A booklet to help health care consumers understand managed care.

• A Consumer’s Guide: Understanding Managed Care

The September/October 1997 edition of the Kaiser Family Foundation/Harvard Health News Index includes questions about major health stories covered by news media, including questions about AIDS, Condoms in Schools and Tobacco Companies. The survey was based on a national random sample of 1,007 Americans conducted October 17-21, 1997 which measures public knowledge of health stories covered in the news media the previous month. The Health News Index is designed to help the news media and people in the health field gain a better understanding of which health stories in the news Americans are following and what they understand about those health issues. Every two months, Kaiser/Harvard issues a new index report.

• Report: A Comparison of the Medicaid Provisions in the Balanced Budget Act of 1997 (P.L. 105-33) w-Prior Law

Background

Health care benefits had been offered to active employees for a long period of time before health coverage became a retiree benefit offered by employers. The key event that made employer-sponsored retiree health care a possible benefit for retirees was the enactment of Medicare in 1965. It was then felt possible to provide a widely desired benefit at a relatively low cost, since the Medicare program would pay the majority of the costs.

Millions of Retirees Have Employer-Sponsored Coverage

Based on the 1995 Medicare Current Beneficiary Survey⁵ analysis by Physician Payment Review Commission (PPRC), about 12 million individuals (37 percent of Medicare aged and disabled beneficiaries) have employer-provided supplemental coverage, including about 2 million with employer-provided coverage and Medigap.

Retiree Health Is a Highly Valued Medicare Supplement

As with other matters related to retirement, the appreciation of retiree health benefits increases with age. For example, based on a Hewitt database of employee surveys, there is a twelve-fold increase in value assigned to retiree health care benefits for employees age 55 and over compared to the group age 25 to 34.⁶

The availability of employer-provided coverage is more critical for the pre-65 retirees because they will generally not have access to other insurance or it will be very expensive for them to purchase, if it is available at all. Post-65 retirees at least have Medicare if they have no other health insurance.

Even Medicare, however, provides a relatively low level of benefit when compared to the typical employer plan for active employees. Comparing the Medicare level of benefits to 250 large employers participating in the 1996 Hewitt Health Value Initiative^TM who offer indemnity type benefits, the Medicare design falls in the lowest quartile measured by plan value (18th percentile). That is, 82 percent of the indemnity plans offered by large employers to active employees provide richer or better benefit levels than traditional Medicare. Most of the employers participating in the 1996 Hewitt Health Value Initiative have more than 5,000 employees. Employers with fewer employees will tend to provide a lower level of benefit.

Assuming that the typical employer medical plan considers about 65 percent of total health care costs as a cost covered by the medical plan (excluded costs include items such as over-the-counter drugs, dental care and eye glasses)⁷, and that the average indemnity medical plan reimburses about 83 percent of covered costs⁸, the typical employer plan will pay 54 percent (0.83

State Reforms of Small Group Health Insurance

Between 1989 and 1995, 45 states enacted laws to make health insurance more accessible and attractive to small businesses. The small group market was targeted for reform because about half of all uninsured workers are either self-employed or working in firms with fewer than 25 employees (EBRI, 1996).

The problem is that only about half of all small firms offer health insurance (Figure 1). In 1995, 53% of small businesses (<50 employees) offered health benefits, and while this is up from 1989 when only 41% offered coverage, it is still much lower than health coverage among larger firms.

Many insurers are willing to sell coverage to small firms, but some insurer practices in the small group market have drawn concern. Some companies refused to sell policies to businesses in specific “high-risk” industries for example, or to firms with fewer than 10 employees. Also, because insurers tended to base premiums for small groups on the medical histories of prospective enrollees, some small businesses have reported that the poor health of their employees or employees’ dependents resulted in their inability to qualify for coverage.

Although these problems exist, they are not widespread. Most small firms say that they can get coverage if they want it. More than three-quarters (of both insured and uninsured small firms) say that they have been solicited to buy health insurance in the last six months, and more than a third indicate that they have received at least six or more inquires.

Three General Types of Small Group Reform

“Bare-bones” policies.

These laws allow insurers to sell “bare-bones” insurance to certain classes of small firms, typically those newly entering the group coverage market. The policies are dubbed “bare-bones” because they are usually exempt from most mandated benefit laws and premium taxes, which allows small firms to purchase basic coverage at lower premiums.

Premium regulations.

Premium rating bands or requirements that insurers follow community rating are two examples of such regulations. These rules are intended to narrow the range in premiums, so that coverage will be more affordable for higher-risk firms.

Standards for underwriting and contracting practices.

These are designed to make coverage both more attractive and available to employers. Included under this category are laws which:

• limit the non-issue of policies to certain types of firms,
• guarantee the renewability of employer coverage,
• allow insured persons to move between plans without having to satisfy new pre-existing condition clauses, and
• limit initial waiting periods that workers must satisfy for coverage of their pre-existing conditions.

The most common reforms are listed in Figure 2 with the number of states that have enacted them. In many cases, the state enacted a small package of measures in 1991 or 1992 and then adopted additional reforms a couple of years later. By 1995, most states had enacted all of the reforms listed here.

Figure 2Small Group Reforms at the State Level Number of States with the Measure as of: Type of State Legislative Reform: ’89 ’91 ’93 ’95 Bare-Bones Insurance Plans Can be Sold 1 9 31 43

To provide an independent source of information about the cost of covering uninsured children in California, the Henry J. Kaiser Family Foundation commissioned an analysis by the Actuarial ResearchCorporation (ARC), which provides actuarial assistanceto a variety of public and private clients. ARC’s analysis suggests that expanding California’s Medicaid program (which is called Medi-Cal) would be substantially less expensive than developing a new private insurance program as proposed.

• Report
• Report

Now I am going to ask you a series of questions about sexually transmitted diseases other than HIV or AIDS, such as gonorrhea, syphilis, herpes, and chlamydia. We want to learn from you how the topic of sexually transmitted diseases, also called STDs, was handled in your visit so that we can help doctors do a better job of addressing STDs with their patients.

Again, please remember that your answers to these questions will be kept completely confidential, and your responses will be shown only in combination with those of the other people we survey.

28. Now, thinking back to this last visit, were there any patient education materials like brochures or videos, about STDs in the (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Single response)

Yes 61 No 30 Don’t know 9 Refused 0 29. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) discuss sexually transmitted diseases, other than AIDS, with you at this visit? (Single response)

Yes 15 No 85 Don’t know * Refused 0 30a. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Single response)

Based on those who discussed STDs. (n=72)

You 17 Someone in your doctor’s office/clinic 83 Don’t know 0 Refused 0 30b. Please tell me whether each of the following apply to how you felt when the health professional raised the subject of STDs with you? Did you feel (insert list)? (Single response) (Record Yes/No/DK/Ref for each) (Rotate first two statements only)

Based on those who discussed STDs. (n=72)

Yes No Don’t know Refused Relieved 47 47 4 1 Offended or insulted 4 94 1 0 It was expected 86 14 0 0 30c. Where did this discussion take place? (Do not read list) (Multiple response) (If respondent says “examining room” probe with: Was that while you were dressed or undressed?)

