Why Narrow Networks are a Big Deal: A Discussion of Network Adequacy

A network is defined as the healthcare facilities, professionals, and suppliers that an insurance carrier has contracted with to include in a given health plan. Network adequacy is the extent to which a health plan has a satisfactory number of primary and specialty healthcare professionals that consumers can access in a timely manner.

The terms network and network adequacy are pretty technical words, so the average consumer may not know their definition, but a percentage of the population is even unaware of how to apply these terms to the process of purchasing a health insurance plan. According to a Commonwealth Fund survey of marketplace shoppers, 25% said they did not know the quality of the network for their health insurance plan. The survey results indicate that consumers may lack an awareness of how network adequacy impacts them on a personal level.

Consumer Problems with Network Adequacy

Consumer awareness is important, because network adequacy can have a tremendous influence on a patient's quality of care. For example, plans can include a hospital in their network, yet exclude doctors or specialists working at that hospital. As a result, patients may unknowingly receive care from an out-of-network doctor and be left with an exorbitant bill. This practice, in which consumers must pay the costs beyond the allowable amount determined by the health insurance company, is called balance billing. Sometimes the lists of healthcare professionals in a network are not even accurate, which may lead consumers to enroll in a plan that does not have their desired provider. Also, hospitals serving special populations, such as children, have reported difficulty being included in networks – preventing families from getting needed care at a reasonable cost.

Network Reforms Proposed

These issues may soon change. The National Association of Insurance Commissioners (NAIC) recently released a new draft model law for states, which has proposed some significant reforms. To begin with, hospitals would need to develop a process for alerting patients in cases where they may be seeking treatment from an out-of-network provider who happened to be working at an in-network hospital. In addition, insurance carriers would be required to update changes to their provider networks on a monthly basis and must make this information available online and in print form.

NAIC's draft model law also created the general recommendation for states to create sufficiency standards accounting for elements such as the amount of specialty services available, geographic accessibility, the number of providers, the wait time for receiving care, and the hours of operation for participating providers. NAIC gives states latitude in how they apply their sufficiency standards. However, NAIC does note that some states have chosen to adopt quantitative standards that set minimum numbers for providers for maximum travel times and maximum waiting times, among other metrics.

Changing Consumer Experiences for the Better

The reforms requiring insurance companies and healthcare providers to communicate accurate and timely information on healthcare networks are a much needed help for consumers who lack basic knowledge of their options (which may be due to the fact that they hate shopping for health insurance). Mandating more open lines of communication would simplify the process of finding and using health insurance. With readily available information, consumers would know what providers and hospitals are a part of their plan. Importantly, state actors are recognizing the significance of empowering consumers with knowledge, as the Illinois Department of Insurance recently released fact sheets on networks and out-of-network benefits.

Beyond improving communication with consumers, NAIC’s draft language on sufficiency standards would support consumers who have purchased a plan in having the ability to access the healthcare providers they need to stay healthy – without traveling great distances or waiting long periods of time. Advocacy needs to be done at the state level to guarantee that the sufficiency standards in place are in line with the intentions of NAIC’s draft model law and create quantitative metrics to determine a network’s strength.


Bryce Marable, MSW
Policy Analyst
Health & Disability Advocates

Consumers Need Protection from Health Insurance Company Plan Year Manipulation

It was disappointing—infuriating actually—to learn that some of the nation’s health insurance companies are trying to take advantage of their current customers by manipulating plan years. They are doing so to avoid having to pass on to these customers the benefits of national health reform.

These insurers are reaching out to current customers, taking advantage of their uncertainties, and luring them to switch to health plan years that begin in 2013. By substituting 2013 plans for their current plans that run through early 2014, customers will lose important Affordable Care Act (ACA) protections that must apply to plans issued on or after January 1, 2014. For example, plans issued in 2014 must offer a comprehensive range of benefits and have rates based only on the customer’s age, geographic location, number in family, and tobacco usage. Discrimination based on gender or pre-existing conditions is banned by federal law in 2014 plans. Health insurance insider turned critic, Wendell Potter, recently wrote in detail about this outrage in the Huffington Post.

