Category Archives: Medicaid

Fifth Circuit Appeals Court Strikes Down the Affordable Care Act’s Individual Mandate

Posted on by • Posted in 2020 Election Issues, ACA, Bad Debt Expense, District Court, District Court of Appeals, Essential Health Benefits, Health Insurance Coverage Adequacy, Health Policy, Individual Mandate, Medicaid, Medicaid Expansion, Out of Pocket Expenses, Preexisting Conditions, Safety Net Hospitals, Safety-Net Providers, Supreme Court, Texas v. United States, Uncompensated Care, Underinsured, Uninsured • Leave a comment

https://www.commonwealthfund.org/blog/2019/fifth-circuit-appeals-court-strikes-down-affordable-care-acts-individual-mandate

The Fallout from Texas v. U.S.:

Yesterday, a three-judge panel from the Fifth Circuit Court of Appeals struck down the Affordable Care Act (ACA)’s individual mandate. The judges agreed with a lower court decision issued in the case, Texas v. U.S., in December 2018 that the individual mandate is unconstitutional but, unlike the lower court, did not decide that the rest of the ACA is also unconstitutional. Instead, the judges remanded, or sent back, the decision to the same lower court judge to consider. California Attorney General Xavier Becerra, who is leading the 21 Democratic state attorneys general defending the law, along with the U.S. House of Representatives, immediately announced he would appeal the decision to the Supreme Court.

Whether the Supreme Court will decide to take the case now or wait for the decision of Judge O’Connor’s, of the lower court, is uncertain. If the Court decides to take the case now, they could expedite the briefing process and issue a decision in 2020. If it does not take the case now, a ruling will be delayed until after the 2020 presidential election.

No one knows how the Supreme Court will ultimately rule. But we do know that if the Court decides to strike down the ACA, the human toll will be immense and tragic. The law has granted unprecedented health security to millions:

  • 18.2 million formerly uninsured people have gained coverage since 2010
  • 53.8 million Americans with preexisting health conditions are now protected
  • 12.7 million low-income people are insured through expanded Medicaid
  • 10.6 million people have coverage through the ACA marketplaces, 9.3 million of whom receive tax credits to help them pay their premiums
  • 5.5 million young adults have gained coverage, many by staying on their parents’ plans
  • 45 million Medicare beneficiaries have much better drug coverage.

Such a decision will also trigger massive disruption throughout the U.S. health system. The health care industry represents nearly 20 percent of the nation’s economy; the ACA has touched every corner of it. The law restructured the individual and small-group health insurance markets, expanded and streamlined the Medicaid program, improved Medicare benefits, and reformed the way Medicare pays doctors, hospitals, and other providers. It was a catalyst for the movement toward value-based care and established a regulatory pathway for biosimilars — less expensive versions of biologic drugs. States have rewritten laws to incorporate the ACA’s provisions. Insurers, hospitals, physicians, and state and local governments have invested billions of dollars in adjusting to these changes.

The law’s popular preexisting health condition protections have made it possible for people with minor-to-serious health problems to apply for coverage in the same way healthier people have always done. These protections have given the estimated 53.8 million Americans with preexisting health conditions the peace of mind that they will never be denied health insurance because of their health.

More than 150 million people who get coverage through their employers now are eligible for free preventive care, and their children can stay on their policies to age 26.

The wide racial and income inequities in health insurance coverage that have been partly remedied by the ACA would return. Hospitals and providers, especially safety-net institutions, would struggle with mounting uncompensated care burdens and sicker and more costly patients who are not receiving the preventive care they need.

The ACA tore down financial barriers to health care for millions, many of whom were uninsured for most of their lives. It has demonstrably helped people get the health care they need in states across the country. Research indicates that Medicaid expansion has led to improved health status and lower mortality risk.

To date, neither the Trump administration, which has sided with the plaintiffs in the case, nor its Republican colleagues in Congress have offered a replacement plan in the event the law is struck down. The historic progress made by Americans, particularly those with middle and lower incomes and people of color, could unravel. Voters are already telling policymakers they are worried about their ability to afford health care. Yesterday’s decision and the uncertain path forward to the Supreme Court is certain to escalate those worries. With the nation entering the 2020 presidential election year, the Supreme Court may decide to take up the case this term.

