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Comments Requested: Children's Health Insurance Program

COMMONWEALTH OF PENNSYLVANIA
INSURANCE DEPARTMENT
1345 Strawberry Square
Harrisburg, PA 17120
Phone (717) 705-0009
Fax (717) 772-1969

Dear Friend of CHIP:
The Pennsylvania Insurance Department has prepared a Concept Document, which is a proposal for improvement to the Children's Health Insurance Program (CHIP). This has been prepared to obtain feedback from concerned persons and organizations prior to the preparing an issuing a Request for Proposal (RFP). A copy of the Concept Document is enclosed for your review.

There will be a series of public meetings conducted various locations throughout Pennsylvania. A complete list of meeting dates and sites are included in the Concept Document.

You are encouraged to respond to the Concept Document. All written comments will be considered. You may comment in person at one of the meetings or send your comments to me.

If you would like an opportunity to testify at one of the meetings, please call 717-783-4789 or send an e-mail to chip@ins.state.pa.us. We will inform you of your scheduled time to appear prior to the meeting. Testimony is limited to no more than a 10 minute presentation. We request that you provide a written copy of your testimony the day of the meeting.

If you have a disability and wish to attend a meeting, and you require an auxiliary aid, service or other accommodation to be able to participate in the meeting, please contact Tracey Pontius, Agency Coordinator at 717-787-4298.

Thank you for your interest in CHIP.

Regards,
Patricia Stromberg
Executive Director

CONCEPT DOCUMENT
A PROPOSAL FOR IMPROVEMENT TO THE CHILDREN'S HEALTH INSURANCE PROGRAM

Tom Ridge, Governor
Diane Koken, Insurance Commissioner
November 1998

MILESTONES

December, 1992 Enactment of Pennsylvania's Children's Health Insurance Act
May, 1993 Implementation of the Children's Health Insurance Program (CHIP)
August, 1997 Enactment of the Federal Balanced Budget Act of 1997 establishing funding
For State Children's Health Insurance Programs
October, 1997 Submission of the Pennsylvania State Plan for CHIP
May, 1998 Federal approval of the State Plan for CHIP
June, 1998 Enactment of Act 1998-68 expanding age and income eligibility for CHIP
October, 1998 Inauguration of state-wide media campaign for CHIP
December, 1998 Public meetings regarding Concept Document for program improvements
January, 1999 Issuance of Request for Proposal for CHIP contracts
July, 1999 (no later than) Contract award and implementation


FORWARD

Pennsylvania's Children's Health Insurance Program (CHIP) is acknowledged as a national model, providing health insurance coverage for children who are ineligible for Medicaid and who are not otherwise insured by private or employer-based insurance. During the month of November, 1998, 66,889 children were enrolled in CHIP. Since 1993, over 165,000 children have received comprehensive coverage.

With the passage of the Federal Balanced Budget Act of 1997, the availability of substantial Federal funding, and the commitment of additional state funding by the Ridge Administration, CHIP may serve thousands of additional children continuing its legacy of quality care. It is estimated that as many as 80,000 to 100,000 additional children may quality for the program. It is our intention to enroll ALL of those children.

Pennsylvania's State Plan for CHIP has been approved by the Federal Department of Health and Human Services. As a condition of approval and receipt of Federal funding, the Insurance Department must choose contractors through an open and competitive procurement process. The need to engage in this process also presents an opportunity to review and assess the general operation of the program. We are committed to assuring public involvement in the assessment process.

This Concept Document provides a conceptual framework for feedback by stakeholders. Issues such as geographic zones, benefits, and enrollment practices are addressed. In some instances, options have been presented for your consideration. We look forward to your comments regarding these proposals as well as to other insights that you may wish to provide.