So insurers are trying to have the best of both worlds. They want all the goodies the ACA offers them, including hundreds of millions of new customers (many of whom will only be able to afford coverage because they qualify for the federal financial help in the form of advance premium tax credits and cost sharing subsidies available under the ACA), but they also want to deprive their existing customers of the benefit of ACA reforms.

Fortunately, insurance regulators can and are protecting customers from such manipulation. Illinois Department of Insurance Director Andrew Boron issued Bulletin 2013-07 on April 29, 2013, telling Illinois health insurers that they won’t get away with such manipulation. “The Department will not approve…filings for such arrangements,” the bulletin says. That should bring these threatened manipulations to an end in Illinois, and we hope regulators in other states take similar actions.

Health insurance has been baffling to most individuals and small businesses. The federal government, many states, and many non-profit organizations are working hard to inform citizens of the reforms, benefits, and opportunities the Affordable Care Act has already brought and the major improvements coming in 2014. Actions like these plan date manipulations simply have no place in the picture. Thank goodness regulators can and are stepping it to ensure a happy ending.

Margaret Stapleton

Community Justice Director
Sargent Shriver National Center on Poverty Law

After The Election: A Consumer's Guide To The Health Law

This post originally appeared on Kaiser Health News; by Mary Agnes Carey and Jenny Gold

Now that President Barack Obama has won a second term, the Affordable Care Act is back on a fast track.

Some analysts argue that there could be modifications to reduce federal spending as part of a broader deficit deal; for now, this is just speculation. What is clear is that the law will have sweeping ramifications for consumers, state officials, employers and health care providers, including hospitals and doctors.

While some of the key features don't kick in until 2014, the law has already altered the health care industry and established a number of consumer benefits.

Here's a primer on parts of the law already up and running, what's to come and ways that provisions could still be altered.

I don't have health insurance. Under the law, will I have to buy it and what happens if I don’t?

Today, you are not required to have health insurance. But beginning in 2014, most people will have to have it or pay a fine. For individuals, the penalty would start at $95 a year, or up to 1 percent of income, whichever is greater, and rise to $695, or 2.5 percent of income, by 2016.

For families the penalty would be $2,085 or 2.5 percent of household income, whichever is greater. The requirement to have coverage can be waived for several reasons, including financial hardship or religious beliefs.

Millions of additional people will qualify for Medicaid or federal subsidies to buy insurance under the law.

While some states, including most recently Alabama, Wyoming and Montana, have passed laws to block the requirement to carry health insurance, those provisions do not override federal law.

I get my health coverage at work and want to keep my current plan. Will I be able to do that? How will my plan be affected by the health law?

If you get insurance through your job, it is likely to stay that way. But, just as before the law was passed, your employer is not obligated to keep the current plan and may change premiums, deductibles, co-pays and network coverage.

You may have seen some law-related changes already. For example, most plans now ban lifetime coverage limits and include a guarantee that an adult child up to age 26 who can't get health insurance at a job can stay on her parents' health plan.

What other parts of the law are now in place?

You are likely to be eligible for preventive services with no out-of-pocket costs, such as breast cancer screenings and cholesterol tests.

Health plans can't cancel your coverage once you get sick – a practice known as "rescission" – unless you committed fraud when you applied for coverage.

Children with pre-existing conditions cannot be denied coverage. This will apply to adults in 2014.

Insurers will have to provide rebates to consumers if they spend less than 80 to 85 percent of premium dollars on medical care.

Some existing plans, if they haven't changed significantly since passage of the law, do not have to abide by certain parts of the law. For example, these "grandfathered" planscan still charge beneficiaries part of the cost of preventive services.

If you're currently in one of these plans, and your employer makes significant changes, such as raising your out-of-pocket costs, the plan would then have to abide by all aspects of the health law.

I want health insurance but I can’t afford it. What will I do?

Depending on your income, you might be eligible for Medicaid. Currently, in most states nonelderly adults without minor children don't qualify for Medicaid. But beginning in 2014, the federal government is offering to pay the cost of an expansion in the programs so that anyone with an income at or lower than 133 percent of the federal poverty level, (which based on current guidelines would be $14,856 for an individual or $30,656 for a family of four) will be eligible for Medicaid.

