Publications

Access to Health Care in Michigan: Cover Michigan Survey

The Center for Health and Research Transformation’s (CHRT) 2018 Cover Michigan Survey asked Michigan residents about their experiences in accessing health care, specifically how easy or difficult it was to get appointments with different providers.

The survey found that two factors—the presence of primary care providers (PCP), and whether or not people had a medical home—figured prominently in reported ease of access to care.

Read the full report: Access to Health Care in Michigan.

Projected Impacts of Medicaid Work Requirements: An Overview of Current State Proposals

As of January 2019, 14 states have submitted proposals to the federal government requesting permission to establish work requirements in their Medicaid programs. To date, the U.S. Centers for Medicare and Medicaid Services (CMS) has approved Medicaid work requirements for seven states, and two states (Arkansas and Indiana) have begun implementing these requirements for Medicaid beneficiaries.

In June 2018, Michigan enacted work requirements for many enrollees in the Healthy Michigan Plan (HMP), Michigan’s expanded Medicaid program for low-income adults.

Beginning in January 2020, HMP enrollees under age 63 will be required to report 80 hours of work per month or obtain an exemption (see CHRT’s previous fact sheet, Proposed Medicaid Work Requirements in Michigan).

The Michigan House Fiscal Agency initially estimated that approximately 80 percent of enrollees would be subject to the requirements, while 20 percent would qualify for an exemption.  More recently, an independent analysis by Manatt Health projected that 39 percent of HMP enrollees would be automatically exempt (based on age, pregnancy, medically frail, or incarceration status; or because they are already meeting SNAP/TANF work requirements), while 61 percent would be required to report work hours or obtain an exemption. This analysis estimated that 9 to 27 percent of all HMP enrollees could lose coverage over a one-year period.

Read Projected Impacts of Medicaid Work Requirements in Michigan.

 

Cover Michigan Survey: Use of Health Care Benefits in Michigan

Data from the Center for Health and Research Transformation’s (CHRT) 2018 Cover Michigan Survey show health benefits that Michiganders with health insurance coverage have used in the past year (1)Survey participants were asked whether or not they or other family members covered by their plans used each health care benefit in the past 12 months.. Detail on the Cover Michigan Survey and analysis methodology can be found on CHRT’s website. In addition to findings on overall use of health care benefits, this brief focuses on three key areas: dental and vision, reproductive health, and mental health care.

Nearly all Michiganders used some kind of health benefit over the last year. To understand differences in the use of health care benefits, several variables were examined including gender, age, race, insurance type, income, and employment status.

  • Preventive care: The highest utilized benefit was routine, preventive primary care This was consistent across all groups.
  • Dental and vision care: There is high use of these benefits even though they are not generally core offerings of most insurance
  • Reproductive health care: Women, especially younger women, use these benefits at a significantly higher rate than men and older Reproductive health care represents 11 percent of younger women’s health care utilization.
  • Mental health care: Younger women and people who are unemployed reported significantly higher use of their mental health care or substance use treatment coverage.

Other findings include:

  • Aside from dental and inpatient care, women consistently utilized more health care benefits than men.
  • African Americans were the least likely to visit a doctor and use vision care benefits compared to other races, while white Michiganders were the most likely to use inpatient services.
  • Regardless of insurance type, respondents use doctor visits at similar rates, however those with employer-provided insurance were the most likely to use dental care benefits.
  • Medicaid beneficiaries had the highest utilization of pediatric care, contraceptive/family planning, mental health/substance use, and maternity/newborn care benefits; and Medicare beneficiaries made the most use of the prescription drug benefit. These differences are likely due to the unique populations that make up membership in these plans.
  • Compared to those with lower household income, Michiganders with incomes of $50,000 or more per year were far more likely to use dental care, doctor visits, and vision benefits.
  • The unemployed population was more likely to use inpatient care, mental health/substance abuse services, and maternity/newborn care than those who are working/in school.

Read the full report, Use of Health Care Benefits in Michigan, and download a full analysis.

References   [ + ]

1. Survey participants were asked whether or not they or other family members covered by their plans used each health care benefit in the past 12 months.

