What do people want?

So what do people want?

Let's look at a few surveys of the options in Health care reform.

This is last year's VERMONT survey of employers and consumers, testing five options. Careful reading of the details on options, like leaving out mandated benefits, can make a big difference in reactions. Also note the reaction of the participants to their lack of background information & knowledge of options:

EXECUTIVE SUMMARY

The Office of Vermont Health Access (OVHA) commissioned Action Research to test-market five policy options developed by The Lewin Group and the Steering Committee for the work undertaken as part of the Federal HRSA State Planning Grant. This research was supported by a grant from the Health Resources and Services Administration, U.S. Department of Health and Human Services.

Focus group sessions were conducted with employers and consumers. The qualitative research had one specific goal: to present each of five policy options and obtain feedback from participants. Specifically, the focus groups sought to determine participants’ perceptions of the benefits and drawbacks of each plan, to explore questions participants had about each plan and to determine what changes participants would like to see with each plan. The research also sought to rank the plans by participant preference.

Findings from the Focus Groups

Reactions to Policy Options

· Generally, most groups found the policy options difficult to digest and understand. Both employers and consumers had many questions about each plan.

In most groups, participants indicated at some point that they did not feel that any of the options addressed what they believe are the core issues in insuring more Vermonters: affordable health care and affordable health insurance.

· In nearly every group, participants raised concerns regarding eligibility requirements for participation in the plan. Participants did not like the idea of targeted, or, from their perspective, limited, assistance. Many groups wanted to discuss "affordable health insurance for all Vermonters." Whether it was the idea of tax credits for employers who have not been offering insurance or sliding-scale fees available to the uninsured, participants felt that all Vermonters were entitled to relief from the high costs of health care and health insurance.

Employer Health Insurance Tax Credits

· This plan was presented as one that would give a refundable tax credit to small employers of low-wage workers who begin offering health insurance to their employees.

· Employers are very attracted to the idea of getting tax relief in exchange for offering health insurance to employees. A number of participants agreed that this policy option would encourage more employers to offer health insurance to employees. Additionally, some employers noted they appreciate that this plan allows employers the freedom to choose which plan they would like to offer.

· Some also noted that they would like to see the amount of the credit increased to 40%-60% of employer costs. Consumers without health insurance suggested that the amount of reimbursement be tied to a company’s profitability, so that the least profitable companies would see the largest proportional reimbursement.

· Employers who are already offering health insurance to employees were upset by the eligibility requirement that would prohibit them from taking advantage of this policy. Participants in other groups also felt this requirement was not fair. Most groups recognize that affordable health insurance is a problem for most small businesses, not just those that do not offer insurance.

· Participants also recognize that, although this policy option would help, many employers cannot afford the cash output required to pay the premiums on a monthly basis. These participants noted that the Employer Health Insurance Tax Credit does not address the need for more affordable health insurance premiums in Vermont. A few also noted that this policy does not address the fact that many low-wage workers cannot afford to pay their share of the premium required to join an employer-sponsored plan.

· Many thought that requiring the firms’ average wages to be below the statewide average would be limiting to many businesses. Employers cited the fact that in today’s economy, they have had to raise their wages to be competitive. Others noted that their particular industry or location (such as Chittenden County) required them to pay higher-than-average wages and, therefore, they would not be eligible.

Low-Cost Insurance Plan

· This plan was described as an insurance policy that would cost 15% to 20% less than other commercial plans. The plan would exclude state-mandated benefits and the state would offer a reinsurance program for 90% of benefit payments in excess of $30,000.

· This policy option was widely considered a good plan for those who do not have any other choices. Overall, it was viewed as a moderately adequate solution to the health insurance problem facing employers. Many liked the idea that a low-cost plan would be available; however, contrary to early findings, most felt the excluded benefits were a major drawback to this plan.

· Respondents agreed that in earlier focus groups they championed the idea of being able to purchase a plan free of state-mandated benefits. The difference between what they described earlier and the Low-Cost Insurance Plan was that this plan did not address the deregulation of the insurance industry, which they believed would increase competition and lower prices.