The Supreme Court, however, ruled in June that states cannot be forced to make that change. Republican governors in several states have said that they will refuse the expansion, though that may change now that Obama has been re-elected.

What if I make too much money for Medicaid but still can't afford to buy insurance?

You might be eligible for government subsidies to help you pay for private insurance sold in the state-based insurance marketplaces, called exchanges, slated to begin operation in 2014. Exchanges will sell insurance plans to individuals and small businesses.

These premium subsidies will be available for individuals and families with incomes between 133 percent and 400 percent of the poverty level, or $14,856 to $44,680 for individuals and $30,656 to $92,200 for a family of four (based on current guidelines).

Will it be easier for me to get coverage even if I have health problems?

Insurers will be barred from rejecting applicants based on health status once the exchanges are operating in 2014.

I own a small business. Will I have to buy health insurance for my workers?

No employer is required to provide insurance. But starting in 2014, businesses with 50 or more employees that don't provide health care coverage and have at least one full-time worker who receives subsidized coverage in the health insurance exchange will have to pay a fee of $2,000 per full-time employee. The firm's first 30 workers would be excluded from the fee.

However, firms with  50 or fewer people won't face any penalties.

In addition, if you own a small business, the health law offers a tax credit to help cover the cost. Employers with 25 or fewer full-time workers who earn an average yearly salary of $50,000 or less today can get tax credits of up 35 percent of the cost of premiums. The credit increases to 50 percent in 2014.

I'm over 65. How does the legislation affect seniors?

The law is narrowing a gap in the Medicare Part D prescription drug plan known as the "doughnut hole." That's when seniors who have paid a certain initial amount in prescription costs have to pay for all of their drug costs until they spend a total of $4,700 for the year. Then the plan coverage begins again.

That coverage gap will be closed entirely by 2020. Seniors will still be responsible for 25 percent of their prescription drug costs. So far, 5.6 million seniors have saved $4.8 billion on prescription drugs, according to the Department of Health and Human Services.

The law also expanded Medicare's coverage of preventive services, such as screenings for colon, prostate and breast cancer, which are now free to beneficiaries. Medicare will also pay for an annual wellness visit to the doctor. HHS reports that during the first nine months of 2012, more than 20.7 million Medicare beneficiaries have received preventive services at no cost.

The health law reduced the federal government's payments to Medicare Advantage plans, run by private insurers as an alternative to the traditional Medicare. Medicare Advantage costs more per beneficiary than traditional Medicare. Critics of those payment cuts say that could mean the private plans may not offer many extra benefits, such as free eyeglasses, hearing aids and gym memberships, that they now provide.

Will I have to pay more for my health care because of the law?

No one knows for sure. Even supporters of the law acknowledge its steps to control health costs, such as incentives to coordinate care better, may take a while to show significant savings. Opponents say the law’s additional coverage requirements will make health insurance more expensive for individuals and for the government.

That said, there are some new taxes and fees. For example, starting in 2013, individuals with earnings above $200,000 and married couples making more than $250,000 will paya Medicare payroll tax of 2.35 percent, up from the current 1.45 percent, on income over those thresholds. In addition, higher-income people will face a 3.8 percent tax on unearned income, such as dividends and interest.

Starting in 2018, the law also will impose a 40 percent excise tax on the portion of most employer-sponsored health coverage (excluding dental and vision) that exceeds $10,200 a year and $27,500 for families. The tax has been dubbed a "Cadillac" tax because it hits the most generous plans.

In addition, the law also imposes taxes and fees on several major health industries. Beginning in 2013, medical device manufacturers and importers must pay a 2.3 percent tax on the sale of any taxable medical device to raise $29 billion over 10 years. An annual fee for health insurers is expected to raise more than $100 billion over 10 years, while a fee for brand name drugs will bring in another $34 billion.

Those fees will likely be passed onto consumers in the form of higher premiums.