Proposed work requirements for Medicaid in Michigan June 7, 2018

At the start of 2018, the U.S. Centers for Medicare and Medicaid Services (CMS) announced a major shift in federal policy that would allow states to request permission to establish, and test the impact of, work and community engagement requirements for able-bodied adults receiving Medicaid health insurance coverage. In the last five months, work requirement proposals have been approved in four states; formal applications have been submitted by seven more; and a number of others are preparing proposals.

In April, the Michigan State Senate took the first step toward establishing work requirements by passing Senate Bill 897. The Michigan House of Representatives passed an updated version of the bill on June 6. And on the morning of June 7, the Michigan Senate approved the revisions and sent the bill to the Governor’s office for signature.

Read the full brief, Proposed Work Requirements for Medicaid in Michigan (June 7, 2018)

Setting the stage for the 2019 Health Insurance Marketplace

health

The Centers for Medicare and Medicaid Services is rolling back regulations around rate increases, essential health benefits, health insurance navigators, and more, for insurers offering Qualified Health Plan coverage on the Health Insurance Marketplace in 2019.

In a new fact sheet, CHRT compares the current rules and regulations to the changes that go into effect in 2019—with a special focus on Michigan. Here are just a few highlights:

  • Rate increases under 15 percent will no longer require review;
  • Simple choice standardized plans will be eliminated; and
  • Consumer cost-sharing limits will increase by 7 percent.

These changes will impact Michigan consumers as soon as November 1, 2018, when the next Marketplace Open Enrollment Period begins.

For more about silver loading, individual mandate hardship exemptions, risk adjustment rules, and other regulatory changes, read the full brief.

 

Proposed work requirements for Medicaid in Michigan (April 20, 2018)

At the start of 2018, the U.S. Centers for Medicare and Medicaid Services announced a major shift in federal policy that would allow states to request permission to establish, and test the impact of, work and community engagement requirements for able-bodied adults receiving Medicaid health insurance coverage. In the last three months, work requirement proposals have been approved in three states; formal applications have been submitted by seven more; and a number of others are preparing proposals.

In early March, Michigan state senators took the first step toward preparing a work requirement proposal of their own by introducing Senate Bill 897. The bill passed the Michigan State Senate on April 19. In this fact sheet, we compare the characteristics and projected impact of Michigan’s work requirement proposal against the characteristics and projected impact of approved work requirement proposals in Kentucky, Indiana, and Arkansas.

Read the full brief, Proposed Work Requirements for Medicaid in Michigan (April 20, 2018).

 

Health Insurance Marketplace in Michigan 2018: Rate Analysis

health

In 2017, the federal government took several regulatory and administrative actions that affect the health insurance marketplaces created under the Affordable Care Act (ACA). At the same time that Congress considered legislative proposals to repeal and replace the ACA, the U.S. Department of Health and Human Services (HHS) promulgated new regulations that changed annual open enrollment dates and announced the end of cost-sharing reduction payments to insurers. These developments, in addition to several other factors, have impacted Marketplace carrier participation and plan pricing in Michigan.

Key Findings

  • Michigan continues to have a robust Marketplace. Eight insurers are participating in Michigan’s health insurance marketplace in 2018, a decrease of two insurers from 2017.
  • Michigan consumers can select from a variety of Marketplace plans. There are 12 to 52 plans offered in each of Michigan’s 83 counties.
  • Across all counties, the average premium increase for the lowest cost and second-lowest cost silver plans is 33 percent and 34 percent, respectively. Premiums for the lowest cost bronze plan increased by 16 percent, and premiums for the lowest cost gold plan increased by 6 percent.
  • Premium tax credits are linked to the cost of the local second-lowest cost silver plan. All else equal, individuals who are eligible for premium tax credits could receive a larger tax credit in 2018 due to premium increases for the second-lowest cost silver plan. In 23 counties, larger tax credit amounts will eliminate the cost difference between renewing the 2017 lowest cost silver plan and actively enrolling in the 2018 lowest cost silver plan.
  • The federal government reduced the open enrollment period to 45 days, from 92 days in 2017.
  • Federal financial support for Michigan Navigators to help with open enrollment has been reduced by 72 percent, from $2,228,692 in 2017 to $627,958 in 2018.

For more, read Rate Analysis: 2018 Health Insurance Marketplace.