Public meetings will be held at which time the opportunity for oral presentation of comments will be provided. Public meetings are scheduled as follows:

Monday. December 7. 1998 at 10:00 a.m.
United Way of Southeast Philadelphia
Seven Benjamin Franklin Parkway
Philadelphia, PA 19103

Tuesday December 8, 1998 at 10:00 a.m.
United Way of Wyoming Valley
9 East Market Street
Wilkes-Barre, PA 18711-0351

Wednesday December 9, 1998 at 10:00 a.m.
Jewish Community Center
3301 North Front Street
Harrisburg, PA 17110

Thursday December 10, 1998 at 10:00 a.m.
United Way of Allegheny County
P.O. Box 735
1 Smithfield Street
Pittsburgh, PA 15230


Anyone wishing to testify at a public meeting is requested to contact Jen Scobee at 7l7-783-4789 to schedule a time. Individuals may also appear without advance notice and will be allowed the opportunity to testify after all individuals scheduled in advance have testified. Testimony will be limited to no more than a 10 minute presentation. The Department requests that individuals provide a written copy of their testimony the day of the public meeting. Individuals who are unable to attend any of the scheduled meetings may submit written comments. Thank you for your interest in CHIP and its children.

CONCEPT DOCUMENT INDEX

PAGE
I. Background

-- Legislative History (state and federal) 1
-- State Plan 2
-- Eligibility 2
-- Applying for Benefits 3
-- Benefits 3
-- Contractors 4
-- Enrollment 5
-- Funding 5

II. Procurement 6

III. Improvement to Program Administration 7

IV. Format for Discussion of Issues 7

V. Principles for Decision Making 7

VI. Discussion of Issues 7

Issue A: Geographic Service Areas 8
Issue B: Managed Care Arrangements 9
Issue C: Provider Networks 10
Issue D: Quality Assurance 11
Issue E: Scope of Benefits 14
Issue F: Eligibility, Enrollment and Outreach 16
Issue G: Electronic Data Processing System 20

Appendices

A Federal Income Guidelines
B CHIP Benefit Package
C Service Area Maps
D New CHIP Benefit Package

I. BACKGROUND
Legislative History
Legislation creating the Children's Health Insurance Program (CHIP) was passed by the Pennsylvania General Assembly in December, 1992 (the Children's Health Insurance Act, 62 P.S. 5001.101). Enrollment of children began in May, 1993. It was the intent of the legislation that children in families with incomes below specified levels have access to cost-effective, health care coverage if they were otherwise unable to afford coverage or to obtain it. Eligible children received either free or low-cost coverage.
CHIP was initially funded by a 2 cents per pack tax on cigarettes (later increased to 3 cents per pack) and a special fund was created for the purpose of purchasing health care coverage for eligible children. The number of participants was limited by the amount of funding available. Since 1995, Governor Ridge has more than doubled the funding of the CHIP Program.

The August, 1997 passage of the Federal Balanced Budget Act of 1997, (Public Law 105-33, Subtitle J), presented states with an opportunity to expand health-care coverage for children. The choices provided included the option to establish a health insurance program distinct and separate from the Medicaid program. Pennsylvania's CHIP, along with the insurance programs of New York and Florida, were specifically cited in the federal statute as exemplary and meeting the federal program requirements. To demonstrate Pennsylvania's support of its CHIP program, Governor Tom Ridge eliminated the waiting list for participation and committed additional state funding.

The federal statute allows states flexibility in the design and operation of an insurance program. However, certain provisions of the statute necessitated amendments to state law in order to maximize the draw of federal funds. On June 17,1998, Governor Tom Ridge signed into law Act 68 of 1998, (P.L. 464) which contained the conforming amendments. Included were: expansion of age limits, expansion of the income limits for the free component of the program, elimination of the $5.00 co-payment for prescription medications, the imposition of a citizenship requirement, and the requirement that the Insurance Department award contracts through a competitive procurement process.

State Plan
In October, 1997, a State Plan was submitted to the Federal Department of Health and Human Services, Health Care Financing Administration (HCFA), for the purpose of seeking approval for the receipt of federal funds for CHIP. Approval of the Plan in May, 1998, allowed the draw of approximately two dollars in federal funds for every state dollar expended on the free component of the program. (NOTE: The subsidized component continues to be funded by state-only revenue because the eligibility standard exceeds the federally sanctioned level.)

Components of the Plan included:
* Eligibility Standards
* Benefit Package
* Quality and Appropriateness of Care
* Strategies for Program Expansion
* Funding and Budget
* Reports and Evaluation

Eligibility
Eligibility for CHIP is determined on the basis of several simple factors
including:
* Family income
* Age of the children (through age 18)
* Citizenship status
* Residency (must be Pennsylvania resident for at least 30 days,
except for newborns.)

