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Structuring Benefits in Health Connector: Maximizing Choice and Value

Learn about the diverse benefits offered in the Commonwealth Connector, ranging from exclusive purchasing groups to alternate distribution channels. Discover the bidding process, price comparisons, and evolution of the non-group market. Gain insights into decision points and the Seal of Approval process, ensuring high-quality health plans meet consumer demand. Advance health care reform with a focus on individual and small group markets.

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Structuring Benefits in Health Connector: Maximizing Choice and Value

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  1. Structuring Choice in the Commonwealth Connector February 26, 2009

  2. Number & kinds of benefits options depends on type of connector • CommCare: exclusive purchasing group • CommChoice YAP: exclusive distribution channel • CommChoice non-group: alternate distribution channel • CommChoice small-group: offers choice to employees

  3. How many & what kind of benefits options • CommCare: exclusive purchasing pool for low income uninsured adults • Total of 15 different plans: • 1 standard HMO plan (w/ & w/o dental) • Progressive schedule of copays • Progressive schedule of contributions • 5(?) different MCOs (2-5 per area/PT)

  4. How many & what kind of benefits options • YAP: exclusive distribution channel for non-poor, non-ESI eligible, 18-26 • Total of 12 different options: • 1 standard HMO plan (w/ & w/o Rx) • Some select, some broad networks • Most with benefits cap, two without • 6 different HMOs (4-10 per area)

  5. How many & what kind of benefits options • CommChoice: alternate distribution channel for non-group & packaging plan choice for small-group employees • Total of 25 (of 180) different options: feedback is very helpful, streamlined way to buy insurance • 3 benefit tiers • Some select, some broad networks • Some w/ deductibles, some without • 6 different HMOs • 2-10 options per tier/area

  6. Bidding and Price Comparisons • CommCare purchases health insurance for low-income enrollees - Competitive bidding under pegged pricing - Acuity adjusted capitations - Qualify, enroll & continue to serve beneficiaries • CommChoice assures value of insurers’ products (benefits/premium) • Awards Seal of Approval to high value plans • For actuarially standardized benefits • Allows clear price/benefits comparisons • Makes it easy to shop

  7. Evolution of Mass. non-group market

  8. Individuals told us 3-5 HMOs at high, medium & low benefit levels MCC Coverage for a 37-year-old Bostonian, April 2009

  9. Individuals told us 3-5 HMOs at high, medium & low benefit levels MCC Coverage for a 37-year-old in Worcester, April 2009

  10. “Take-Aways” • 40%-60% premium “swings” on each tier • Significant membership for plans at both ends of spectrum (price & network) • CommChoice promotes price-shopping: • Bronze has 59% share • NHP & FCHP get disproportionate share

  11. Decision Points for SoA RFR • Right benefit tiers? • More standardization/less choice within tiers? • New/different mix of products? • Better value carriers/plans? • Too much disruption?

  12. Seal of Approval Process Overview February 26, 2009

  13. SoA Process Overview • As specified in Chapter 176Q, SoA signifies a health benefit plan meets certain quality & value standards approved by the Board • Connector Authority is to facilitate availability, choice and adoption of private health insurance to eligible individuals and small groups • Products to be available beginning 1/1/2010

  14. Goals of SoA Process • Select and offer high value plans • Align choice of plan designs and carriers with consumer demand • Enhance simplicity of consumer shopping experience • Minimize risk selection • Inside and outside of the Heath Connector • Among participating health plans • Maintain continuity of coverage for existing ~21,000 CommChoice enrollees

  15. Advance Health Care Reform • Success to date in Individual Market • Individual market has more than doubled since c.58 • 30% of this growth has come through CommChoice • for some carriers Choice is more than 50% of new growth • Would like to strengthen this role • Small Group offering just started

  16. Benefits and Tiers • Balance choice and simplicity • Need to balance demand for choice, ease of buying, and continuity of plans for individuals and small firms • Benefit and tier organization • Assessing benefit designs available in each tier (Gold, Silver, Bronze) • Assessing relative value between tiers

  17. Number of Benefit Designs - Current • 37 plans are available to new purchasers • 12 exclusively for young adults • 25 for “regular” non-group Plus: • 9 for “renewals only” • 8 are “closed” to new entrants (non-Rx plans) and will sunset

  18. Number of Benefit Designs - Current • Of the total 37 open plan designs: • 6 are in Gold tier • 12 are in Silver tier • 7 are in Bronze tier • 12 are in Young Adult

  19. Membership by Plan Design Gold • 60% of members in two plans (out of 11) Silver • 60% of members in five plans (out of 15) Bronze • 60% of members in two plans, and 80% of members in four plans (out of 14, 6 closed) YAP • 60% of members in 3 plans (out of 14, 2 closed)

  20. Membership by Carrier • Over 90% of membership is in 4 of the 6 carriers • However, fifth carrier has some 30% market share in Western Mass

  21. Next Steps • Perform Market Research • Surveys • Focus Groups • Analyze benefit take-up outside of CommChoice • Informing to development of SoA specifications

  22. Goals of SoA Process • Select and offer high value plans • Align choice of plan designs and carriers with consumer demand • Enhance simplicity of consumer shopping experience • Minimize risk selection • Inside and outside of the Heath Connector • Among participating health plans • Maintain continuity of coverage for existing ~21,000 CommChoice enrollees

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