BACKGROUNDER: Charter Oak Health Plan

The state has taken numerous steps over the last several years to help more residents obtain affordable health insurance. Starting August 1, the Charter Oak Health Plan will be one such step, offering managed health care to uninsured residents regardless of their health status.

ENABLING LAW

PA 07-2, June Special Session, established the Charter Oak Health Plan for residents who have been uninsured for at least six months. It authorized the Department of Social Services (DSS) to procure the insurance through contracts with managed care organizations or other health care provider consortia. DSS was directed to determine the program's scope of benefits, and could not impose a pre-existing condition exclusion. The law also addressed cost sharing, allowing Charter Oak plans to impose the following:

1. monthly premiums;

2. a maximum $1,000 annual deductible;

3. coinsurance of no more than 20% once the deductible is met;

4. tiered co-payments for prescription drugs;

5. no fees for valid emergency room visits, with a maximum $150 fee for non-emergencies;

6. annual benefit limit of $100,000 and

7. a lifetime benefit of up to $1 million.

DSS issued a request for proposals to health insurers in fall 2007. At that time it decided to combine Charter Oak with the HUSKY program so that a winning bidder could spread the risk among HUSKY and Charter Oak members. A community health center consortia and two other managed care organizations bid on the joint program—CHNCT, Aetna Better Living, and AmeriChoice (United Health Care's parent company), respectively.

Agreements were reached between all three plans and DSS in June 2008. DSS has set up a dedicated website (www.charteroakhealthplan.com) that provides general program information as well as “Quick Start” applications. Predeterminations of eligibility are made based on these applications, and letters seeking additional information, if needed, are sent before making final determinations, which includes the mailing of an enrollment form for choosing a plan. The plans will begin serving Charter Oak members on August 1.

Table 1 lists Charter Oak's benefits; limits on them, if any; and co-payment requirements. Dental, vision, and chiropractic services are not covered.

*Benefit*	*Scope of Coverage and Co-Pay*
Primary care office visit	$25 co-pay
Specialist office visit	$35 co-pay
Preventive care office visit	100% coverage
Emergency room visit	$100 co-pay (waived if emergency)
Prescription drugs	Tiered co-pays: $10 for generics, $35 for brand name drugs on formulary, full cost or $35 with medical exception for non-preferred drugs
Durable medical equipment	$4,000 annual limit with prior authorization (PA), no co-payment (limit excludes diabetic and ostomy supplies)
Behavioral health services (provided through Behavioral Health Partnership) ^[1]	Outpatient: $35 co-pay for outpatient visits, substance abuse visits limited to 30 per year; PA required for both. Inpatient: admissions require PA, with limits on drug and alcohol stays; 10% co-pay after deductible met
Outpatient rehabilitation	$35 co-pay, 30 visits per year
Maternity—pre- and post-natal care	100% covered
Inpatient rehabilitation/skilled nursing	80% covered after deductible met, 14-day limit per year
Inpatient hospital stays	90% covered after deductible met
Outpatient surgical	80% covered after deductible met

Charter Oak members pay monthly premiums to the MCOs and must meet deductibles. For the nonsubsidized plans, the actual premiums will be: CHN: $256.71, AmeriChoice: $250.89, Aetna Better Health, $259.36. These are reduced for members with incomes below 300% of the federal poverty level. The deductibles must be met before the program begins paying for inpatient hospital, outpatient surgical, and inpatient rehabilitation and skilled nursing care. Table 2 illustrates both.


*Family Size/Income in 2008*						*Monthly Premium, per member* *Annual Deductible (individual/family)*
1	2	3	4	5	6
under 15,600	under 21,000	under 26,400	Under $31,800	Under $37,200	Under $42,600	$75	$150/$300
$15,600 to $19,240	21,000 to 25,900	26,400 to 32,600	31,800 to 39,320	37,200 to 45,900	42,600 to 52,500	100	200/350
19,240 to 24,400	25,900 to 32,900	32,600 to 41,400	39,200 to 49,400	45,900 to 58,300	52,500 to 66,700	175	400/600
24,400 to 31,200	32,900 to 42,000	41,400 to 52,800	49,800 to 63,600	58,300 to 74,400	66,700 to $85,200	200	750/1,400
Over 31,200	Over 42,000	Over 52,800	Over 63,600	Over 74,400	Over 85,200	$259 maximum	900/1,750


July 24, 2008		2008-R-0403
BACKGROUNDER: CHARTER OAK HEALTH PLAN
By: Robin Cohen, Principal Analyst