Comparing Key Provisions: Affordable Care Act, American Health Care Act, and the Graham-Cassidy Proposal

In July 2017, the United States Senate rejected a series of proposals to repeal and replace the Affordable Care Act (ACA). On September 13, 2017, Senators Lindsey Graham and Bill Cassidy introduced a new proposal to repeal and replace the ACA.

The Graham-Cassidy proposal retains some similarities to the American Health Care Act, which passed the U.S. House of Representatives in May 2017, but includes some notable differences. The following table compares key provisions of the Affordable Care Act, American Health Care Act, and the Graham-Cassidy proposal.

The Senate has until September 30, 2017 to pass a repeal and replace package under the Fiscal Year 2017 budget reconciliation process, which requires a simple majority for passage. After the end of FY 2017, any repeal and replace legislation would most likely require 60 votes for passage.[footnote]It is possible that budget reconciliation, requiring a simple majority for passage, could be used for repeal and replace legislation in FY 2018 if it is not used for other issues.

On Sept. 25, the U.S. Congressional Budget Office (CBO) issued a preliminary report on a version of the Graham-Cassidy bill summarized in this brief. The CBO concluded that the bill would save at least $133 billion. However, it would result in millions of people losing health insurance. Additional, detailed analyses may be forthcoming.

Read more in Comparing Key Provisions: Affordable Care Act, American Health Care Act, and the Graham-Cassidy Bill.

Decrease in Hospital Uncompensated Care in Michigan, 2015

 

Introduction

The Affordable Care Act (ACA) expanded access to health insurance coverage for Michigan residents in 2014 through the creation of the Health Insurance Marketplace and the expansion of the Medicaid program. Since then, Michigan has experienced large decreases in the number of adults who lack health insurance, delay necessary care, and have trouble paying their medical bills.(1)E. Austic, E. Lawton, M. Slowey, M. Riba, and M. Udow-Phillips, Changes in Health Care Cost Barriers under the Affordable Care Act in Michigan (Ann Arbor, MI: Center for Healthcare Research and Transformation, 2017). Hospitals also appear to have reaped the benefits of the ACA’s coverage expansions. Following the expansion of Michigan’s Medicaid program in April 2014, Michigan hospitals experienced a steep drop in uncompensated care costs. In 2015, uncompensated care costs continued to decline, and as uncompensated care’s share of hospital operating expenses decreased, the median hospital operating margin in Michigan improved for the second year in a row. As policymakers debate changes to the Affordable Care Act and Medicaid, it is important to assess the financial gains that Michigan hospitals have received in the first two years of ACA implementation and the potential losses they could incur with a repeal of the ACA.

For an analysis of uncompensated care costs nationwide and a comparison of these trends in several Midwestern states, please see CHRT’s companion piece, Hospital Uncompensated Care in the United States, 2015 – Comparison of Midwest States.

Hospital Uncompensated Care and Financial Trends

Recent studies have documented decreases in uncompensated care and the proportion of uninsured patients in Michigan hospitals after the ACA’s coverage expansion began in 2014. One study used Medicaid cost reports to find that uncompensated care costs for 88 Michigan hospitals(2)88 hospitals in the state of Michigan reported FY2015 data at the time of the study. decreased from $627 million in 2013 to $332.1 million in 2015.(3)T. Buchmueller, H. Levy, S. Nikpay, and J. Rhodes, Healthy Michigan Plan 2015 Report on Uncompensated Care and Insurance Rates, prepared for the Michigan Department of Health and Human Services, December 31, 2016 (accessed 6/12/17).

Another study examined shifts in payer mix in Michigan hospitals following the launch of the Healthy Michigan Plan in April 2014. This study found that the proportion of uninsured patients in Michigan hospitals from April-December 2014 decreased by four percentage points and the proportion of patients with Medicaid coverage increased by 6.5 percentage points compared to the same time periods in 2012 and 2013.(4)M. Davis, A. Gebremariam, and J. Ayanian, “Changes in Insurance Coverage Among Hospitalizeds Nonelderly Adults After Medicaid Expansion in Michigan,” Journal of the American Medical Association, June 21, 2016 (accessed 6/12/17).

