Health Insurance in Rural Communities, with Abigail Barker and Timothy McBride

Organizations and resources mentioned in this episode:

• An Insurance Profile of Rural America, RUPRI Center for Rural Health Policy Analysis
• RUPRI Center for Rural Health Policy Analysis
• Brown School, Washington University in St. Louis
• Access to Affordable Care in Rural America: Current Trends and Key Challenges, Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services
• HealthCare.gov, for Health Insurance Marketplace information.
• U.S. Census Bureau
• Medical Expenditure Panel Survey, Agency for Healthcare Research and Quality
• Federal Office of Rural Health Policy, Health Resources and Services Administration

Transcript

Andrew Nelson: Welcome to Exploring Rural Health, a podcast from the Rural Health Information Hub. My name is Andrew Nelson. In this podcast, we'll be talking with a variety of experts about providing rural healthcare, problems they've encountered, and ways in which those problems can be solved. This is an episode about rural health insurance.

Today we're talking to Dr. Abigail Barker and Dr. Timothy McBride from the Rural Policy Research Institute, or RUPRI. The RUPRI Center for Rural Health Policy Analysis has just released a chartbook called “An Insurance Profile of Rural America,” of which Dr. McBride and Dr. Barker are both authors. Thank you both for joining us today.

Abby Barker: Happy to.

Tim McBride: Thank you for having us.

Andrew Nelson: Yeah. First of all, can you just kind of tell me why you wanted to produce this type of chartbook at this point in time?

Tim McBride: I think the reason we wanted to do this was to pull together a lot of work we've done on this topic of insurance over the years. And, you know, we've written a lot on insurance topics, Medicare Advantage, marketplaces, and this puts kind of in one handy guide, kind of a long one, a chart book that might be where people can look to find some facts about these topics on one place.

Abby Barker: And, and I might add to that, that we've seen a real increase over the past couple of decades in terms of reliance on market-based mechanisms to sort of allocate health insurance. And we have a bit of a concern that there could be a differential impact to that kind of mechanism in rural places. So it's a really good idea to sort of keep tabs on how rural disparities might be showing up in all these different markets.

Andrew Nelson: Yeah. Kind of provides us with some information about how rural Americans are covered or aren't covered and how that can impact their access to healthcare. How have you found that rates of insurance or uninsurance have changed over the 10-year time span that you were studying this?

Tim McBride: So, in general, the news is good for both urban and rural people, because uninsurance rates have dropped pretty dramatically; fallen by about a third, between 2010 and 2019, pre- and post- the Affordable Care Act [ACA]. But the other general point is that throughout the whole period, uninsurance rates are higher for people in rural or nonmetro areas, than they are in metro areas. And the other thing is the gap between nonmetro and metro uninsurance rates is slightly widened. So the gap was about 1.4 percentage points in beginning, and now it's about 2.5 percentage points.

Andrew Nelson: Getting into a little greater depth, how have you seen that coverage rates compared between rural and urban residents have changed over that time?

Tim McBride: You know, I think, as I mentioned, uninsurance rates are higher in rural areas, employer sponsor coverage rates are lower. In general, we've found public coverage rates are higher through Medicare and Medicaid for a host of reasons. Were it not for those coverage rates, the gap would probably be even worse. So the chartbook compares a couple five year periods and finds that the Medicaid coverage rate went from 18.8% to 22.6% in nonmetro areas, and from 15.9% to 19.7%. So there's a 20% increase in non-metro and 24% increase in Metro, and so one of the things that that shows you is there's been a bigger increase in Medicaid coverage rates in metro areas.

In a recent ASPE report, the yearly trends found similar results, but rural coverage rates exceeded urban throughout, but both rates were growing due to the ACA, but the differential stayed about the same, and the gap has been growing somewhat again. You know, I think part of this is due to differential uptake of Medicaid expansion in urban and rural areas. So it's more likely that people in states with a higher proportion of rural people have been less likely to take up Medicaid expansion.

