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SERVING THE UNINSURED AND UNDERINSURED
IN NEW YORK STATE
Prepared by the New York State
Association of County Health Officials
July 1996
General Principles
*Services for the uninsured and underinsured must be protected.
* Undocumented persons must remain eligible for services for the uninsured and underinsured.
* Serving the uninsured and underinsured is a responsibility that must be shared by federal, state, and local government.
* The infrastructure of safety-net providers including local health units must be preserved during this time of transition in the health care delivery system.
* New York State Departments of Health and Social Services should initiate a coordinated and systematic response to and integration of existing programs into a comprehensive
"wrap-around" system of care for the growing numbers of uninsured and underinsured. Instead of taking a categorical approach, a statewide health care needs assessment must be conducted to look at the
entire needs of the population in the context of the provider infrastructure.
Introduction
The New York State Association of County Health Officials (NYSACHO)
is a statewide association representing each of the 58 local health departments throughout New York State. The membership includes health commissioners, public health directors, deputy commissioners, and directors of patient services in county and city health departments. NYSACHO is concerned about a variety of primary care, preventive health care, and public health services that affect the residents of New York State. As local health officers, the members of NYSACHO are in a unique position to observe the local impacts of state and federal policies.
Earlier this year NYSACHO convened an ad hoc committee to study
the issue of the growing numbers of uninsured and underinsured persons in the state. The primary concern of the committee is to assure that public resources supporting essential health services to the medically indigent are preserved in the face of the growing population of indigent and the shrinking community of providers of services to them. This report summarizes current support for indigent care and presents NYSACHO's recommendations for a comprehensive and coordinated response to the growing numbers of uninsured and underinsured in the context of the reconfiguration of the health care system.
Problem Statement
In the past two years, national discussion of the issues of the uninsured and underinsured has been replaced by successive efforts to restrict
eligibility for and reduce entitlements to services. The sweeping corporatization of the health care system, combined with budgetary constraints at the federal, state and local
levels, have left the less profitable, safety-net providers, struggling to redefine their role in the face of decreasing support for care to an increasingly vulnerable and growing population.
The "Current Population Survey" estimates that 2.9 million New Yorkers were uninsured in 1995. This means that, from 1994 to 1995, the percentage of
uninsured individuals in New York State increased from 13.9 % to 16%, while the population on public assistance remained at 26.7%. In 1995, 14. 1 % of children under the age of 18 years living in New York
State had no health insurance coverage, a 32.2% increase over the number of uninsured children in 1994. Children accounted for 22.8% of the uninsured in 1995, compared to 19.8% in 1994. White, non-Hispanic
persons accounted for 52.4% of the uninsured in 1995, up from 50.0% in 1994. Black, non-Hispanic persons accounted for 23.0% of the uninsured population in 1995 compared to 21.6% in 1994.
The proportion of uninsured in the State living outside
of New York City increased between 1994 and 1995 from 46.3% to 48.3%. In 1995, employed persons accounted for 47.4% of uninsured persons; between 1994 and 1995, the percentage of employed persons living in New York State who were uninsured increased from 15.9% to 17.4%. The median family income among the uninsured rose between 1994 to 1995 from $20,300 to $26,000.
More difficult to quantify is
the magnitude of the underinsured population. Between 1994 and 1995, the percentage of privately insured persons in New York State decreased from 59.4% to 57.3%. As benefits offered by employers and insurance companies become more stringent, the number of persons who delay care because they cannot afford the out-of-pocket expenses of co-payments, deductibles and exclusions will increase. National studies have estimated the number of underinsured persons to exceed the number of uninsured by as many as 150%. The delivery of services and care to the uninsured and underinsured varies from county to county but unquestionably is becoming an increasingly larger problem for all.
Medicare/Medicaid/Commercial
Increasing enrollment into managed care, more restrictive employer-sponsored health plans, stricter eligibility criteria, and reduced entitlements, serve not
only to increase the numbers of uninsured and underinsured but to eliminate a source of revenue that has historically helped to offset the unreimbursed costs of public health services, and of home care
services in particular.
In many counties, Certified Home Health Agencies (CHHAs) have provided the vehicle for subsidizing public health nursing and other activities that represent
cost-effective ways to avert more expensive forms of health care such as emergency rooms, hospitals, or nursing homes. Health guidance, teaching preventive health care, prenatal and postpartum follow-up,
prevention of child abuse, follow-up after an emergency room visit or hospital stay, health teaching regarding newly diagnosed medical conditions and information regarding services available in the community,
are basic public health primary and preventive services that the underinsured and uninsured need but may only be able to access through CHHAs.
