Why Nevada Leaders Tried to Open Medicaid Health Plans to Everyone
With the American health care system in a state of uncertainty because Congress may repeal the Affordable Care Act (ACA), state policymakers nationwide are considering new ways to cover their uninsured residents. On June 2, the Nevada legislature passed a bill that would allow residents ineligible for the state Medicaid program to purchase similar health coverage through the Nevada Care Plan. Democratic Assemblyman Mike Sprinkle, a veteran paramedic from Reno, sponsored the bill, which had been labeled a “public option” and stirred strong media interest.
On June 16, Nevada Republican governor Brian Sandoval vetoed the bill. In his message, Sandoval wrote: “Given the possibility that changes in federal law may put Nevada’s expanded Medicaid population at risk of losing their coverage, the ability for individuals to purchase Medicaid-like plans is something that should be considered in depth. If done correctly, the proposal . . . could provide a necessary safety net for those who may no longer have access to traditional Medicaid.” After the veto, I interviewed Sprinkle, who chairs the Nevada Assembly Health and Human Services Committee and is the Assembly’s majority whip. Here is an edited and condensed transcript of the conversation.
Q: What inspired you to sponsor the Nevada Care Plan bill?
A: After the election, the rhetoric from Washington gave us real uncertainty about how health care is going to be funded. We need to start looking at how we can provide for the people of Nevada by ourselves.
Q: Medicaid now covers more than 600,000 Nevadans. Do you think there would be much demand from many others to buy into Medicaid?
A: The Nevada Medicaid Department would manage this program, which mirrors a lot of the Medicaid benefits, but it would not be a Medicaid expansion. The Nevada Care Plan was intended to cover those who use their premium dollars to get a health plan. People could lose their health insurance, but this would be stable and always available, unlike private health plans that may not stay in the market. Nevada has outstanding Medicaid benefits, and I believe most Nevadans would feel more secure in this option and its benefits. The benefit package would be the same as Medicaid, except that for fiscal reasons, Nevada Care wouldn’t cover nonemergency transportation. Pretty much the only thing we would have given up is transportation to appointments.
Q: Did the bill encounter much political resistance in the legislature?
A: No. Both chambers approved it easily. It was really important that the people who worked with me on crafting the bill are the governor’s people. I put together a high-level working group with the head of Nevada Medicaid, the state insurance commissioner, and the head of the state health insurance exchange.
Q: How would Nevada Care have affected your emergency patients in Reno?
A: I think it would be tremendous for people without other coverage. These are the people I pick up every day — and often multiple times a month. They are uninsured or unable to manage the convoluted health care system, and this could help them get the services they need to have a healthier lifestyle.
Q: Can you describe the population you had in mind for Nevada Care?
A: One specific group we looked at was the ACA Medicaid expansion population, which is more than 300,000 people who could lose benefits if expansion goes away.
Q: How would Nevada Care have delivered benefits to members?
A: We divide Medicaid into two forms. The most populous counties, Washoe (Reno) and Clark (Las Vegas), are served by four managed care organizations (MCOs) that don’t go into rural areas. Those are covered by providers on a fee-for-service basis. The Nevada Care proposal was based on the fee-for-service model, but it would have opened the door for contracting with private insurance companies in ways that are parallel to MCOs. I’ve heard rumors that we may lose some large MCOs because of the changes that could come from the American Health Care Act in Congress. In Nevada, this program would fill that hole.
Q: What kind of premium levels did you envision for Nevada Care?
A: I didn’t get that number. The bill would have funded a $1 million actuarial study to ground us in the numbers and give us a far better idea about what a monthly premium charge would look like. Our working group’s fundamental concern was that we not have a government entity disrupt the insurance marketplace. Our intent was to come up with a premium number that would be competitive and probably comparable to what’s being offered today by other private health plans.
Q: Would the program have included income-based premium subsidies?
A: We planned to apply for waivers from the Centers on Medicare & Medicaid Services to potentially achieve the same tax credits as are now available on the ACA health insurance exchange, but that wasn’t certain. We’ve gotten indications that if states take on more responsibility themselves, the administration would be more willing than previous administrations to award waivers. Under my proposal, there would be no subsidy in place for this program. People would simply purchase their insurance at the offered premium. We planned to look at funding mechanisms to provide our own state subsidies. We thought we might be able to bring in more group insurance policies, which might be a more fiscally sound way to provide coverage at lower premiums.
Q: If Nevada Care had been approved, how would it have prevented an insurance death spiral caused by an imbalance of healthy and sick enrollees?
A: That was a legitimate concern I wanted to address with our Medicaid director. I assumed protections against adverse selection would revolve around only allowing people to sign up during open enrollment periods. While it wasn’t mentioned in the bill, it was my intent that preexisting conditions would never prevent anyone from purchasing this plan.
Q: Do you think providers would have wanted to participate in this plan?
A: Providers are hesitant to take Medicaid recipients because of reimbursement rates, which aren’t great, but I’ve heard that if Congress were to eliminate the Medicaid expansion population, Nevada Care would have been attractive to them if these somewhat draconian changes proposed by the federal government come to fruition. We would have to call a special legislative session to deal with that alone. But I didn’t really envision doctors getting a raise for Nevada Care patients above Medicaid rates. Network adequacy is always going to be an issue in rural areas in Nevada and other states. We tried to address that by expanding the scope of nurse practitioners and physician assistants. Nevada Care might have inspired more health care professionals to get involved because they know they will get reimbursed. I also hope we open more Federally Qualified Health Centers.
Q: How did the health care industry react to the legislation?
A: No one said to my face they thought this was a horrible idea. The insurers were asking a lot of questions. They were generally intrigued, and big managed care plans want to be part of the process. The hospital association liked the idea of the policy, but they were concerned about the fiscal impact on their members.
Q: How would you compare the way Nevada lawmakers considered this bill to what’s been happening in Washington with the ACA repeal?
A: My intent as a legislator is always to be open-minded and to listen. I never pretend to have all the answers. As an ACA proponent, I felt there were unforeseen problems that need to be addressed. In the same way, we couldn’t identify all the possible negative ramifications of this bill. My commitment to everyone was to continue to address those roadblocks to make the program better. If Congress isn’t listening to all sides and trying to reach consensus, then I believe they are going at it the wrong way. Without buy-in from everybody, it will ultimately fail.