Need To Know, November 2014

Health Management

A surge in emergency department visits and hospitalization rates on the part of newly-insured Medicaid patients is a mostly temporary phenomenon created by pent-up demand, according to a report by UCLA’s Center for Health Policy Research (HPR).

The study, released in October, eases fears that large numbers of new Medicaid patients would overwhelm the system and strain budgets.
As of July 2014, California had logged 1.5 million new Medicaid enrollees due to the state’s decision to expand Medicaid as part of the Affordable Care Act. That number includes 650,000 who were transitioned from the state’s Low-Income Health Program (LIHP).

The study looked at claims data from two consecutive Medicaid-voucher programs in California, the Health Care Coverage Initiative (HCCI), which ran from September 2007 to October 2010, and LIHP, which ran from July 2011 to December 2013.

Both provided coverage to individuals who were not eligible for Medi-Cal or other low-income programs at the time, and who would have been eligible for Medicaid under Medicaid expansion.

Results were that those individuals with the highest pent-up demand initially had 600 emergency room visits for 1,000 enrollees, but the rate quickly dropped and then remained relatively constant, eventually falling to 183 out of 1,000 individuals during the second year of analysis.

The next highest-demand group showed a significantly smaller initial number of visits that then remained constant, and the lowest-demand group had a had a smaller number of initial visits that remained constant.

Hospitalization rates among those with the highest pent-up demand followed a similar trend, spiking at first and then rapidly declining. “We believe Medicaid expansion is sustainable because the initial high cost of newly enrolled beneficiaries does not persist beyond the first year of enrollment for the vast majority of new enrollees,” Gerald F. Kominski, Ph.D., director of the HPR, told Managed Healthcare Executive. The report “suggests that the higher costs and utilization among newly enrolled Medicaid beneficiaries is a temporary rather than permanent phenomenon.”

Business

Walmart is continuing its expansion into healthcare by partnering with Direct Health to launch Healthcare Begins Here, an in-store program to educate customers about insurance options.Customers will be able to shop for insurance through directhealth.com, an aggregator site that provides access to more than 1,700 plans from 12 leading carriers including Aetna, Cigna, Humana, United Healthcare, and participating Blue Cross and Blue Shield companies. Stores will be staffed by independent, licensed health insurance agents from DirectHealth.com who can enroll customers in certain health insurance plans, according to Walmart. Agents can also enroll customers into Medicaid during the Affordable Care Act’s open enrollment period, which begins Nov. 15, 2014. Walmart says the partnership will bring “transparency and simplicity to the changing health insurance market.”

Walmart entered the primary care arena this year, opening eight company-owned clinics since April with four more planned by year’s end.