Exchange CEO: Basic health plan unlikely

Health insurance exchange CEO Kevin Counihan cast doubt Thursday night on the prospects of a concept favored by many supporters of universal health care, the basic health program.

Speaking at a panel discussion about the health insurance exchange, Counihan responded to a question on the lack of a public option in the state by saying that, among other things, he doesn’t think any state will develop a basic health program as part of federal health reform.

The basic health program, which advocates for low-income residents want the state to adopt, would be a state-run health plan for people whose incomes are just about the limit for Medicaid.

One major reason they’re pushing for it is that they worry that thousands of parents currently covered in the state’s HUSKY Medicaid program could lose Medicaid once federal health reform takes effect.

Here’s why: In 2014, as part of federal health reform, Connecticut will expand Medicaid to cover all adults earning up to 133 percent of the poverty level. The federal government will pay the full cost of covering the newly eligible people for the first three years; after that, it will cover at least 90 percent of the costs.

Connecticut already provides Medicaid to some adults who earn higher incomes — parents of minor children who earn up to 185 percent of the poverty level. For their coverage, the federal government reimburses the state for 50 percent of its costs.

There’s nothing in the law that requires the state to stop covering those parents who earn more than 133 percent of the poverty level. But advocates worry that once health reform rolls out, providing a way for those parents to get private coverage, state lawmakers will cut the parents from HUSKY as a way to save money.

In states without a basic health program, poor adults who earn too much for Medicaid would get federal subsidies to buy coverage through their state’s exchange, a store for buying private coverage. That would likely require some premium and cost-sharing payments from the members, whereas HUSKY costs members nothing.

A state panel is looking into whether Connecticut should create a basic health program. But Counihan is skeptical. He said the federal government hasn’t issued any guidance on the concept. And he’s cited the challenge of creating a new state-run program by 2014, the technological difficulties enrollment and management of the program could pose, and concerns that it could reduce the exchange’s customer base.

He said Thursday night that two states that had been expected to create basic health programs, Washington and Massachusetts, do not appear likely to do so.