Costs of Enrollment and Estimated
Savings Related to Simplification
New York Academy of Medicine
Gerry Fairbrother, Ph.D
Kerry-Ann Newell, M.S.
Children’s Defense Fund
Melinda Dutton, J.D
Rachel Cooper, M.A.
Manatt, Phelps & Phillips, LLP
Deborah Bachrach, J.D.
Patricia Boozang, M.P.H.
Academy Health 2004 Annual Research Meeting
June 8, 2004
Funded by the Foundation for Child Development
Background
• Fiscal constraints are driving states to cut
Medicaid budgets
• Administrative hurdles are also being reintroduced or made more onerous in order to
“reduce the rolls”
• Administrative complexity drives up costs in
states’ Medicaid programs
Study Overview
• The study assessed administrative costs to
enroll NYC children in Medicaid and SCHIP by:
– Estimating costs related to the “typical” enrollment
process
– Estimating cost savings realized through a
dramatically streamlined process modeled on the
post-9/11 Disaster Relief Medicaid (DRM) program
Methods
• Develop a detailed description of the typical
enrollment process
• Assess overall time and costs related to the
typical process
• Determine whether reductions in time and cost
were occurring in the DRM process
• Estimate cost savings by comparing the typical
costs to the DRM costs
Data
• Three of 16 MCOs enrolling in Medicaid and
SCHIP in Greater New York City:
– Provided 2001 enrollment and cost data
– Participated in interviews regarding the enrollment
process
– Complete detailed questionnaires regarding time
allocated to the typical process and time saved on
enrollment in the DRM process
Typical Enrollment Process
Outreach/Health Insurance
Education
•
•
•
•
Recruit Families
Answer Questions
Explain importance of health insurance
Educate families about how to use
health care
Application Completion/
Documentation
•
•
•
•
Help families choose a provider
Help families fill out application
Calculate likely eligibility
Identify and gather documents
Quality Assurance
•
Check applications for completeness
and accuracy
Application submission/
troubleshooting
•
•
•
Track application submissions
Troubleshoot problems
Follow-up with agencies and families
How Enrollers Spend Their Time
The Typical Enrollment Process
Other Enrollm ent
Activities
19%
Outreach/ Health
Insurance Education
18%
Eligibility Screening
16%
Application Process
27%
Gathering Docum ents
20%
Source: Authors’ analysis
DRM Enrollment Process
Outreach/Education
•
•
•
•
Recruit Families
Answer Questions
Explain about how DRM works
Educate families about how to use
health care
Application Completion/
Documentation
•
•
Help families fill out application
Calculate likely eligibility
Time Enrollers Saved
The DRM Enrollment Process
Outreach/ Health
Insurance
Education 18%
Other Enrollment
Activities 19%
Eligibility
Screening 16%
10%
10%
Application
Process 27%
11%
Gathering
Documents 20%
Source: Authors’ analysis
Time
Saved
Costs Allocated
Functional Enrollment
Categories
$350
$300
$282
Application Submission
and Troubleshooting
$25
$250
$26
Quality Assurance
$200
$59
$166
$11
$150
$8
Outreach/ Health Insurance
Education
$56
$100
Application Completion
and Documentation
$172
$50
$91
$0
Typical
Enrollment Costs
Source: Authors’ analysis
Costs with
Simplification
Limitations
• Findings are from three managed care
organizations in one state
• Costs do not include:
–
–
–
–
Medicaid costs to enroll
State-level administration costs
Advertising
MCO overhead (e.g. CEO salary)
Conclusions
• Enrollment in NYS Medicaid and SCHIP
programs costs roughly $282 per enrollment
• This cost could be reduced by 40% to $166 if a
dramatically simplified process modeled on DRM
were implemented
• Administrative costs related to enrollment are a
misallocation of scarce resources