The changing face of Medicaid in 2014

By Joanne Finnegan

With many states reshaping their Medicaid programs under the Affordable Care Act, new challenges and opportunities for private health insurers have emerged. Medicaid changes will continue to play out in 2014, with some of the trends highlighted by LifeHealthPro.

1. Expect to see more integration between state Medicaid programs and the private insurance market.

While the U.S. Supreme Court decision in 2012 made Medicaid adult expansion optional, half of the country's states are expanding Medicaid and the remaining states will likely go in the same direction. While there's debate about how best to do that, some states have reshaped their Medicaid programs by incorporating private insurance principles, including premiums, cost sharing and incentives for healthy behavior, LifeHealthPro reported. Arkansas, Iowa and Michigan all received federal approval to use a private option to expand Medicaid.

2. Look for faster convergence of commercial and government-sponsored insurance markets.

This will play out in three main areas: decline of insurer market segmentation, operational infrastructure and multipayer purchasing, LifeHealthPro noted. New revenue opportunities will send commercial insurers into the Medicaid market in greater numbers. The market offers a huge potential for insurer growth, according to Mark Farrah Associates, evidenced by Aetna's buyout of Coventry and WellPoint's acquisition of Amerigroup.

3. Be prepared to offer coverage stability for individuals who may move in and out of Medicaid eligibility as their financial situation changes.

So-called churning, where people move between Medicaid and marketplace health plans, will be a major challenge in every state as implementation of the ACA continues, as previously reported by FierceHealthPayer. States will explore a number of options to prevent insurance gaps resulting from churning that could affect health plans.

For instance, some states might require Medicaid and marketplace plans to allow people to complete a course of treatment, according to LifeHealthPro. So plans might have to fill prescriptions or continue with treatment during a transitional period.

To learn more:
- read the  LifeHealthPro article

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