Andrew Nelson: Okay, interesting. What other trends have you seen in terms of rural Medicaid coverage, and how has this affected beneficiaries and providers?

Abby Barker: So Tim already spoke to some of the rates, you know, in terms of coverage and the increase in public coverage that was a little bit disproportionately affecting rural populations. So that's generally a good thing. And he referred to the ASPE report, and I would add to that, that in terms of our own research, and kind of to the topic that I mentioned at the beginning, there's also been a shift in reliance on Medicaid managed care organizations [MCOs] who are covering more rural Medicaid beneficiaries over that time span. So this is not something that's in the chart book, but in some of our other work, we've seen states switching to MCOs statewide, which then includes the rural parts of the state, and then we have others that have extended geographic coverage of MCOs to include the rural parts of the state. And I think the effect on beneficiaries and providers of this kind of phenomenon is variable, because it really depends upon each state's regulatory structure, and especially with respect to how well they are enforcing their network adequacy standards. So it could be a fine thing and it could also be a problematic thing just depending on each state, and how careful they are with network adequacy.

So I mean, I think that the effect on beneficiaries of having access to Medicaid coverage, especially when compared to being uninsured, is definitely positive in terms of health outcomes. There have now been hundreds of studies across many health conditions that find this sort of result, especially when it comes to management of chronic conditions, pregnancy outcomes, and things like that. You know, the benefit of having continuous access to health insurance coverage is certainly detectable in a lot of different research. And then in terms of providers, I think the effects may be the most apparent when you think about cash flow. Because more reimbursement can happen through claims and less of it has to go through the prolonged, dragged out mechanisms for uncompensated care. There's a really long lag on those and on, um, especially for rural hospitals and low volume hospitals, this kind of thing can make the difference between staying open and having to close just, just because of cash flow.

I also wanted to point out that some states' Medicaid programs have been using Medicaid expansion as a motivating factor to restructure reimbursement. So, you know, when you're covering the entire low-income population, you can move into more value-based arrangements; you can focus more on Medicaid trying to help meet the social determinants of health, again, more at the population level. And I think this could be somewhat helpful to providers who may feel burdened by the need to care not only for their patient's clinical conditions, but also to try to address their social needs without really having any real resources to do that. So I think that's another advantage to Medicaid expansion.

Andrew Nelson: Definitely, the more availability you have, the more options people have, the better off they're going to be. We've already talked about a little bit that wasn't covered in the chart book, but did you have any other observations you wanted to share about the ways in which Medicare Advantage uptake has impacted Medicare beneficiaries and providers?

Tim McBride: So Medicare Advantage has grown significantly in both metro and nonmetro areas, from about 25% of Medicare beneficiaries and metro areas to almost 45%, and about 14% to about 35% of nonmetro areas. So that's really huge growth with the rest of the beneficiaries being in what we call traditional Medicare. So that's a really huge change in payment. There's also been a lot of change in plan types, as we call it. Under Medicare Advantage, you can get your plans under different types of plans, HMOs [health maintenance organizations], PPOs [preferred provider organizations], and other types of different changes. HMO is still a preponderant type in metro areas. In metro areas it's largely HMOs and local PPOs — about 97%. Well, about 87% of nonmetro beneficiaries are in those plan types. They're more likely to be in what are called regional PPOs in metro areas, which are typically less highly rated, which creates some issues. And the trend over time is a steady increase in HMOs and local PPOs and nonmetro beneficiaries. So there's been a lot of change generally in the Medicare Advantage market.