Based on those who discussed STDs. (n=72)

In examining room while you were dressed 44 In doctor’s personal office 36 In examining room while you were undressed 17 In counseling room 4 All other 3 In waiting room 1 Don’t know 0 Refused 0 30d. Where would you have preferred this conversation took place? Would you say (read list)? (Single response)

Based on those who discussed STDs. (n=72)

In doctor’s personal office 46 In examining room while you were dressed 42 Doesn’t matter 6 In examining room while you were undressed 4 Don’t know 1 Refused 1 31a. Please tell me whether each of the following apply to how you would have felt if the health professional had talked about STDs with you? Would you have felt (insert list)? (Single response) (Record Yes/No/DK/Ref for each) (Rotate first two statements only)

Based on those who did NOT discuss STDs. (n=408)

Yes No Don’t know Refused Relieved 24 72 4 * Offended or insulted 6 93 1 0 It was expected 64 36 0 * 31b. Do you think the health professional should have raised the subject with you? (Single response)

Based on those who did not discuss STDs. (n=408)

Yes 33 No 66 Don’t know 2 Refused 0 31c. Do you think you should have raised the subject of STDs? (Single response)

Based on those who did NOT discuss STDs. (n=408)

Yes 15 No 85 Don’t know 1 Refused 0 32. Why not? (Do not read list) (Multiple response)

Based on those who did not believe they or health professional should have raised STDs. (n=255)

Don’t feel at risk for STDs/only one partner/married 77 Discussed with doctor or health professional before 7 Visit was for other reason 7 No reason to (unspec.) 6 Already know about STDs/Office knows my history 2 Already been tested 2 Don’t know what STDs are 1 Don’t know 0 Refused 0 33. In general, do you think STDs should be discussed as part of seeing a new doctor orhealth professional for gynecological care? (Single response)

Yes 83 No 6 Depends 9 Don’t know 2 Refused 0 34. Who do you think has the primary responsibility for raising the subject of STDs, the health professional or the patient? (Do not read list) (Single response)

Health professional 64 Patient 23 Both 12 Neither 0 Don’t know 1 Refused 0 35. Who would you prefer talk to you about STDs, a doctor, a nurse, a counselor, or someone else in the doctor’s office? (Do not read list) (Single response)

Doctor 71 Nurse 12 Doesn’t matter 12 Counselor 2 Either a doctor or nurse 2 All other * No one * Don’t know * Refused 0 36. Did you feel you and your health professional had enough time to discuss STDs? (Single response)

Based on those who discussed STDs. (n=72)

Yes, had enough time 94 No, not enough time 6 Don’t know 0 Refused 0 37a. Did the health professional seem embarrassed or uncomfortable during your discussion about STDs? (Single response)

Based on those who discussed STDs. (n=72)

Yes 4 No 96 Don’t know 0 Refused 0 37b. Were you embarrassed or uncomfortable during this discussion? (Single response)

Based on those who discussed STDs. (n=72)

Yes 7 No 93 Don’t know 0 Refused 0 38. Did the health professional seem like he or she was judging you during this discussion? (Single response)

Based on those who discussed STDs. (n=72)

Yes 6 No 94 Don’t know 0 Refused 0 39. Did the health professional suggest to you that you should be tested for any STDs? (Single response)

Based on those who discussed STDs. (n=72)

Yes 32 No 67 Don’t know 1 Refused 0 40. Which, if any, specific STDs did the health professional recommend you get tested for? (Read list) (Rotate) (Multiple response) Probe: Can you think of any others?

Based on those for whom health professional suggested STD testing. (n=23)

Gonorrhea 74 AIDS/HIV 70 Chlamydia 65 Syphilis 52 Herpes 35 Human Papilloma Virus, or genital warts 30 Trichomonas 13 All others 13 No specific STDs mentioned 9 41. Omitted

42. Would you say the subject of STDs was discussed in a way that made you feel very comfortable, somewhat comfortable, not very comfortable, or not at all comfortable? (Single response)

Based on those who discussed STDs. (n=72)

Very comfortable (4) 76 Mean: 3.7 Somewhat comfortable (3) 21 Not very comfortable (2) 3 Not at all comfortable (1) 0 Don’t know 0 Refused 0 43. Did you feel that the health professional asked you enough questions, and knew enough about you, to be able to tell whether or not you were at risk for STDs? (Single response)

Total Among womenwho did not talkabout STDs(n=408) Yes 80 80 No 19 20 Don’t know 1 * Refused 0 0 44. Next I’m going to describe different issues that might affect how comfortable a patient feels about discussing STDs with a doctor or other health professional. Please rate how important each one is to you, very important, somewhat important, not very important or makes no difference.

The first [next] is (insert list). (Single response)

Where the conversation takes place, such as the exam room or in a private office:

Very important (4) 26 Mean: 2.5 Somewhat important (3) 25 Not very important (2) 20 Makes no difference (1) 29 Don’t know 0 Refused 0 Whether you are certain that the conversation is completely confidential:

Very important (4) 80 Mean: 3.7 Somewhat important (3) 15 Not very important (2) 2 Makes no difference (1) 4 Don’t know 0 Refused 0 Whether you feel the health professional might be judging you:

Very important (4) 46 Mean: 3.1 Somewhat important (3) 27 Not very important (2) 14 Makes no difference (1) 13 Don’t know * Refused 0 Whether the health professional is a [rotate] woman or man/man or woman:

Very important (4) 19 Mean: 2.1 Somewhat important (3) 19 Not very important (2) 19 Makes no difference (1) 43 Don’t know 0 Refused 0

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Talking About STDs With Health Professionals: Women’s Experiences:Press Release Report Survey Part One Part Two Part Three

Talking about STDs with Health Professionals: Women’s Experiences

Glamour/Kaiser Family Foundation National Survey

Methodology

Talking about STDS with Health Professionals: Women’s Experiences was conducted for the Kaiser Family Foundation and Glamour by Market Facts, Inc. The results are based on telephone interviews conducted between May 27 through June 1, 1997 with a sample of 482 women ages 18-44 who had been to a new doctor within the last year for gynecological or obstetrical care. These women were selected using Market Facts’ Consumer Mail Panel, a nationally balanced sample of households. All interviews were conducted by female interviewers. The margin of sampling error for results based on the total sample is plus or minus 5 percentage points at the 95 percent level of confidence.

Final Topline Data

Hello, may I please speak to (Ask for panel member)? This is ______ calling on behalf of Marie Brighton of the Consumer Mail Panel. Today I’d like to speak with the female aged (Insert age from sample) in your household. Would that be you?

Yes (Continue with remainder of Introduction) No (Ask to speak with that person, reintroduce and continue with remainder of Introduction — If not available, arrange callback) No one that age (Ask: Are you, or any other female in your household between the ages of 18 and 44? If Yes — Ask to speak with a female 18-44 and continue with remainder of Introduction; If No, terminate) Today I have a few questions regarding doctors and screening for sexually transmitted diseases. I’d like to remind you that your responses will be kept strictly confidential and that your responses here will be combined with that of approximately 700 other women we are interviewing and shown only as percentages.

