LINCOLN — Federal officials have approved changes that will allow Nebraska to continue a program in which Medicaid helps pay private health insurance premiums for some people.
The Health Insurance Premium Program provides health coverage for about 230 Nebraskans, including several disabled children of working parents.
Thomas “Rocky” Thompson, interim Medicaid director in the State Department of Health and Human Services, called the program a “fiscally responsible and pragmatic approach to providing needed benefits.”
It was created in 1994 as a cost-saving alternative to Medicaid. It kicks in when it is less expensive for the state to pay insurance premiums, deductibles and co-payments than to pay for a person’s care through regular Medicaid.
Participants undergo regular reviews to ensure that the program remains cost-effective.
But the program’s future was jeopardized when the state switched to a new version of Medicaid managed care, called Heritage Health, in January.
The switch affected the cost-effectiveness calculations, potentially forcing most participants into regular Medicaid.
State Medicaid officials responded by making changes in the methodology they use to compare costs. The Center for Medicare and Medicaid Services approved the changes in late July.
The next step will be to amend state rules and regulations for the program, according to HHS.
The cost-effectiveness reviews were instituted after a 2013 state audit found that HHS failed to adequately check and document whether the program’s participants were eligible.
More than half of the participants were removed from the program later that year, after the first round of reviews found that HIPP was not cost-effective for them.
Medicaid is a state-federal program that provides health coverage for low-income Nebraska children, parents, elderly and disabled people.
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