Has the law hit some bumps in the road?

Yes. For example, the law created high-risk insurance pools to help people purchase health insurance. But enrollment in the pools has been less than expected. As of Aug. 31, 86,072 people had signed up for the high-risk pools, but the program, which began in June 2010, was initially expected to enroll between 200,000 and  400,000 people. The cost and the requirements have been difficult for some to meet.

Applicants must be uninsured for six months because of a pre-existing medical condition before they can join a pool. And because participants are sicker than the general population, the premiums are higher.

Enrollment has increased since the summer, after the premiums were lowered in some states by as much as 40 percent and some states stepped up advertising.

A long-term care provision of the law is dead for now. The Community Living Assistance Services and Supports program (CLASS Act) was designed for people to buy federally guaranteed insurance that would have helped consumers eventually cover some long-term-care costs. But last fall, federal officials effectively suspended the program even before it was to begin, saying they could not find a way to make it work financially.

Are there more changes ahead for the law?

Some observers think there could be pressure in Congress to make some changes to the law as a larger package to reduce the deficit. Among those options is scaling back the subsidies that help low-income Americans buy health insurance coverage. The amount of the subsidies, and possibly the Medicaid expansion as well, could be reduced.  

It’s also possible that some of the taxes on the health care industry, which help pay for the new benefits in the health law, could be rolled back. For example, legislation to repeal the tax on medical device manufacturers passed the House with support from 37 Democrats (it is not expected to receive Senate consideration this year). Nine House Democrats are co-sponsoring legislation to repeal the law’s annual fee on health insurers.

Meanwhile, the Independent Payment Advisory Board (IPAB), one of the most contentious provisions of the health law, is also under continued attack by lawmakers. IPAB is a 15-member panel charged with making recommendations to reduce Medicare spending if the amount the government spends grows beyond a target rate. If Congress chooses not to accept the recommendations, lawmakers must pass alternative cuts of the same size.

Some Republicans argue that the board amounts to health care rationing and some Democrats have said that they think the panel would transfer power that belongs on Capitol Hill to the executive branch. In March, the House voted to repeal IPAB.

Healthcare by the Numbers

In the United States in 2012:

• Annual health care costs: $2.7 trillion
• Percent of healthcare costs linked to individual behaviors: 70%
• Cost of tobacco, alcohol, soda, illicit drugs, unsafe sex, sedentary lifestyle, etc: $1.89 trillion.

The numbers tell a story—of how much money we can save on medical spending if as a society, we find ways to change individuals’ risky health behaviors.

Fee for service reimbursements to doctors:

• 5 minute cardiac stent: $1500
• 45 minute behavioral counseling: $15

Current reimbursements favor intervention, not prevention. We pay big bucks for sick care not health care.

Average annual salary:

• Interventional cardiologist: $320K
• Family physician: $168K
• Nutritionist: $53K
• Athletic trainer: $45K

We need to fairly reimburse the care that will keep people well. We need less high tech and more high touch interventions to empower people to change their lifestyles. We need more athletic trainers, yoga instructors, exercise physiologists, nutritionists, and dietitians, working together with the medical team to promote healthy behaviors. As a society, we need to make healthy choices easy choices.Simplify food labeling.Subsidize fruits and veggies instead of commodities like corn. Ensure the creation of bike trails and city parks.

“We don’t need to spend ourselves into poverty on health care,” cautioned a speaker in the documentary film Escape Fire. “We just need to do it differently.”


We need to reimburse health and wellness instead of more-more-more medical care. We need to pay fee for value instead of fee for service.

If health care inflation applied to the rest of the economy from the 1950s to today, food costs would be:

• A dozen eggs: $55.
• A gallon of milk: $48.

We can’t afford the status quo in the way we spend our healthcare dollars. We need to value health, and shift from desperate medical interventions to stave off death to gentle lifestyle changes to promote health. Together, we can pay for the powerful, simple, low tech low cost interventions that motivate patients to change their risky health behaviors, and stop the runaway inflation of our medical costs.

By Dr. Kohar Jones 
This post originally appeared on the Doctors for America blog. 