In addition, children must not be eligible for Medicaid or have any other health
insurance.

The income limit for the free component of the program is 200% of the Federal Poverty Income Guidelines. The income limit for the subsidized component of the program is 235% of the Federal Poverty Income Guidelines. The Federal Department of Health and Human Services adjusts the guidelines in February of each year.

1998 Income Guidelines
Number of Free Subsidized
Household Program Program
Members

2 $21,700 $21,701-$25,498
3 $27,300 $27,301-$32,078
4 $32,900 $32,901-$38,658
5 $38,500 $38,501-$45,238
6 $44,100 $44,101-$51,818

See Appendix A - "Federal Income Guidelines" for further information on eligibility limits. Appendix A is availang Lisa Lowrie at PCPA.

Application for CHIP is made through each of the five participating contractors. The contractor is responsible for determining eligibility for the program. Each contractor has unique enrollment materials and a single page application form. Applications are filed through the mail with assistance, if necessary, provided through telephonic consultation. Each contractor maintains a toll-free telephone number for this purpose.

The benefit package for CHIP is prescribed in the Children's Health Insurance Act as amended and includes:

* Diagnosis and treatment of illness or injury
* Preventative care
* Injections and medications
* Emergency care
* Prescription drugs
* Dental care (excluding orthodontia or cosmetic surgery)
* Vision care
* Hearing care
* Inpatient hospital care

See Appendix B - "Chip Benefit Package" for more information on the scope of benefits currently provided by each CHIP Contractor. Appendix B is available by calling Lisa Lowrie at PCPA.

In most areas of the state, contractors provide care through managed care arrangements (either a health maintenance organization or a preferred provider organization). About 1% of care (primarily in the northern area of the state) isprovided on an indemnity basis because managed care arrangements are not available.

The following contractors presently provide health care for eligible children:

Aetna USHealthcare - providing service in the counties of Allegheny, Armstrong, Beaver, Berks, Bucks, Butler, Chester, Cumberland, Dauphin, Delaware, Fayette, Lancaster, Lawrence, Lehigh, Montgomery, Northampton, Perry, Philadelphia, Schuylkill, Washington, and York.

Caring Foundation of Central Pennsylvania - providing service in the counties of Adams, Berks, Centre, Columbia, Cumberland, Dauphin, Franklin, Fulton, Juniata, Lancaster, Lebanon, Lehigh, Mifflin, Montour, Northampton, Northumberland, Perry, Schuylkill, Snyder, Union, and York.

Caring Foundation of Northeast Pennsylvania - providing service in the counties of Bradford, Carbon, Clinton, Lackawanna, Luzerne, Lycoming, Monroe, Pike, Sullivan, Susquehanna, Tioga, Wayne, and Wyoming.

Independence Blue Cross & Blue Shield - providing service in the counties of Bucks, Chester, Delaware, Montgomery, and Philadelphia.

Western Pennsylvania Caring Foundation, Inc. - providing service in the counties of Allegheny, Armstrong, Beaver, Bedford, Blair, Butler, Cambria, Cameron, Centre, Clarion, Clearfield, Crawford, Elk, Erie, Fayette, Forest, Greene, Huntington, Indiana, Jefferson, Lawrence, McKean, Mercer, Potter, Somerset, Venango, Warren, Washington, and Westmoreland.


Enrollment
Enrollment in CHIP began in May, 1993. Cumulative enrollments for the state fiscal year 1993-94 and thereafter are:

Fiscal Year Enrollment

1993-94 31,259
1994-95 65,095
1995-96 86,517
1996-97 110,477
1997-98 143,171
1998 to date 165,318

Monthly enrollments for the 1998-99 fiscal year have been:

July 60,902
August 60,985
September 65,578
October 66,305
November 66,889


Funding

CHIP was initially funded by a 2 cents per pack tax on cigarettes (later increased to 3 cents per pack) and a special fund was created for the purpose of purchasing health care coverage for eligible children. The number of participants was limited by the amount of funding available. Beginning in fiscal year 1998-99, state general fund revenue and federal funds became available to the program.

