Bring back state’s Basic Health Plan

Washington now has the opportunity to revive a program to provide more affordable health insurance coverage for low-income working individuals and families, one that the state innovated in 1987 but ended in 2014.

Signed into law by Gov. Booth Gardner, the program was created to help childless individuals and couples with incomes up to twice the Federal Poverty Level, but who were not eligible for Medicaid. Primarily funded by the state, the Basic Health Plan provided health coverage with affordable premiums and co-pays for as many as 150,000 residents as of 2011.

The Basic Health Plan allowed the state to coordinate care and offer wellness and prevention programs that provided efficient, stable and continuous coverage. Despite its success, funding for the program was gradually reduced and then shuttered at the end of 2013, a victim of state budget constraints.

Between Medicaid and the Affordable Care Act, some of those who had been served by Basic Health Care were able to get coverage. Those at 138 percent of the poverty level qualify for Medicaid, and those with incomes up to four times the poverty level qualify for coverage purchased through the state-run insurance exchange at Washington HealthPlanFinder.

But an estimated 162,000 in Washington, those making between about $16,000 and $23,500 a year, don’t qualify for Medicaid and cannot afford insurance even with the federal subsidies. The uninsured rate for that population is about 13 percent to 15 percent, higher than the state’s overall uninsured rate of about 7 percent, according to figures from the office of U.S. Sen. Maria Cantwell, D-Washington.

Cantwell, who helped launch the state’s Basic Health Plan in the late ’80s when she was in the Legislature, has been working to revive the health plan model, making it an option for all states by amending the Affordable Care Act. Rather than leaving the states to fund the program on their own, which is what led to its end here, Cantwell’s amendment to the ACA allows states to use 95 percent of the federal funding they already receive to negotiate directly with insurance providers to secure coverage for low-income customers.

State lawmakers considered legislation in 2014 to lay the groundwork to revive the Basic Health Plan. The bill passed the House but did not advance in the Senate.

But two other states, New York and Minnesota, have adopted the Basic Health Plan. New York has signed up about 400,000 people, who are paying about $20 in monthly premiums and $15 co-pays to see a primary care doctor. Minnesota has enrolled about 121,000, who are paying average premiums of about $16 a month, according to the Associated Press.

An analysis of the program by the Urban Institute’s Health Policy Center said that the program would have the added benefit of reimbursing medical providers for coverage at a higher rate than Medicaid, as much as 15 percent to 34 percent more, adding to the program’s stability.

There’s a financial incentive for the state, too. Since implementing the plan in 2015, New York has saved an estimated $1 billion, and Minnesota projects it will save about $334 million in 2016-17, according to a report by Cantwell’s office.

Having seen how it worked in Washington state, Cantwell told the Associated Press, she wanted to make it part of the Affordable Care Act. It worked for the state in the beginning because of the leverage created by negotiating with the insurance companies, she said.

Now Cantwell wants the state that created the Basic Health Plan to benefit from it again. Last week she was joined by state Rep. June Robinson, D-Everett, in calling for the Legislature to adopt the Basic Health Plan.

In 2013, almost 17 percent of Washington residents were without health coverage. As of February, because of the Affordable Care Act, the rate has dropped to 7.3 percent, though many of the state’s rural areas still have uninsured rates greater than 14 percent.

Bringing back the Basic Health Plan to Washington should help increase access to coverage, especially in the state’s rural areas, and further deliver on the Affordable Care Act’s promise of affordability.