October 22, 2009: Preliminary SHARE findings show the importance of keeping premium assistance programs affordable for consumers and minimizing the administrative burden of these plans on employers. A number of states have implemented premium assistance programs in efforts to reduce their rates of uninsurance. Through these programs, low-income individuals (and sometimes small employers) are given financial assistance to help pay private insurance premiums. Most of the time, premium assistance programs are partially funded through waivers authorizing the redirection of Medicaid and/or Social Security Funds. The appeal of these programs is that they encourage participation in private coverage, thereby bolstering rates of private coverage, reducing crowd?out, and leveraging employer contributions.
Although premium assistance programs are meant to encourage an individual to move from public to private insurance, little data exists regarding their actual cost-effectiveness and their efficacy in meeting the insurance and health care needs of participants. As states move forward with health reform efforts, premium assistance programs will likely undergo more scrutiny regarding their processes and outcomes.
In an effort to build the evidence base about premium assistance programs, the following SHARE studies are evaluating these programs in several states. To read more about these studies, click on the project titles below.
How affordable are state coverage plans?
Investigator: Elizabeth Kilbreth, Ph.D.
Preliminary Finding: Data from three states with cost-sharing provisions for public insurance suggest a strong correlation between low premium costs and enrollment in public programs: Take-up rates are highest among individuals in the lowest income tiers-where premiums are most heavily-subsidized-and lowest among groups where subsidies are minimal.
Evaluating small group employer participation in New Mexico's SCI program
Investigator: Anna S. Sommers, Ph.D
Preliminary Finding: Anna and her team have found that there is a significant tradeoff between accessing federal money for three-share programs through Medicaid/CHIP funds and requiring employers to meet the processing and paperwork requirements that accompany these funds: The significant administrative burden that results can deter employers from participating.
Findings from both these projects are featured in SHARE's recently-released issue brief, "State of Reform." Click here to view the brief.