1. My first question is… in general, how would you describe your own health? Is it excellent, good, only fair, or poor? (Single response)

Excellent 47 Good 48 Only Fair 3 Poor 1 Don’t know 0 Refused 0 2. Do you have a doctor or other health care professional who you see regularly for gynecological care that is, for annual exams, birth control, or other reproductive health care? (Interviewer Note: If respondent has a regular place to go for care, but no regular provider at that place, record as “no.”) (Single response)

Yes 93 No 7 Don’t know 0 Refused 0 3. When was the last time you visited a doctor or clinic for gynecological or pregnancy-related care? Would you say your last visit was within (read list)? (Single response)

The past month 24 1-3 months ago 30 4-6 months ago 23 7 months to 1 year ago, or 23 More than 1 year ago Terminate) Never Been (Don’t read) (Terminate) 4. And was this most recent visit for prenatal care or gynecological care? (Single response)

Prenatal/Pregnancy-related care 18 Gynecological 82 Don’t know * Refused 0 4b. Was this most recent visit at a private doctor’s office, a family planning clinic, or some other type of clinic? (Single response)

Private doctor’s office 75 Family planning clinic 10 Some other type of clinic 15 Don’t know 0 Refused 0 5. Was this most recent visit your first appointment with this (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) or had you been there before? (Single response)

First visit 46 Been there before 54 Don’t know 0 Refused 0 5b. How long ago was your first appointment with this (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Read list) (Single response)

Based on those whose most recent appointment was not their first appointment. (n=261)

The past month 2 1-3 months ago 15 4-6 months ago 21 7 months to 1 year ago, or 62 More than 1 year ago (Terminate) Never Been (Don’t read) (Terminate) [If “been before” at Qu. 5 say:] For the remainder of this survey, we are going to ask about your first visit to this (doctor’s office [If private “doctor’s office” or “DK/REF” AT Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])

6. What type of doctor or health professional did you see at (this visit [If first at Qu. 5] / your first visit [If been before at Qu. 5])? Was it an ob/gyn, a general practitioner, some other type of doctor, or health professional? (Single response)

Ob-gyn/Gynecologist/Obstetrician 70 General Practitioner/Family Practice Doctor/Internist 18 Other type of doctor, such as a specialist or a surgeon 3 Other, such as a nurse practitioner, a nurse midwife, or physician’s assistant 9 Don’t know * Refused 0 7. Was the health professional a man or woman? (Single response)

Male 49 Female 51 Don’t know 0 Refused 0 8. Why did you go to a new health professional? (Do not read list) (Multiple response)

I changed health insurance coverage/health plans 20 I moved 17 Because of current problem or question 11 Referred to this doctor by another health professional or clinic 10 I got pregnant 8 Previous doctor closed/moved 8 Didn’t like previous doctor 6 I got health insurance coverage 6 For a pelvic exam or pap smear 5 To get established with a doctor in case of need 4 My first gynecological visit 3 Just wanted change/Other general change mentions 3 Wanted doctor closer/More convenient 3 Regular doctor not available 2 Wanted female doctor 2 Friend/relative/co-worker recommended 2 Less expensive 1 I lost health insurance coverage 1 Previous doctor too expensive * I am planning to get pregnant * I don’t have a regular doctor * Refused * 9. Thinking about this first visit, were you asked to fill out a form with questions about your medical history? (Single response)

Yes 92 No 7 Don’t know * Refused 0 10. Did this form have specific questions on it about current or past sexual activity, such as number of sexual partners, contraceptive use, or sexually transmitted diseases? (Single response)

Based on those asked to fill out a form. (n=445)

Yes 54 No 40 Don’t know 7 Refused 0 11. Were you worried about whether your answers to the questions on this form would be keptconfidential? Would you say you were (read list)? (Single response)

Based on those who filled out a form with sexual history questions on it. (n=239)

Very worried 1 Somewhat worried 2 Not too worried, or 16 Not at all worried 81 Don’t know 0 Refused 0 Now I am going to ask you some questions about what you and your health professional discussed at this first visit. Your answers to these questions will be kept completely confidential, and your responses will be shown only in combination with the many other women we survey.

12. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) discuss pap smears with you at this visit? (Single response)

(If respondent says the doctor did a pap smear, probe with: Did he or she just perform the pap smear, or did they have a discussion with you about pap smears?)

Yes 74 No 26 Don’t know * Refused 0 13. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Do not read list) (Single response)

Based on those who discussed pap smears. (n=357)

You 16 Someone in your doctor’s office/clinic 81 Don’t know 3 Refused 0 14. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) discuss breast self-exams with you? (Single response)

(If respondent says the doctor did a breast exam, probe with: Did he or she just perform the breast exam, or did they have a discussion with you about breast self-exams?)

Yes 74 No 26 Don’t know * Refused 0 15. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Do not read list) (Single response)

Based on those who discussed breast self-exams. (n=357)

You 6 Someone in your doctor’s office/clinic 94 Don’t know 1 Refused 0 16. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) discuss mammograms with you? (Single response)

(If respondent says the doctor did a mammogram, probe with: Did he or she just perform the mammogram, or did they have a discussion with you about mammograms?)

Yes 41 No 58 Don’t know 1 Refused 0 17. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Do not read list) (Single response)

Based on those who discussed mammograms. (n=197)

You 16 Someone in your doctor’s office/clinic 83 Don’t know 1 Refused 0 18. Have you ever had a mammogram yourself? (Single response)

Yes 34 No 66 Don’t know 0 Refused 0 19. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) discuss birth control with you? (Single response)

Yes 54 No 46 Don’t know 0 Refused 0 20. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Do not read list) (Single response)

Based on those who discussed birth control. (n=259)

You 37 Someone in your doctor’s office/clinic 62 Don’t know 1 Refused 0 21. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) discuss alcohol use with you? (Single response)

Yes 25 No 73 Don’t know 2 Refused 0 22. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Do not read list) (Single response)

Based on those who discussed alcohol use. (n=121)

You 5 Someone in your doctor’s office/clinic 95 Don’t know 0 Refused 0 23. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) discuss AIDS or HIV with you? (Single response)

Yes 21 No 78 Don’t know 1 Refused 0 24. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Do not read list) (Single response)

Based on those who discussed AIDS or HIV. (n=101)

You 10 Someone in your doctor’s office/clinic 89 Don’t know 1 Refused 0 25. Did someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b]) ask you about your sexual history and current sexual activity? (Single response) (Do not read list)

Yes 38 No 59 Asked about sexual history, but not current sexual activity * Asked about current sexual activity, but not sexual history 1 Don’t know 2 Refused 0 26. Who initiated this conversation, you or someone in your (doctor’s office [If private “doctor’s office” or “DK/REF” at Qu. 4b] / clinic [If “family planning” or “other type of clinic” at Qu. 4b])? (Do not read list) (Single response)

Based on those who discussed sexual history or sexual activity. (n=188)

You 7 Someone in your doctor’s office/clinic 92 Don’t know 1 Refused 0 27a. Where did the discussion take place? (Do not read list) (Multiple response) (If respondent says “examining room” probe with: Was that while you were dressed or undressed?)

Based on those who discussed sexual history or sexual activity. (n=188)

In doctor’s personal office 42 In examining room while you were dressed 41 In examining room while you were undressed 14 In counseling room 3 In waiting room 2 All other 2 Don’t know 1 Refused 0 27b. Where would you have preferred this conversation took place? Would you say (read list)? (Single response)

Based on those who discussed sexual history or sexual activity. (n=188)

In doctor’s personal office 45 In examining room while you were dressed 43 Doesn’t matter 4 In examining room while you were undressed 3 Don’t know 5 Refused 1

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Talking About STDs With Health Professionals: Women’s Experiences:Press Release Report Survey Part One Part Two Part Three

Contraception 911

If a condom breaks, a diaphragm slips, or you realize after having sex that you forgot to take the pill for three days in a row, it can be enough to make the calmest person very upset! Fortunately, there is something you can do. If you act within 72 hours after unprotected intercourse, two doses of a special combination of birth control pills, available by prescription, can prevent or delay ovulation and reduce the chance of pregnancy by about 75 percent. The method is called emergency contraception (the morning-after pill).

You can get the pills from a doctor or a family planning clinic. If there is any chance you might already be pregnant you’ll need a pregnancy test. (If you are pregnant, the treatment won’t work.) The medication isn’t without side effects, though; nausea, especially, is very common for a day or so. And it’s not foolproof – it only reduces your chance of pregnancy by 75%. And even if it does work, the pregnancy protection doesn’t last so you’ll need to go back to another birth control method right away. Generally, emergency contraception costs $55 to $245 for the whole shebang (examination, pregnancy test, and pills); costs are less – or even free – at family planning clinics and health centers. To find a provider near you, you can call the Emergency Contraception Hotline at 1-888-NOT2LATE.

