Private option: It’s all about the paperwork now

By Steve Brawner
© 2015 by Steve Brawner Communications, Inc.

As of the beginning of this month, 31,501 Arkansans no longer have insurance through the private option, mostly because there’s a problem with their paperwork.

The state is redetermining eligibility for 600,000 Arkansans who receive health insurance through the private option or traditional Medicaid. Medicaid serves the poor, the disabled and others. The private option uses federal dollars to buy private insurance for lower-income Arkansans who previously wouldn’t have qualified for Medicaid.

The redetermination process, required by the federal government, has been a mess, beset by costly computer glitches. Now the state is trying to make up for lost time. Recipients whose incomes appear to have changed 10 percent are sent a Department of Human Services letter warning that they must verify their income within 10 days or they’ll lose their benefits.

If you count both the Medicaid and private option recipients, and both July and the upcoming August terminations, about 48,000 Arkansans will be off the rolls – 97 percent of them because they didn’t meet the deadline.

Some of that is because the state is overwhelmed. Some recipients have claimed to have submitted their incomes and then been told they’ve lost their benefits anyway. On Tuesday, Hutchinson announced a two-week pause in sending out the warning letters while DHS scrambles to find staff to process all the paperwork.

Why aren’t the others responding? Maybe they never realized they were on the private option, or they moved and never received the letter, or they read the letter and tossed it because they’re not sick right now. Some mistakenly sent verification to their local DHS office instead of the address required by the letter.

And some may have misunderstood the letter’s meaning or importance. Using bureaucratic language, it tells the recipient to verify their income or “your case will be closed and you will have to reapply” – not “or you will lose your insurance.” The envelope isn’t marked with anything that would communicate that it’s more important than all the other mass-produced envelopes in the recipient’s mailbox. Here’s the verification letter.

Asked if he might throw away an impersonal mass mailing, Gov. Asa Hutchinson, who personally selected that 10-day timeline, said, “If I were a recipient of Medicaid from DHS, and I get a letter from DHS, I would presume it’d be a responsibility to open that letter.”

He’s right that recipients of a very generous government health benefit have at least that responsibility. But the private option serves many lower-income people who, for whatever reason, haven’t previously qualified for Medicaid and often haven’t had health insurance, government or private. Many have jobs but just don’t have experience working the system.

Hutchinson also pointed out that recipients actually have much more than 10 days. Counting a grace period and then a 90-day appeal process where medical bills will be paid retroactively, recipients actually have three or four months before they are completely off the rolls. Before losing their benefits, they are told through another bureaucratic-sounding termination letter that their ”case will be closed.” Also, the insurance companies who provide private option recipients their coverage were alerted that they were about to lose their government-funded ratepayers, so they had a big incentive to try to contact them as well.

Seems like there should be a better way to verify who should receive a government benefit, and who shouldn’t. The state will pay to kick people off the private option, and then pay to put them right back on it when their pharmacist can’t fill their prescription.

The backstory behind this process is the controversy over the private option itself. Created as an outgrowth of the Affordable Care Act (Obamacare) it barely passed in 2013 and barely was reauthorized in 2014. The Legislature cut the private option’s marketing budget in 2014, which might could have paid for the ink to print on those envelopes, “Urgent: Respond within 10 days or you’ll lose your insurance.” The private option survived 2015 only because Hutchinson convinced legislators to give him a couple of years while he and a legislative task force create something better by the end of 2016. One by one, private option supporters are losing elections or drawing primary opponents.

So part of what’s happening is that we’re all trying to prove that we can get tough on the private option, right before we close the case on it and reapply with something else.

4 thoughts on “Private option: It’s all about the paperwork now

  1. Your ending shows what the problem is across all of our politics in this country. People are more interested in pushing their personal ideology than in solving problems or developing policies that will lift people up.

    I spent 35 years chasing down that rabbit hole and the last six and half years I have shown me the futility of doing that as our once governable, problem solving country has been brought to a virtual standstill by narrow ideologues on the right and the left. I’ve hopped out of that rabbit hole and I invite my fellow Americans to do likewise or else continue to see problems lie festering in these United States.

  2. Steve, here is the scariest possibility of all: a certain percentage of adults in AR who are on subsidized health care insurance are unable to read letters they receive. As an active literacy tutor I can assure you this is true. Many of my students routinely throw letters into the trash. If they sense that a letter may be important, they may bring it to me for help. The number of functionally illiterate adults in this state is beyond many folks’ comprehension. Someone has to help these people sign up for a benefit, but then they have little skill to keep things in motion. Some are reluctant to admit just how illiterate they are.

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