So just in general, I'll say that there's been a lot of change in this over time in the early period of Medicare Advantage, and it actually had a lot of different names in their early period, and I won't go into that, but real plans paid significantly less to providers in the early period, which created a lot of problems. They paid significantly less than they did in urban areas. And there were a preponderance of plans that were not HMOs, as I just mentioned. And so rural providers reported being underpaid, which created a lot of problems. And I think that's less the case now. But they still report problems of being underpaid and other problems with Medicare Advantage. So there's still a lot of struggles, I think, with Medicare Advantage, including out-of-pocket costs for the beneficiaries and such. So I think that's one of the things I would mention here. Go ahead, Abby.

Abby Barker: Right. I mean, I just wanted to clarify a little bit that some of that stuff is kind of baked into the policies because each county has a benchmark. It's a dollar amount that's related to what things cost in fee-for-service, traditional Medicare. And the process of establishing those benchmarks is kind of challenging. And it's not clear whether it really represents the true costs of care in an individual place. And you can kind of tell on the basis of whether or not in a given county a Medicare beneficiary or a Medicare Advantage enrollee is able to get a bunch of extra benefits with their MA plan. That suggests that there's something a little bit disproportionate about the way the benchmarks work, I guess.

And so there's still some concern, I think, by people who study Medicare Advantage that those foundational elements about how the benchmark is set are still creating disparities between urban and rural MA recipients.

Andrew Nelson: Sure. Can you tell us about your findings in regards to rural patients having usual sources of care?

Abby Barker: Yeah, I'm actually happy you brought that up because this was one place where the disparity, if you will, went another direction. Having a usual source of care is generally considered to be a measure of access. And in particular, it's a point of access where there is a provider who knows the person's health history and circumstances. And it turns out that Americans in nonmetropolitan counties, regardless of insurance type or even being uninsured, were much less likely to state that they had no usual source of care. And even among the uninsured only 38% of rural people as opposed to 55% of urban people said that they had no usual source of care. So I think it is an interesting thing to point out.

Andrew Nelson: Not having that consistency can really kind of complicate people's access to get the care that they need.

Abby Barker: Exactly.

Andrew Nelson: In the chart book, it includes data on insurance status across various demographic factors such as poverty and race or ethnicity. Did you find any noticeable differences or disparities in health insurance coverage associated with some of those factors for rural residents?

Tim McBride: Among the uninsured, there were higher proportion of nonmetro uninsured that had incomes below the poverty line compared to the metro. Uninsured about 35% compared to 27% about difference, about 8%. And then about nearly half had incomes below 200% of the salary line in metro areas compared to 61% of the people in nonmetro areas. So there's pretty significant difference between people in metro, nonmetro areas. So that would be one thing I would point out. Uninsurance rates were higher for non-White persons living in nonmetro areas. 18% for non-Hispanic Blacks in nonmetro areas compared to 11% in metro areas and 26% for Hispanics and nonmetro areas, 21% for metro areas. All these rates dropped over time. So that's the really good news. It might surprise people that the rates are so high for people of color in nonmetro areas. But one thing I always point out to people is that there are a lot of people of color in the rural South, in the rural Southwest. And you know, a lot of times people think of rural America as being the rural Midwest or such, but there are a lot of people in the rural South and many of them are uninsured or lack insurance.

Andrew Nelson: How have you found that the availability of employer-sponsored insurance in rural areas can differ from metro areas? And what effect does that have on healthcare access?

Tim McBride: We generally find that rural workers are less likely to be eligible for employer-sponsored health insurance, and they're more likely to be uninsured if working. And that's just been a broad finding over time. We show that in the chart book pretty dramatically.

Abby Barker: I mean, and that's a function of the fact that firm sizes tend to be smaller, and so they're less likely to be mandated to offer coverage just because of smaller firms.

Tim McBride: I agree with Abby, but I would also add to that, that their wages tend to be somewhat lower for rural people and also somewhat due to occupational mix of rural workers.

Andrew Nelson: A lot of people do have the option of public coverage or insurance through their employer. Why did you find that rural people were less likely to take advantage of employer-sponsored coverage that was offered to them?