What Doesn’t Work

If you’re considering any of these folklorist contraceptive methods, fuhgeddaboudit!!! Here’s why:

• Douching: Rather than rinsing sperm out of the vagina, douching could actually send them swimming upstream towards an egg. (It can also increase the risk of infection.) All in all, a bad idea!
• Peeing after intercourse: An old folks’ tale! Urinating after sex does nothing to protect against pregnancy because the urinary opening is near to, but not inside, the vagina. So sperm won’t be touched by the liquid rush.
• Having intercourse during your period: First of all, just because you’re bleeding doesn’t mean you’re having your “true” period; some women bleed during ovulation. And it’s often hard to predict when you’ll ovulate. So you’d better use protection whenever you have intercourse, all month long.

How to Negotiate with Your Partner

Think you might be ready to have sex with a special someone? Before deciding, make sure you’ve considered all the issues and discussed them with your partner. After all, the decision is – always! – up to both partners. Here are three tricky sexual scenarios and solutions for how to handle them:

Scenario #1: You’re thinking about having sex but you’re just not comfortable talking about it with your partner.

Solution: First things first: If you can’t talk about it, how are you going to feel comfortable doing it? Maybe one of you thinks that talking about sex kills the mood or that it should just happen naturally when the moment is right. Wrong, wrong, wrong. Talking about sex can actually help you trust each other more and feel closer to each other because it shows you care. But most importantly, it helps you make wiser decisions, and if you decide to begin a sexual relationship, to plan ahead to protect yourselves against pregnancy and STDs. In fact, you should hash out what you’re willing to do and what you’re not and agree to use condoms for your mutual protection before things get too intimate.

Scenario #2: Your partner does not want to use a condom.

Solution: Some people will use a zillion lame excuses to weasel out of using condoms so you’d better be armed with a snappy comeback. If she says, “It takes away the romance,” you could say, “So could getting an STD.” If he says, “I can’t feel anything with a condom,” tell him “You’ll feel even less if you don’t use one because we won’t be having sex.” If she swears she won’t give you any diseases, tell her it’s nothing personal but you want to make sure both of you stay healthy. The bottom line: Don’t feel bad about saying “No condom, no sex.”

Scenario #3: You’ve already had intercourse together but now you realize that it’s just too soon for you – and you don’t want it to happen again.

Solution: It’s not too late to slam on the brakes. One thing to keep in mind is that just because you’ve done it once or twice doesn’t mean you have to do it again and again. It’s okay to say “no” to any part of sex at any time, regardless of what you’ve done in the past. The key is to be firm and clear – hopefully, before you get to the undressing stage – about how you’re feeling and what you want for the future. If your partner tries to push the issue, stand your ground, and remind him or her how strongly you feel about slowing things down. Anyone worth your time and affection should respect that.

Sexually Transmitted Diseases

You’ve heard about all these scary things that can happen to you if you don’t practice safer sex, and you may even know people who have caught sexually transmitted diseases (STDs). Which isn’t surprising, considering that at least one in four people will contract an STD at some point in his or her life. What is there to worry about? Plenty. Here’s what you need to know about the risks of unprotected sex.

Each year more than 12 million Americans, including 3 million teenagers, are infected with STDs, and many of them probably thought they didn’t need to worry about protection. While a few STDs are just annoying, many others can have lasting effects on your health and sex life. We all know that HIV is an incredibly deadly STD. In fact, half of all new HIV infections occur in people under 25, and AIDS has become the leading cause of death among Americans between the ages of 25 and 44. And if you think the new AIDS drugs you have been hearing about are a magic cure, forget it. They are hard to take, often have strong side effects, and do not always work. Other STDs can cause nasty recurrent symptoms, such as painful or itchy sores, and a select few can cause death or increase the risk of cancer for both women and men. What’s more, several STDs can cause infertility, meaning you could never have children.

And get this: Almost any STD increases your chances of contracting HIV. In fact, people who already have an STD, like herpes, gonorrhea or chlamydia, are three to five times more likely to become infected with HIV than someone who does not have an STD if they have unsafe sex with an HIV-positive partner.

It’s a myth that you can tell if someone has an STD by the way he or she looks or acts. That wholesome-looking guy or woman may look safe and seem safe but appearances can be deceiving. After all, you’re not just having sex with that person but with everyone they’ve ever had sex with . . . and everyone THEY’VE ever had sex with… and… well, you get the point. Because lots of STDs have no symptoms (or only subtle ones), your partner may not even know he or she has one. That’s why if you have had sex in your life, you should get tested for STDs like chlamydia, and for HIV, even if you have no symptoms and are feeling just fine.

To be blunt about it: The only way to be sure you’re having safer sex is to keep your partner’s blood, semen, or vaginal fluids out of your body. Abstinence is the safest course. But, if you’re going to have sex, always use a condom.

How can you tell if you’re infected with an STD?What should you do if you are?

If you’ve been experiencing burning urination; heavy, smelly discharge from the vagina, penis or anus; bumps, sores or itching in the genital area; pain or tenderness in the pelvic area; or other funky symptoms, you may have a sexually transmitted disease. In that case, you need a medical visit right away so you can get tested.

Why is it important to get tested early? Because if you have an STD and don’t know it – and so don’t get treatment – you could pass it on to your partner and you could risk your health and your ability to have kids in the future. Not all STDs are curable, but even for ones that aren’t, treatments are available that can help. If you have HIV, for example, finding out early means you can take advantage of new medications that are more effective if you take them before you start to get sick.

If you are a woman and you’ve been experiencing cramping or persistent pain in the abdomen or back; abdominal tenderness with movement or going to the bathroom; abnormal vaginal discharge; pain during intercourse; or any of these symptoms with a fever over 100.5 degrees Fahrenheit – these may be signs of pelvic inflammatory disease (PID). If you have these symptoms, see a doctor or go to a clinic or a hospital emergency room immediately; PID can lead to infertility in a woman if it’s left untreated. PID can also be silent – an infection that spreads to your tubes from chlamydia or gonorrhea with no severe signs that could alert you that something is wrong.

Now, to get the inside scoop on the most common STDs, consult this table:

STD Chart

STD: Chlamydia What it is: A bacterial infection of the genital area. How many get it: About 4 million Americans each year; the highest rates are among women aged 15 to 19 – in fact, in some communities studies have found that up to 30 percent of sexually active teenage women and 10 percent of sexually active teenage men are infected. Signs: There are no symptoms in most women and many men who have it. Others may experience abnormal vaginal bleeding (not your period), unusual discharge or pain within one to three weeks of having sex with an infected partner. How it’s spread: Through vaginal or anal intercourse. Treatment: Oral antibiotics cure the infection; both partners must be treated at the same time to prevent passing the infection back and forth – and need to abstain from intercourse until the infection is gone. Possible consequences: Pelvic inflammatory disease (PID) in women, tubal (ectopic) pregnancy, infertility, and increased risk of HIV infection.

STD: Trichomoniasis (“Trich”) What it is: A parasitic infection of the genital area. How many get it: As many as 3 million Americans each year. Signs: Often there are no symptoms, especially in men. Some women note a frothy, smelly, yellowish – green vaginal discharge, and/or genital area discomfort, usually within 3 to 28 days after exposure to the parasite. How it’s spread: Through vaginal intercourse. Treatment: Antibiotics can cure the infection. Both partners need to be treated at the same time to prevent passing the infection back and forth – and need to abstain from intercourse until the infection is gone. Possible consequences: Increased risk of HIV infection; can cause complications during pregnancy. Also, it’s common for this infection to happen again and again.

