costs? Families pay low NJ State-set, monthly premium per child: –$137 a month for one child –$274 for a family with two children –$411 for a family of three or more children 14

The Benefit Package Very similar to NJ FamilyCare (SCHIP) benefits –Visits to child’s PCP –Specialty care –Dental care (under 12 years old) –Prescription drugs -$1 co-pay generic/$5 brand name –Hospital services: Inpatient Outpatient with $5 co-pay per visit –Emergency medical care/emergency services –Well child care, immunizations, lead screening/treatment –Laboratory services - covered with a $5 co-pay –Optometrist - yearly eye exam with a $5 co-pay –Optical - eyeglasses or contact lenses every 24 months 15

Enrollment & Marketing As of 5/1/2008, 34 members are enrolled in the plan –Slow and cautious approach to make sure operations run effectively Phone line began taking calls 1/1/2008 –More than 125 applications sent out NJ FamilyCare Advantage pages were added to Web site the first week of February –91 applications were downloaded during the first 3 weeks Grass Roots marketing/community relations –Continue to work with community-based organizations, faith-based organizations, providers, schools, etc. –Partnering with the State (Notify those not eligible for SCHIP) –Participating in more than 250 health fairs in

Thank You

Contact Information: Philip M. Bonaparte, MD 210 Silvia Street West Trenton, NJ Tel.: (609)