The amount of federal funds available to Pennsylvania and other states with approved State Plans is determined on the basis of a formula devised by the Department of Health and Human Services. Congress has appropriated funding for a five-year period. States may take as long as three years to expend a one-year allocation. In addition, beginning in October, 1998, Pennsylvania is subject to a Maintenance of Effort (MOE) provision that requires the state to spend at least an amount equal to that spent in federal fiscal year 1996 (the base year for federal funding allocation purposes) The MOE requirement for Pennsylvania is $31 million.

Annual state budget appropriation levels for CHIP have been:
State
Fiscal Cigarette General Federal Total CHIP
Year Tax Fund Funds Budget
1994-95 $21.5M N/A N/A $21.5M
1995-96 32.35M* N/A N/A 32.35M
1996-97 30.7M N/A N/A 30.7M
1997-98 32.6M N/A N/A 32.6M 1998-99 33.0M $15.0 M $80.3 M 128.3M

*Increase from $.02 to $.03 per pack on cigarettes

II. PROCUREMENT

Federal and State law require that the Department engage in an open and competitive procurement process to acquire the services of contractors. The Department will use the Commonwealth's "Request for Proposal" (RFP) process for this purpose. The procedures employed are governed by the Commonwealth's "Contracting for Services Manual" (M215.1 ß5.1 et seq). Detailed description of the conditions for participation will be provided in the RFP. However, in general, successful bidders will be required to:
* Comport with all conditions set forward in Articles XXI and XXIII of Act 68 (relating to Quality Health Care Accountability and Protection and Children's Health Care).
* Conduct outreach activities.
* Determine eligibility and enroll eligible children.
* Provide a uniform benefit package (consistent with the miniumum scope of coverage and service delivery requirements prescribed by the Department).
* Contract with qualified, cost-effective providers to provide primary and preventative health care.
* Provide parent health education.
* Perform quality assurance tasks (including, but not limited to, monitoring quality of care and health outcomes).
* Interact electronically with an electronic data processing system to be developed by the Department (including, but not limited to, electronic billing, financial reporting, utilization, and enrollee files).


III.IMPROVEMENT TO PROGRAM ADMINISTRATION

The Department is soliciting comment on issues to improve the overall performance and operation of CHIP. They are:
* Eligibility and enrollment assistance (long-term).
* Computer system design and use of data.

IV.FORMAT FOR DISCUSSION OF ISSUES
For each issue, we have provided:
* A description of the current practice, method or benefit.
* An explanation of WHY alternatives should be explored (issues for consideration or concern).
* The alternatives considered.
* The recommended (or best-balanced) action.

V.PRINCIPLES OF DECISION MAKING
The following principles guided the consideration of alternatives:
* Enroll ALL eligible children (in the appropriate health coverage program - either CHIP or Medicaid).
* Insure access to care.
* Insure quality of care.
* Maximize enrollee choice (of managed care arrangement entity and primary care provider).
* Maximize the availability and use of federal funding.
* Insure program integrity and accountability.

VI. Discussion of Issues
Summary
The Insurance Department will be issuing a Request for Proposal (RFP) for the purpose of purchasing health care coverage for eligible children. Coverage under the program will be available statewide. The Department intends to promote enrollee choice of health care coverage and primary care practitioner. The following issues and factors will be considered in selecting successfulbidders for participation in the administration of contracts.

Issue A: Geographic Service Areas
Current Practice:
Each current CHIP contractor serves a unique geographic service area. The contractor service areas for the four Caring Foundations are based upon the service market agreements of Pennsylvania's four Blue Cross Plans (the Blues). Aetna USHealthcare, the only non-Blue Grantee, provides service within its service areas approved by the Department of Health. The Department has not established, defined or otherwise prescribed contractor service areas.

Issues for Consideration/Concern:
With expansion of CHIP and anticipation that more contractors may be participating, consideration should be given to whether more formalized geographic service areas should be designated or whether the current practices may continue without causing harm to the program. Alternatives to the current configuration should optimize enrollee choice; encourage healthy and positive competition among contractors; and not be administratively burdensome to the Department.

Alternatives:
The following alternatives have been reviewed and considered:
* Retain the current geographic service areas.
* Dispense with geographic service areas, but require contractors to provide coverage in the entire area for which they are licensed.
* Dispense with geographic service areas, require contractors which are hospital plan corporations to provide coverage in their entire service area, but encourage other contractors to provide coverage in the entire area for which they are licensed.
* Employ the geographic service areas designated by the Department of Public Welfare in the Health Choices initiative.
* Employ the four Department of Health service zones.