STD: Gonorrhea What it is: A bacterial infection of the genital area. How many get it: Approximately 800,000 Americans a year; the highest rates are among women aged 15 to 19. Signs: Most women and many men who get it have no symptoms. For those who do get symptoms, it can cause a burning sensation while urinating, green or yellowish vaginal or penile discharge, and for women, abnormal vaginal bleeding, pelvic pain, and/or fever within 10 days of getting infected. It takes 1 to 14 days for symptoms – such as discharge or pain – to appear. How it’s spread: Through vaginal, oral, or anal intercourse. Treatment: Oral antibiotics. Both partners need to be treated at the same time to prevent passing the infection back and forth – and need to abstain from intercourse until the infection is gone. Possible consequences: PID, tubal (ectopic) pregnancy, sterility, increased risk of HIV infection. The infection can spread into the uterus and fallopian tubes. It can also cause complications during pregnancy (including stillbirth) or infant blindness or meningitis (from an infected mom during delivery).

STD: Human Papilloma Virus (HPV) What it is: A viral infection with 60 different types, primarily affecting the genital area, both the outer and inner surfaces. How many get it: An estimated 500,000 to 1 million Americans per year; about 40 million people already have it. Signs: Soft, itchy warts in and around the vagina, penis, and anus, may appear two weeks to three months after exposure. Many people, however, have no symptoms but may still be contagious. How it’s spread: Through vaginal or anal intercourse, or by touching or rubbing an infected area. Treatment: There is no cure. Warts can be removed through medication or surgery. Even with such treatments, the virus stays in the body and can cause future outbreaks. Possible consequences: Increased risk of genital cancer for men and women. Some virus types cause the most common form of cervical cancer in women.

STD: Genital Herpes What it is: A viral infection of the genital area (and sometimes around the mouth). How many get it: Between 200,000 and 500,000 Americans each year; an estimated 40 million Americans already have genital herpes. Signs: There are two kinds of herpes. Herpes 1 causes cold sores and fever blisters on the mouth but can be spread to the genitals; Herpes 2 is usually on the genitals. Nearly two – thirds of people who are infected with herpes don’t even realize it. An outbreak can cause red bumps that turn into painful blisters or sores on the vagina, penis, buttocks, thighs, or elsewhere. During the first attack, it can also lead to fever, headaches, and a burning sensation when you urinate. Symptoms usually appear within 2 to 20 days of infection but can take longer in some cases. The first outbreak is usually more severe than later recurrences. How it’s spread: By touching an infected area or having vaginal, oral, or anal intercourse. Warning: some people may be contagious even when they don’t have symptoms. Treatment: There is no cure. An antiviral drug can help the pain and itching and also reduce the frequency of recurrent outbreaks. Possible consequences: Recurrent sores (the virus lives in the nerve roots and keeps coming back), as well as increased risk of HIV infection. May cause complications during pregnancy, possibly causing severe illness, disabilities, or (in rare cases) death for an infant if there is active infection during childbirth. (A cesarean section delivery can reduce this risk.)

STD: Syphilis What it is: An infection caused by small organisms, which can spread throughout the body. How many get it: About 120,000 Americans a year. Signs: In the first phase, sores may appear on the genitals or mouth about three weeks to three months after exposure, lasting for three to six weeks. Often, however, there are no noticeable symptoms. In the second stage, about three to six weeks after sores appear, a variety of symptoms can appear, including a rash (often on the palms of the hands and soles of the feet). How it’s spread: Through vaginal, oral, or anal sex – and through kissing. Treatment: Antibiotic treatment can cure the disease if it’s caught early, but medication can’t undo damage the disease has already done. Both partners must be treated at the same time. Possible consequences: Increased risk of HIV infection. If syphilis is untreated, about a third of people who reach the disease’s late phase may experience brain damage, heart disease, nerve damage, and other incapacitating health problems. If untreated, it can seriously harm or even kill a developing fetus during pregnancy.

STD: Hepatitis B Virus (HBV) What it is: A viral infection primarily affecting the liver. How many get it: About 200,000 Americans a year; more than 1.5 million people in the U.S. now have HBV. Signs: Many people don’t have any symptoms. Others may experience severe fatigue, achiness, nausea and vomiting, loss of appetite, darkening of urine, or abdominal tenderness, usually within one to two months of exposure. Yellowing of the skin and whites of the eyes (called jaundice), and darkening of the urine can occur later. How it’s spread: Through vaginal, oral, and anal sex – and through kissing. Also by sharing contaminated needles. Treatment: Most cases clear up within one to two months without treatment, during which complete abstinence from alcohol is recommended until liver function returns to normal. Some people are contagious for the rest of their lives. A vaccine is now available to prevent this STD. Possible consequences: Chronic, persistent inflammation of the liver and later cirrhosis or cancer of the liver; plus, 90 percent of babies born to women with HBV will carry the virus unless they are vaccinated within an hour of birth.

STD: HIV What it is: The human immunodeficiency virus (HIV), the cause of AIDS. How many get it: An estimated 40,000 to 80,000 Americans are infected each year. AIDS is the leading cause of death among Americans between the ages of 25 and 44. Signs: Many people who have HIV don’t even know it because symptoms may not appear for 10 years or longer. Others experience unexplained weight loss, flu-like symptoms, diarrhea, fatigue, persistent fevers, night sweats, headaches, mental disorders, or severe or recurring vaginal yeast infections. How it’s spread: Through body fluids such as blood, semen, vaginal fluids and breast milk – in other words, during vaginal, oral or anal intercourse; by sharing contaminated needles; via pregnancy or breast – feeding. During vaginal intercourse, the risks of catching the virus are higher for women than for men. Treatment: There is no cure – and AIDS is considered fatal. Several new antiviral medications can slow progression of the infection and delay the onset of AIDS symptoms. Early treatment can make a big difference. Possible consequences: It is the deadliest STD of all and can weaken the body’s ability to fight disease, making someone with HIV vulnerable to certain cancers and infections such as pneumonia. Fifteen to thirty percent of babies born to HIV – positive mothers can get the disease if the mother is not receiving treatment, but treatment can reduce that rate significantly.

Possible STD Symptoms

Do you or your partner have any of these symptoms? If so, you can review the information in the corresponding sections, and consult your doctor.

• Abdominal pain or tenderness (especially with a fever):See Hepatitis B Virus (HBV)
• Bleeding from the vagina (other than your period):See Chlamydia and Gonorrhea
• Blisters on your genital area:See Genital Herpes
• Discharge from the vagina or penis:See Chlamydia, Trichomoniasis, Gonorrhea
• Irritation in the genital areaSee Trichomoniasis
• Itching in the genital areaSee Human Papilloma Virus (HPV)
• Pain or burning while urinatingSee Gonorrhea, Genital Herpes
• Painful intercourseSee Pelvic Inflammatory Disease (PID)
• Pelvic painSee Gonorrhea
• Sores on the vagina, penis, buttocks or thighsSee Genital Herpes
• Very dark urineSee Hepatitis B Virus (HBV)
• Vaginal yeast infectionsSee HIV
• Warts or bumps on the genitalsSee Human Papilloma Virus (HPV)
• Yellowing of the skin or whites of the eyesSee Hepatitis B Virus (HBV)

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It’s Your (Sex) Life; Your Guide to Safe & Responsible SexReport Two Part One Part Three

Estimated Cost of a Child Health Program in California

Prepared by Gordon R. Trapnell, F.S.A., Actuarial Research Corporation

For the Kaiser Family Foundation

September 10, 1997

Summary

The Balanced Budget Act of 1997 created a new federal/state program to cover uninsured children. The new federal legislation provides states with a substantial amount of flexibility in designing their child health insurance programs by expanding their existing Medicaid programs, creating new state child health insurance programs, or a combination of both. This report provides an analysis of the cost of covering California children through the options available under the federal program.

