14M Newly Insured Will Hit the Market Next Year: How to Start Preparing

About 14 million Americans will gain insurance from Medicaid expansion and the insurance exchanges by next year — and that number is expected to grow to 34 million by 2017, according to Truven Health Analytics. The influx of new patients will mean big changes for hospitals across the nation.

 

In an Aug. 29 webinar titled "What to Expect from the Newly Insured," sponsored by Truven Health Analytics, Bob Kelley, senior vice president of the Center for Healthcare Analytics at Truven Health, and Linda MacCracken, vice president of advisory services for Truven Health, shared insight on the large population of Americans gaining insurance in the next four years and how provider organizations can prepare for the flood of newly insured patients.

Population profiles

The population of people who will be newly eligible for Medicaid and the population on the insurance exchanges will vary by local market based on a myriad of factors, such as local payer and provider access and demographics. However, one looms larger than the others: "The biggest impact on the shift of the uninsured into either Medicaid or into the exchanges is the decision by each of the states to expand Medicaid eligibility," Mr. Kelley said. In states that do not expand Medicaid, the newly eligible will seek insurance on the exchanges, and vice versa in states that are expanding Medicaid. Mr. Kelley used Texas as an example of a state where many potentially Medicaid-eligible will turn to the exchanges for coverage.

On a more micro level, Mr. Kelley and Ms. MacCracken urged provider organizations to think local to avoid the risk of over-preparing for the wrong demand or not being prepared with sufficient capacity in the right care settings. "These impacts are going to be local," Mr. Kelley said.

Medicaid eligible patient characteristics. Compared to current Medicaid enrollees, people who are newly eligible for Medicaid are more likely to be employed but were unable to afford insurance. According to Mr. Kelley, this likely indicates a "pent-up demand" for healthcare services.

Newly exchange eligible patient characteristics. Relative to the existing commercially insured population, the exchange eligible will have more major health issues because they are more likely to have been uninsured for more than three years due to cost concerns,  Kelley says. This suggests that the newly insured on health exchange "are in significant need of services."

Areas to prepare: Emergency department and primary care

Keeping unnecessary emergency department visits in check has major cost-saving potential, according to Ms. MacCracken: Since national figures show 65 percent of ED visits are urgent, redirecting 20 percent of ED visits to a lower-cost care site has a national savings potential of $4 billion.

However, the newly insured will present a problem to hospitals and health systems trying to keep their ED visits down, given a tendency to be higher ED users. "The challenge of the newly insured is that there is a greater familiarity of using the emergency department, and certainly Medicaid patients have a higher utilization rate of emergency departments. Ensuring capacity, given increased demand, is critical to managing costs and effective coordinated care," Ms. MacCracken said.

She presented the following suggestions for how hospitals and health systems can manage their ED capacity, primary care and the newly insured:

•    Forecast the demand of the newly insured. Include the impact of the aging baby boomers as they become higher service users once covered by Medicare
•    Be prepared for retail patient engagement. Offer direct communication to targeted newly insured that offers self-serve care management and redirected primary care based on the demand.  
•    Develop capacity among new sites of care while creating early use pilots. One way to do so is redirecting ED frequent fliers or super-users to community health centers.
•    Prepare specialized retail care centers in the face of demand forecasts. Ms. MacCracken recommended expanded urgent care and on-demand services for each age group, including children or seniors.
•    Prompt chronic care patients to manage their care. That way, they are less likely to become lapsed patients.

Overall, Mr. Kelley and Ms. MacCracken urged providers to prepare demand forecasts for their local market that integrate the local practice patterns, the likely newly insured, and the aging baby boomers. Since demand is still a function of coverage, it's best to be prepared.

Download the presentation.

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