Muskegon Plan Gets Governors Eye
The key to the viability of Access Health, which provides affordable health benefits to more than 1,100 people at 420 small businesses in Muskegon County, is a business model that ties the benefit package to specific coverage needs of the community, as identified through comprehensive market research.
In her proposal to expand the use of so-called three-tier health plans — so named because of their use of Medicaid funding, plus low-cost monthly premiums paid by employees and employers — Granholm wants “to borrow the best practices” of the pioneering Access Health model and use that as the basis for other counties to fashion their own health plan under what’s been dubbed the Michigan Third Share Partnership.
“What we’d like to do is work with each community on a case-by-case basis,” Granholm said during a visit last week to the Wee Care Child Development Center in Norton Shores that uses Access Health to provide employee health benefits that are otherwise unaffordable.
“Each community has to do this in a way that most benefits them. Each community is different, and so what works in one community might not work in another,” she said. “We have to develop a niche in the same way Muskegon has developed a niche.”
Access Health, an offshoot of the grassroots Muskegon Community Health Project, offers small businesses an affordable option for employee health benefits and a bridge they can use until they are able to afford a commercial health policy. Designed for start-up small businesses and employers that have never been able to afford employee health benefits, Access Health’s coverage includes primary care, hospitalization and generic prescription medications for a premium of only $46 per month paid by both the employee and employer. Medicaid pays $56 per month per enrollee.
Access Health has been able to keep monthly costs of the health plan to about $150 per enrollee, including administration costs, by tightly controlling the benefit package to what is needed.
That process is “probably the most critical angle” to the success of Access Health, said Vondie Woodbury, director of the Muskegon Community Health Project. Communities seeking to replicate the model must “go the extra mile,” conduct the market research, and tailor a benefit package based purely on local needs, Woodbury said.
“We offer Muskegon’s benefit plan,” said Woodbury, who has received numerous inquiries from around the country from community groups seeking to formulate their own three-share health plan. Access Health received national attention late last month in a front-page article in the Wall Street Journal about grassroots efforts to address the rising number of uninsured people, now estimated at some 46 million, by creating locally-based health plans tailored to individual communities.
“If it’s going to be successful you have to know who’s out there, what they need, what they’re willing to pay, and what is going to make them purchase it,” Woodbury said. “This truly was inclusive decision-making and community ownership of this product.”
While promising, Access Health and three-share models do have their drawbacks. Most notable is that Access Health coverage is only good in Muskegon County and with local hospitals, physicians and pharmacies. The same goes for the nine other three-share health plans operating across Michigan, including Kent Health Plan in Kent County. Another 20 plans are under development in counties across the state.
The three-share model is also not a long-term fix for what ails the health-care system in America, including a growing uninsured population that’s placing a larger financial burden on hospitals and care providers.
But, said Lody Zwarensteyn of the Alliance for Health, a Grand Rapids health care planning agency, “it is something” that’s helping. Three-share health plans, Zwarensteyn said, are tantamount to the proverbial finger in the dike — albeit a much-needed finger.
“The problems of health care are huge. Given the short-term realities, you have to put your finger in the dike wherever you can. You have to do everything you can in the short term to meet the realities we’re facing these days, ” Zwarensteyn said. “It’s not a long-term fix but it sure is giving people something they deserve, which is care.”
Granholm used last week’s Muskegon visit, on the morning after her State of the State address, to tout Access Health and how it has helped small businesses. She wants to expand the use of three-share health plans in Michigan by offering tax credits to small businesses to cover the state’s one-third share. Undetermined and up for discussion is how to apply the same financial benefits from tax credits to tax-exempt nonprofit organizations that are most apt to use low-cost, three-share health plans.
Granholm, who unveiled the Third Share Partnership in her Jan. 27 address to the Legislature, hopes communities will use the Access Health model to formulate their own three-share health plans as a way to begin extending benefits to the estimated 1.5 million state residents that are without health coverage.
“It gives access to health care to a whole array of people who don’t currently have access,” she said.
Contrary to public perception, some 70 percent of the people who lack health coverage are employed. They don’t have health benefits because they are typically low-wage earners working in service-sector jobs, and neither they nor their employer can afford health premiums in today’s era of skyrocketing health-care costs, yet they earn too much to qualify for Medicaid. The lack of any health coverage forces them to pay sticker price when they visit a doctor or go to a hospital for a medical problem.
The number of uninsured people in Michigan is unacceptable, Granholm said. Using the Access Health model attacks the problem from an economic development perspective that fits with her agenda to create jobs, support business and improve the accessibility and affordability of health care.
“You cannot grow jobs if you do not have the ability to provide benefits in a reasonable way,” Granholm said. “The example in this day care center is very important.”
At the Wee Care Child Development Center in Norton Shores, coverage through Access Health has made a difference by creating a stable work force. Since becoming the first employer in Muskegon County to enroll in the health plan when it was formed in 1999, the pre-school and day care center has seen absenteeism drop sharply and the annual employee turnover rate fall from 40 percent five years ago to zero in 2003 because it provides health benefits.
Five of the center’s 15 employees are enrolled in Access Health. Those not enrolled have benefits available through a spouse.
Access Health allows Wee Care to provide health benefits that otherwise are unaffordable and lets Executive Director Carla Morat-Hill maintain her focus on running the business, rather than spending an inordinate amount of time recruiting new employees. Just as important, Morat-Hill said, is the peace of mind she receives through the ability to offer affordable health benefits to employees.
“It was very difficult to know my staff couldn’t afford to get sick or was coming to work sick,” Morat-Hill said.
With the escalating costs of health care a top concern for businesses, and rising to the top of the political agenda in Lansing, the time appears ripe for Granholm’s initiative to receive a large push.