 

 

South Carolina is the next battleground for Medicaid work requirements

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https://www.axios.com/south-carolina-medicaid-work-requirements-f8c52243-d1de-47bf-bf47-5ea82326cea4.html

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The Trump administration is losing the legal battle over Medicaid work requirements — one of its most impactful and controversial health care policies — but it is leaning into that fight even more aggressively.

Driving the news: The Centers for Medicare & Medicaid Services formally signed off yesterday on South Carolina’s work requirements. Medicaid recipients in the state will have to perform 80 hours per month of work or community service, unless they receive an exemption.

Why it matters: Other states have primarily sought work requirements as a condition of their Medicaid expansions, but South Carolina will impose its new rules without expanding.

Where it stands: A federal judge has already ruled against work requirements in Arkansas, Kentucky and New Hampshire, arguing that they’re inconsistent with Medicaid’s statutory goals.

  • Judge James Boasberg has leaned heavily on the fact that work requirements would cause thousands of people to lose their Medicaid coverage.
  • That will also happen in South Carolina, and those coverage losses will be a factor in the inevitable lawsuits over these rules.

Yes, but: Those rulings are working their way through the appeals process, and rather than change course or slow down in the face of legal setbacks, the administration is getting work requirements on the books wherever it can and hoping for an eventual win in the courts.

 

 

 

Centene quietly lobbying Congress to let states partially expand Medicaid

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https://www.healthcaredive.com/news/centene-quietly-lobbying-congress-to-let-states-partially-expand-medicaid/568742/

Centene, the nation’s largest Medicaid managed care provider, wants Congress to change the eligibility requirements around Medicaid, the government-sponsored safety net program that covers one in five low-income Americans.

Its proposal would ultimately push more people onto the Affordable Care Act exchanges by allowing states to adopt a partial Medicaid expansion, an idea typically embraced by red states.

CEO Michael Neidorff told Healthcare Dive the company has been quietly talking to lawmakers on both sides of the aisle on Capitol Hill about the plan, though he emphasized nothing of substance will happen until after the 2020 election.  

Centene says its proposal is an attempt to strengthen the ACA markets by increasing the pool of people while enticing holdout states to partially expand their Medicaid programs.

“I think there’s a way to get it done,” Neidorff told Healthcare Dive. “We have a very powerful Washington office and they’ve been working with leadership and their staff.”

Centene filed lobbying forms totaling about $2 million in spending in the congressional lobbying database for 2019, as of Dec. 11. ​In 2018, the payer reported spending roughly $2.5 million. 

However, policy experts caution that it would result in increased spending for the federal government and fewer protections for those enrolled in Medicaid who are then pushed into the exchanges.

It’s unclear how receptive Congress will be, but experts were skeptical of any consensus on the polarizing health law.

“It would be a very major change. I certainly don’t see that happening. It’s opening up the ACA and as we know from past history, it’s a battle royale when you go into the ACA,” Joan Alker, executive director and co-founder of the Center for Children and Families at Georgetown University, told Healthcare Dive.

Centene’s proposal

Under the ACA, states can expand their Medicaid programs to cover all adults whose annual incomes does not exceed 138% of the federal poverty level, or $17,236 for an individual.

Centene’s proposal calls for lowering that income ceiling from 138% to 100%, or $12,490 for an individual.

That would shrink the pool of who is eligible for Medicaid and push those people into the exchanges. Neidorff said the move would grow the exchange pool and ultimately drive down prices. High costs have attracted criticism as they play a role in forcing those who are not subsidized to leave the market.

Credit: Samantha Liss/Healthcare Dive

For Centene, it would be a notable shift because its core business has long been in Medicaid. The insurance exchanges only became a viable business beginning in 2013 with the advent of the ACA. It’s a nod to how important the exchange business has become for the payer.

Centene arguably stands to benefit the most as the nation’s largest insurer on the exchanges in terms of enrollment, plus the exchanges generate higher profit margins than its Medicaid book of business.

“You move those lives into exchange and your profitability is higher,” David Windley, an analyst with Jefferies, told Healthcare Dive.​

In the states that have not expanded Medicaid, there are about 2 million people with incomes between 100% and 138% of the federal poverty level, according to the Kaiser Family Foundation.

Hospitals and providers are likely to favor the proposal because Medicaid plans tend to pay less than commercial ones. The idea could garner support from states with tight budgets as some, even Massachusetts, have already expressed a desire to adopt a partial expansion. (Both the Trump and Obama’s administrations have denied providing the enhanced match rate for states seeking partial expansions).