Public health Certified Home Health Agencies (CHHA) serve a wide variety of populations, while being cost effective. Under Article 36, CHHA's in New
York State served 365,000 clients in 1994, with 215,466 being Medicaid clients. During this time, the Medicaid expenditure growth has slowed from 10.9% to 6.1 %
according to the Home Care Association of New York State, Inc. In many agencies, Medicaid is only 20-40% of revenues. Medicare may be the payer for as much as 75% of the revenues. Private insurance may account for 10% of revenues. CHHA's are required, minimally, to give up to 3.5% bad debt and charity care and usually give more. Under Title 25, the amount of bad debt and charity care is significantly higher due to the increase in underinsured and uninsured. Some public health agencies no longer have CHHA's and cannot charge for any home visiting services to families. Services provided by these agencies are covered by local taxes, grants, and New York state Article 6 funds. With cutbacks in federal and state funding for a variety of programs, the local taxpayers cannot pick up the costs.
RECOMMENDATION
The charity care standards required of certified home health agencies must be strengthened and enforced.
Current Programs
Child Health Plus
The Child Health Plus program pays for primary and preventive health services, laboratory and x-ray tests, prescription drugs, ambulatory surgery and
emergency room visits for uninsured and underinsured children born on or after June 1, 1980. To qualify family income must be below 220% of the federal poverty level; currently, a $25 per child annual
enrollment fee is required for families with incomes between 160% and 220% poverty. The program does not currently require proof of U.S. citizenship or residency. Services are provided through a managed care
configuration.
Child Health Plus in New York State has, to date, been selectively available through "demonstration" agreements with the New York State Departments of Health and Social Services. While the State has indicated its intent to continue the Child Health Plus program, the means by and extent to which the program will be expanded statewide are not yet known.
In light of the statewide movement towards mandatory enrollment of Medicaid recipients into managed care plans, it is important that Child Health Plus
be offered by the Medicaid managed care providers in each county. The ability of the same provider to offer services under Medicaid and Child Health Plus is critical in order to avoid disruption of primary
pediatric relationships regardless of the fluctuations in Medicaid eligibility of individual children. The
availability of Child Health Plus through all Medicaid managed care plans selected under a mandatory enrollment program would also permit the plans to compete equally. Finally, the expanded availability of Child Health Plus through providers participating in the Partnership Plan will increase choice and access to providers of core pediatric services.
RECOMMENDATIONS
Child Health Plus must continue to be extended to undocumented residents of New York State.
Co-payments must continue to be affordable for families enrolled in the Child Health Plus program.
Article 6
In part, public health services for the under served are funded through Article 6 of New York State Public Health Law, which reimburses localities for
approximately 40% of the net cost of specified services. By providing funding for health services net of reimbursement from other sources, including Medicaid and other forms of revenue, Article 6 can be deemed
a type of safety net for partially- funded public health based on the expenditures of the locality. However, in order to draw down Article 6, counties must be able to expend the local funds required to run programs.
In New York State Public Health Law, public health services are designated as either core or optional services. This distinction has recently become
more important to localities. The SFY 97 Budget changes the funding formula for public health services, lowering the reimbursement rate for both core and optional
services, and dropping the rate for optional services significantly below that of core. The current designation of core and optional services articulated in Article 6, Part 40 of Public Health Law, places some direct care services for the under served in jeopardy by categorizing them as optional services, which would be reimbursed at the lower rate described above. In addition, as Article 6 reimbursement declines in general, providing the same level of service to the uninsured would require additional tax levy funding by individual localities, a difficult proposition in these fiscal times.
Unlike many
other funding streams such as Bad Debt and Charity Care or other categorical programs, Article 6 does not specify that it funds the uninsured or underinsured in New York State. In addition, Article 6 alone does not provide a comprehensive safety net for the uninsured due to a variety of structural reasons including the fact that not all counties provide the same set of services or have the same level of need. It is only because it supports categorical programs that Article 6 provides the essential public health services to the uninsured and underinsured population. However, in many cases it provides a partial safety net for many health services that would be dramatically down sized in the absence of these state dollars.
RECOMMENDATIONS
Article 6 funding for public health services must be maintained.
The New York State Department of Health must work with local public health officials to evaluate public health programs, services, and funding
Physically Handicapped Children's Program
The Physically Handicapped Children's Program (PHCP) enables eligible children to receive care without causing extreme financial hardship to a family. Any
family with a child under 21 years of age, who has a physically handicapping condition, may apply for financial assistance from PHCP. A simple means test is administered and families who are financially able
may be required to share in the cost of services. Reimbursement rates are based on state Medicaid fee schedules and are paid directly to the provider. By law, all sources of private health insurance must be
utilized before PHCP funds can be expended. U.S. citizenship or residency is not a requirement for program participation.
