With the defeat of Mitt Romney in the November election, Utah finally had to reconcile itself to the fact it would soon have to swallow the Obamacare medicine. But local health advocates worry two factors will keep Utah from following the good doctor’s prescription for implementing the president’s Affordable Care Act: young immortals and stubborn politicians.
“Young immortals,” as Judi Hilman of the Utah Health Policy Project calls them, are young health consumers who are years away from their first major hospital visit and, under the old system, avoided paying for insurance, thinking themselves invincible. The ACA’s individual mandate requires all individuals to be on private insurance or face a penalty and is expected to help push most into purchasing insurance, thereby adding to the pool and bringing premiums down for everybody. Still, Hilman remains worried.
“I don’t think the mandate is our saving grace,” Hilman says. “I’m afraid a lot of young people will just pay the penalty. I don’t want to see that happen, because then the market will die.”
Hilman’s nonprofit is trying to help the state get its federal health exchange, Avenue H, running and become ACA-compliant. She works closely with lawmakers and policy leaders—old, young, stubborn and willing alike—who will fine-tune Utah’s exchange in the 2013 Legislature, leading up to open enrollment, which begins Oct. 1, 2013.
But the possibility that politics could interfere with Utah’s ability to run its exchange does concern Hilman. She worries that the conservative Legislature’s allergic reaction to federal grant money that would help administrate the program could mean struggles in enforcing penalties against the young immortals—and worse, that the state won’t invest in employees and infrastructure needed to do the important work of getting Utahns signed up with Medicaid, Medicare or private insurance.
She points out that Massachusetts, the original pilot state for health-care reform, has 40 full-time employees administering its exchange.
“We have three [in Utah],” Hilman says. “I’m all for lean government, but let’s make sure we have the necessary resources and infrastructure to make it work.”
By 2019, Utah will be expected to have 77 percent of its population on private insurance or Medicaid. According to a 2012 study by the Kaiser Commission on Medicaid & the Uninsured, by 2019, Utah will also have enrolled 78,284 new Medicaid consumers who had previously been eligible but uncovered.
But Utah has lagged behind other states in getting citizens onto Medicaid. According to a December 2012 study by Washington, D.C.-based policy think tank the Urban Institute, Utah ranked 50th out of all states and Washington, D.C., for enrolling eligible children in the Children’s Health Insurance Program (CHIP) and 42nd out of 51 for enrolling adults in Medicaid.
Utah is one of a minority of states that have made the decision to run its own federal health exchange; 25 states so far have chosen to let the United States Department of Health & Human Services (HHS) run their exchanges, and other states have remained undecided. Utah’s Avenue H received tentative approval by HHS on Jan. 3 to operate as a state-run exchange.
But getting there could be a challenge, Hilman worries, especially when it comes to enrolling Utahns in Medicaid and private insurance. This task calls for an army of “navigators”—people deputized by the state to go out and enroll people in Medicaid or private insurers.
Hilman and her group have already taken measures to recruit their own advocates who are used to dealing with current uninsured populations. Her nonprofit has even built an online database to help navigating organizations looking to enroll new clients. Even still, she worries that the logistics of such an enterprise will suffer if the state doesn’t accept funding to help orchestrate the effort.
Hilman points out that Utah leaders have shunned federal grant money as part of distancing themselves from the president’s legislation. This also raises concerns about the enforcement of penalties against those who opt out of getting coverage—thereby keeping premiums high for those in the insurance pool. While enforcement is a federal jurisdiction, it still requires administrative support from state regulators.
Utah opted to run its own exchange in order to have more control over the process, and while policymakers grapple with interfacing with federal regulators, they also have to brace for a political backlash from those opposed to the ACA, like Don Ruzicka, husband of conservative firebrand Gayle Ruzicka, president of the Utah Eagle Forum. On Jan. 12, Don Ruzicka spoke about Obamacare at the 2013 Utah Eagle Forum Convention and blasted state leaders for their “premeditated lies or criminal stupidity” in describing the state exchange as market-driven. Ruzicka also implored the more than 200 in attendance to rally against the reform, no matter what it takes. That’s exactly the kind of vague call to action that can be troublesome for lawmakers walking the difficult line of owning a health exchange the state can control and actually making it compliant with federal regulations.
Rep. Jim Dunnigan, R-Taylorsville, is running the exchange bill in the upcoming session and also worries about funding. The current exchange, he says, runs on an annual $600,000 appropriation, but he says an analyst the Legislature hired said a new ACA-compliant exchange would likely cost $15 million to $20 million.
Accepting federal money is tricky, Dunnigan says, because while the federal government will provide grants to build and operate the state’s exchange, after the first year, it will have to be fully funded by the state.
“They’ll give you just enough money to get you up to your neck and then say, ‘See you later,’ ” Dunnigan says. “We have to be careful how deep we get, especially if we’re dependent on federal money.”
As for state funding, he’s doubtful about getting $15-$20 million from the Legislature, and says the state is considering contracting to private vendors, who would help build and operate the exchange and might recoup expenses through fees charged to exchange users.
Hilman is comforted, however, by the fact that the Utah Health System Taskforce is collaborating more with the advocates and is reaching out to them to help host public forums on enrollment and the new health-care law. She’s also encouraged that the state is moving to set meaningful transparency laws. Still, she says, bringing tens of thousands of new Utahns into the exchange is not something the state should do on a dime just because lawmakers are sore that they are being forced to implement Obamacare.
“If Utah on principle is going to refuse this money, then we’ve got a problem,” Hilman says. “Because at the end of the day, you get what you paid for.”
Young adults can remain on parents’ insurance until age 26. Children and minors under 18 can’t be denied coverage for pre-existing conditions. Open enrollment for individuals and small businesses begins Oct. 1, 2013.
No individuals will be denied coverage for pre-existing conditions. Insurance premiums for people earning under 400 percent of the federal poverty line will be set on a sliding scale based on income, not to exceed 8 percent of their annual incomes. Example: A person making $35,000 a year incurs $5,000 in insurance premiums and medical expenses, and pays 8 percent of that cost or $2,800; the remaining $2,200 is subsidized.