WHAT IS MEDICAID BUY-IN? WHAT ARE OTHER BUY-IN OPTIONS?
The term “Medicaid buy-in” is used to describe any policy that would allow some people who are not currently eligible for Medicaid to purchase Medicaid-like coverage.. States may also use different names to talk about these new coverage options, and depending on the state, these plans may not be referred to as a “Medicaid buy-in” at all.
Additionally, some states are considering t or have studied buy-in options that rely on programs other than from Medicaid, such as creating pathways for residents to buy into their state employee health plan.
Medicaid buy-in proposals aim to offer the relatively robust and affordable coverage typically provided by Medicaid to people who would not otherwise qualify. This type of policy does not intend to change the Medicaid program for those already eligible and enrolled. Similarly, other buy-in options aim to make additional coverage options available to consumers who may find their current options unaffordable. Specific policy proposals differ from state to state, and each state must consider their specific needs and goals when designing a buy-in option.
In this context, Medicaid buy-in should not be confused with existing programs in many states that allow individuals with disabilities to buy Medicaid coverage if their income or assets would otherwise make them ineligible for Medicaid coverage.
WHY IS MEDICAID AN APPEALING OPTION FOR CONSUMERS?
Medicaid is a familiar source of affordable health care for many families and communities, providing health care coverage to 19% of the U.S. population. Medicaid has evolved to fit the diverse needs of different enrollees, including children, parents, those receiving long-term care, people with disabilities and childless adults. Medicaid provides comprehensive coverage of benefits tailored to different groups of enrollees in the program with minimal cost sharing.
Medicaid beneficiaries are generally satisfied with their care, with Medicaid enrollees in a recent study rating their care a 7.9 on a scale of 0-10. People who became eligible for Medicaid under the Affordable Care Act’s expansion rate their coverage even more highly than those enrolling in Marketplace coverage. A Commonwealth Fund study in 2016 found that 77 percent of adults with marketplace plans and 88 percent of those newly enrolled in Medicaid were very or somewhat satisfied with their health insurance.
WHY IS MEDICAID BUY-IN AN APPEALING OPTION FOR STATE POLICYMAKERS?
Medicaid buy-in proposals can also appeal to state policymakers for many different reasons. Medicaid is an efficient program, and while it occupies significant percentages of states’ budgets, when controlled for enrollees’ health status, Medicaid costs less than private insurance. Similarly, Medicaid’s per-enrollee costs have grown slowly compared to other payers. Medicaid buy-in proposals can be structured to help state policymakers achieve a range of goals and address varying priorities such as:
- Increasing choice and competition: In 2019, 35% of counties will have only one issuer offering coverage on the Marketplace. Creating a way for consumers to purchase Medicaid coverage generates more competition in areas with few issuers, giving consumers more choices, and reducing the risk of bare counties with no issuers offering coverage.
- More affordable coverage: With lower per enrollee costs than private insurance, Medicaid offers a more affordable option to consumers, with lower premiums and out-of-pocket costs.
- Minimizing churn and disruption: People in the individual insurance market can experience “churn” as their income changes and they move between Medicaid and the private insurance market. Depending on the way it is designed, a Medicaid buy-in option could help minimize the disruption that consumers currently face when their circumstances change.
- State public option tool: With broad support for proposals to allow people to purchase Medicare coverage before age 65, pursuing Medicaid buy-in gives state officials a way to respond to their constituents’ interest in additional public coverage choices, especially when federal policymakers are unlikely to enact this type of option.
WHY ARE OTHER BUY-IN OPTIONS APPEALING FOR STATE POLICYMAKERS AND CONSUMERS?
While Medicaid buy-in and other buy-in options are different from one another, they are often talked about in the same way because they both leverage the state and the state’s purchasing power to provide more coverage options and create affordable, quality plans for residents. These approaches are appealing because they allow residents to buy into an already existing state-run health plan, such as Medicaid, a state-employee health plan, or basic health program. Buy-in options look different across states, but they all serve the goal of providing more affordable, comprehensive coverage options to individuals who do not currently qualify for such coverage. From the state perspective, these options are appealing because each state has the ability to build upon popular, effective programs and to tailor the plans to their state’s specific needs.
Some people or states may describe some types of buy-ins as a “public option.” Regardless of the term used, the general idea of a buy-in is that individuals can benefit from state-run networks, cost-sharing, and/or benefits. These generally accepted definitions of a "buy-in" and "public option" are not mutually exclusive from one another, and don't have to be followed strictly.
HOW WOULD MEDICAID BUY-INS OR OTHER BUY-INS ACTUALLY WORK? WHAT WOULD BE COVERED AND WHERE WOULD I BUY IT?
Just as every state’s health care system and Medicaid program looks different, every state’s approach to a buy-in will look different. The different reasons a state may pursue a buy-in proposal will help to shape the way the proposal is structured.
