LCDR Beth A Henson, MSW, Senior Project Officer

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Use of Part B ADAP Funds to Purchase Health
Insurance Policy Number 07-05 Overview
LCDR Beth A Henson, MSW, Senior Project
Officer Mr. Gbolahan Cole, Project
Officer HRSA/HAB, Division of Service Systems
For the Feb 5-7, 2008 Administrative Overview
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Topics to Cover

• Purpose of Policy 07-05
• Implementing Policy 07-05
• How Part B Programs Use Policy 07-05

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ADAP Policies Provide Options for States

• Purchase medications directly
• Purchase health insurance (premiums, co-payments,
  and deductibles) for eligible persons
• Use ADAP funds with increased flexibility to
  provide services that enhance access, adherence,
  and monitoring of drug treatment (See Policy
  Notice - 07- 03) for eligible persons

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Purpose of 07-05 Expand Access Through Health
Insurance

• Policy 07-05 (Use of Part B ADAP funds to
  purchase health insurance) is to help states
  expand access to medications.
• Policy was updated in September 2007 (revision of
  the earlier Policy 99-01). Policy 07-05 was
  updated to reflect changes to the Modernization
  Act of 2006, though the policy was not
  substantatively changed.
• Many states have used policy as a cost saving
  measure to further expand services to eligible
  PLWHA, through using ADAP dollars to
• Purchase COBRA policies
• Purchase risk pool policies
• Purchase new insurance

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Implementing Policy 07-05

• Payer of Last Resort. To expand ADAP flexibility
  while ensuring Ryan White remains payor of last
  resort.
• Manage 07-05 Funds In Context of ADAP. Must
  manage 07-05 spending as part of the established
  ADAP Program.
• Reporting. Must report on use of 07-05 funds to
  purchase and maintain insurance as well as funds
  spent administering these policies, using report
  the ADAP Quarterly Report (AQR) and annual CADR.
• Equivalency of Policies to ADAP. Funds may only
  be used to purchase premiums from health
  insurance plans that are at least equivalent to
  Part B formulary.
• Cost Neutrality. The total aggregate amount
  spent on insurance premiums can not be greater
  than the annual aggregate cost of maintaining
  that same population on the existing state ADAP
  program.

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Implementing HAB Policy 07-05

• Funds may be used to cover any costs associated
  with the health insurance policy, including
  co-payments, deductibles, or premiums to purchase
  or maintain insurance policies
• Current client eligibility guidelines, set under
  Section 2616(b) of the Public Health Service Act,
  must be followed.
• The States must maintain their contributions to
  their HIV/AIDS care programs as required under
  Section 2617(b)(7)(E).
• The State must assure that ADAP funds will not be
  used to purchase health insurance deemed
  inadequate by the State in its provision of
  comprehensive primary care services.

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Implementing HAB Policy 07-05Methodology and
Notice to HAB

• Prior to the use of ADAP funds for the purchase
  of health insurance, States must provide the
  HIV/AIDS Bureau and Grants Management Branch with
  the a cost study to demonstrate the methodology
  used by the State to
• Assure that they are buying health insurance that
  at a minimum includes pharmaceutical benefits
  equivalent to the Ryan White HIV/AIDS Program
  Part B ADAP formulary, and
• Assess and compare the costs of providing
  medications through the health insurance option
  versus the existing ADAP program
• If the use of ADAP funds for buying insurance is
  initiated within a grant cycle, the State ADAP
  will provide a letter of intent with the
  aforementioned assurances and cost study to the
  Grants Management Officer.

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Part B Experiences with HIC

• FY06 66.75 million in Part B Funds to HIC
• 35 States
• The following slide lists Part B programs that
  currently utilize Policy 07-05 to fund insurance
  continuation premiums, deductibles, and
  co-payments to eligible Part B consumers

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FY06 Part B Spending on Health Insurance
Continuation
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For Further Information

• Contact Your Project Officer
• Policy Clarifications
• Network with Other Part B Programs
• Request TA
• TARGET Center Central Source of Ryan White TA
• http//careacttarget.org
• Search the TA Library gt health insurance
• LCDR Beth A. Henson, MSW, BCD, Senior Project
  Officer
• bhenson_at_hrsa.gov
• Mr. Gbolahan Cole, Project Officer
• gcole_at_hrsa.gov

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