A state program aimed at moving Medicaid recipients off the state’s dime and onto employer-sponsored health plans has been expanding sharply, recent enrollment figures show.
Enrollment in the state’s RIte Share program bloomed to 4,270 as of June 30, the last day of the state’s 2003 fiscal year, according to the state Department of Human Services, which runs the program. That’s up from about 1,600 enrollees at the end of the previous year.
The state saved about $1.3 million in Medicaid expenditures by moving those people onto employer-sponsored health plans, according to the human services department.
The Legislature created the program in 2001 in an effort to slow growth in the RIte Care program, the state’s health plan for low-income families. Lawmakers expressed concerns that some workers were opting to remain on the state-funded health plan even if they could get health coverage at work, to avoid paying premiums.
Under RIte Share, the state pays an eligible employee’s share of premiums under his or her company’s health plan. Typically, that subsidy amounts to about half of what it would have cost the state to cover that worker under RIte Care.
The program, however, initially got a cool response from the business community.
Even though businesses already might have been offering their workers health coverage, they weren’t paying anything for those employees who opted to stay in RIte Care – the state was picking up the whole tab. Now, thousands of workers have been shifted back onto company health plans.
One of those businesses is Greylawn Foods Inc., a food distributor in Cranston. Sidney I. Goldman, the company’s president, said the business consistently has had one or two of its 42 employees in RIte Share since the program began.
Greylawn contributes 80 percent of premiums for individual plans, and the employee contributes 20 percent. If an individual plan costs $3,200, for example, the state pays $640 toward the employee’s share, and Greylawn pays the rest.
Goldman initially had feared a big financial hit from the program. But he said absorbing the cost of a few new RIte Share-eligible workers has been manageable.
“I don’t have a problem with RIte Share; I think everyone should have health coverage,” said Goldman.
With RIte Share’s current enrollment of nearly 4,500, the program has reached nearly two-thirds of the roughly 7,000 people who are eligible – workers who have low enough incomes to qualify for RIte Care, but who also have access to a health plan at work.
The program, however, has fallen short of DHS targets. The department had a goal of 6,000 RIte Share enrollees by the end of fiscal year 2003, with annual savings to the state of as much as $6 million.
“We’re getting there,” said Ron Lebel, acting director of DHS. “We’re pleased with the success so far, and we’ve ironed out the initial growing pains in terms of the processes and getting information from employers about their health plans.”
Still, the RIte Share program – which has the express purpose of taking pressure off the RIte Care system – is only a drop in the bucket compared with the overall cost of RIte Care.
Spending on RIte Care has jumped from $200 million in fiscal 2002 to a budgeted $243.7 million for fiscal 2004. Those expenditures are split roughly evenly between state and federal Medicaid funding, with a slight majority coming from federal sources.
Enrollment in RIte Care has swelled from fewer than 80,000 in 1998 to the present 119,000. The program has been credited with Rhode Island’s 7.2 percent rate of uninsured residents, which is the lowest in the country.
While Goldman said the effect of RIte Share has been minimal on his business, he’s far more concerned over his company’s 15 to 20 percent annual premium increases. He said future premium hikes likely would be passed on to employees in the form of higher co-payments or premium contributions – a sentiment echoed by many business owners.
As businesses shift costs to employees, Lebel acknowledged that RIte Share’s
effectiveness as a money saver for the state is eroded, since the program will
end up bearing the brunt of those higher employee contributions.
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