Tim McBride: Yeah, it's an interesting finding, and I'm glad you pulled it out because it surprises people sometimes. But again, you know, if you have workers that their wages are pretty low, they tend to be a little bit lower than for nonmetro people compared to metro workers. And if their premiums are little higher, as Abby just mentioned, if you're working for a smaller employer, your premium might be higher. So you have sort of both things working against you. Your wages might be lower, your premiums might be higher. And also, if you tend to be working for the type of occupation where your premium might be higher, maybe say you're working in agriculture or service work or something, all that works against you. You might just proportionally see that in a rural area versus sort of high income, high-tech jobs or high management jobs or such in urban areas. So all that you just find a little bit more proportionally in urban areas. Those are some of the factors that we've seen over time and it shows up in the chart books.

Abby Barker: Yeah. And I'd just add to that a little bit and clarify that one reason the premiums might be higher in a small rural setting is that, you know, one of the fundamental reasons we have health insurance is to pool risk, you know, and so sometimes premiums are, well, premiums are a function of the size of the risk pool. So if you are a large employer who ensures 10,000 lives across the country, you know, you're a major corporation, you're going to be able to get better rates than somebody who runs a small business that employs 50 or a hundred people, just because it's the way the risk pooling works.

Tim McBride: Yep.

Andrew Nelson: In terms of Marketplace plans, can you tell us a little bit about the so-called metal level that those plans have and how silver loading can increase the accessibility of gold plans?

Abby Barker: We can talk about that. It's a kind of a little bit complicated question, but most people probably know that there are three metal levels in the Marketplace. There are bronze and silver and gold, with gold being the most comprehensive coverage. So, kind of the best coverage. All types of financial assistance within the Marketplaces that are helping cover premiums and cost sharing are based upon a person's income, and how that income compares to the cost of the second lowest silver plan available in their county. So people with incomes of up to 250% of the federal poverty level are eligible for these special silver plans that offer lower deductibles and lower copays. But due to a long, convoluted history of policy changes, there's no additional funding to the insurer to actually pay for those additional benefits.

And so insurers have responded to that situation by doing what's called silver loading. And what that means is they're pushing all the extra costs of those reduced cost silver plans into the premiums of the regular silver plans. And so the result of that is that silver plans are more expensive than they otherwise should be compared to gold plans. And so if you're a consumer going into the Marketplace and you're typing in your income into the little search tool, a subsidy is computed for you on the basis of your income and those expensive silver plans. So that ends up creating a more generous subsidy for you that you are able to apply to any plan purchase, and in particular, it makes gold plans more affordable. And so that can be helpful since, as I said, gold plans are generally better coverage. So you're able to get a little more out of your subsidy.

Andrew Nelson: Yeah, it's kind of interesting to see the way in which that has actually resulted in making gold-level coverage more accessible for some people.

Abby Barker: Yeah. It, it's a little bit ironic, how it's panned out.

Andrew Nelson: What conclusions did you reach about variation in coverage depending on the occupations that people have?

Tim McBride: So, you know, a lot of our coverage rates in this country are driven by employer-sponsored coverage. You know, in general, just to sort of frame this, most of us get our health insurance — about 60% — through employer-sponsored coverage. And then when you zone in on that, the private coverage, a lot of this depends on where you're employed, what industry you're employed in. And that differs pretty significantly by nonmetro and metro residents. Nonmetro people are more likely to be employed in agriculture, construction services, and health and social services. And when you look at that, the private coverage rates are lower in those industries; they're less likely, in other words, to have coverage and probably less likely to be offered coverage, than, say in finance and insurance, public administration, education, that kind of thing, which means that they're either going to go uninsured or get public coverage. So that's a pretty significant difference between nonmetro and metro. And it really just is something that's an artifact of where people work.

Andrew Nelson: Generally speaking, I think it's fair to say that the more income people have, the better care they're able to access, but it's interesting that there can be those kinds of divisions along the field they're working in as well.

