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Cost/Benefit Analysis of Tribal Sponsorship. Mim Dixon and Dale Nachreiner Tribal Self Governance Annual Meeting New Orleans, May 8, 2012. Opportunity in Affordable Care Act. Opportunity for Tribes New revenues for Tribe CHS cost savings

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cost benefit analysis of tribal sponsorship

Cost/Benefit Analysis ofTribal Sponsorship

Mim Dixon and Dale Nachreiner

Tribal Self Governance Annual Meeting

New Orleans, May 8, 2012

opportunity in affordable care act
Opportunity in Affordable Care Act
  • Opportunity for Tribes
      • New revenues for Tribe
      • CHS cost savings
  • Tribal Sponsorship is a path to realize the revenues and savings.
  • New tool available to help your Tribe do cost-benefit analysis of Tribal Sponsorship.
tribal sponsorship
Tribal Sponsorship
  • Tribe pays portion of premium for selected individuals to enroll in Health Insurance Exchanges.
  • Federal funds can be used.
  • Aggregate payments
      • One check per month from Tribe
      • Payment to Exchange, Insurance or TPA
  • Exchange decides rules for Tribal Sponsorship.
teoc project
TEOC Project
  • Case Studies of Tribal Sponsorship
      • 3 Tribes
      • 2 scenarios for each Tribe
      • Real numbers
      • Methodology developed
  • Focus Group with Tribal Leaders
  • Cost/Benefit Analysis Tool
case study results
Case Study Results
  • Small, medium and large Tribes
  • 6 different scenarios
  • In every scenario, Tribe had net benefit

Range: $65,398 to $4,684,878

  • Positive rate of return

Range: $1.77 to $5.99 for each $1 spent

results of focus group with tribal leaders
Results of Focus Group with Tribal Leaders
  • Health Directors are primary source of information for Tribal decisions about Tribal Sponsorship.
  • Tribal Councils want Health Directors to present a Tribal-specific proposal.
  • Health Directors must be well informed about Health Insurance Exchanges.
teoc cost benefit analysis tool
TEOC Cost/Benefit Analysis Tool
  • ACA provisions guide model
  • Based on data and assumptions
  • Tribe fills out questionnaire
      • Demographics (age)
      • Census data (poverty levels)
      • Billing and collection data
      • Administrative costs
  • Spreadsheets calculate estimated costs and benefits of 3 scenarios.
affordable care act
Affordable Care Act
  • Insurance companies can base premiums on
      • Age (3x greater for older people)
          • This is only factor used in methodology.
          • This is why age pyramid is needed.
      • Geographic area
      • Tobacco use (1.5% higher)
  • Federal subsidy of premiums
      • Individual payment limited to % of income
          • This is why income information is needed.
cost assumptions
Cost Assumptions
  • Use only people 19-64 years old

<19 eligible for Medicaid or CHIP

>65 eligible for Medicare

  • Use only individual premiums
  • Use Silver plan premium costs
      • 70 % actuarial value
      • Kaiser Family Foundation calculator
  • 138% FPL for Medicaid Expansion
  • Poverty rates for uninsured active users are same as AI in general population in U.S. Census
revenue assumptions
Revenue Assumptions
  • Tribes will be providers of services for plans they sponsor.
  • No co-pays or deductibles for anyone sponsored by Tribe.
  • Reimbursement for Exchange plans will be between Medicare and commercial insurance rates.
  • Bill-to-collection ratio same as current commercial insurance.
calculating chs savings
Calculating CHS Savings
  • 3 year average CHS expenditures
  • Use number of people eligible for CHS to get savings per person.
administrative costs included in methods
Administrative Costs Included in Methods
  • Education and enrollment assistance
  • Provider contract administration
  • Billing plan for services provided
cost benefit analysis tool
Cost/Benefit Analysis Tool
  • Generates 1 page summary table
  • 3 scenarios for Tribe:
      • All uninsured active users
      • Uninsured active users eligible for CHS
      • Uninsured Tribal members
  • For each scenario:
      • Costs
      • Revenue and CHS savings
      • Net benefits
      • Estimated earnings from $1 invested
  • These are estimates only.
  • Affordable Care Act may change.
      • Supreme Court decision in June
      • Elections may affect ACA
      • Federal regulations are still being written
  • Tribe may want to consider other scenarios.