Who benefits the most?

Still, there are potential drawbacks, according to analysts and policy experts. For example, the plan could potentially cost taxpayers more if there is a greater shift to the exchanges away from Medicaid coverage.

“Medicaid is broadly accepted as the cheapest coverage vehicle in the country,” Windley said, noting that the exchanges are typically a more expensive insurance product than Medicaid coverage.

Plus, because of the way the ACA was written, the federal government would be forced to pick up the entire tab of the subsidies for those between 100% and 138% of FPL. 

“As a result, the states save money for every beneficiary whom they can move from Medicaid into their exchanges,” according to a previous paper in the New England Journal of Medicine.

However, policy experts warn the proposal may not be in the best interest of Medicaid members who would migrate to the exchanges.

These members are better off with Medicaid, Alker said.

“From a beneficiary perspective it’s problematic because there are no premiums in Medicaid for that group, 100-138 [FPL]. The cost sharing is very limited,” she said.

Plus, there are benefits in Medicaid members would no longer have access to if they move to the exchanges, Adrianna McIntyre, a health policy researcher at Harvard University, told Healthcare Dive, including non-emergency transportation and retroactive eligibility.

Centene argues many states have avoided expanding Medicaid because of cost concerns, which then leaves some residents without access to affordable care, particularly those in the coverage gap, or those with incomes below 100% of FPL.

Credit: Kaiser Family Foundation

If a partial option convinces some holdout states to expand “that’s a tradeoff some may be willing to make,” McIntyre said.

Some states that did expand are looking for ways to curb costs and have decided to implement work requirements, Neidorff noted. He believes the proposal is the answer to both these problems for states.

Centene’s plan comes as a slate of Democratic presidential contenders are calling for “Medicare for All,” a single-payer or public-option healthcare system.

Not surprisingly as such a plan would at a minimum sideline private plans and at the extreme eliminate private payers, Neidorff dismissed the idea.

He estimates his plan would cost $6 billion a year, which he characterized as “very affordable” when compared to a Medicare for All plan, which some studies estimate could cost as much as $32 trillion over 10 years.

Still, some policy experts say the change being proposed by Centene is a tall order.

Though the changes may seem small, the consequences of adopting a partial expansion are large, researchers wrote in a NEJM report: “The damage to Medicaid beneficiaries, the exchange population, and the federal budget could be serious.”

 

 

 

Health care spending grows — again — in 2018

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Americans spent $3.65 trillion on health care in 2018 — 4.6% more than the year before. That growth also was higher than the 4.2% rate from 2017, according to revised figures from independent federal actuaries, Axios’ Bob Herman reports.

Between the lines: U.S. health care spending climbed again not because people went to the doctor or hospital more frequently, but because the industry charged higher prices. And private health insurers didn’t do a particularly good job negotiating lower rates.

The intrigue: The number of people with private health plans — which mostly consists of the coverage people get through their jobs — dipped in 2018, yet the amount spent per person soared 6.7%.

  • That is the highest per-enrollee spending growth rate among people with private health insurance since 2004, actuaries wrote.
  • Part of that increase was due to higher premiums that insurance companies passed on from the Affordable Care Act’s health insurance tax.
  • More importantly: Hospitals, doctors and drugmakers continued to wring out much higher rates from private insurers thanks to provider mergers and perverse negotiating incentives.

Medicare and Medicaid had much lower per-enrollee spending growth rates in 2018 than private insurance, but those figures were the highest they’ve been since 2015 — again due to higher costs for the private insurers that are increasingly running those government programs.

 

University to Students on Medicaid: Buy Private Coverage, or Drop Out

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Emily and Kullen Langston were enrolling in classes for the winter semester at Brigham Young University-Idaho when they hit an unexpected roadblock.

The school, like many others, requires all students to have health coverage. But this month, the university made an unusual announcement: It would no longer accept Medicaid.

Ms. Langston, 20, enrolled in the free government insurance program last year after becoming pregnant with the couple’s daughter, who is now 4 months old. Mr. Langston, 22, was planning to sign up for Medicaid in January, when it is set to expand in the state.

To remain in school, they would have to buy private coverage. The cheapest option available is the university’s student health plan, which does not comply with the Affordable Care Act’s consumer protections and would require the Langstons to pay a $3,125 annual premium.