Tim McBride: Yeah. And one thing I will add to that, and I've known this from other work I've done, if the main income of the household is say, agriculture, one thing you find is what happens is that one of the spouses actually might go off and get a job that has health insurance just so that the household has health insurance, because otherwise they're not gonna have it.

Andrew Nelson: Yeah. That's, that's pretty important. With all the research you've put into it, how do you hope your chart book will be used?

Abby Barker: So, we are definitely very interested in creating evidence and data that are, can be at the fingertips of policy makers. I think that as policies related to health insurance move more toward relying on market mechanisms to provide access, it's really increasingly important to monitor all of these different markets for signs of disparities. And just today we've, you know, we've talked about Medicaid managed care organizations, we've talked about Medicare Advantage, we've talked about Health Insurance Marketplaces. So these are all the things that we're talking about, in which a market mechanism is being brought in to try to provide access across the board. Tim and I are health economists; we're very well aware that markets generally tend to work better in high volume settings. In rural situations, it is kind of an open question that does need research to understand whether or not these kinds of models are going to perform as intended in smaller volume rural settings. So I personally, I'd like to see policy makers studying some of these trends and identifying ways to modify and improve existing policies so that urban and rural disparities are narrowed rather than widened. And I think that this chart book could be put to that kind of a use.

Tim McBride: I agree with all that. And I think that this chart book covers a broad array of topics; everything from insurance, you know, Marketplaces and Medicare Advantage and Medicaid and Medicare, and kind of gives a quick overview of some of the causes and consequences of some of the reasons why there may be differences at least between nonmetro and metro people. And maybe it'll get people to dive a little deeper, I hope. Not just policy makers, but also researchers interested community folks. And I hope it's like sort of a beginning portal to sort of a pretty broad, piece of, you know, a place of research that we've contributed to not only us, but many others. I think it's pretty comprehensive look at insurance issues and I hope that that's pretty useful to people.

Abby Barker: I mean, I guess the only other thing I might comment on is just the, you know, in terms of the mechanics of putting together a chart book like this, we pulled so many different data sources from the Census and from Medical Expenditure Panel Survey data and from multiple different ways of slicing and dicing data and in particular of defining rural. And I think that that's a challenge that, you know, anyone who works with data and tries to answer these questions has to struggle with how to address. How do you define rural and how do you get enough data? How do you get enough high quality data that really allows you to describe what you're seeing in rural places? And since they do have smaller numbers, sometimes there's censoring of data or combining data or reporting data less often, a whole host of different data related issues that if there as increased attention becomes focused on rural America, that there will be increased efforts to, to solve these data problems.

Tim McBride: The Federal Office of Rural Health Policy, which sponsored this work, has been very careful in thinking about these issues over a long period of time. And we had to be very deliberate about thinking about the issue that Abby just mentioned. And as we went from data source to data source, we were forced sometimes to use different literal definitions of rural and urban or nonmetro/metro, and so the chart book, if you read it carefully, says that now we're using rural/urban, now we're using nonmetro/metro and a careful reader will pick up on that. And that's something that is just sort of the way it is in, you know, the way federal data sources are set up.

Abby Barker: Well, and just as another example, you know, there, there are a lot more questions asked in the Medical Expenditure Panel Survey about out-of-pocket cost exposure and about just overall ability to access care in a number of different ways. In most cases, there just wasn't enough rural data to be able to produce a chart, just because, you know, the, there's low numbers, and it would be great to have some over sampling so that we could say a little more, go a little deeper, and do a better job describing what's going on for rural Americans.

Andrew Nelson: You've been listening to Exploring Rural Health, a podcast from RHIhub. Today, we spoke with Dr. Abigail Barker and Dr. Timothy McBride from the Rural Policy Research Institute. Look in our show notes for more information about their work, and visit ruralhealthinfo.org for all things pertaining to rural health. Join us next time for a discussion about health equity.