West Virginia Bureau for Medical Services (BMS) offers the Health Insurance Premium Payment (HIPP) program to Medicaid recipients to assist those recipients who have high healthcare costs and are eligible for employer group health insurance. When it is determined cost effective, BMS reimburses the primary insurance premiums for Medicaid recipients.
The HIPP program also assists recently unemployed individuals by paying COBRA benefits from former employers. Most employers are required under COBRA to offer continued health benefits for 60 days after employment is terminated. After an individual chooses to continue with COBRA benefits, the plan may be renewed for an additional 18 months. Applicants must have group health insurance available which covers at least one person who is Medicaid-eligible in the State of West Virginia.
The Omnibus Budget Reconciliation Act of 1990 mandated that states pay group health insurance premiums for Medicaid-eligible individuals if the insurance plans are determined cost effective.* As a result of this mandate, BMS implemented the West Virginia HIPP Program in 1996 to reimburse the commercial insurance premiums for Medicaid recipients when cost effectiveness requirements are met. Cost effectiveness means that the costs of health insurance premiums, co-insurance and deductibles must be less than the member’s Medicaid healthcare costs and meet HIPP program requirements. Local welfare office case workers primarily submit referrals to the HIPP Unit for evaluation of the cost effective determination. A Medicaid recipient may also submit an application directly to the HIPP Unit.
Emphasis is placed on the reimbursement of group health insurance premiums for cost effective private policies, conversion policies, and COBRA extensions. These plan premiums may also be reimbursed by BMS under the HIPP program.
Insurance premiums for cost effective Medicaid recipients are reimbursed upon the completion and acceptance of the referral process. BMS reimburses policyholders for health plan premium payments paid through employer payroll deductions and direct employee payments. Reimbursements are made to the policyholder in the month following the premium payment. The HIPP program reimburses for the medical portion of primary policies; however, dental, vision, Medicare, or accident policies are not reimbursed under the HIPP program.
*Under the Balanced Budget Act of 1997, HIPP is no longer a mandatory program
The HIPP Program is advantageous to BMS and to taxpayers because it enables the Medicaid agency to shift some of the cost of care to liable third party insurance.
Providers of medical care, benefit from the HIPP program because commercial group insurance payments are usually higher than Medicaid payments.