The analysis is based on an August 27th plan presented by the Wilson Administration for covering uninsured children in California — the California Children’s Health Plan (CCHP). A key element of the proposed CCHP is to expand coverage to uninsured children using a private insurance mechanism, which the Wilson Administration has said would be slightly less expensive on a per child basis than using the Medicaid program (which is called Medi-Cal in California). The Wilson Administration estimates that the proposed CCHP would cost $74.75 per child per month, while expanding Medi-Cal would cost $76.60 per child. These figures do not include premium contributions made by families or various state administrative costs that might be required under either approach. If families made an average $8 monthly premium contribution per child as suggested in the CCHP proposal, then the government’s cost per child under the CCHP would drop to $66.75 per month. The table on page 33 of the Administration’s published August 27th plan shows that the estimated total program costs assuming full participation at 580,000 children under Medi-Cal would be more costly than under their proposed private insurance approach.

Our analysis follows the same basic approach used in the comparative fiscal analysis in the August 27th description of the CCHP. Our analysis finds that while the per month enrollee premium estimate for a private insurance plan is only slightly less than the premium estimated by the Administration for its private insurance proposal, the per enrollee cost of a Medi-Cal approach is significantly less than the Administration’s Medi-Cal estimate. The primary reason our cost estimates for the Medi-Cal option are less expensive than the Wilson Administration’s Medi-Cal estimates is that we have assumed that children who will enroll in the new program will be less expensive than children currently enrolled in Medi-Cal. In a full-participation scenario, we find that a Medi-Cal expansion would be significantly less costly than a private insurance approach. (See Exhibit 1)

In sum, in our analysis:

• the cost of a private insurance option would be $74.39 per child per month, slightly less (-0.5%) than the Wilson Administration’s estimates for its CCHP proposal;
• the cost of a Medi-Cal approach would be $60.65 per child per month, substantially less (-21%) than the Wilson Administration’s Medi-Cal estimates. As a result, we estimate that a Medi-Cal approach would cost 18 percent less than the Wilson Administration’s CCHP private insurance option. If the average $8 per month enrollee premium contribution per child is used to offset government expenditures under the private option, the private insurance option premium would be $66.39, making the Medi-Cal estimated cost 9 percent less than the private insurance option amount.

The Wilson Administration estimates that 580,000 uninsured children would be eligible for a new program. Our analysis suggests that if all of these children enrolled (and no currently insured children dropped private coverage and became eligible), then using our estimate of per child costs would yield a Medi-Cal option cost for 1998 that would be approximately $96 million per year less than a private insurance option. If a family average premium contribution of $8 per enrollee per month is used to offset government expenditures under the private option, government spending for the Medi-Cal expansion option would be approximately $40 million per year less than for the private insurance option.

One reason why using Medi-Cal might be less expensive than providing coverage through a private insurance mechanism is that Medi-Cal has historically paid providers at lower rates than private health plans. However, the benefits provided by Medi-Cal are more comprehensive — and therefore more expensive — than those provided by most private health plans (and than those provided in the proposed CCHP).

Exhibit 1

ARC Premium Calculations For Child Health Insurance In California — CY 1998

Per Child Per Month Costs Medi-Cal Option Base Monthly Per Capita $50.32 Adjusted Benefit Package $50.22 Projected to 1998 $54.86 Adjusted to HMO rates $54.31 Adjusted for Additional Administrative Functions $60.65 HIPC-Based Consortia Plan (Private Insurance Option) Base Monthly Per Capita $60.03 Adjusted Benefit Package $67.28 Projected to 1998 $70.84 Adjusted to HMO rates $70.84 Adjusted for Additional Administrative Functions $74.39

Estimated 1998 Aggregate Costs(Maximum-Enrollment-Based Calculations, Assuming Total Enrollment of 580,000) Medi-Cal Plan $422.1 million Consortia Plan – gross $517.8 million minus $8/month enrollee charge $55.7 million Net Consortia Plan $462.1 million Difference $40.0 million Source: Estimates based on analysis by Actuarial Research Corporation.

Objective

Our objective is to estimate the cost per child covered of implementing a Child Health Program in California (CCHP) in one of two modes:

• Through an expansion of Medi-Cal income limits and liberalizing asset restrictions
• Through an independent program as suggested by Governor Wilson, modeled on the California HIPC structure, but with plans limited to HMOs (and EPOs) in order to keep cost sharing at levels suitable for a low income population.

In both cases we project the incurred cost of the first year of an expansion or new program that begins in July 1998.

Medi-Cal Expansion

1. Base

We do not have a comprehensive set of premium rates for Medi-Cal, but rather:

• A DHS tabulation of the Medi-Cal FFS claims for children other than infants and foster children, for the period July 1995 through June 1996.
• A somewhat detailed description of the derivation of the original premium rates proposed for Local Initiatives and Commercial Plans under the two plan model county rates from the experience of the Santa Barbara County Operated Health Plan, together with supporting data and information provided in the report “Two Plan Model; Capitation Rates for July 1, 1995 – May 31, 1996 and June 1, 1996 – September 30, 1997.”
• DHS estimates of the average incurred FFS cost per capita for (i) members of families and (ii) foster children for the periods July ’95 through June ’96 and July ’96 through June ’97. In both cases the estimates exclude the costs of those institutionalized and specialized services for such children, and any other services not capitated with the “local initiative” prepaid plans.
• A comprehensive set of HMO payment rates from several years ago.

In addition, we have a copy of the Capitation Rate Manual for Fiscal Year 1990-91, compiled by the California Medi-Cal actuaries, which provides a number of factors concerning key financial relationships.

Of these data sets the most relevant are (i) the rate structure derived from the Santa Barbara plan and calibrated with the estimated average FFS claims incurred per capita for July 1996 through June 1997 and (ii) the tabulation, apparently on an incurred basis, of a sample of children ages 1-18. The average incurred FFS cost per child per month of eligibility from the DHS tabulation for the period July 1995 through June 1996 was $50.32 per eligible per month (PEPM).

This rate is somewhat lower than the average FFS cost per eligible month in that period for foster children in the eight counties in which the two plan model will be implemented, $58.20 (which was actually higher than the estimated cost a year later of $57.47). This cost PEPM for foster children appears to be higher than found in the tabulation of all children for some combination of area differentials (most of the two plan counties are in the areas with higher average Medi-Cal costs) and a higher average cost for foster children than for children in families (which apparently are somewhat older on average and may include more children with special Medi-Cal needs). Both the estimate for foster children and that for all eligible children exclude the cost of expensive conditions found in infants.

Given the methodology followed by California in setting rates to be paid to health plans, the estimated FFS cost PEPM in July ’95 through June ’96 appears to provide the most reliable basis for an estimate of what the State would offer HMOs to cover an expanded child population. (It also necessarily provides the basis for an estimate of the average that would be paid if the services are not provided through prepaid plans, i.e. on a FFS basis.) The California methodology, well documented by the Medi-Cal actuaries in various reports, has been to:

• Project the average FFS cost by category of eligibility, age-sex group and county of residence
• Adjust for difference in the average cost of those eligible for enrollment in an HMO in each category of eligibility
• Adjust for differences in the benefits for which HMOs are responsible and those retained by Medi-Cal
• Increase the per capitas by an allowance for those state administrative expenses that will be replaced by contracting with managed care plans
• Decrease the results for the state’s share of managed cost savings.