State Health & Value Strategies, in partnership with Manatt Health, has laid out two primary designs that states are considering specifically for buy-in policy options. The two options laid out are a Medicaid buy-in and a basic health buy-in. The Medicaid buy-in is represented as two different options: 1) a state-sponsored option that people purchase through their state’s Marketplace which meets the same rules and requirements as other plans sold there. 2) a Medicaid buy-in outside of the Marketplace. The basic health buy-in design involves a state to expand an already existing Basic Health Program (BHP) to additional individuals. A BHP is an option states already have through section 1331 of the Affordable Care Act that provides essential benefits coverage for low-income residents who earn more than the Medicaid/CHIP eligibility level and up to 200% of the federal poverty level (FPL). A basic health buy-in would raise the max income eligibility for a BHP to be above 200% FPL
Medicaid buy-in plans may not cover the full suite of benefits that some people receive through Medicaid, like long-term care services. However, Medicaid buy-in can be a way for a state to increase access to important benefits that are not always included in health insurance, like dental and vision care. Similarly, other buy-in designs will differ from state to state, with some states looking to offer more robust coverage than may be otherwise offered and some states looking at similar benefits to what is offered through qualified health plans.
CAN MY STATE PUT IN PLACE A BUY IN PROGRAM WITHOUT INVOLVING THE FEDERAL GOVERNMENT?
Yes, it’s possible. A state could opt to design a buy-in that does not require them to seek permission or approval from the federal government. However, if a state wants to allow people to use their tax credits to purchase the buy-in coverage on the Exchange and capture any savings, the state would need to receive permission from the federal government, in the form of a State Innovation Waiver, known as a 1332 waiver.
WHY NOT A MEDICARE BUY-IN PROGRAM?
While Medicare is a federal program, Medicaid is a federal-state partnership that is administered by individual states. States have a track record of proving they can solve problems when Washington DC can’t, and Medicaid buy-in is an approach that states can use now to expand access to affordable options. And with a Medicaid buy-in, states have the ability to develop a unique approach that is right for their state.
WILL I STILL BE ABLE TO SEE MY DOCTOR? OR WILL I HAVE TO CHANGE DOCTORS?
It depends. Not all doctors take all forms of insurance, so just like any other coverage, people would need to check to see if their doctor accepts the coverage they choose to buy.
IT CAN ALREADY BE CHALLENGING TO FIND A DOCTOR THAT ACCEPTS MEDICAID-- WOULD MEDICAID BUY-IN PAY DOCTORS THE SAME RATES AS CURRENT MEDICAID PROGRAMS?
States will need to determine how they pay providers as part of any Medicaid buy-in or other buy-in initiative, and they will need to carefully consider whether enrolling additional consumers in plans that tend to pay lower rates will result in sufficient provider participation and access to care. A new coverage option that attracts people currently enrolled in commercials plans that typically pay higher rates could require a different approach than one that primarily attracts those who are currently uninsured.
WHAT’S THE DIFFERENCE BETWEEN MEDICAID BUY-IN AND A PUBLIC OPTION?
States can create a range of buy-in options for their residents that may look very different from one another. Medicaid buy-ins specifically leverage the existing Medicaid infrastructure to provide coverage options and public options leverage other existing infrastructures, such as state employee health plans or exchanges, to provide more coverage options. While the names may be different, the aim of these approaches is the same: to provide more affordable options to individuals and families by expanding upon existing successful programs. Each state exploring these options has unique needs, which means their approaches are specifically tailored to address those needs. Similarly, the names of these different proposals may be different based on what resonates most with residents and/or policymakers. This website tracks both Medicaid buy-in and public options in the states.
WHO WILL BE ABLE TO BUY-IN TO THIS PROGRAM?
The eligibility for buy-in programs will depend on each state and how they design their program. Some proposals, for example, would allow any state resident to purchase Medicaid, while others may target the buy-in to certain populations or certain geographic areas.
HOW MUCH WILL IT COST? AND WHO IS GOING TO PAY FOR IT?
Much like eligibility, cost and funding will vary from state to state. Just as the name suggests, with a buy-in, people are paying for the cost of their coverage-- it is not a way for states to receive additional federal Medicaid funding. A state could provide financial assistance to make the cost more affordable if they chose.
WHAT OTHER PUBLIC OPTION APPROACHES ARE UNDER CONSIDERATION IN THE STATES?
Every state exploring this policy area will likely opt for a slightly unique approach. Some states may choose to build on particular aspects of their Medicaid programs, while others may design a buy-in around a different program. For example, Washington and Colorado have passed legislation to create buy-ins that leverage the states’ existing health care system, including the state exchanges, to provide additional coverage options (see more on these policies on our state tracking page). We’re tracking Medicaid buy-in and other proposals, such as those in Washington and Colorado, on this website.
HOW WOULD A MEDICAID BUY-IN AFFECT PEOPLE IN THE STATE CURRENTLY COVERED BY MEDICAID OR OTHER SOURCES OF COVERAGE?
While they may build on the infrastructure of existing programs, buy-ins do not necessarily impact the coverage of those currently enrolled in Medicaid or other sources of coverage. That being said, any buy-in proposal should carefully consider any potential implication for those already enrolled in Medicaid or other coverage and ensure that there are no unintended consequences that could erode the current coverage and benefits available for those currently enrolled.
Do you have additional questions about Medicaid buy-in? Let us know by contacting us here.