Ms. Langston said her family, which relies on the income her husband earns as a call-center operator, cannot afford that. She had hoped to become a teacher, but now intends to drop out of school, and her husband is unsure whether he will attend.

“I’m disappointed that they’re showing prejudice against those of us who are poor right now,” Ms. Langston said. “I’m disappointed that I’m not going to be able to finish school.”

The decision on the eastern Idaho campus has confused and angered students. The change is set to go into effect on Jan. 1, the same day Idaho will expand Medicaid coverage to about 70,000 low-income residents, including college students.

In an email last week to its 19,000 students in Idaho, the university appeared to tie its decision to the Medicaid expansion. It’s not clear how many students currently have Medicaid coverage, but the state projects that about 2,400 more people in Madison County, where the school is, would enroll with the expansion. The university warned that having too many students sign up for the public program “would be impractical for the local medical community,” an assertion a local hospital official rejects.

The policy change is likely to push more students into a health plan administered by Deseret Mutual Benefits Administration, which, like the university, is owned by the Church of Jesus Christ of Latter-day Saints.

That plan limits annual benefits and doesn’t cover birth control — provisions that would violate the Affordable Care Act, but for a little-noticed Obama-era exemption for universities that fund their own health plans.

“It seems like a loophole, and is pretty misleading to students,” said Erin Hemlin, who oversees health policy at Young Invincibles, a nonprofit that focuses on issues affecting college students and young adults. “It’s called a student health plan, so you would think it’s going to be comprehensive coverage, and it isn’t.”

The church has been vocal on aspects of the Affordable Care Act, including religious freedom and the health law’s birth control mandate, but it has remained quiet on Medicaid expansion. It has never taken a public position on the issue, a church spokesman confirmed. The university’s Idaho campus and the church both declined to comment on the policy change.

Before the Affordable Care Act, student health plans across the country varied significantly from one campus to another. Some offered robust health benefits, while others had maximum annual benefits as low as $5,000.

The Obama administration required that most university plans comply with the new law by covering a wide array of essential health benefits, including maternity care and prescription drugs, and eliminating annual benefit caps.

The rules, issued in 2013, included a carve-out for a small number of universities that “self-funded” their health plans, meaning they used student premiums to cover costs — and accepted responsibility for any large bills that might cost even more. At the time, about 30 universities had such plans.

Most were big institutions with large endowments, such as the University of California, Johns Hopkins and Princeton. Those three, and some others, chose nevertheless to make their self-funded student plans comply with the Affordable Care Act.

But Brigham Young University campuses in Utah, Idaho and Hawaii did not. The university publicly opposed the law’s requirement to cover contraceptives. And its plans limited the maximum annual benefit. At the time, a university spokesman told the campus newspaper in Utah, “There are numerous government-imposed requirements that we don’t believe are necessary to provide good health care to our students.”

The Idaho campus’s plan has a $4,750 deductible that must be met before it will cover maternity care for the spouse of a student. It does not cover certain major medical services, such as residential mental health care and care related to an organ transplant.

These restrictions, along with the premium costs, are central reasons the Idaho students with Medicaid coverage object to buying the university’s student plan. “It feels like they’re forcing us into a noncompliant health plan when the one we have is already compliant with Obamacare,” said Amanda Emerson, a 26-year-old student. “They’re making it really difficult to do anything otherwise.”

Deseret Mutual Benefit, the plan administrator, says that limiting benefits helps keep premiums down. “The purpose is to try to provide a plan as inexpensively as possible to the students,” said Andy Almeida, the company’s chief operating officer.

The Idaho campus is the only Brigham Young site that will no longer accept Medicaid as a substitute for the student health plan, a decision that university officials would not explain. The school’s Utah and Hawaii campuses allow students with Medicaid to waive private coverage.

Utah voters agreed to a Medicaid expansion last year, and a partial version of the program took effect in February. The state does not provide data on how many of the 33,000 students at the Provo campus are enrolled in Medicaid. The Hawaii campus has just 2,500 students; the number on Medicaid is not disclosed.

Idaho had long resisted participating in the Affordable Care Act’s expansion of Medicaid, which provides coverage to Americans who earn less than 133 percent of the federal poverty level ($16,612 for an individual, and $34,248 for a family of four).