Health Care Reform Leadership Training for Faith Community and Communities of Color

Strong leaders are needed to speak out now about the development of an Illinois health insurance marketplace and expanding Medicaid, not cutting it.  

The Campaign for Better Health Care's Faith Caucus is inviting you to become a partner because, as a leader in the faith community or community of color, you can bring back the information to your congregation and community so they can join the effort for the full implementation of the new health care law (Affordable Care Act).  Your commitment will be to attend the next five trainings (one per month, each 3 hrs) and to follow through by mobilizing your communities. 

These trainings will help prepare you for a more active role in the pursuit of affordable, accessible and quality health care for everyone.  The leadership training series topics will include Organizing 101, Affordable Care Act, Marketplace, fundraising, legislative advocacy, messaging, social media, community engagement, leadership development, communications and resource development.

The initial five trainings will be held in Chicago, but we are seeking funding to provide trainings statewide.

Help make a difference in shaping our healthcare and the healthcare of those who need you to take action.

You can register by clicking this link.

 

Day	Date	Time	Location	Room
Tuesday	August 28st, 2012	1-4 pm	Mercy Hospital	Great Room
Tuesday	September 19th, 2012	1-4 pm	St. Mary’s Hospital,	1CD
Tuesday	October 16th, 2012	1-4 pm	Mercy Hospital	Room 242
Tuesday	November 13th, 2012	1-4 pm	Mercy Hospital	Penthouse
Tuesday	December 11th, 2012	1-4 pm	Mercy Hospital	Penthouse

Mercy Hospital & Medical Center. 2525 South Michigan Avenue Chicago, IL 60616.

St. Mary’s Hospital, 2233 W. Division St.  Chicago, IL 60622 Parking across the Street–North of Division St.

Laura Leon
Director of Faith Initiatives
Campaign for Better Health Care

Let’s Make Sure the Affordable Care Act Lives Up to Its Name

Low-income workers received a potentially devastating blow when the US Supreme Court decided to strike down the provision in the Affordable Care Act (ACA) penalizing states that do not expand access to Medicaid to families earning up to 133% of the poverty line. Unless states voluntarily expand Medicaid, many low-income workers will be left to shoulder the cost of mandated insurance on their own because few are likely to be covered through their employer.

According to the administrative rules for the ACA, employers (with 50 or more employees) have to pay a “shared responsibility fee” only when they neglect to cover full-time employees. Under this new law, full-time employees are defined as those who average 30 or more hours per week, and employers are granted ample leeway in defining the time period on which eligibility is based. Research I’ve conducted in several industries indicates that work hours in today’s hourly jobs are often scarce, with many workers expressing a preference for additional hours of work for additional pay. Because employers condition access to benefits on job status and hours worked, hourly workers, especially part-time workers, are often excluded from company-sponsored health insurance. The ACA is unlikely to do much to extend employer-sponsored coverage to hourly workers and may even heighten their risk of poverty given the incentive to employers to keep work hours below 30 a week.

Let’s make sure the Affordable Care Act lives up to its name by encouraging Governor Quinn and our legislators to voluntarily expand Medicaid. Because the federal government will pick up over 90% of the tab for the expansion, it makes good fiscal sense for both Illinois taxpayers and Illinois families.

Susan Lambert
Associate Professor
School of Social Service Administration
University of Chicago

(Portions of this letter were published in the Chicago Tribune, July 6 Voice of the People here)

The Economic Toll of Health Disparities

April is National Minority Health Month, and we are commemorating it with this post on health disparities from the Heartland Alliance blog, Heartbeat. The Affordable Care Act's reforms will make a difference in some of these disparities, such as the focus on expansion of access to primary care, innovations in medical delivery models, increased access to health insurance and the Medicaid expansion. 

Health disparities among minority groups account for 30.6% of direct medical expenditures, reflecting the significant toll being African-American, Asian or Hispanic has on one's health and economic well-being.

A study by the Joint Center for Political and Economic Studies found that between 2003 and 2006 almost a third of health care costs for minorities were due to poorer care compared with whites. Minorities face greater barriers to preventive care, acute treatment and chronic disease management.