Recommended Alternative:The Department has determined that the best-balanced choice is to dispense with the concept of geographic service areas. The Department will require contractors which are hospital plan corporations to provide coverage in their entire service area but encourage other contractors to provide coverage in the entire area for which they are licensed. This alternative essentially views the entire state as a service area. This alternative has the highest potential to increase provider participation in the program by taking advantage of natural growth in the marketplace.

Issue B: Managed Care Arrangements
Current Practice

The majority of children currently served by CHIP are enrolled in managed care arrangements (either health maintenance organizations or preferred provider organizations) This practice is encouraged by Subsections 2311 (j)(1) and (l)(2) of the Children's Health Insurance Act, as amended, which provides that the Insurance Department require that contractors "use appropriate cost-management methods" and "managed health care techniques and other appropriate medical cost management methods".

Issues for Consideration/Concern:
The transition in CHIP from use of indemnity care to health care management has taken place over the last three years, initially for cost containment reasons. Containing the cost of the program was particularly important during a time when funding was capped and the number of children to be enrolled was limited by the cap. As a result of this prudent decision, hundreds more children were able to receive coverage. However, a decision to continue with health care management in some form or another should not be made solely for fiscal reasons. Consideration must be given to the service delivery method(s) that best meets the program goal of promoting good health outcomes for children.

Alternatives:
* Continue the current practice of encouraging the use of managed care arrangements by participating contractors.
* Require that contractors use managed care arrangements where available.

Recommended Alternative:
The Department has determined that the best-balanced choice is to require contractors to use managed care arrangements because of their unique ability to focus on preventative care, to initiate early intervention when health problems are revealed, and to develop long term relationships with parents and children. We embrace the concept of a "medical home" for children a concept that managed care arrangements naturally support. Alternative means of care oversight will be pursued in areas where managed care arrangements are not widely available.

Issue C: Provider Networks
Current Practice:

The Department has required that contractors participating in CHIP provide assurance that enrollees have access to the same practitioners' services as do commercial subscribers. In addition, contractors must provide listings of providers by specialty; a description of procedures and requirements for credentialing providers; a description of the key components of contractual relationships with providers; and a description of how enrollees will gain access to primary care providers and services.

Issues for Consideration/Concern
The Department is generally concerned that provider networks be adequate and that a sufficient number of primary care providers be available to serve the increasing number of enrollees. This is particularly critical in the more rural and medically underserved areas of the state.

Recommendations:
Provider networks must meet all licensing standards and requirements imposed by the Department of Health as well as requirements imposed by the Department to assure efficiency and adequacy of provider networks. Requirements include, but are not limited to:
* Assure availability and accessibility of adequate health care providers (including pediatric specialities).
* Encourage expansion of networks in medically underserved areas.
* Provide lists of health care providers participating in the plan and the extent to which the providers are accepting new enrollees.
* Encourage participating providers to enroll in the Medicaid program (either in a voluntary or mandatory managed care arrangement or in fee-for-service where Medicaid managed care is not in place).

Issue D: Quality Assurance
Current Practice

The Children's Health Care Act requires that the Department, in conjunction with the Children's Health Advisory Council and other Commonwealth agencies review and evaluate the adequacy, accessibility and availability of services provided to children enrolled in CHIP. In addition, contractors are required to provide:
* A description of how the health delivery system complies with Preventive Health Services Standards".
* A description of special features of the health delivery system (e.g. use of primary care providers as health managers).
* A description of the quality assurance and utilization review system including inpatient pre-certification.
* A description of the complaint/grievance resolution system applicable to participating providers and enrollees.
* Utilization and financial reports regarding service and general operation of the program.
Contractors are also required to participate in medical audits as prescribed by the Department to assess quality and access to care.

The Department has, as a condition of approval of the CHIP State Plan, committed to measuring program performance (refer to Section 9 of the State CHIP Plan relating to Strategic Objectives and Performance Goals for the Plan Administration).

Issues for Consideration/Concern:
The contractual requirements and commitments made in the State Plan are "industry standard" and sufficient to produce the information necessary to measure performance. However, we know from the results of a study performed by the Pennsylvania State University, Department of Health Evaluation Sciences, that the Department must be proactive in routinely monitoring the delivery of services.

