Is DirigoChoice a Health Insurance Exchange (HIX)?

Around in various incarnations for more than a decade, DirigoChoice is Maine's best effort to date on expanding health care coverage to it's small businesses and individuals who would have problems accessing health insurance otherwise. The plans offered by current provider Harvard Pilgrim (I guess the "choice" part of "DirigoChoice is a bit of a misnomer) have relatively high deductibles (from $1500-$2750) and include state-supplied subsidies for qualifying entities.

Chronically underfunded for it's mandate, DirigoChoice's subsidies are currently capitalized through a 2.14% surcharge on insurance claims. This has replaced past funding measures including regressive "sin taxes" (repealed by voter initiative) and the original (and controversial) tax on health insurance providers.

Is DirigoChoice a Health Insurance Exchange (HIX) as defined by the Affordable Care Act (ACA)? Not as far as I can tell, though it certainly provides a solid jumping off place. How would DirigoChoice need to change to evolve into a HIX? Some initial thoughts:

• Expand the supporting IT systems to allow other insurance carriers to offer their products on the DirigoChoice chassis.
• Modify the premium subsidy mechanism (and eliminate the existing claim surcharge process) to align with the ACA funding model.
• Integrate more tightly with the MaineCare mechanisms to provide a more seamless continuum for servicing low- and middle-income customers.

In it's current configuration, DirigoCare is aligned with the spirit of the ACA (providing health coverage to constituents that otherwise could not access it) and puts Maine on much better footing than many other states. The decade of wrangling the insurance industry, DHA and state legislature has gone through has provided those involved with innumerable lessons and many of the policy fights have subsequently been hammered out. While most states (who haven't embarked upon the public-private collaboration of providing expanded health coverage) are being handed a pre-packaged policy by the ACA, Maine is in the enviable position of having deep experience with such policy at all levels of our leadership. The hope is that this will play out to deliver the most efficient and cost-effective system in the country and the coverage extended to Maine citizens will be the best possible across the spectrum.

MaineCare

As background, we look to some of the existing programs which Maine has in place. The first is Maine's Medicaid implementation known as MaineCare, which provided some level of coverage to almost half a million Mainers in 2010. A good overview of how MaineCare fits into the landscape of health care in Maine was produced in 2005 and is still largely relevant. From a HIX perspective, it is important to realize that a broad spectrum of services well beyond the scope of health insurance (long term care, disability coverage, etc) in encompassed in MaineCare.

The boundary between private insurers and the Medicaid infrastructure has been expanding year over year and particularly in Maine. This is one area we look to as the foundational aspect of any future Maine HIX. There is a strong history of public-private collaboration in delivering subsidized group and individual health insurance products to Mainers, meaning that any HIX implementation will not be "green field" development in any sense.

The next post will look at DirigoChoice, which builds on MaineCare and is even closer to a HIX-compliant offering.

Introduction

I'm starting this blog as a venue for exploration of this interesting topic as it develops over the next eighteen months. As a technologist with experience in the insurance industry and resident of Maine, the mandate for Health Insurance Exchanges (HIX) in the federal PPACA (ObamaCare) legislation is both interesting and confusing - hence the deeper dive. A great primer/overview for what the federal legislation actually is showed up on Reddit lately as "What exactly is Obamacare and what did it change?" in the "Explain like I'm 5" subreddit.

I will say up front that while I have personal beliefs and opinions on ObamaCare and other topics, I will keep the conversation to the facts and refrain from politicizing the dialogue (monologue?). By focusing on the technology around HIX compliance, hopefully this will not be overly onerous.

Finally, as of this writing, it would seem the points to be made are largely moot as Maine has indicated it will not be establishing it's own state-based HIX. The assumption is that the Federally-Facilitated Exchange (FFE) will be leveraged in Maine on the January 2013 deadline. This may change in the future (making this a fascinating topic!) but it would appear that much of the discussion around a Maine HIX is largely academic at this point.