Prepaid plans are offered the resulting rates on a take it or leave it basis.

In addition, the total paid to prepaid plans can not exceed estimates of what would have been paid in a FFS system, according to Federal laws and regulations. Thus the estimated FFS cost PEPM controls what can be paid to prepaid plans under Medicaid, and is by definition what a FFS program would cost.

The rate structure derived by the Medi-Cal actuaries produces numbers that appear to be reasonable in relationship to those from the FFS tabulation, but require adjustments for:

• Deriving a rate for children between 1st and 18th birthdays from the average family member rates
• Area differences between payments in the twelve two plan counties and the entire state
• Differences in the benefit package offered through the prepaid plans and all Medi-Cal benefits (to the extent that benefits were limited in the prepaid benefit packages).

Since each of these steps may involve error, we rely here on the rate ($50.23) derived from FFS data for a population most like what is to be enrolled under CCHP. However, we note that to the extent that the new program will enroll some age groups in larger numbers than others (especially if distinctions are introduced), this provides a promising base for estimates of the relative cost of different age groups.

2. Adjustments to benefit package and eligibility

By definition, the benefit package would be the same as the full Medicaid program. Thus the tabulations of FFS data cited above exclude services not currently capitated with HMOs. The value for the average experience of all eligible children during the twelve months ending in June 1996 appears to include all categories of benefits, including some related to institutional services. These should probably be excluded from the estimate, on the grounds that most needing institutional services are already eligible for Medi-Cal, and would not be included in the expansion population. The adjustment appears to be a decrease of the order of $.10 PEPM.

It is not clear whether the services provided to crippled children are included in the base data. If they were, the cost PEPM should be further reduced by around 5% to allow for the relatively high cost per capita of this group, compared to what may be expected to be found in the expansion program.

3. Projection to First Program Year

The period for which the base rates were tabulated was from July 1995 through June 1996. The estimates from DHS estimates for the average incurred FFS cost per capita for (i) members of families and (ii) foster children for the periods July 1995 through June 1996 and July 1996 through June 1997 can be used to update this base for another year. The average increase is 2.1%.

The resulting rate represents the average cost of FFS Medi-Cal during the period from July 1996 through June 1997. We wish to project the cost to the period July 1998 through June 1999, which occurs two years later. We project the increase to be 3.5% per year. After incorporating these two trend factors, the estimated average FFS claims incurred for non-infant non-foster-child Medi-Cal children is $54.86.

4. Adjustments for prepaid plan payment rates

Medi-Cal has increased payment rates to HMOs by 1% to reflect the estimated savings in Medi-Cal administrative expenses, and decreased rates by a small percentage to obtain a state share of managed care savings, e.g. a projected 2% in the calculation of two plan county rates. The rates are also reduced by around 0.5% to reflect a loss of interest when capitations are paid in advance rather than claims paid some time after the date on which services are performed.

After these adjustments, the average payment rates to prepaid plans for Medi-Cal children ages 1 – 18 would be $54.31 PEPM.

5. Medi-Cal administrative expense

The primary categories of expense that will be expanded would be expenses relating to eligibility determination and enrollment in prepaid plans. There would also be a modest increase in the workloads of the central staff and auditors. All additional expenses would be marginal expenses, since the same basic systems and procedures in place for Medi-Cal would be extended to the new eligible groups.

The most important new expense would be determining eligibility for a large new population. There would also be increased cost to calculate a new category of rates and to integrate the new beneficiary class into the current system of contracting with prepaid plans. The new categories would also produce an increase in auditing expense and the cost to analyze encounter data from the prepaid plans. Even relatively large such increases in the work loads of central staff, however, would not produce more than nominal increases in administrative outlays.

We have been provided the following information from the operation of the Medi-Cal program and plans for an expansion through Medi-Cal to cover new eligible children:

• Medi-Cal reimburses the counties $119.51 per intake per case (family) and $20.46 per month for “ongoing costs”.
• Planning for an expansion of Medi-Cal under the Child Health Program is based on payment to the counties of $119.51 per case “at least once per case” per year for “intake” and “redetermination” after any year of continuous eligibility and an allowance of $10.23 per month per active case.

The latter amounts appear excessive for the marginal costs of administering an expansion population under Medi-Cal, but would produce the $116.02 projected per case (and something more than the $9.67 projected in the August 27 description, as a monthly cost per eligible since some children would not be eligible for multiples of full years). In addition, although eligibility determination is the largest expense of an expansion of Medi-Cal, it is not the only additional expense. There would also be increases in Medi-Cal expenditures for a number of other functional expenses, including hearings and appeals, auditing of payments to health plans, central office staff time, etc.

The level of reimbursement to counties, however, appears to be excessive for the marginal cost of determining eligibility for an expansion population in which incomes should be more stable, and for which income verification will not have to be performed for all eligibles (since many with relatively low health needs will never apply). We also note that past expansions of eligibility of children do not appear to have produced significant increases in Medi-Cal administrative costs as a percentage of benefits Consequently, we will base our estimate on an average administrative expense for eligibility of 60% of that projected, and increase the result by 1% of the average benefits per capita (including payments to health plans) to allow for other functions.

This produces an average administrative cost of $6.34 in addition to the basis of payment to health plans, bringing the total estimate to $60.65 PEPM.

6. Payment of bad debts

An important effect of the expansion should be some relief to major providers from the burden of bad debts. The primary beneficiaries would be the “essential providers”, i.e. institutions that now receive Disproportionate Share payments and cross subsidies to Federally Qualified Health Centers. To the extent that the state’s share of differential payments (including the extent to which a higher payment rate has been built into the two plan county rates) will be reduced by the new benefits, the state’s cost for the program will be reduced.

7. Coverage of children now covered by employer plans

A strong incentive is created by the new coverage for families that now pay for coverage of their children through employer plans to drop this coverage. Their children would become eligible for Medicaid immediately.

Medicaid, however, can consider such coverage in determining eligibility. Further, the Medicaid eligibility is designed to detect employment and ask about such coverage, and the questions would be repeated quarterly. Medicaid has the option (and, if cost-effective, is required by HCFA) to pay the employee contribution rates to obtain coverage for persons eligible for Medicaid. It should be noted, however, that this affects aggregate outlays, but not necessarily the PEPM).

8. Selection

The average rate PEPM derived above is determined for coverage of the full population eligible for the expansion, estimated to be some 580,000 children. In practice, only some fraction of these children would actually become enrolled, issued health cards and enrolled in prepaid plans. Thus there would continue to be a FFS program paying some claims for eligibles before they are enrolled in prepaid plans. The method of estimation implicitly averages such claim payments and the cost of processing with the premium rates paid to the prepaid plans.

Further, although those who are enrolled will include most with major health expenses, some of the expenses of the potential expansion population will not be paid under the expansion because the providers to not find obtaining eligibility worth the effort and because some care will not be provided to those who do not obtain eligibility. On the other hand, the average cost per person found eligible will be significantly higher than the average expenditure per potential eligible derived above.

9. Other considerations

One possible shortcoming of the estimates derived above is that the plans may balk at the level of rates being offered. Since we assume the newly covered group will be offered as part of the overall package, however, a decision to withdraw would necessarily involve losing the rest of the Medi-Cal enrollment. For this reason, we only mention the possibility that the increased size of the contract at what appear to be below market rates may result in some loss of potential contractors.