Services covered by the program include surgical, medical, orthodontic, and rehabilitative treatment, medications, and
assistive technology. Referrals for service, may be made by families or health and social service providers.
Established under New York State Public Health Law, PHCP is currently
funded 50:50 by the State and county. County participation in the program is voluntary, and the provision of the rehabilitation components of PHCP vary statewide and often reflect local budgetary concerns.
Some counties administer the Medicaid Orthodontic Screening Program on behalf of the State. Of great concern is a recent, deleterious policy change from
the State Department of Health
effective January 1, 1996, which terminates coverage of PHCP orthodontic cases at the end of a treatment year when Medicaid eligibility is lost. The policy places orthodontists and local health units in the untenable position of either initiating treatment that may be prematurely terminated, resulting in greater disfigurement, or refusing to provide care altogether to otherwise eligible children to avoid the possibility of "doing harm" as a result of service termination due to loss of Medicaid eligibility. The policy also potentially shifts fiscal responsibility from the State to the county if the local decision is to not prematurely terminate care to orthodontic rehabilitation cases that were initiated under Medicaid.
As county budgetary constraints become more severe, continued participation in
this non-mandated program will be increasingly questioned, even if the State share of program costs remains at 50%. The tremendous and rapid growth in the numbers of applications for PHCP assistance is a vivid indicator of the growing numbers of uninsured and underinsured persons in the State. The appropriation of a discrete and modest local fund to offset the increasing number of requests for assistance may be viewed as a local liability in the absence of a more comprehensive, statewide plan.
RECOMMENDATIONS
The New York State Department of Health must suspend the PHCP policy change effective January 1996 regarding Medicaid orthodontic rehabilitation cases until such time as the local
health units and NYSDOH can together develop a clinically and fiscally responsible policy. Concerns about this policy were communicated to NYSDOH by NYSACHO and Commissioners and Public Health Directors across
the state earlier this year. NYSDOH should convene a work group that includes representatives of state and local public health departments, to plan for integration of PHCP into the changing health care
delivery system. This recommendation was formally conveyed to the NYSDOH this spring.
Early Intervention/Preschool Programs
Of concern to both the State and counties is the extraordinary growth in enrollment and in expenditures for the Early Intervention and Preschool programs and
the potential for these programs to
drain scarce public resources from other public health services. In addition, Early Intervention services are scheduled for integration into the State's mandatory Medicaid managed care program in the third year of the Partnership Plan.
Article 25 of Public Health Law (Early Intervention) and Section 4410 of Education Law (Preschool programs) provide for services to families with
infants/toddlers
(birth to three years of age), and preschoolers (three to five years of age) with developmental disabilities. Depending on the program, services may include Child Find, evaluations, service coordination and professional services. Family support services and assistive technology devices may also be accessed for eligible families. Services are family-centered and to be provided in a normalized environment to the extent possible. The current state share for Early Intervention administration is 40%, and 59.5% for the Preschool program.
RECOMMENDATIONS
The Early Intervention program in New York State should be scaled back to the requirements of Federal Part H IDEA to stem the diversion of scarce resources from core public health
activities. A mean-sensitive approach to parental contribution to the developmental needs of their child should be encouraged for all "non-core " Early, Intervention services, that is, to services
other than Child Find, evaluation and service coordination. A means appropriate parental contribution will empower parents as full programmatic and fiscal partners in the habilitation and rehabilitation of
their children, is in line with
the principles of personal responsibility and responsible administration of public resources, and will assist in assuring that scarce public funds remain available to pay for El services to those uninsured and underinsured families who do not have the resources necessary to obtain services.
New York State should institute measures that curb opportunities for the Early Intervention and Preschool provider industry to market their services in such a way as to preclude fully
informed choice for families.
The integration of Early Intervention into the State's mandatory Medicaid Managed Care Program must address the direct and residual impacts on the continued provision of services to
children who are uninsured or underinsured.
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Prenatal Care Assistance Program (PCAP)
The Prenatal Care Assistance Program (PCAP) is a Medicaid Program available to pregnant women during the prenatal and early postpartum period, and to their
infants resulting from the pregnancy until the infant is one year old. PCAP differs from regular Medicaid prenatal programs in four fundamental ways:
*Applicants are not required to provide proof of U.S. citizenship or residency.
