Written by, Third Horizon Strategies
April 14, 2021
On July 7, 2020, Illinois Governor J.B. Pritzker signed SB 1864, requiring that a working group comprised of personnel from the departments of Healthcare and Family Services (HFS) and Insurance (DOI) conduct a feasibility study regarding policy options to make health insurance more affordable for low- and middle-income Illinoisans. The study had three major goals: improve health care affordability, reduce the number of uninsured residents, and improve health equity.
On April 1, the working group published its feasibility report, highlighting six policy areas that Illinois could adopt and noting that the six areas could be combined in various ways to better achieve the three goals of the study. A brief overview of each option is provided below.
1. Basic Health Program
o Authorized by the ACA
o Replaces coverage for individuals who qualify for tax credit (up to 200 percent of FPL)
o Federal government gives states 95 percent of what it would have paid in tax credits
o Two states have implemented the program: Minnesota and New York
2. State Premium and Cost-sharing Subsidies
o Federal government provides tax credits and cost-sharing options
o States can complement federal assistance by providing their own subsidies
o Five states have committed their own money: California, Colorado, Massachusetts, New Jersey, and Vermont
3. Public Option Plan
o State-run health plan that would compete with other private health plans on the market
o The plan could potentially lower administrative costs and lower provider prices
o Only one state – Washington – has implemented a public option, but several other states are discussing legislation to do the same
4. Medicaid Buy-in
o A Medicaid-like coverage option would be made available to people who are traditionally not eligible for the program
o The buy-in could reduce costs by leveraging existing state Medicaid infrastructure and lower provider reimbursement rates
o Target population could be narrow (up to 400 percent of FPL) or broader (all non-Medicaid eligible)
o Several states are considering this concept, but no state has officially adopted the buy-in
5. Transitioning to a State-based Marketplace
o Illinois would take ownership of the health insurance marketplace from the federal government
o The state would run eligibility and enrollment, consumer outreach and assistance, and plan management functions
o The working group added that some of the above options would work better, or require, that Illinois move to a state-based marketplace for maximum efficacy
6. State-supported Marketing and Outreach
o Illinois could increase marketing and outreach efforts to individuals eligible for health insurance under the Marketplace or Medicaid.
Third Horizon Strategies is a Chicago-based, boutique advisory firm focused on shaping a future system that actualizes a sustainable culture of health nationwide. The firm offers a 360 degree view of complex challenges across three horizons – past, present, and future– to help industry leaders and policymakers interpret signals and trends; design integrated systems; and enact changes so that all communities, families, and individuals can thrive. www.ThirdHorizonStrategies.com