The Basic Health Program isn’t the most flashy or popular provision in the Affordable Care Act. But anyone who’s watched a classic – or even a less-than-classic - teen romantic comedy knows that the shy, somewhat awkward wallflowers often have tremendous hidden potential.
That’s certainly true of the Basic Health Program (BHP.) As we’ve already blogged, this provision has the potential to lower health care costs by about $1,500 each year for low-income adults. But first states have to take up this option, and until recently, few states have paid any attention.
Fortunately, we can take comfort in another teen truism: all it takes is one independent-minded soul – cue Humphrey Bogart or Freddie Prinze Jr. – who takes the time to notice the wallflower, and before you know it everyone wants a spot on her dance card. Recently, both Massachusetts and Washington State have stepped into this role; both states are making their moves on BHP.
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In Massachusetts, the governor’s administration (including the Connector and the Office of Medicaid) has approved a proposal to adopt BHP, and advocates expect the legislature to authorize BHP implementation by the end of July. And Washington State recently passed an Exchange bill which included design and development work for BHP; the legislature must still take action in 2013 to enact it, but two key legislative leaders on health in the state (the Chair of the Senate Health and Long Term Care Committee and the Health Care and Wellness Committee Chair) have declared their commitment to moving the needed legislation.
What’s more, the Urban Institute recently released a very positive study about the potential of BHP in Washington State. They found by taking up BHP, Washington State could:
- Reduce the burden of health care costs significantly for low-income adults by offering plans with $100 annual premiums and 98% actuarial value (by contrast, the Exchange plans available to this population without BHP have premiums at 3-6.3% of family income and 87-94% actuarial value)
- Reduce the overall number of uninsured, because lower costs will translate to higher enrollment in cost-sensitive low-income communities
- Pay for this coverage entirely using BHP funds from the federal government without having to dip into state funds
- Offer providers a higher payment rate than Medicaid with funds leftover from the federal BHP payments
- Maintain a robust Exchange that still covers about 250,000 lives and no noticeable impact on premiums
We’re hopeful that the attention generated by this new report and by the recent progress in Massachusetts and Washington will trigger a few other states to take a second look at this promising option.We’re also hopeful that these recent developments will encourage Centers for Medicaid and Medicare Services to release long-awaited regulations on BHP to define, for example, exactly how the federal financing for BHP will work, and other yet undefined details of this program. These regulations are necessary for states to decide whether or not they should take up the option; if CMS waits too much longer, the window of opportunity may be closed in many states.
Like any good wallflower, we’re confident BHP will prove itself to be a popular, successful provision once a few states – and the feds – start giving it the attention it deserves.
- Katherine Howitt, Senior Policy Analyst