West Virginia: Medicaid Buy-In Program

West Virginia: Medicaid Buy-In Program

Upshot

  • Creating the Affordable Medicaid Buy-In (H.R. 3001 and S.B. 688) would establish a Medicaid buy-in plan in West Virginia for individuals who are above current state Medicaid eligibility levels (138 percent FPL).

  • ·The Medicaid buy-in plan would only be available at the platinum metal tier on the individual market outside the Marketplace and require a monthly premium on a sliding scale for individuals under 200 percent FPL.

  • The state would have the latitude to offer the Medicaid buy-in plan through Medicaid MCOs, with provider reimbursements rates based on the Medicaid fee schedule.

  • Neither bill advanced beyond the committee level during the legislative session. However, the bipartisansupport for the new coverage pathway is relatively unique and signals the willingness of some state legislators to work across the aisle on lowering health care prices.

Background

West Virginia adopted the ACA Medicaid expansion. Therefore, all adults with an income up to 138 percent FPL are eligible for the state Medicaid program. Since 2004, West Virginia has offered Medicaid Work Incentive Network (MWIN), a Medicaid buy-in program for individuals who are disabled and employed with a household income up to 250 percent FPL, as authorized under the federal Ticket to Work and Work Incentives Improvement Act of 1999. Enrollees receive full Medicaid benefits and are required to pay a monthly premium based on a sliding fee scale – $15 to $129.50.

West Virginia leverages the federally-facilitated Marketplace. In 2022, two insurers offered plans on the Marketplace, both of which increased premiums from the previous year – Highmark Blue Cross Blue Shield (11.6 percent) and CareSource (14.9 percent). The ARP APTC expansion has been particularly impactful in West Virginia. In 2021, the average monthly premium in West Virginia was $1,038 without subsidies (the second highest in the country) and $323 with subsidies.

Summary

The bills would require the Department of Health and Human Resources (DHHR) to establish the Affordable Medicaid Buy-In Program by January 1, 2023. The program is defined as a “state-administered, public option, health care coverage plan that leverages the Medicaid coverage structure.” Additional details follow.

  • Administration: DHHR would have some flexibility on how to administer the Medicaid buy-in plan. DHHR could rely on existing Medicaid infrastructure and administer the Medicaid buy-in plan through MCOs under contract with the state to provide Medicaid services and benefits. In addition, DHHR could apply the medical loss ratio for Medicaid managed care to the Medicaid buy-in plan, which requires plans to spend at least 85 percent of total payments (per member per month) on covered services and no more than 15 percent on other activities such as plan administration and profit. Since West Virginia uses the federally-facilitated Marketplace, the Medicaid buy-in plan would be available on the individual market outside the Marketplace (i.e., off-Marketplace).

  • Eligibility: All people who are ineligible for Medicaid and Medicare and who lack access to employer-sponsored health coverage would be eligible for the new Medicaid buy-in – specifically, adults between 16 and 64 years above 138 percent FPL.

  • Covered Services: The plan would only be available in the platinum metal tier, which generally covers 90 percent of all health care costs. The plan would offer EHBs required by the ACA for Marketplace plans. DHHR would be required to establish a standardized benefit and cost sharing design for the plan and establish a method for procuring prescription drugs, which could involve using pharmacy benefit managers to negotiate prices or contracting with other entities for combined purchasing power.

  • Payment Rates: DHHR would be required to use the Medicaid fee schedule for provider reimbursement rates. DHHR could increase reimbursement rates if funds are available and doing so would not jeopardize the sustainability of Medicaid or the plan.

  • Premiums and Cost-Sharing: Enrollees would pay a monthly premium on a sliding scale based on household income. DHHR would be required to set “fair and reasonable premium rates” based on an actuarial analysis “to ensure maximum access to coverage.” Additionally, DHHR would be required to offer discounted premiums and cost-sharing to residents with household incomes below 200 percent FPL.

  • Federal Waiver: DHHR would be required to pursue a Section 1332 waiver to allow individuals who qualify for coverage on the federally-facilitated Marketplace to use their APTC to purchase the Medicaid Buy-In plan. Under current law, APTCs cannot be used to subsidize plans purchased off-Marketplace.

  • Advisory Council: DHHR would be required to establish an Affordable Medicaid Buy-In Program advisory council to advise the department on implementation, plan affordability, marketing, enrollment, outreach, and evaluation. The advisory council would consist of the DHHR Secretary, insurance commissioner, three consumer representatives, and a total of four industry representatives and experts appointed by the Governor.