This study, commissioned by the Department of Health, was designed to assess quality and access to care based on the experience of children who were continuously enrolled in CHIP for at least 12 months during the two-year study period (July 1,1994 through June 30, 1996). The focus of the study was preventative care, assessing physician office visits, routine tests and measurements, and childhood immunizations.

The results demonstrated that complete compliance with all preventative care criteria was low. However, approximately 80% of all children in the study had at least one well-child visit during the study period. The study explains that the reasons for these results are varied including the fact that many children come to the program without a history of well-child visits and, therefore, have "catching up" to do. In many instances, enrollment in CHIP represents a child's first involvement in an organized system of health care management.

Responsibility for quality assurance rests with all parties involved in the administration and operation of CHIP as well as with those participating directly in the health delivery system. The Department, Contractors, Primary Care Providers and parents all have unique and important roles in health care outcomes for children. We recommend further development of a comprehensive strategy that defines roles and establishes monitoring standards. Examples of roles and standards include:

* Establish performance measures regarding health care delivery and outcomes.
* Conduct on-site visits with contractors to review compliance with performance measures.
* Impose corrective action requirements, where necessary, and financial penalties for failure to accomplish corrective action.
* Develop a quality assurance module as a part of the Department's electronic data system to facilitate analysis of service delivery and performance data and to produce performance reports for individual contractors and for the program generally.

Contractor
* Establish procedures to facilitate the selection of a primary care provider within 30 days of the date of enrollment in CHIP, where appropriate.
* Establish procedures to encourage the arrangement for a first well- child visit within 30 days of selection of a primary care provider.
* Require that providers document and report all services provided as a condition of payment.
* Establish means to measure enrollee satisfaction.
* Establish complaint/grievance procedures in compliance with requirements of Act 68.
* Remind families of the importance of annual re-enrollment in CHIP to assure continuation and continuity of care.

Primary Care Provider
* Provide or direct all age-appropriate preventative services.
* Document that preventative health measures are being taken.
* Monitor visitation pattern of families to ensure that appointments are routinely kept.
* Provide parent education (discussion and materials) about the need for preventative care as well as information about the care of children with special or chronic health care needs (e.g. management training for diabetes, etc.).

Parent
* Select primary care provider, where appropriate, to manage the health care of each child.
* Keep routinely scheduled appointments.
* Become involved in meeting the health care needs of the child by attending parent education meetings, etc.
* Re-enroll in CHIP.


Issue E: Scope of Benefits
Current Practice:
The Children's Health Care Act as amended by Act 1998-68 provides for the following minimum benefit package:
* Preventative Care, including well-child visits in accordance with theschedule established by the American Academy of Pediatrics.
* Services related to well-child visits including immunizations, health education, tuberculosis testing, routine developmental screening, comprehensive physical examinations, and x-rays (especially for children exhibiting symptoms of child abuse).
* Diagnosis and treatment of illness or injury including medically necessary services related to the illness or injury (e.g. laboratory tests, wound dressing and casting to immobilize fractures).
* Injections and medications provided at the time of an office visit or therapy.
* Outpatient surgery performed in the office, a hospital or freestanding ambulatory service center.
* Anesthesia provided in conjunction with surgery or during emergency medical service.
* Emergency accident and emergency medical care.
* Prescription drugs.
* Emergency, preventative and routine dental care (exclusive of orthodontia or cosmetic surgery).
* Emergency, preventative and routine vision care including the cost of corrective lenses and frames (limited to two prescriptions per year).
* Emergency, preventative and routine hearing care.
* Inpatient hospitalization up to ninety (90) days per year

The following services are also provided by all contractors:

* Inpatient and outpatient mental health services.
* Inpatient and home health care.

The following services are being provided by some, but not all, contractors at no additional cost to the program:
* Partial hospitalization for mental health services.
* Substance abuse services.
* Durable medical equipment.
* Rehabilitation therapy (physical, occupational, speech andrespiratory).
All services are provided without a co-payment.
(See Appendix B - "CHIP Benefits" for comparison of services currently provided by the contractors.)

