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Utah expected its federal high-risk pool — subsidized health coverage for the sick and uninsurable — to be an easy sell.

But it proved easier than state officials ever imagined.

That's because hospitals, looking to get paid for treating uninsured patients, did the heavy lifting. They filled out and submitted papers on behalf of patients and, in some cases, paid their monthly premiums, no strings attached.

"People who have a financial interest in making things work will find a way to do it, and do it quickly," said Utah Gov. Gary Herbert's health adviser, Norm Thurston, citing the experience as proof that Utah's hands-off, private-market approach to another Affordable Care Act (ACA) requirement — health exchanges — will work.

Exchanges, online insurance marketplaces, are designed to be a "no wrong door" portal to health coverage where consumers can compare plans, see if they're eligible for federal subsidies to purchase them, or enroll in low-income programs such as Medicaid.

"The idea is you can enter this door and walk out with coverage," said Lincoln Nehring, a health policy analyst at Voices for Utah Children.

Utah already has a "shop" exchange for small businesses, Avenue H, which the governor has asked the U.S. Department of Health and Human Services (HHS) to declare as good enough for Obamacare.

Herbert promises to open it to individuals and larger employers and to enforce new insurance price controls and consumer protections. But he argues the customer outreach and hand-holding required to help people navigate insurance options are a waste of money and unrealistic.

His proposal is being viewed as a test case of just how much leeway the Obama administration is willing to give states in running their own exchanges.

HHS will not comment on the negotiations, but Thurston said sticking points are mostly on small, technical issues.

It's the details that worry consumer advocates, who are pushing for greater clarity on Utah's plan and fear Herbert's vision for Avenue H falls woefully short.

Of top concern, they say, is Utah's poor track record in linking eligible Utahns with health safety nets.

The state ranked 50th in enrolling eligible children in Medicaid and the Children's Health Insurance Program (CHIP) in 2010, said Nehring, noting that 80 percent of the state's 102,400 children are eligible for these programs.

"Utah families are in particular need," he said, "of the ACA's vision of an exchange that will connect [them] with all their health coverage options."

Under the ACA, those shopping on an exchange must first be screened to see if they're entitled to Medicaid or CHIP. They are also screened for federal tax credits to apply toward the purchase of their coverage.

States are supposed to hire navigators to help people pick plans best suited to their needs. The rules say they have to provide interpretive services, aides for people with disabilities, and publish "culturally and linguistically appropriate outreach" materials.

But Herbert's advisers argue these services are widely available in the community.

Insurance brokers exist to guide consumers in making choices. Charities, schools and churches refer low-income families to public aid. And the Department of Workforce Services in recent years spent millions on a computerized system for screening aid applicants.

Instead of replicating these resources, the plan is to harness them to work with Avenue H, said the insurance portal's director, Patty Conner.

Avenue H, for example, would have a simple pre-screening tool to help people discover whether they might qualify for public assistance. Those found likely to be eligible would be referred to Workforce Services to apply.

"Why make everyone go through the trouble of filling out a Medicaid application if they're not eligible?" Conner asked. "Unlike the feds, we think people can make the right insurance decisions for themselves when given choices."

The state is exploring ways to have Avenue H interface with Workforce Services to ensure people move "seamlessly" from public to private insurance as their financial situations change, according to Utah's exchange blueprint, obtained through a records request by The Salt Lake Tribune.

This is especially critical for mixed families in which the parents don't qualify for public aid but the kids do — a problem that will be amplified if Utah opts against expanding Medicaid to cover more poor adults, Nehring said.

"It turns out parents aren't always altruistic," he said. "If they can get coverage for themselves, they're more likely to cover their kids."

But, Thurston notes, there are fail safes for families who fall through the cracks or ignore the law's requirement to get insured, including the health providers that have a "profit motive" to get patients covered.

Hospital financial-aid counselors routinely submit Medicaid and CHIP applications for patients. How many enrollees get benefits this way isn't clear; Workforce Services officials couldn't say on Friday.

But experience with the high-risk pool, Federal-HIPUtah, shows how far hospitals are willing to go.

"At one point, 60 percent of our applicants were coming from hospitals," said the program's director, Tomi Ossana. Often hospitals paid patients' first month's premiums, which average $350. Some paid for up to four months of coverage, or more — a small price in exchange for being reimbursed for treatments or surgeries costing hundreds of thousands of dollars, Ossana said. "It benefits the patient and the hospital."

The arrangement may seem an injustice, though, to those who paid their own way. And Ossana said some enrollees dropped coverage once the hospital stopped footing the bill, raising concerns about their access to follow-up care.

"Hospitals may have an incentive to find coverage to pay for a $10,000 hip, and it's appropriate that they help patients explore options," Nehring said. "But there are very few incentives to help people get coverage for low-cost preventive care, such as vaccinations for their kids and wellness checks."

And it's preventive care, he added, that promises to reduce expensive hospitalizations and lower insurance prices for everyone.

Examining exchange plans

In letters to the U.S. Department of Health and Human Services last week, several advocacy groups complained about the lack of clarity and transparency surrounding Utah's plans for Avenue H. Among them: a physicians group, federally certified community health clinics, AARP Utah, Voices for Utah Children and the Utah Health Policy Project.

The Salt Lake Tribune obtained parts of Utah's exchange blueprint through a records request. They make promises, say advocates, but don't say how the state will live up to them.

"There's so much in there that's theoretical," said Judi Hilman, executive director of the Utah Health Policy Project. "If I were the feds, I would agree to a federally facilitated exchange or give Utah conditional approval subject to our meeting certain requirements and deadlines."

See the embedded documents for details of Utah's blueprint.

Links to other states' plans: