Michigan (Access Health)

Background – Access Health, which began operations in 1999, provides access to a comprehensive array of health care services for uninsured workers of businesses who did not previously provide health insurance coverage. It is a national model for the local approach to health care reform. Health care services are provided by local county-based providers and the care is paid for on a fee-for-service (FFS) basis. Certain services, such as routine dental care, vision and hearing exams, neonatal intensive care outside the county, injuries resulting from automobile accidents, workplace injuries, organ transplants, and treatment for serious burns are not covered by the program.

Access Health currently serves approximately 1,200 employees and dependents. It is known as a “three-share plan” whereby employers and employees each pay approximately 30 percent of the cost of the program and the community pays the remainder. The community share for Access Health is largely composed of Michigan’s Medicaid disproportionate share hospital (DSH) funds. The State has allowed the program to use local match for DSH as opposed to using State general funds.

Michigan law allows Access Health to be overseen by the State treasurer rather than the insurance commission, thereby allowing the program to be exempt from health insurance rules such as State benefit mandates and solvency requirement. Access Health, Inc. administers the program and provides a comprehensive set of services through a local network of physicians, hospitals, and other providers. Although they pay for services on an FFS basis, Access Health managers do not see themselves as a traditional health insurance agency. Instead, they see themselves as hands-on care managers who help individuals get preventive health care and who provide disease management to members with chronic health care conditions.

Program History – The program history of Access Health is well documented in an Issue Brief called “The Muskegon Access Health Three-Share Plan: A Case History,” published in June 2005 by the Employee Benefit Research Institute (EBRI).

In summary, the W. K. Kellogg Foundation developed a Comprehensive Community Health Models (CCHMs) Initiative to increase access to health care through an inclusive community-based decision-making process. Through this initiative, three counties received funding to develop “alternative, comprehensive, high-quality, and affordable health services models.” The CCHMs Initiative awarded a planning grant to the Community Foundation of Muskegon County for the 1994-1996 period. The Community Foundation received the Kellogg grant at least in part because of its long history of investing in community-based health and human services.

The Community Foundation used this planning grant to establish the Muskegon Community Health Project (MCHP), which was responsible for facilitating the community-based decision-making process. Through this process, community stakeholders, including community residents and organizations, worked together to redirect the flow of resources in order to create a more efficient and effective health care system. Access Health was the product of one of many MCHP health initiatives.

Between the end of the planning grant and the beginning of the program, MCHP developed a program model and reached consensus on that model among the many stakeholders. They also negotiated with the State a community subsidy for the program. After receiving significant input from the provider community, stakeholders decided to implement a FFS model. Stakeholders developed the benefit package and the cost-sharing rules within the context of trying to keep the premium at a level that would be affordable for small businesses and low-wage workers.

MCHP also received funding from HRSA in 2002 and 2003 which was used to develop a sustainable risk pool for their program and to enhance ongoing marketing and education efforts.

Eligibility Requirements for Employers – Access Health enrolled its first provider in late 1999. Although the program is intended for and typically serves small and medium-size employers, there is no upper limit on the size of eligible firms. Initially, employers with more than 20 employees were not eligible for the program, but the ceiling was lifted in order to meet initial enrollment targets. Program staff believe this decision was wise and that it is better to target businesses of all sizes that employ low-wage workers. In order for employers to offer Access Health, a number of criteria must be met. The employer:

• Must be headquartered in Muskegon County.
• Must not have offered health insurance for their defined employee group for at least 12 months. New employers that have never offered health benefits can start offering Access Health after being in operation for 13 weeks, as long as they have never before provided health benefits to employees.
• Must not be self-employed without any employees. These employers are not eligible for Access Health.
• Is eligible to offer Access Health only if the median wage of workers in the business does not exceed $11.50 per hour.
• Must agree to its share of the premium, currently set at about 30 percent. Some employers could choose to pay the employee’s share as well, but they are not required to.
• Must offer Access Health to all uninsured workers employed at least 15.5 hours per week.
• Must offer dependent coverage equally. That is, if the employer offers dependent coverage to one eligible employee, all workers eligible for Access Health must also be eligible for dependent coverage.
• Cannot offer Access Health to retirees, seasonal or temporary employers, or temporarily laid-off employees.

Eligibility Requirements for Employees – Employees and dependents must meet a number of criteria to be eligible for Access Health. They must work for an employer who agrees to offer the program and they must work at least 15.5 hours per week over a 13-week period. Employees and dependents must be uninsured and not eligible for public programs such as Medicaid, SCHIP (State Children’s Health Insurance Program), or Medicare. The staff at Access Health help employees and dependents enroll in public programs when it is determined that they are eligible for such a program. The higher income standards for children in Medicaid and SCHIP explain why children account for only 10 percent of the Access Health population. If the employer qualifies to offer Access Health, individual employee income is not used to determine employee eligibility.