Issues for Consideration/Concern
The benefit package for CHIP is comprehensive, providing an array of preventative care in addition to diagnosis and treatment for illness or injury. A review of recommendations made by the American Academy of Pediatrics for the "Scope of Health Care Benefits for Newborns, Infants and Children and Adolescents Through Age 21 Years" issued in December, 1997, reveals that CHIP covers the majority of services recommended.

In addition, the CHIP benefit package compares favorably with those of other state children's health insurance programs. However, the inclusion of some additional and age-appropriate services should be considered to meet the needs of children in the expanded program.

Recommendations

The following recommendation is made to provide improvement/uniformity and modest expansion of the CHIP benefit package:
* Contractors will be required to provide an identical "core" of benefits as statutorily prescribed by Act 68 and contractually prescribed by the Department.


Consideration will also be given to adding the following to the "core of benefits:

* Rehabilitation therapy (occupational, physical, respiratory andspeech)
* Home health care
* Substance abuse services.
* Durable medical equipment and supplies.
* Maternity care (for adolescents not eligible for Medicaid).
* Medically necessary orthodontics.

Contractors will be permitted to provide additional benefits beyond "core" benefits at their discretion, but at no additional cost to the program. The addition of such benefits and services will be made known to and approved by the Department.

Issue F: Eligibility, Enrollment and Outreach
Current Practice
Eligibility/Enrollment:
Eligibility and enrollment functions are currently performed by the CHIP contractors. Each contractor maintains a toll-free number to facilitate access, has a single-page application document, and completes the application process through the mail. There is no requirement that an applicant family have an in person interview when either applying or being re-certified for the program. Children are enrolled for a twelve-month period at which point a recertification of eligibility must be completed.

Outreach:
CHIP contractors are statutorily required to conduct outreach for the program. Outreach, including providing assistance in completing applications, is also performed on a voluntary basis by many organizations and agencies, either as individual entities or as part of a localized and collaborative health coverage strategy for children. The contractor and the Department have participated in, or provided technical assistance to, those efforts. In addition, County Assistance Offices (where application for Medicaid is made) also provide information to families about CHIP and have developed information and referral protocols with the contractor(s) that provide coverage in their area.

NOTE: The Department has recently inaugurated a statewide media campaign for CHIP which includes television, radio and print media advertisements. A poster and brochure have also been developed and are available for distribution. The general purpose of the campaign is to increase public awareness of the program and to encourage families to call the toll-free Healthy Babies/Healthy Kids Helpline for information and referral (1-800-986-KIDS). Families who contact the Helpline will also be helped to apply for Medicaid, when appropriate.

Issues for Consideration/Concern:
Eligibility/Enrollment:
The application process for CHIP is simple and competently performed by the CHIP contractors. The process requires only the completion of a single-page application and submission of the form through the mail to the selected contractor. However, changes in program requirements and emerging factors have given rise to a re-examination of the process for both the short and long term. Those requirements and factors are:
* Enrollees must currently choose the source of coverage prior to being determined eligible for CHIP. They potentially make this choice without awareness that an alternative plan is available. This issue may be more of a concern as the number of participating contractors increases. It heightens the need to insure that consumers have all information necessary (e.g. provider network, scope of benefits, etc.) prior to making a choice. The challenge is how to accomplish this without adding complexity to the application process.

* The Insurance Department and the Department of Public Welfare must improve access to both CHIP and Medicaid because of the requirement in Federal law to facilitate entry into both programs and because of our goal that ALL children have coverage through the program for which they are eligible. The practice of reciprocal referral arrangements is no longer acceptable. We must work together to create a simple enrollment system that works for families.

Outreach
Effective outreach is critical to enrolling children in CHIP. Since the expansion of CHIP began, many individual organizations and local coalitions have come forward to assist in the enrollment process. We are extremely grateful for this and will continue to support those efforts. However, there is a recognized need that these efforts share a common message about coverage and that the issue of enrollee choice be carefully and uniformly explained. There is also a lack of uniform procedure for processing applications.