In the present study, CHRT used Medicare cost reports to examine the financial characteristics of 104 hospitals in Michigan. Michigan expanded Medicaid eligibility with the launch of the Healthy Michigan Plan on April 1, 2014. By the end of the year Michigan experienced a sharp decline in uncompensated care, dropping from $903 million in 2013 to $677 million in 2014 (see Figure 1). This drop continued into 2015 as uncompensated care fell to $394 million, a decrease of 56 percent from 2013 levels.

Uncompensated care comprises both charity care costs and bad debt costs. The effect of the Medicaid expansion was larger for the charity care portion of uncompensated care compared to the bad debt portion. Charity care expenses for hospitals decreased by 70 percent from 2013 to 2015.

Figure 1: Hospital Uncompensated Care Costs in Michigan, by Bad Debt and Charity Care, 2011–2015

From 2013 to 2015, Michigan hospitals generally experienced improved overall financial outcomes as well as decreased uncompensated care burdens. Uncompensated care’s share of hospital expenses fell from 3.6 percent for the median hospital in 2013 to 1.7 percent in 2015 after increasing in the years prior to Medicaid expansion (see Figure 2). However, hospitals had different levels of uncompensated care burdens and the effects of coverage expansion varied by specific hospital characteristics (see Appendix).

Coinciding with the decline in uncompensated care costs, the median hospital operating margin (net profits from patient care services) increased from -4.3 percent in 2013 to -0.5 percent in 2015. The ACA includes several quality improvement programs, such as penalties for hospital readmissions, which affect Medicare reimbursement. While these types of penalties may have had a negative effect on the profitability of certain hospitals, many hospitals experienced substantial gains in profitability in 2015.

Figure 2: Median Hospital Financial Indicators in Michigan, 2011–2015

From 2011 to 2013 the number of inpatient days and outpatient visits at Michigan hospitals decreased from 4.68 million to 4.46 million (see Figure 3). In 2015, Medicaid volume increased by 16 percent to 1.13 million inpatient days and outpatient visits, while volume for other payers decreased by 4 percent. Overall volume has remained nearly unchanged from 2013 to 2015. Medicaid’s share of total patient volume increased from 21.7 percent in 2013 to 25.2 percent in 2015.

Figure 3: Hospital Inpatient Days and Outpatient Visits for Michigan Hospitals by Payer, 2011–2015

Conclusion

Hospital financial performance in Michigan has improved in the two years since the implementation of the ACA’s coverage expansions in 2014. Michigan continued to experience a decline in hospital uncompensated care costs in 2015 as hospitals saw fewer uninsured patients and a higher proportion of patients covered by Medicaid. Overall hospital operating margins also improved in 2015. Medicaid expansion appears to have had a positive effect on hospitals’ uncompensated care costs and overall margins since the launch of the Healthy Michigan Plan in 2014. With policymakers currently debating changes to Medicaid and the future of the Affordable Care Act, it will be important to monitor the connection between the coverage expansions created under the law and the financial performance of health care providers. Policy changes that reverse the ACA’s coverage gains could also affect hospitals’ financial status.

Data and Methodology

We extracted hospital data on uncompensated care and other facility characteristics from publicly available cost reports submitted by hospitals to the Centers for Medicare and Medicaid Services (CMS) via the Healthcare Cost Report Information System (HCRIS). Data include reports collected by December 31, 2016, which were released on January 19, 2017. For this analysis, we restricted the set of hospitals to short-term acute and critical access hospitals that submitted complete reports for each year from 2011 through 2015. This eliminated rehabilitation, long-term, psychiatric, children’s, and other specialty hospitals that have high nonresponse rates or are not largely affected the ACA’s Medicaid expansion. The resulting data set includes 3,474 hospitals nationwide and 104 in Michigan.

Hospitals submit worksheet S-10 as part of their cost report that breaks down their uncompensated care costs into their separate sources. In our analysis, we define uncompensated care as the sum of charity care (care delivered with no expectation of payment) and bad debt (care that is billed but no payment is received), but underpayments from public payers (Medicare, Medicaid, and the Children’s Health Insurance Program) were excluded. The use of cost report data for uncompensated care research is still relatively new, and not all responses from hospitals are audited by CMS. However, MedPAC has supported using worksheet S-10 to directly measure uncompensated care costs.(5)Medicare Payment Advisory Commission. Report to the Congress: Medicare Payment Policy. March 2016. http://www.medpac.gov/docs/default-source/reports/march-2016-report-to-the-congress-medicare-payment-policy.pdf (accessed 3/17/16). Data for inpatient days and outpatient visits were extracted from worksheet S-3, part 1, and data on operating margins were extracted from worksheet G-3 of the cost reports.