The state legislature twice voted down bills that would have added Idaho to the program, which currently covers 36 states and the District of Columbia. In 2018, local activists secured a ballot initiative on the issue. The proposal passed with a double-digit margin, and after a State Supreme Court challenge, the program will start in January.

In announcing its new stance on Medicaid, Brigham Young University-Idaho cited a worry about overwhelming local health care providers. The local hospital, however, said it had no such concerns and had not raised the issue with the university.

“We have some great providers here, and we feel like we’re able to handle any growth that the university and the community would need,” said Doug McBride, executive director of business development at Madison Memorial Hospital, a county-owned facility.

Since the school announced the new policy this month, students have organized Facebook groups and circulated petitions opposing the change.

Ms. Emerson, one of the students with Medicaid, is planning to enroll in a private plan in addition to her public coverage. Her husband, also a student at the Idaho campus, plans to do the same. They said they had discussed their options with a local insurance broker and found that the student plan would be the cheapest, but hadn’t yet made a decision.

“We only have a few weeks until we have to be registered for new classes, so this kind of dropped a bomb on us,” Ms. Emerson said. “We only have one semester to go, so we’re willing to dip into our savings.”

 

 

 

Tennessee becomes first state to ask permission for Medicaid block grants

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Tennessee becomes first state to ask permission for Medicaid block grants

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Tennessee on Wednesday formally asked the Trump administration for permission to convert its Medicaid program into a limited, block grant–type model, a controversial plan that, if approved, could be the first in the nation.

The proposal will test the Trump administration’s ability to allow states the flexibility to make drastic changes to Medicaid.

Imposing block grants in Medicaid has long been a major conservative goal and has been encouraged by the Trump administration, but it is not clear if the administration alone has the legal authority to allow such drastic changes.

Administration officials had drafted a guidance that would make it easier for states to apply for a capped payment or block grants, but the document was quietly removed from the White House Office of Management and Budget last week.

No states have been granted permission to date, but if Tennessee’s plan is approved, it would likely embolden other Republican-led states. The proposal will also mobilize opposition from patient advocacy groups, who have already been protesting since the state passed a bill

“This proposal represents a significant opportunity for the federal government to test a potential innovative, national solution at how to incentivize states’ performance in maximizing the value of taxpayer dollars,” the state said in its application.

Republicans say policies like block grants allow for more state flexibility and are more fiscally sustainable.

Critics fear a block grant would ultimately lead to states kicking people off their rolls or pulling back services. But Tennessee’s proposal is a novel one that departs from some of the more traditional block grant ideas, even as it imposes financial caps on federal spending.

Under Tennessee’s proposal, the state would receive a nearly $7.9 billion block grant from the federal government, which is based on projected Medicaid costs. The amount would be adjusted for inflation, but unlike a traditional block grant, it could increase in the future based on enrollment.

If enrollment drops, the block grant amount would not decrease. The state said no current TennCare members would experience a loss or rollback of benefits.

Also unlike a traditional block grant, if the state spent less in a given year than it would have under the traditional Medicaid system, Tennessee would split those savings with the federal government.

 

 

More older Americans need Medicare and Medicaid

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https://www.axios.com/newsletters/axios-vitals-e30baa47-bebc-4081-81a6-cb96115c5e55.html

 

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Retirement in America is growing less secure, physically and financially, given the omnipresent threat and cost of serious illness or disease, Bob reports.

Why it matters: Qualifying for Medicare does not guarantee that older adults will skirt potentially ruinous medical bills. Millions of seniors have also come to rely on the taxpayer-funded program for lower income people — Medicaid — and there’s no indication that will slow down.

By the numbers: More than 12 million Americans — most of them over 65 — have both Medicare and Medicaid coverage.

  • That represents about one-fifth of all Medicare enrollees, a percentage that has stayed stable over time even as more baby boomers enter the program.
  • This low-income population has some of the most expensive health care conditions and disabilities — averaging roughly $30,000 in annual spending per person, or double the average Medicare enrollee.

Between the lines: Some people who age into Medicare have very few assets and income, and therefore automatically qualify for Medicaid.

  • But retirees who consider themselves middle-class increasingly have to resort to Medicaid because high costs, like dementia or nursing home care, consume their entire nest egg.

What to watch: The federal government has been experimenting with ways to coordinate care better for this population, but that’s a reaction to seniors falling into poverty due to health care costs.