Consortia Plan

1. Base

The most important consideration in the choice of a base is to emulate the procedures that will be followed to determine the premium rates that will be paid for the coverage. A fundamental difference between the procedures used to determine rates for the consortia plans offered in California and the managed Medicaid plans is that the plans are free to bid rates that they believe constitute prudent business decisions, without the implicit threat of loss of existing market share.

In contrast, in the managed Medi-Cal program, the prepaid plans must accept the rates offered, or not participate. Many have participated despite the apparently low level of payment rates offered. Further, if additional volume is not accepted, the plans would lose their present share of this market. It is much more difficult for a HMO management to decide to drop an existing product line than to decide not to bid on a new class of business.

The most appropriate base for which we have adequate publicly available information from which to estimate the premium rates that would be bid by health plans in a new program offered by MRMIB would be the average of the HMO “Preferred” plans being offered through the HIPC, averaged over the areas in which the uninsured children live. This base is most appropriate for the CCHP plan because:

• The mechanism is more like that to be used for CCHP than CalPERS, since there will be needs to maintain eligibility roll by individual/family, eligibility depends on payment of premiums (complete with grace periods), there are enrollments taking place throughout the year, etc.
• In addition, enrollment is open to biased selection through dumping of sick employees by very small employers (who constitute a large proportion of the actual enrollment).
• The average is less biased toward urban areas where there are proportionately more civil servants than the near poverty population.

Since we do not have the enrollment by plan in HIPC, nor any rates specifically for children living alone, we determine an adjusted premium rate for those plans offered widely throughout each of the six HIPC areas from that charged for single adults using (i) standard demographic relationships relating to the average cost of covering children and single adults through HMOs and (ii) the average Medi-Cal costs of children over age one to that for all children under age 19.

The next step is based on an assumption concerning how the premium rates would be charged, namely that payments by CCHP would be based on the lowest rate of prepaid plans widely available throughout each county (less $8.00) and families would be responsible for the additional premium charged by the health plan chosen. This would mean that the CCHP expenditure would in effect be based on the premium rates of the lowest cost plan in each county. To simulate this basis, we based the estimate on the average of the lowest cost among plans widely available in each area. (We believe that this method (i) overweights areas 1 and 2, which have the highest of the lowest premium rates for widely available plans to offset (ii) a bias in projecting the lowest cost plans (usually Kaiser Permanente) to be fully available in all counties in areas 3 through 6. The result was an average child premium of $60.03.

2. Adjustments to benefit package

We estimate the benefits included in the August 27 descriptive proposal. (These benefits may have to be increased to meet the “actuarial equivalence tests” required by federal law.) Accordingly, adjustments must be made for including vision care (including eyeglasses) and a full benefit package for preventive and restorative services for dental care. We estimate the cost of these additional benefits to be $7.25.

3. Projection to first program year

The present HIPC rates are for calendar year 1997. We are estimating the average cost during the first operating year of a program that would be in effect during 1999, and perhaps begin as early as July 1998. We project the cost for July 1998 through June 1999. Thus the general level of rates needs to be projected for 1.5 years. The projection was made at 3.5% annually.

4. Administrative expenses

The average administrative expenses will be significantly higher than currently experienced in the HIPC for:

• Enrollment, eligibility determination and premium processing for individual family units rather than employers, meaning smaller numbers of persons per contract.
• Premium collection costs will be higher, with more late payments and grace period notices and processing. (Dealing with inexperienced family heads rather than the administrators of small employers.)
• More rapid turnover, with higher finders fees and enrollment expenses as a proportion of total expenses.
• Units are limited to one or more children, without any adults, meaning both smaller families and much lower premium per family unit, than found in individual insurance.

Administrative expenses as a percentage of the average benefits will be increased for two primary reasons: (i) the additional cost to deal with individual families, especially low income families and (ii) the cost of administrative functions will be divided by a much lower average premium per unit.

Unlike the situation with an expansion of Medi-Cal, a new operation is to be brought into existence under MRMIB, requiring the hiring a completely new staff, renting new facilities and purchase or lease of equipment, software, etc. The cost to set up and run the organization will be a higher percentage of the relatively low premium rates for children compared to those of the HIPC. Thus there should be no savings compared to the level of functional costs of the HIPC, but these will constitute a much higher percentage of benefits.

The primary functional area in which the unit expenses will be greater is in dealing with individual enrollments and all the attendant problems. The complications will affect both the umbrella organization and the health plans, although primarily the former. (It is also not clear that the HMOs will build the additional cost of dealing with individuals into their bids, since many HMOs cross subsidize individual product administrative expenses.)

Typical administrative expenses of health insuring organizations that deal primarily with individuals run 15% to 20% or more of benefits (although much of this is marketing expenses). Further, although the average duration of individual health insurance policies tends to be relatively short, e.g. an average of three to four years, turnover in the population to be covered is likely to be much higher, perhaps one third to one half of the enrollment each year. Further, by limiting coverage to children in the families, there is less premium over which to spread the cost of administration. Consequently, the average administrative expenses are likely to run an order of magnitude higher than for the current mix of small employer groups. The $50 finder’s fees, which are payable for nearly all new enrollments, with one-third turnover each year, by themselves increase premiums by nearly 2%.

The most suitable starting point would be the total administrative costs of the HIPC divided by the number of employment groups. This would be biased upward, since the cost to deal with employment groups of many individuals will be higher than for a family. But the calculation is likely to be more instructive than beginning with the percentage allowance in the current HIPC rates.

In comparison to the administrative costs found in Medi-Cal, allowances must be made for the additional functions associated with coverage dependent not only on eligibility determination but on the collection of monthly premium rates, especially given the targeted income group and the creation of a completely separate organization to handle all staff functions. The latter include:

• Maintaining enrollment files
• Premium collection (including pursuit of unpaid premiums due)
• Margins to fund uncollectible premiums due and interest on grace periods
• Commissions and finders’ fees
• Accounting, audit, etc.
• Actuarial
• Investment of surplus
• Employee services and benefits management
• Insurances (e.g. E&O)
• Provider/plan relations
• Compliance with regulations and other staff functions (e.g. legal, actuarial, etc.).
• Corporate overhead
• Risk/profit charges to fund increasing needs for working capital.

Although this is a highly uncertain estimate, it is difficult to see how administrative expenses could be less than 10% to 15% of benefits. This compares to a present level of administrative expenses of a few percent of premium built into the rates charged by the HIPC, i.e. an increase of the order of 5% beyond the percentage included in HIPC rates. Compounding these factors from the base rate yields a final cost per child of $74.39.

4. Anti-selection

The average cost per child under the proposed CCHP program would be increased by limiting eligibility to those willing to pay the premium. This is not reflected in these estimates. As with the August 27 proposal’s support material, for purposes of discussing the relative merits of alternative implementations, the estimates are based on a “high cost” scenario reflecting enrollment at the total number of uninsured eligible children implied by Census data.

5. Coverage of children now covered by employer plans

A strong incentive is created by the new coverage for families that now pay for coverage of their children through employer plans to drop this coverage. Their children would become eligible for the new program after six months.

There would appear to be few barriers to such conversion of child coverage from employer plans to CCHP. First, eligibility is only determined on an annual basis, and without the kind of investigation that is likely to find all existing insurance coverage. Further, some families would decide that a six month waiting period was well worth having the new program pick up a much higher proportion of the cost. Thus a substantial coverage of children now covered by employer sponsored insurance must be anticipated under this program. However, as noted previously, this primarily affects the aggregate program costs, rather than the PEPM.