Travis County’s nonprofit health plan could break even this year, marking progress from past financial strain

Community members come to advocate for continued funding for Sendero Health Plans at a special called Central Health meeting Sept. 22.

Community members come to advocate for continued funding for Sendero Health Plans at a special called Central Health meeting Sept. 22.

A strategy to save the financially embattled Sendero Health Plans, a nonprofit health maintenance organization created by Central Health—Travis County’s health care district—is showing signs of promise, Central Health CEO Mike Geeslin told Community Impact Newspaper.

“What the preliminary results are showing is that this particular program is achieving its objective,” Geeslin said.

At the end of fiscal year 2017-18, Sendero’s net income suffered $19 million in losses, Sendero President and CEO Wes Dulkalski said during a presentation to Central Health board members Dec. 19. New actuarial projections based on preliminary enrollment estimates from the 2018 open enrollment period that ended Dec. 15 indicate Sendero could break even in FY 2018-19, Dulkalski said, with just over $1 million in net income projected.

The plan in action

After a contentious FY 2018-19 budget process, the board of managers for Central Health voted Sept. 22 to reverse its previous proposal to shutter Sendero Health Plans due to financial challenges.

Sendero, which covered 24,000 Travis County residents through the Affordable Care Act in 2018, has been financially burdened because its patient population is relatively healthy, Geeslin said.

A federal program known as the Affordable Care Act Risk Adjustment Program requires that ACA plans with the healthiest members must pay funds back to the federal government to be redistributed to health plans with the least healthy members. In the past Sendero’s healthy population has meant it is required to make these payments, straining its financial operations.

For Sendero to secure funds from the risk adjustment program, its patient pool will need to have a higher average risk score, which is a way to measure how much it costs to insure a patient, Geeslin said.

One key population that could increase Central Health’s average risk score are members of Central Health’s Medical Access Program, or MAP, according to Central Health. MAP is not an insurance plan and is not operated through Sendero Health Plans, but it allows Travis County residents with incomes 100 percent below the federal poverty level or lower to receive limited health care services without paying any premiums.

In October, Central Health’s eligibility staff began reaching out to specifically identified MAP members and informing them they are eligible for a new plan called CHAP–Central Health Premium Assistance Program–offered by Sendero without paying more for care than they already pay, if they pay anything at all.

As of Dec. 19 staff and Central Health partners had reached out to over 1,000 MAP and sliding fee scale members–a program similar to MAP– and 228 members selected to enroll in CHAP, according to Central Health.

“We were happy to be able to take on some CHAP members, and we believe we will be able to break even this year,” Dukalski said.

More formalized financial projections will be available in the coming months, Geeslin said.
By Emma Whalen
Emma is Community Impact Newspaper's Houston City Hall reporter. Previously, she covered public health, education and features for several Austin-area publications. A Boston native, she is a former student athlete and alumna of The University of Texas at Austin.