Copyright © 2014 Albuquerque Journal

Customer advocates Tanya Sena, foreground, Maggie Tiberi and Rachel Esquibel assist Blue Cross Blue Shield members with their claims. (Courtesy of BCBSNM)

New Mexico, a state where 20 to 25 percent of its residents are without health coverage, would appear to be the perfect market for low-cost, federally subsidized, easily purchased health insurance of the type promised by the federal Affordable Care Act.

Yet, after the insurance exchanges’ open enrollment period ended March 31, only about 32,000 individuals had purchased insurance on the federal exchange, and only about 540 employees and their dependents from fewer than 150 companies had purchased insurance through the state exchange. The insurance companies that cover them don’t know if these customers are newly insured or are just changing plans.

It’s hard to sell health insurance in any case, but efforts to enroll New Mexicans began much later than insurance-exchange officials planned. Once started, some marketing efforts appeared to be ineffective.

Funds available for marketing went unspent, partly because of the marketing effort’s late start and partly because it wasn’t clear what the best use of the funds would be.

DAMRON: Exchange faced time crunch

New Mexico Health Insurance Exchange Board Chairman J.R. Damron said the board didn’t have time before enrollment began to do the market research necessary to guide marketing efforts.

“We had enough money, but we didn’t have time to do the surveys and the proactive stuff that states like California and New York could,” he said. “They’ve been working on this for three years. We had five months.”

The New Mexico Primary Care Association had a contract with the New Mexico Health Insurance Exchange to help enroll customers in insurance plans.

Few signed up

Executive Director David Roddy said that by the end of March, a promotional event sponsored by KOAT Television turned up 11,000 people who asked for appointments to enroll in an insurance program. PCA was able to contact 7,700 of them. Fewer than 600 actually bought insurance.

“The No. 1 reason people didn’t sign up was price,” he said. “The No. 2 reason was bad media.”

The news was full of problems with the federal exchange website, and it took months to launch media campaigns to counteract that news, Roddy said.

Insurance is complicated and hard to explain, and people who have done well without it don’t necessarily believe they need it. People are more likely to buy insurance when they’re dealing with health problems.

“What you need to do is convince the people that, first, you have to have insurance,” Roddy said. “It’s required. No. 2, if you are low or middle income, you’re likely to get some (financial) help with that. No. 3, it is critical to have insurance for physical health and financial health.”

“There is a culture of un-insurance out there,” said Dick Mason, vice president of the League of Women Voters of New Mexico and the league’s expert on health-insurance exchanges. “People have gone generations without health insurance. The concept is just not there for them.”

There is some disagreement about what marketing approach would work.

Advocates like Mason say the exchange needs to hire more people, known as guides or navigators, to personally call on targeted customers. People from the community know who needs insurance and understand what potential customers’ concerns are, he said.

Roddy said the Primary Care Association has been in the business of enrolling Medicaid members for 10 years and has found many outreach efforts don’t work.

Outreach failures

An insurance exchange-sponsored pizza party at the University of New Mexico aimed at students produced no enrollment, he said. Six health care guides spent hours at a computer lab during another UNM event, saw 10 people and got two to enroll.

“You can go door to door, you can do community outreach, but this is not like voter registration,” he said.

Yet, it was precisely that approach that Mason and other advocates say was responsible for some success in enrolling American Indian customers.

Roxane Spruce Bly, director of health-care education and outreach at Native American Professional Parent Resources, said outreach efforts aimed at Native Americans reached 22,000 people, of whom 566 bought health insurance.

That’s a small number until you consider they have very little incentive to buy insurance at all. Native Americans are exempt from ACA provisions that tax people who don’t have coverage this year, and they are eligible for free care through the Indian Health Service.

The state exchange funded outreach efforts that were based in native communities. Pueblo governors and other officials in some communities went door to door to encourage enrollment. Marketing materials were custom designed for Native American customers.

“We found people where they were at,” Spruce Bly said. “We thought about where people work, play, shop, hang out. That’s where we did the outreach.”

Guides rode city buses to meet urban American Indians. They recruited people in laundromats.

“We learned early on people weren’t going to go somewhere to get information,” she said.

Fewer uninsured now

Despite the marketing challenges, the Affordable Care Act did put a meaningful dent in the state’s uninsured population. One provision of the law allows states to extend Medicaid benefits to any able-bodied adult younger than 65 years who earns no more than 138 percent of the federal poverty level, which is $15,856 a year for a single-person household. New Mexico’s Medicaid program before the expansion covered almost exclusively low-income children, people older than 65 and disabled people.