*Financialeligibility for the program extends to incomes up to 185% of the federal poverty level whereas regular Medicaid eligibility requires income below the federal poverty level.
* Applicants can be "presumed eligible" by a PCAP provider for a period of up to 90-days based on a preliminary financial screening. Presumptive eligibility ends when one of
the following occurs: Clients are certified as eligible, determined to be ineligible, or the 90-day period expires. All final eligibility determinations are made by the local Department of Social Services.
* PCAP participating medical care providers are required to offer a comprehensive medical services package as defined by the New York State Department of Health.
Prior to the inauguration of PCAP, it was not uncommon for women to arrive at local emergency rooms in labor and without benefit of any prenatal care. The
lack of care was the result of either low-income without insurance or the unwillingness of local obstetricians to accept Medicaid reimbursement rates. Significant improvements in maternal and infant morbidity
and mortality have been documented in the years since PCAP was inaugurated.
The primary purpose of the expanded eligibility level is to assure that low-income, uninsured or underinsured women receive
comprehensive prenatal, inpatient and postpartum care from an approved provider. The women who benefit most from PCAP are those whose earnings would be too high for Medicaid, but too low to afford insurance or to pay for services out-of-pocket. PCAP providers can also opt to offer the same benefit package on a sliding fee scale to low-income women who are financially ineligible for PCAP but unable to afford insurance or private care.
In return for providing an array of services to this population (diagnostic and treatment services, psychosocial assessment, nutrition, health education, HIV
counseling, and testing, etc.), PCAP provider agencies receive an enhanced Medicaid rate for outpatient care. Income derived from PCAP fees is used to support total prenatal clinic operations and acts as an
incentive for providers to offer services at a low-reduced rate to self-paying patients.
The structure that has been carefully set up to assure that all women in the State can receive prenatal care is not
perfect and is being threatened even further. A minority of PCAP agencies do not have the resources to extend coverage to the uninsured or underinsured because this cost must be borne by the sponsoring agency. With many companies downsizing and re-hiring at lower salary levels and often without benefits, the numbers of PCAP eligible women is increasing. This will put an extra burden on present PCAP programs including those who offer services to the underinsured and uninsured. These agencies may have to raise their sliding fee scales to an unaffordable level or no longer offer services to this population.
RECOMMENDATION
PCAP should be continued to ensure good prenatal, postpartum and infant care and its principles must be incorporated into capitated models of care.
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Federal Categorical Grants
Over the past several
years, as tax levy support for some services has diminished, local health units like other providers of service have sought alternative funding sources. In addition, with the recognition of significant new disease trends, the Federal government has provided additional categorical support for health related activities. The specific areas of recent or new increased Federal and State grant support are in Tuberculosis Control, Sexually Transmitted Disease Control, HIV/AIDS services, immunization activities, and lead poisoning prevention activities. However, in many cases the funds must be directed to specific types of health services (e.g., funding for education and prevention, but not treatment), are categorical in nature, and do not provide for the comprehensive health needs of the uninsured. For example, a categorical grant may cover Directly Observed Therapy costs for a person who is TB-infected but does not cover essential ongoing primary and preventive care treatment for the individual. While the Federal Centers for Disease Control and Prevention and other agencies are beginning to address these issues through broad-based block grants and limiting their use of categorical grants, block grants present another set of potential issues for the uninsured and underinsured populations. In all, Federal grants do provide some critical funding for the uninsured and underinsured populations, but the monies do not cover all health needs and is not equally available to all populations.
RECOMMENDATIONS
Categorical grants supporting services for the uninsured and underinsured should address the complete public health needs of the individual or community.
Bad Debt Charity Care Pools (BDCCP)
New York State reimburses hospital-based facilities and Diagnostic and Treatment Centers that provide care to a significant number of low or no charge
patients through its Bad Debt and Charity Care Pools (BDCCP). Several different pools exist in New York State, each with its own separate funding mix. The largest pool provides Medicaid Disproportionate Share
dollars to fund health care services for those without the ability to pay (including the large undocumented immigrant population). However, there are many limitations:
* BDCCP does not provide insurance for individuals who are uninsured or underinsured. Funds are directly provided to the provider agencies that serve this population.
* The security of BDCCP funding is unsure at this time. Changes in Medicaid may limit the amount of Disproportionate Share funding available to contribute to the BDCCP.
* Population-based public health services are not eligible for funding from these pools; only direct care services are reimbursable.
RECOMMENDATIONS
Access to BDCCP by both hospital and free-standing Diagnostic and Treatment Centers must be preserved
If BDCCP is eliminated, alternative funding for the uninsured and underinsured populations should be appropriated.
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