Executive Office of Health and Human Services (EOHHS) has issued a series of proposed rule changes that would affect who is eligible for services from the Health Safety Net as well as the coverage period for new patients. The Health Safety Net helps to finance care provided to Massachusetts low-income residents who are uninsured or underinsured.
The governor’s FY2017 budget proposal eliminates the $30 million contribution to the Health Safety Net. The Baker Administration states the new proposed rules, if enacted, would reduce HSN expenses, which justifies the elimination of the state’s $30 million annual contribution to the safety net. However if the state backs out of its HSN commitment, hospitals would be entirely responsible for the reduced funding. Every acute hospital now pays an assessment which totals $165 million in the aggregate for all hospitals. Insurers pay a similar amount. Hospitals alone, however, are responsible for funding any HSN shortfall. The current shortfall is estimated at $76 million.
One specific proposed change to the HSN eligibility rules includes altering the retroactive date of coverage. Currently, many patients who get coverage under the HSN are covered for six months retroactive from their application. EOHHS proposes changing that to only 10 days retroactive coverage.
The concern among hospitals caring for the uninsured and underinsured is that patients don’t always apply for or complete their application for HSN coverage at the time they receive care. There is often a lag between the time of care, the receipt of a hospital bill, the patient’s realization they need coverage, the hospital enrollment staff’s ability to contact the patients in a timely manner, and completion of the application process. When retroactive coverage is reduced as in the case of new 10-day proposal, hospitals and community health centers are more directly exposed to the cost of care for uninsured patients who do not apply at the time they receive care. In those cases providers, effectively, eat the cost of care and aren’t reimbursed.
Among other proposed changes, the Baker Administration wants to change the income eligibility standards for those eligible for HSN care. For example, currently those earning between 200% and 400% of the federal poverty level (FPL) are eligible for partial HSN coverage. The Baker Administration wants to change that to those with incomes between 150% and 300%. The proposed regulation also creates a new minimum deductible for some HSN enrollees.
The administration states these changes are designed to align with other eligibility standards for MassHealth and Connector. The policy changes are estimated to be worth $60 million annually, much of which will result in a direct cost-shift to hospitals. If enacted, the new proposed rules would be effective April 1, 2016.
EOHHS will hold a public hearing on Friday, February 26 at 9 a.m. on the proposed changes to the eligibility rules. MHA will be offering testimony.