Eliminating those disparities would have reduced by $229.4 billion direct medical expenditures by minorities, according to the Joint Center's estimate. Minorities could have saved more than $1 trillion on indirect costs -- such as those associated with illness and premature death -- during the four years studied if disparities didn't exist.

The 2010 National Healthcare Disparities Report found that rates of potentially avoidable hospitalizations for blacks are double those of whites. Blacks and Hispanics have higher rates of potentially avoidable hospitalizations for chronic conditions compared with whites.

Differences in access to care, provider biases, poor provider-patient communication and poor health literacy contribute to health disparities, according to the report. It states:
"Unfortunately, Americans too often do not receive care that they need, or they receive care that causes harms. Care can be delivered too late or without full consideration of a patient's preferences or values. Many times, our system of health care distributes services inefficiently and unevenly across populations."

Quoted in an America's Wire article on health disparities, Jennifer Ng'andu of the National Council of La Raza said minority children are particularly impacted by a lack of access to care. Children "will experience developmental setbacks because they are sick or their parents are sick. It makes it harder for them to achieve in school and can have serious consequences on their future."

Financial strains on families due to health care can hinder children's academic success and, in turn, future earnings. At the same time, minority youth are increasingly affected by chronic diseases such as diabetes.

Hispanics in general have higher rates of high blood pressure and obesity than non-Hispanic whites. They are twice as likely to die from diabetes as non-Hispanic whites, according to the Centers for Disease Control and Prevention.

Caring for chronic disease over a lifetime is expensive. With minorities representing more than half of uninsured Americans, the effect on their health and finances can be great. We support efforts to expand access to care -- particularly for preventive services -- to minority communities to eliminate health disparities and the economic costs that come with those disparities.

This article was originally posted on the Heartland Alliance Heartbeat blog. 

Toward a More Inclusive, Healthy Union

Two and a half years ago Congressman Joe Wilson called out across the well of Congress, "YOU LIE, Mr. President." If the never-ending news cycles leave you struggling to recall exactly what President Obama was accused of lying about, it was the inclusion of undocumented immigrants in the yet-to-be-passed healthcare reform bill.

Thanks to this comment and the resulting uproar when healthcare reform begins in 2014 undocumented immigrants will be barred from purchasing healthcare on the regulated insurance exchanges -- even with their own money. They won't qualify for Medicaid, contrary to a popular myth. Moreover, many of their legal immigrant spouses, parents, cousins, etc. will also be ineligible for Medicaid. The unbelievably complex rules for immigrant healthcare could easily result in one family having their various members regulated by five separate sets of eligibility rules.

Eventually our nation will need to decide if we really want the people who clean our office buildings, care for our children, serve our food, and whose children attend school with our children to have significantly worse healthcare. Meanwhile, down in Florida, Governor Romney and Speaker Gingrich argue over the laughable notion of "self-deportation" and spar over who the anti-immigrant is.

But Illinois can move ahead, and make sure that healthcare reform is both rational and humane. While we cannot change the enormously complicated federal eligibility guidelines, we can reduce the confusion for families here in Illinois and promote healthcare access to the fullest extent possible.

We can ensure that immigrant families understand what their new healthcare options will be in 2014 by developing an infrastructure of community organizations to assist immigrants to understand their complicated eligibility and guide them towards other options if they don't qualify for or can't purchase health insurance. We must make sure we have a strong, stable safety net that includes not just preventative care but the acute care that left untreated results in high medical bills and throws many low-income individuals into medical debt and hurts our overall economy.

For all those who are still learning English, we can make sure the system supports provides language access so that patients can navigate their healthcare options. Finally, here in Illinois we've made a strong stand that all children should have access to healthcare. Let's keep it that way.

For more info on immigrants and the ACA, check out this IHM Resource.

Written by Joshua Hoyt, Director at the Illinois Coalition for immigrant and Refugee Rights. Follow Joshua Hoyt on twitter at www.twitter.com/icirr

This post originally appeared on the Huffington Post. 