Recommendations:
Eligibility/Enrollment: Short-Term Remedy
Throughout the balance of state fiscal year 1998-99 the Department will use the services of the Healthy Babies/Healthy Kids Helpline as a central source of information and referral to CHIP. Callers to the toll-free Helpline will be screened for both CHIP and Medicaid and provided with basic information about both programs. The Department will be providing funding to add staff to the Helpline to accommodate increased telephone activity. In addition, Helpline counselors will also begin to take applications for CHIP, discuss the choice of coverage (in accordance with an agreed upon protocol and script) and forward the application to the selected CHIP contractor or to the County Assistance Office, when appropriate.

Establishing this central source for information and referral will NOT negate or replace the eligibility and enrollment responsibilities of the contractors for the short term. Both points of entry will be used for access to the program. Experience gained from use of the Helpline will assist us in making informed decisions for the longer-term as to the advisability and viability of creating a single point of entry.

Discussions have already begun with the Department of Public Welfare around improvements to the interactive application process for CHIP and Medicaid. We support the need for a common application form and the procedures that will make best possible use of that concept.

Eligibility/Enrollment: Long-Term Solutions
For the long term, the Department will be determing whether to use a single point of entry or multiple points of entry for CHIP. It is our goal to facilitate access to enrollment and information about benefits. Alternatives for long term solutions may include:
* Contractors determine eligibility and complete enrollment (Helpline would continue as a source of information and referral).
* Expanding the resources of the Helpline and using it as the exclusive point of entry for CHIP, performing all eligibility and enrollment functions.
* Pursuing, through an open procurement, a contractor to perform all eligibility and enrollment functions.

Outreach/Short-Term Initiatives:
CHIP contractors will continue to perform outreach for CHIP as required by the Act and by contractual obligations. In addition, the Department and the contractors will continue to support voluntary outreach efforts. Materials such as brochures and applications will be made available as requested. In addition, training materials will be developed and technical assistance provided upon request to encourage consistency of message and procedures. Over the next few months, a proactive and targeted outreach strategy will be developed. We will be consulting with the CHIP Advisory Council, the Departments of Welfare, Education, and Health, with the contractors, and with advocacy groups in developing this strategy.

Examples of other short term efforts include:
* Sending notice about CHIP to families found ineligible for Medicaid.
* Developing an outreach strategy for use in public and private schools.
* Meeting with major child-oriented associations and organizations to share information about CHIP and encourage their participation in outreach (e.g. YMCA, YWCA, religious based organizations, PTA, etc.).
* Establishing mailing lists and the like to facilitate the dissemination of information about CHIP.

Outreach/Long-Term:
All of the activities described as short-term initiatives will continue to be pursued in some form or other over the long term. However, consideration may also be given to granting funds for the purpose of augmenting the efforts of local organizations. Preliminary thinking is that requests for grant proposals would be issued and preference given to organizations which demonstrate strong community collaboration, goal oriented strategies, and that have the highest potential to increase enrollment for underrepresented populations and in
underserved areas (e.g. rural) of the state.

Issue G: Electronic Data Processing System
Current Practice:
There is currently no central electronic data processing system for CHIP. Contractors maintain individual data systems for the purpose of enrollment, billing and service delivery. However, no standards for data collection have been prescribed by the Department except for quarterly and annual reporting requirements regarding enrollment and service patterns. All billing is submitted via monthly paper reports.

Issues for Consideration/Concern:
The new world of expansion and federal funding and oversight demands precision in areas such as expenditure accounting, federal programmatic reporting, budget development and analysis, service patterns, program monitoring, and auditing. We must also have the capacity to analyze such things as enrollment patterns, market strengths and weaknesses, and enrollee demographics to be properly informed about the overall performance of the program and to tell us about the families who are participating in CHIP.

Recommendations:
The Department will be selecting a contractor from the Commonwealth's list of qualified companies to provide consultation on the electronic data system needs of the program. The results of that consultation will be used for the design and development of a system. Generally, we expect that the system design will include the following major features:
* Eligibility determination (including the capacity to connect with the Client Information System maintained by the Department of Public Welfare).
* Budget and financing for purpose of tracking expenditures, completing federal financial reports, performing expenditure projections and the like.
* Electronic billing (billing files will be routinely monitored against recipient files to insure accuracy).
* Provider enrollment files (tracked by specialty and geography to assist in the monitoring of provider networks).
* Service delivery and utilization review (for the purpose of routine measurement of services provided and assessment of quality). This system is critical to the future performance and success of CHIP. All contractors will be required to electronically link to the central data system

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