Connector Board Discusses Wellness, Operating Budgets, and Exchange Planning

This morning, the Connector Board met to discuss four agenda items: Updates on the wellness initiative for Business Express, FY 2011 Administrative Budget and Audits, Voting on FY 2012 Administrative Budget Recommendation, and a vote on an exchange planning grant contract. Materials from the meeting are here.

Small Business Wellness Program

Scott Devonshire and Cathy Hoffman presented an update on the Connector’s small business wellness Initiative, which is required by Chapter 288 of the Acts of 2010. As of June 6th, new businesses signing up for Business Express may register for a Wellness Track.

In order to receive the 5% premium subsidy, employers and employees must complete several requirements:

• Employers: Enroll and meet eligibility, promote employee engagement in Wellness Track and demonstrate efforts to create a healthier work environment.

• Employees: Complete a wellness questionnaire and standard encounter form (signed form from employee’s primary care physician documenting his/her annual physical). In addition, at least 33% of employees in eligible small businesses must participate.

Devonshire and Hoffman displayed the online component, noting the many ways in which employees can become involved in their own health and wellness goals, such as drinking more water and tracking glucose levels. Employers and employees are able to track their progress toward receiving the premium subsidy by visiting the Wellness Bank Page that visually depicts which goals a business has successfully completed, and which have yet to be fulfilled.

Board members were concerned about the confidentiality of questionnaire information, but they were assured questionnaire information would only be analyzed aggregately, and no information could be tracked to individuals. About 4,000 individuals and their family members are currently enrolled in Business Express, with a concentration of businesses with five or less employees. Lastly, board members were concerned about the 5% subsidy excluding business owners and their families, so this issue needs to be explored for further clarification.

Glen Shor, Executive Director of the Connector, concluded by expressing his hopes of the wellness program’s success, and looking forward to learning from its first year in order to effectively improve the issue of workplace health. Celia Wcislo added her hopes that success of this program can hopefully carry over to similar initiatives in the Commonwealth Care population, though subsidies will not be likely.

FY 2011 & FY 2012 Administrative Operating Budget

FY2010 Connector Audit

Dom Divito, the Connector’s Director of Accounting, began by reporting the FY 2010 Health Connector financial audit results, which found no deficiencies in internal control over financial reporting, and no instance of noncompliance. In addition, FY 2010 brought in a net income of $5 million.

Ed DeAngelo, the Connector’s General Counsel, reported the results of the FY 2010 Health Connector state audit, conducted to determine the adequacy of internal controls. The final report concluded that with one exception, the Connector implemented adequate oversight and internal controls. DeAngelo and Shor assured that Connector fully complied with policy, yet failed to provide written documentation on their compliance with certain aspects of their procurement policy. In response, the Connector has developed new practices to ensure full documentation of all procurements.

FY2011 Connector Administrative Operating Budget

Kari Miller, Connector Senior Financial Analyst, presented the year end update of FY 2011 Health Connector Administrative Operating Budget.

Important updates include:

• The revised year-end expense estimate: $29.1 million ($32.6 million estimate in June 2010)

o Commonwealth Care: 5% reduction in member months, due to the delay in transition of folks from the Medical Security Program (MSP) due to extended unemployment insurance. Likely, the Connector will see an increase of MSP members transitioning to CommCare in FY 2012.

o Commonwealth Choice: 28% fewer members than budgeted, most of which is due to the cancellation of phase 2 transfers from the Small Business Service Bureau (“Alliance”).

o Commonwealth Care Bridge/AWSS: 44% fewer members; budget conservatively, assuming no attrition (there has been significant attrition in the Bridge program due to AWSS folks attaining a different status and transferring to other programs, for example).

FY 2012 Connector Administrative Operating Budget Recommendation

• FY 2012 Budget: $33.3 million (14% increase from FY 2011 year end estimate)
o Expected Spending Increases
• Renewal of contract with Dell for customer service and billing
• 10% anticipated in CommCare membership, due to increased enrollment and eligibility (transition from MSP, natural growth, and possible AWSS reintegration)
• 5% increase in CommChoice membership
• National health reform implementation
o Revenue challenges
• CommCare revenue is level-funded
• New open enrollment rules for the non-group market (7/1-8/15)
o Revenue opportunities
• Federal grants
• Student Health Plan procurement
• Medical Security Program procurement

Additionally (not included in recommended budget), the Health Connector will contribute $2.5 million for the small business wellness program, and set aside about $2 million to fund infrastructure changes needed for the possible reintegration of legal immigrants back into Commonwealth Care. The latter estimate is based on staff time and IT investments. These will be funded from the Connector’s reserves.
The Board voted to approve the recommended FY2012 Administrative Operating budget.

Exchange Transition Planning

Lastly, Kaitlyn Kenney, the Connector’s Director of Policy and Research and National Health Care Reform Coordinator, presented updates on the $1 million exchange planning grant awarded from the Center for Consumer Information and Insurance Oversight (CCIIO). To advance the exchange planning process, the Connector established six workgroups and developed a Request for Proposals (RFP) in March seeking assistance with exchange transition planning. Since then, consulting teams have presented their plans for implementing national health reform in Massachusetts, a unique state because of its existing exchange.
The Procurement Management Team evaluated teams based on several criteria, and decided the best proposal was given by Mannatt Health Solutions/Mercer. Kenney stressed that though Mannatt/Mercer was not the lowest priced bidder, due to the quality of their presentation, the experience of the team, and the familiarity with Massachusetts state health policy and MassHealth actuarial practices, the Procurement Management Team decided Mannatt/Mercer would provide the most cost-effective, quality, scope of services for the Health Connector. The Board voted to approve the contract of $545,000, which will require Mannatt/Mercer to work under a tight schedule, and have until September 30, 2011 to meet their deliverables.

The next Connector Board meeting is scheduled for July 14th from 9:00-11:00am at One Ashburton Place, 21st floor.

-Amelia Russo, Health Policy Intern

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