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Barnes Floats State Subsidy Idea During Budget Negotiations

by Christine Stuart | May 8, 2013 5:30am
(0) Comments | Commenting has expired
Posted to: Health Care, State Budget

Christine Stuart file photo

Ben Barnes

There may be a light at the end of the tunnel for the 37,500 parents who face the possibility of being kicked off the state’s HUSKY insurance program.

Gov. Dannel P. Malloy’s administration had planned to cut those parents from the program and to then encourage them to purchase a federally subsidized health insurance plan through the exchange, due to launch officially Jan. 1. But Democratic lawmakers in charge of the budget writing committee rejected that idea in April.

When the two sides sat down recently to start negotiating the state budget, Office of Policy and Management Secretary Ben Barnes floated a compromise: a state subsidy.

In a phone interview Tuesday, Barnes said the state could offer parents a premium subsidy to purchase their insurance privately through the exchange. That would be in addition to the federal subsidy these parents — who fall between 133 and 185 percent of the federal poverty level — will receive for participating in the exchange. Children and pregnant women would still be covered under HUSKY.

Barnes argued that the state would still save some money if it offset the monthly premiums these parents would be asked to pay to private insurance companies.

If lawmakers followed through and agreed to kick about 37,500 parents off the HUSKY plan, it was expected to save the state about $58.8 million in the first full year of implementation. Barnes estimated that the state could spend a few million dollars and “cover quite a few people” with a state premium subsidy.

In combination with the federal subsidy the state could get the monthly premium down to about 3 percent of the parents’ income, Barnes said. For a family that makes about $30,000 a year, that’s about $900.

But advocates aren’t completely sold on the idea of a state subsidy when it’s likely to cost the parents about $47 million in premiums, according to Barnes, to purchase their insurance through the exchange.

Sheldon Toubman, of New Haven Legal Assistance, said subsidizing the monthly premium is one thing, but there will still be plenty of out-of-pocket costs for this population if they are no longer covered by the Medicaid system. He said Barnes’ proposal doesn’t address the deductibles or co-pays, and there’s no coverage of dental or vision, which are currently covered under the Medicaid program.

Deb Polun, government affairs and media director for the Connecticut Health Center Association of Connecticut, said the idea of eliminating health care coverage for these parents goes against the purpose of health reform.

“It is unlikely that the patients that the health centers see will be able to afford the cost of co-pays and deductibles — so the idea being proffered that all providers prefer commercial insurance coverage for financial stability purposes certainly does not apply to the health centers,” Polun said. “Honestly, the health centers want what is best for their patients — and what is best for these parents is to continue with HUSKY.”

CTNJ file photo

Rep. Toni Walker

Rep. Toni Walker, D-New Haven, who is part of the budget negotiations with Barnes, said that there are some real concerns about moving this population of adults into the exchange.

“I know a lot of my members in the House have expressed serious concerns about moving them into the exchange,” Walker said Tuesday.

She said she hasn’t had a chance to speak with all of her colleagues in the House about the latest proposal to create a state subsidy. It’s possible the state subsidy proposal will “maybe alleviate some of their concerns,” but she doesn’t know if that’s the case, she said.

“When we get to the table and actually start the discussion, I assure you Sen. Toni Harp and I are going to really drill down into the feasibility of the impact,” Walker said. She said she doesn’t see the economic condition for these parents getting better in the short-term and her objective is “not to give temporary fixes.”

Barnes said he would be open to discussing how to possibly cover out-of-pocket costs like co-pays, but expressed concern about the difficulty of administering such a program. Since co-pays are made at doctor offices and pharmacies, it would be difficult for the state to track all of that information for this population.

Toubman and Walker didn’t disagree that covering those out-of-pocket costs would be difficult to administer. But Toubman said that’s all the more reason to keep the parents in the current HUSKY program where the benefits they are receiving are better than they would receive in the exchange.

Barnes disagrees that the benefits offered are better. He said the parents will get better access through private insurance to providers, but Toubman said the Medicaid system has improved over the past few years and more doctors are accepting it.

Making things a little more difficult is the knowledge that lawmakers may not know how much insurance carriers plan to charge for specific benefits, since none have submitted their plans to insurance regulators.

According to the Courant, not a single carrier has submitted a plan and they aren’t necessarily mandated to do so until July, which is long after the June 5 budget deadline.

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