Cost reports submitted to hospitals are based on individual hospitals’ fiscal years, which have varying beginning and end dates. To generate comparable time-series measures, we converted hospital fiscal year measures to calendar year estimates by combining the portion of each fiscal year that fell within a given calendar year. Uncompensated care amounts were converted from charges to costs using hospital-specific cost-to-charge ratios calculated in the cost reports, and all financial measures were adjusted for inflation to 2015 dollars. Facilities that reported outlier uncompensated care amounts compared to their historic trend were dropped from the study.

Hospitals were identified as for-profit, nonprofit, or government-owned based on control status data from the 2013 American Hospital Association annual survey.(6)American Hospital Association. Annual Survey Database: http://www.aha.org/research/rc/stat-studies/data-and-directories.shtml (accessed 3/17/16). Metropolitan status was determined based on the U.S. Department of Agriculture’s rural-urban continuum codes for 2013,(7)US Department of Agriculture, Economic Research Service, Rural-Urban Continuum Codes: http://www.ers.usda.gov/data-products/rural-urban-continuum-codes.aspx (accessed 3/17/16). and hospitals were identified as teaching institutions if they indicated in their cost reports that they train residents as part of an approved graduate medical education program.

Appendix

Figure A-1: Median Financial Indicators for Michigan Hospitals by Select Characteristics, 2011–2015

 

 

References   [ + ]

1. E. Austic, E. Lawton, M. Slowey, M. Riba, and M. Udow-Phillips, Changes in Health Care Cost Barriers under the Affordable Care Act in Michigan (Ann Arbor, MI: Center for Healthcare Research and Transformation, 2017).
2. 88 hospitals in the state of Michigan reported FY2015 data at the time of the study.
3. T. Buchmueller, H. Levy, S. Nikpay, and J. Rhodes, Healthy Michigan Plan 2015 Report on Uncompensated Care and Insurance Rates, prepared for the Michigan Department of Health and Human Services, December 31, 2016 (accessed 6/12/17).
4. M. Davis, A. Gebremariam, and J. Ayanian, “Changes in Insurance Coverage Among Hospitalizeds Nonelderly Adults After Medicaid Expansion in Michigan,” Journal of the American Medical Association, June 21, 2016 (accessed 6/12/17).
5. Medicare Payment Advisory Commission. Report to the Congress: Medicare Payment Policy. March 2016. http://www.medpac.gov/docs/default-source/reports/march-2016-report-to-the-congress-medicare-payment-policy.pdf (accessed 3/17/16).
6. American Hospital Association. Annual Survey Database: http://www.aha.org/research/rc/stat-studies/data-and-directories.shtml (accessed 3/17/16).
7. US Department of Agriculture, Economic Research Service, Rural-Urban Continuum Codes: http://www.ers.usda.gov/data-products/rural-urban-continuum-codes.aspx (accessed 3/17/16).

Comparing Key Provisions: Affordable Care Act, American Health Care Act, and Better Care Reconciliation Act

Editor’s Note: CHRT revised the following table (originally published June 27, 2017) to reflect both the U.S. Senate’s July 13 revision of its Better Care Reconciliation Act (BCRA) and the Congressional Budget Office’s score of the revised BCRA.  

On June 22, 2017, Senate Republicans released a discussion draft of the Better Care Reconciliation Act, their proposal to repeal and replace the Affordable Care Act (ACA). The Senate draft retains a similar overall structure as the American Health Care Act, which passed the U.S. House of Representatives in May 2017, but includes some notable differences. The following table compares key provisions of the Affordable Care Act, American Health Care Act, and Better Care Reconciliation Act. This document reflects the revised Better Care Reconciliation Act as of July 13, 2017. CHRT will update this table if the Senate votes to approve the motion to proceed.