· Some participants indicated that they were not aware that benefits such as home health care and drug and alcohol treatment were state-mandated benefits – and they felt insurance plans should cover those services. Others noted that many people utilize chiropractic and mental health services. Some agreed that the benefits exclusions were an acceptable way to achieve "cheap" health insurance coverage; however, most agreed they would not want to be covered by such a plan. Many participants agreed that a 15%-20% savings would not be enough to justify purchasing a plan with significantly fewer benefits than other plans. It was noted that a 15%-20% price reduction would barely cover a single year premium increase at the rate that health insurance companies have been raising premium rates.

· Every group was significantly confused by the reinsurance portion of this policy option. Many thought that it meant the employers had to pay out $30,000 in health insurance expenses before the plan would begin to assist them; others thought that the employer would be responsible for paying the first $30,000 in benefit payments.

· Respondents also criticized participation requirements. They believed that the employee income caps were too low; that some employers of low-wage workers would not be able to afford half of the premium, and that it would be difficult to get half of the employees in low-wage firms to agree to sign up for the plan. Most also agreed that a $100,000 lifetime benefit cap was too low.

VHAP Buy-In to Employer-Sponsored Plans

· This plan was described as one that would shift children from Dr. Dynasaur to a parents’employer-sponsored health plan. This would be done only in instances where it would be less costly to the state to pay the difference necessary to obtain family coverage on the private plan than to keep the child enrolled in Dr. Dynasaur.

· Initial reactions to this policy option were good. Participants liked the idea that the plan would save the state money and that it would assist individuals in affording private insurance. Many appreciated the individual-targeted approach.

· However, participants noted that Dr. Dynasaur benefits are often far superior to benefits available in an employer-sponsored plan. They also mentioned that the policy option would increase costs to individuals, because most employer plans have co-pays and deductibles, which individuals were not paying under Dr. Dynasaur. Participants looked significantly less favorably on the plan when they realized that, although the state would save money, individuals would end up with more out-of-pocket medical expenses.

· Participants were concerned that many parents would be unwilling to move their children from Dr. Dynasaur to an employer’s plan. Questions were raised about whether people would be required to move their children, against their wishes. Many also wondered what would happen in cases where a parent is offered insurance, but chooses not to be insured for cost reasons. Would that person be required to pay the individual premium portion, so the state could shift the children to the employer plan?

· There were also concerns about the state’s involvement in the administration of this plan. Most agreed they did not want the state making decisions about who should be on which insurance program. Many also anticipated a significant amount of bureaucracy and paperwork, requiring many administrative personnel. Many questioned whether the state had the current capacity for this additional work. Questions were raised regarding whether shifting a number of children from Dr. Dynasaur to private insurance would increase health insurance premiums for all. Many thought that this would be the case. However, consumer without insurance believed that adding more persons to private insurance policies would give employers more bargaining power to get lower premium rates.

· As with other policy options, many note that this plan does little to address the need for lower premium costs or more affordable health care. They also criticize the plan for being selective about who receives assistance, noting that this plan would only help those who are already offered health insurance and would do nothing for persons without access to insurance.

Direct Care Model

· This plan was presented as one that would provide funding to expand the availability of free or subsidized health care for the uninsured.

· This policy option was perhaps the most confusing to nearly all of the groups. Many could not understand that this was not a health insurance program, nor could they understand how this program would work. Many were cynical about a doctor’s or hospital’s willingness to participate in another program that did not charge full fees for services. Participants used Medicaid and Medicare as examples and insisted that there would be no such thing as free care.

· Consumers without health insurance were not as confused by this policy option. They were slightly less cynical about doctor’s and hospital’s willingness to participate in such a system. Despite this, they had many of the same questions and concerns as those in other groups had.

· Participants believed that someone, somewhere, would end up paying for the care delivered under this model. Most believed the burden would fall upon taxpayers and insured persons in the form of higher taxes and higher premium rates.