Employees and dependents are able to remain members of Access Health if they experience a COBRA-qualifying event. Only employers with 20 or more employees are required to provide COBRA coverage. A worker and his or her dependents can maintain COBRA coverage for 18 months if the worker was terminated (other than for gross misconduct) or if the worker experienced a reduction in hours of work, resulting in a change in eligibility for health benefits. Dependents of active workers are able to continue coverage under COBRA for 36 months in the case of the employee’s death, divorce, or legal separation; the employee’s entitlement to Medicare benefits; or if a dependent child ceased to be a dependent under applicable plan provisions. Employees and their dependents are required to pay the full premium, which includes the employee share, the employer share, and the community subsidy.

Program Funding – Funding for Access Health is based on the “three-share” model: the employer share (30 percent), the employee share (30 percent), and the community share (40 percent). The community share is funded mostly using Medicaid DSH funding, although sometimes it includes funding like United Way and foundation grants for special projects, such as marketing and outreach for the SCHIP program. The Federal DSH dollars are matched by the employer premium.

The main threat to sustainability of the program would be loss of DSH funding. CMS is critically examining DSH payments across the country. If this funding were reduced or redirected, it would affect the sustainability of Access Health. In addition, Federal scrutiny of DSH funding is making it less and less likely that other States could take advantage of DSH funding to establish similar programs. On the other hand, national legislation (Communities Building Access Act) could support and expand community-based programs that have successfully provided health care coverage to uninsured individuals. This legislation was inspired by Access Health of Muskegon and CareNet of Toledo/Lucas County, Ohio.

Prior to implementing the program, MCHP interviewed uninsured businesses in Muskegon County to determine what level of premium would be acceptable. The vast majority of the businesses reported that they could afford between $35 to $50 per person per month. With this information in hand, the program developed a benefit package that would fit into this price range. In 1999, the program began by charging the employer and the employee $38 per person per month. The current premiums are $46 per person per month for both the employer and employee. The community share is $62 per person per month.

Program Design – Access Health is a stand-alone program that is not an insurance product and thus is not subject to State benefit mandates or solvency requirements. Members are required to select a primary care physician (PCP). It is the responsibility of the PCP to refer patients for specialty care, diagnostic tests, and other necessary services. Care is only covered within Muskegon County. Services received outside the county, including emergency services and specialty services not available within the county, are not covered. There are full-time employees providing case and disease management services.

Providers are paid fee-for-service minus applicable co-payments. In the case of physicians a 10 percent deduction is subtracted from the physician fee-for-service payment as a provider donation toward the member’s total cost of coverage. Access Health contracts with a Pharmacy Benefits Manager for processing pharmaceutical claims. Access Health processes and reviews medical claims internally and provides utilization review, case management, and disease management for enrollees.

Access Health maintains its own sales staff and also works with local insurance agents/brokers, who donate their time, to identify and enroll eligible businesses and members. Although the program is not a Medicaid or SCHIP expansion, MCHP staff for the program link low-income people and dependents to the Medicaid and SCHIP program whenever possible. This is especially common for child dependents and pregnant women.

Delivery of Services – Access Health, Inc. is an independent 501(c)(3) corporation that contracts directly with providers. The program is not a managed care organization (MCO) or a health maintenance organization (HMO). One study of the program indicated that local physicians supported the program because it only covers services provided inside the county and because, after years of unsatisfactory experiences with MCOs, the MHCP Board negotiated to pay for services on an FFS basis. This decision was later endorsed by the Access Health Board once the board was convened. However, Access Health is quick to point out that they do provide strong case management and they believe this has been a key element in keeping premiums under control.

Over 97 percent of the physicians in the county participate. In addition, the two hospitals participate in the program. Because the program is community-sponsored and perhaps because payment rates are generous, Access Health has no problems with access to care for their enrollees. The program works closely with safety net providers, but not necessarily as enrolled providers. Instead, safety net providers such as local health departments provide supportive services to patients in this program. These services are also available to the general public; however, the program uses its case managers to link individuals with the programs. In addition, although Federally qualified health centers (FQHCs) are allowed to participate in the program, most enrollees choose private practicing physicians as their primary care providers. Program staff believe this allows FQHCs to concentrate their efforts on Medicaid and uninsured populations within the county.

Payment and Reimbursement – Access Health pays physicians 120 percent of Medicare. In turn, physicians provide a 10 percent donation to Access Health to subsidize the cost of program administration. This generous payment rate, along with a decision not to implement an MCO or an HMO, allowed the program to attract 97 percent of the providers in the community. Hospitals are paid 101 percent of diagnosis related groups (DRGs) and both hospitals in the county participate in the program.

Plan Benefits – Access Health covers a comprehensive array of services, but there are also unique benefit exclusions. For example, the benefit package only includes services delivered in the county. This does not create access problems with most services.

