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Premium Assistance Programs: Evolution and Challenges

Explore the evolution and challenges of Premium Assistance Programs in leveraging employer contributions, keeping families together, and overcoming stigma to strengthen private insurance markets. Learn strategies to address low take-up rates and employer offer rates, and discover new avenues for sustainability.

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Premium Assistance Programs: Evolution and Challenges

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  1. Premium Assistance: Evolution of Programs and New Challenges Jeremy Alberga Senior Manager SCI Workshop for State Officials June 28-29, 2004

  2. Goals for Premium Assistance (PA) Programs • Leverage employer contributions • Keep family members together • Limit Crowd-Out • Ease transition from public to private coverage • Strengthen private insurance market • Platform for future program expansions • Eliminate “stigma” of public program

  3. What Problems Are You Trying to Solve? Different problem requires different solution… • Problem: Coverage offered by employer but not taken up by worker Solution: Subsidize employee premium -or- • Problem: Employer doesn’t offer coverage at all Solution: Create affordable product targeting employers and workers

  4. PA Strategy 1: Address Employee Take-up Note: The take-up rate is the percent of employees in a firm who enroll in a plan offered by the firm. All estimates are weighted by the number of employees in the firm. Source: RWJF Employer Health Insurance Survey, 1997

  5. Challenges to Date • Administrative complexities • Start-up costs • Identify potential enrollees • Coordination with employers • Wrap-around requirements • Assessing cost effectiveness • Availability of employer coverage • Low employer contribution for dependant coverage • Employer reluctance to participate

  6. PA Strategy 2: Address Employer Offer Rates (Offer Rates by Firm Size, 1996-2003) Source: Kaiser/HRET Employer Health Benefits 2003 Annual Survey

  7. Premium Assistance: The New Breed • Create a new product, targeting working uninsured • Target either employer or employees • Challenges • Coordinating with carriers, other stakeholders • Avoiding adverse selection • Finding new funding sources in difficult times • Controlling rapidly rising costs

  8. Ongoing Technical Assistance • Premium Assistance Toolkit (with CMS, NASHP) • First three sections written (program costs, design, benefits and cost-sharing) • 1-day PA mtg. at NASHP Annual Conference, Aug. 1-4 • Dissemination of lessons learned from 8 demonstration grantees (AR, HI, ME, NM, OR, RI, VA, WV) • State Reports: 101 individual state and multistate reports [keyword=“premium assistance”] http://statecoverage.net/reportsearch/index.cfm

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