An estimated 220,000 New Mexicans are eligible for expanded Medicaid benefits, and 121,000 of them signed up for the newly available coverage. Many of them found their way to Medicaid by visiting the insurance exchanges online, by talking with guides, or at enrollment events designed to encourage use of the exchange.

Uncle Sam will pay the entire tab for these newly insured through 2016, then taper payments down until the federal government pays 90 percent of the cost after 2020.

MOLINA: President of Molina Healthcare

“If the goal was to get people insured, we did that,” said Mario Molina, president of Long Beach, Calif.-based Molina Healthcare, which offers Medicaid managed-care products and insurance on the exchange in New Mexico.

The wonder is that the New Mexico exchange worked at all. The state Legislature voted to start the exchange in 2011, but Gov. Susana Martinez, who unlike many Republican governors agreed to Medicaid expansion, vetoed that bill. Martinez said the legislation was premature because the state had until 2013 to prepare; federal rules governing exchanges weren’t completed; and there wasn’t enough consideration of the costs.

The law establishing the exchange finally went into effect in early 2013. The board didn’t have its first meeting until May of last year, giving it five months to bring an online insurance marketplace into existence by the federal Oct. 1 deadline.

A very late start

The board realized early on that it could not get both an individual exchange and an exchange where small businesses could buy coverage for employees running at the same time. The New Mexico exchange focused on the business piece, called a SHOP exchange, and plans to launch a state-run exchange for individuals this fall.

That left individual New Mexicans to buy insurance on the notoriously flawed federal exchange, which was barely functional in December, two months after the first ACA open-enrollment period began.

“Given that the board had less than a year to implement this, I think they’ve done an amazing job,” Mason said.

Damron said the exchange board originally expected to enroll 80,000 people in the first year of operation.

“We really didn’t get started in marketing and public relations until mid- to late December,” in part because it didn’t seem wise to push enrollment on a federal website that didn’t work, he said. “Nobody wants to talk about health insurance that time of year, so we downgraded our expectations to 40,000.”

Roddy said 90,000 New Mexicans who were eligible to use the exchange went online and registered, a step the federal exchange required before allowing a customer to buy insurance. Of those, 26,000 did not purchase insurance and about 30,000 were found to be eligible for Medicaid.

How the plans did

Presbyterian Health Plan ended up enrolling about 6,600 individuals through the insurance exchange. New Mexico Health Connections enrolled about 10,000 members, about 8,000 of whom used the exchange to enroll.

Blue Cross Blue Shield of New Mexico enrolled about 15,000 through the exchange. Molina Healthcare declined to disclose how many members it enrolled on the exchange.

The plans don’t know much about their new enrollees yet.

LUJAN: President of Presbyterian Health Plan

Presbyterian Health Plan President Lisa Lujan said early numbers suggest members enrolled as a result of the ACA seem to need more care than other members. They have more primary- care visits and more hospitalizations for medical conditions.

“We are also seeing higher emergency department use in the members enrolling under ACA plans, which is consistent with national trends,” she said. Presbyterian is seeing “earlier-than-anticipated utilization” of behavioral health and maternity coverage, “including a significant number of births in the first quarter.”

Other ACA members seem to be demanding “several high-cost medical services” related to chronic conditions.

“These early trends are not surprising,” Lujan said. “Based on past experience, we expected to see some pent-up demand in this population.”

Emergency department use is fairly typical among newly insured, Mario Molina said.

“Sometimes it’s not that patients don’t have a doctor. A lot of them just don’t know how to use their coverage. They go to the emergency department because they don’t know what else to do,” he said.

Older, sicker signees

People who enrolled in Presbyterian’s ACA plans tended to be a little older, and they were a little more likely to be female than male. About 53 percent of enrollees qualified for federal subsidies designed to make health insurance more affordable.

About 26 percent of Molina Healthcare enrollees on the exchange were younger than 34; 38 percent were 35 to 54 years old; and 36 percent were 55 to 65.

Most of Molina’s New Mexico members, 78 percent of them, bought the more-expensive plans, which charge higher premiums but which require less out-of-pocket spending, Mario Molina said.

On the other hand, 40 percent of New Mexico Health Connections customers chose plans offering the lowest premiums and the highest out-of-pocket spending. About 75 percent of the customers qualified for a federal subsidy.

Just based on the phone calls customer-service personnel are receiving, Blue Cross Blue Shield of New Mexico believes “many consumers were able to obtain health insurance for the first time through the exchange,” said Janice Torrez, vice president of external affairs.

“The length of calls alone tells us they are new to insurance,” said Becky Kenny, Blue Cross Blue Shield spokeswoman. “We’re spending 30 to 40 minutes on calls that used to take 10 at the most.”