Health Reform's Best-Kept Secret

The Basic Health Program could bring more affordable, more reliable coverage to millions of adults--and improve access to care for children, too.

For all the attention devoted to the Affordable Care Act, scant consideration has been paid to a little-known part of it called the Basic Health Program. It's an option for states that could, if implemented nationwide, make health care coverage more affordable and accessible for more than 5 million adults and bring health coverage to more than 600,000 who would not otherwise have it.  Because many of these adults are likely parents of Medicaid- and CHIP-eligible children, the Basic Health Program could improve coverage and access to care for low-income children as well.

Most Say Ahhh! readers likely know how it works, but here's a quick recap of the Basic Health Program: under health reform, low-income people without health coverage will receive federal subsidies starting in 2014 to buy health insurance through Exchanges. States that implement the Basic Health Program in addition to an Exchange would contract with health plans or networks of doctors and hospitals to provide health care to people with incomes up to twice the Federal poverty line--just under $22,000 for a single adult--who don't qualify for publicly-financed programs such as Medicare or Medicaid. The Basic Health Program would replace subsidized coverage through Exchanges for this lower-income population. Washington would pitch in by providing states with 95 percent of the tax credits and subsidies that would have otherwise been provided through health reform.

According to an Urban Institute paper commissioned by our organization, the Association for Community Affiliated Plans, costs for subsidized health coverage through the Exchange are projected to cost low-income individuals more than $1,650 per year in premiums, copays and deductibles. For most people, that's a terrific deal. But for someone making $22,000 a year, $1,650 is nearly a month's pay. Many could well forgo coverage through the Exchange, pay a tax penalty of up to $700 and apply the difference to food, rent, or electricity. While health reform goes a long way towards making coverage more affordable through Exchanges and subsidies, health coverage may remain out of reach for some people with low incomes.

But if states were to implement the Basic Health Program to provide coverage modeled on Medicaid and CHIP, the Urban Institute estimates that annual premiums and out-of-pocket costs for adults would drop from a combined $1,650 to just under $200. At that level of affordability, paying the tax penalty makes no sense. The Urban Institute estimates that 600,000 people who would otherwise not purchase insurance would do so if all states ran a Basic Health Program. That's reason for cheer on its own.

Better still, the Basic Health Program could help more children access coverage and care in two ways. First, covering more adults will help children. While the Basic Health program would primarily cover adults in 2014 (Medicaid and CHIP handle low-income children), the lower premiums and reduced cost-sharing that could happen under BHP for adults would help children, as research has suggested a link between parents' insurance status and their children's access to care.

It could also serve as a backstop: should Congress not authorize new funding for CHIP in 2015, the Basic Health Program could serve as a bridge program for children, providing them with CHIP-like coverage rather than coverage through an Exchange. Finally, children who are prohibited from receiving Medicaid or CHIP coverage because of the 'five year bar' could be covered by the Basic Health Program. CHIPRA in 2009 gave states the option of covering these kids, but only six states had done so as of January 2011.

The Basic Health Program remains a work in progress, and there's work yet to be done: the Department of Health and Human Services must provide states guidance on several issues that will affect how states tailor their Basic Health Programs--notably, clarification of the mechanisms for calculating and delivering Federal funds. States must ensure that reimbursement levels for health plans and providers are high enough to attract an adequate number of participating physicians to meet demand for services generated by the program. While some analysts have questioned whether the Basic Health Program could adversely impact Exchanges, policy solutions could be found to address these impacts if they do occur.

The Basic Health Program represents the best health reform has to offer: more affordable and accessible care for millions of Americans, including parents and their children, and up to 600,000 fewer uninsured.

Given the financial pressures felt in statehouses across the country--and the professed desire by leaders on both sides of the aisle for affordable health options--the Basic Health Program deserves a long, close look. Governors, Medicaid directors and state legislatures across the country owe it to the people they serve to give Basic Health Program serious consideration.

Because this program is simply too promising to be kept a secret.

By Meg Murray and Jenny Babcock,Association for Community Affiliated Plans

This post originally appeared in Say Ahhh! A Children’s Health Policy Blog.