· The perception is that doctors are already overbooked, because many people have difficulty getting in for appointments. Therefore, many questioned how doctors would be able to fit in new patients from this plan. Many also believe that doctors are reluctant to take Medicare and Medicaid patients, because of low reimbursement rates. Given this, they question a physician’s willingness to take on more patients who would not be paying full cost for their services.

· Additionally, many believe that this option is targeted toward a group of people who are most likely already eligible for other types of assistance. Participants also mentioned that this program does not address the issue of affordable health insurance and care for all Vermonters.

· Despite the confusion over this model, many did praise it for getting people access to health care and helping them afford it. Many agreed that the plan would reduce the cost of caring for the uninsured by integrating them into mainstream care, getting access to preventive care and reducing the need for emergency room visits.

Medicaid Eligibility Expansion

· This plan was presented as one that would expand the income eligibility levels for VHAP to 300% of the federal poverty level for all Vermonters. The increase would be implemented gradually.

· Many (is how many?) thought that this policy option was a good idea. They see that this policy option would achieve the goal of insuring more Vermonters, specifically addressing the needs of uninsured adults in Vermont. Many preferred this plan because it targeted individuals rather than employers. This plan was also seen as one that would address the need of Vermonters who work multiple part-time jobs or hold seasonal positions and, therefore, are not eligible for employer-sponsored health insurance.

· Again, participants took issue with some of the eligibility requirements. A few felt that 300% of the FPL was too high; however, most felt that 300% did not go far enough. Many thought that the eligibility levels should be increased at the same time for everyone, regardless of whether or not they have children.

· One concern voiced about this policy option is whether it would cause more people to drop employer-sponsored coverage, thus making it more difficult for employers to qualify for plans or to afford the premiums. Another concern is that this option will end up costing taxpayers more. Uninsured respondents and one group of employers who do not offer health insurance note that expansion of VHAP will increase the cost-shifting that occurs due to the reimbursement rates.

· Participants did mention they would like to see a gradual move off VHAP, rather than a strict cutoff. Respondents thought that those over 300% of the FPL should be allowed to participate in VHAP, but pay premium payments, deductible and co-pays. They envision that these payments would increase the higher one’s income level was.

Comparing the Options

· Each group was asked to rank the three policy options they evaluated in depth. Participants from businesses not currently offering insurance named the Employer Health Insurance Tax Credit as their first choice and the Low-Cost Insurance Plan as their second choice. The VHAP Buy-In was the third choice.

· Employers who are offering health insurance to employees were most likely to select the VHAP Buy-In to Employer-Sponsored Plans as their first choice. The second choice was the Employer Health Insurance Tax Credit and the lowest-ranked plan was the Low-Cost Insurance Plan.

· Generally, employers gave the highest ratings to the plans that they felt would benefit them most directly. In fact, many employers who do offer health insurance noted that they did not really prefer any of the plans, because none were targeted toward them and their struggles with offering health insurance. The consumers who have health insurance had very different opinions on which of the individual-targeted plans rated first. In Rutland, respondents named the VHAP Buy-In as their first choice; in Bennington, respondents preferred Medicaid Eligibility Expansion. Consumers without health insurance ranked the Direct Care Model and Medicaid Eligibility Expansion as their first choice.

· Near the end of each group, respondents were asked to vote on all five plans that had been presented and discussed. Two out of three indicated they would support the Employer Health Insurance Tax Credit and Medicaid Eligibility Expansion. Half supported the idea of the VHAP Buy-In to Employer-Sponsored Plans or the Direct Care Model. About one in three supported the creation of a Low-Cost Insurance Plan.

· Perhaps not surprisingly, employers who do not offer health insurance are most likely to support the programs targeted toward employers not currently offering insurance (Employer Health Insurance Tax Credit and Low-Cost Insurance Plan). Employers who do currently offer health insurance prefer the individual-targeted plans (Direct Care Model and Medicaid Eligibility Expansion). Interestingly, consumers who have health insurance spread their support among the Employer Health Insurance Tax Credit, the VHAP Buy-In and the Medicaid Eligibility Expansion; those without health insurance supported all of the plans except the Low-Cost Insurance Plan