Stakeholders working with MCHP staff developed the benefit package. MCHP staff determined, in advance of the stakeholder process, the level of premium that target employers were willing to pay. This pre-determined premium allowed the stakeholders to carefully consider which benefits and cost sharing would be necessary to meet the cost goal. With planning, they were able to cover the following in-county services:

• Physician primary and specialty care
• Radiology and labs
• Emergency visits
• Ambulance
• Durable medical equipment and supplies
• Pharmacy
• Hospital care
• Therapies with limitations
• Home care
• Outpatient behavioral health with limitations

Access Health does not provide an insurance product and therefore does not have to meet State benefit mandates or solvency requirements. By only paying for care delivered in the county, Access Health does not have to pay for some of the tertiary care paid for by private insurers, such as neonatal intensive care, organ transplants, or serious burn care. Even though the services are not paid for by the program, enrolled providers are responsible for referring individuals out-of-county for services. In addition, many Access Health enrollees become eligible for Medicaid when they are pregnant; Access Health and MCHP staff assist with the Medicaid application process so that these services do not need to be covered at the same level as in a private insurance company. All of these factors allow Access Health to offer a lower cost product with an attractive benefit package.

In order to keep the premiums low, the program also implemented the following cost-sharing/prior authorization rules:

• Primary care office visit - $10 co-payment
• Home care services - $10 co-payment, needs prior authorization
• Pre- and post-natal care - $110 maximum co-payment
• Surgical services (office visit) - $25 co-payment
• Specialist provider service (office visit) - $25 co-payment
• Blood component (hospital outpatient) - $20 per unit
• Physical, occupational, or speech therapy - $25 co-payment, 20 visit maximum per year
• DME, prescribed prostheses, or orthotics - 20% co-insurance, needs prior authorization
• Radiation therapy in hospital OPD - $50 co-payment, no co-payment in physician office
• Chemotherapy - $20 co-payment per visit, $200 maximum out-of-pocket
• Vision and hearing exams - Primary care office visit - $10 co-payment
• Vision and hearing exams - Specialist provider service (office visit) - $25 co-payment
• Inpatient Hospital Services - 25% co-insurance, $300 maximum out-of-pocket per stay
• Outpatient Hospital Services - 25% co-insurance, $300 maximum out-of-pocket per service
• Emergency room services - $75 co-payment per visit, co-payment is waived if admitted as inpatient
• Urgent care centers $30 co-payment per visit - subject to retrospective review
• Ground ambulance services - 25% co-insurance
• Prescription Drugs and Supplies - up to $6,000 maximum calendar year benefit
• Generic drugs $7 co-payment - up to a 30-day supply
• Brand name drugs 50% co-insurance - up to a 30-day supply
• Supplies needed to administer medication - 20% co-insurance

The program has also controlled premiums by the use of care management, disease management, and outside available community resources (such as tobacco cessation classes at local health department). By aggressively pursuing these strategies, they have not seen large increases in premiums.

Impact of SPG Program –The W. K. Kellogg Foundation provided funding to allow the MCHP to conduct the types of surveys and data studies that have been the hallmark of SPGs. Community leaders in Muskegon County widely acknowledge that Access Health would not have evolved without the funding and support of the W. K. Kellogg Foundation. Kellogg provided funding for the employer surveys that were critical in determining target populations, employers, and premium levels. MCHP also received funding from HRSA in 2002 and 2003 to develop a sustainable risk pool for their program and to enhance ongoing marketing and education efforts and assist with evaluation efforts.

Lessons from Administering the Program – Program administrators offered the following advice for local communities considered a “three-share” program.

It takes time, energy, and information to bring all the stakeholders together and to develop a common mission and goal. Even with a common goal, there needs to be a strong leader to keep the project and the stakeholders on track toward implementation.

Programs that include encouraging small businesses to offer health insurance have a long take-up process. Therefore, initial public funding does not need to be as large. Be flexible about changing target population if necessary to meet enrollment and funding targets. The Access Health decision to include larger providers is an example of such flexibility.

Programs that require means testing of individuals are inherently complicated; programs need to understand that low-wage workers are hesitant to provide this kind of information to the State.

In order to attract small businesses and low-wage workers, there needs to be a significant community subsidy.

Conduct careful surveys of small businesses and employee market prior to developing the benefit package. Find out how much these parties are willing to pay for insurance and then use this information to build the benefit package.

Evaluation – Access Health has been studied by the Employee Benefit and Research Institute (EBRI). The study can be found at www.ebri.org and it is EBRI Issue Brief No. 282, June 2005.

The study was descriptive in nature and concentrated on lessons learned rather than on recommendations. The authors maintain that the program was a success because it overcame barrier to providing coverage for uninsured working members of the county and it attracted the interest of Federal policymakers as well as community organizers and politicians in other States. The one area in which concern was expressed is financial sustainability (given the uncertain future of DSH money it uses to fund its community share).