  • Unless policymakers address the high and rising costs of care, more retirees and their families will have to depend on both Medicare and Medicaid.

 

 

 

The Politics of Medicaid Expansion Have Changed

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https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2019/11/13/the-politics-of-medicaid-expansion-have-changed

Year by year, resistance to extending Medicaid to more low-income Americans in conservative states has given way. That trend seems likely to continue into 2020.

In some states, Democratic governors who favor expansion have replaced Republicans who were stalwart opponents. GOP critics have had a change of heart in some holdout states. And in several Republican-led states, citizen ballot initiatives are driving expansion.

Serious efforts are underway in Kansas, Missouri, North Carolina and Oklahoma that could add them to the 36 states, plus Washington, D.C., that have opted to expand Medicaid under the Affordable Care Act (ACA), also known as Obamacare. Three of those states adopted the expansion but have yet to implement the program.

Organizers in Missouri say they have collected a quarter of the 172,000 signatures they need to get a measure on the ballot next year. In Oklahoma, organizers say they have turned in 135,000 more signatures than required.

Proponents also are optimistic about a legislative breakthrough in Kansas, where Democratic Gov. Laura Kelly is finishing up her first year in office and expansion missed by a single vote this year in a Senate committee. And in North Carolina, a new Democratic governor and a Republican-led legislative effort give expansion the best chance it’s had in that state.

In Maine, Democratic Gov. Janet Mills in January signed an executive order implementing Medicaid expansion, which had been approved by voters in 2017 but blocked by her Republican predecessor. And in Montana, Democratic Gov. Steve Bullock in May signed a law extending Medicaid expansion for another six years.

Meanwhile, Idaho, Nebraska and Utah have submitted applications to the federal government to expand Medicaid after voters approved ballot initiatives last year.

History may be repeating itself. Although Congress created Medicaid in 1966, it was another 16 years before every state agreed to participate in the government health plan for lower-income Americans. In 1982, Arizona became the last state to sign up.

The politics surrounding the issue have changed dramatically in the past five years. Republican officeholders have shown an increasing willingness to break with party orthodoxy to support expansion. And the benefits of expansion have been thoroughly researched and publicized: Millions of Americans have gained coverage in expansion states, while rural and safety net hospitals have benefited from the additional federal resources.

Republican officeholders also have seen voters in red states signal their support for expansion at the ballot box.

In Mississippi, Democratic gubernatorial candidate Jim Hood championed expansion during his campaign. He eventually lost, but observers believe the issue helped him run a surprisingly close race against Republican Tate Reeves.

Although Kentucky has already expanded Medicaid, the winning Democratic gubernatorial challenger, Andy Beshear, made protection of the ACA a central feature of his campaign. His Republican opponent, incumbent Gov. Matt Bevin, is an outspoken opponent of the ACA. Beshear’s victory also is likely to mean that the state will stop trying to impose work requirements on Medicaid beneficiaries, a Bevin initiative.

Even Georgia’s conservative governor, Republican Brian Kemp, who highlighted his opposition to expansion in his 2018 campaign against Stacey Abrams, has softened. Earlier this week, he unveiled his own modified Medicaid expansion plan.

If not quite a conservative bandwagon, momentum is certainly moving in one direction, and policymakers in non-expansion states are taking note.

“People in Missouri know that other states right next door have passed it,” said Connie Farrow, spokeswoman for Healthcare for Missouri, the group leading the signature-gathering for that state’s ballot initiative. “Nebraska is a conservative state, and they passed it. Arkansas is a conservative state, and they passed it. Conservative states like Idaho and Utah, they’ve passed it.”

The experience states have had with expansion has made it harder to continue to stand against it, said Jesse Cross-Call, a senior health policy analyst with the Center on Budget Policy and Priorities, a liberal-leaning research and policy institute in Washington.

“There’s been a ton of evidence showing large gains in health care coverage, while helping states economically and keeping rural hospitals open,” Cross-Call said. “And it hasn’t hurt state budgets. It remains a really good deal for states to cover hundreds of thousands of people.”

New research this summer also makes the case that Medicaid expansion is literally a life-or-death decision for states. A study by the National Bureau of Economic Research found that at least 19,200 lives of adults aged 55 to 64 had been saved in states that had expanded Medicaid between 2014 and 2017.

At the same time, 15,600 people in that demographic died because their states hadn’t expanded. The deaths and non-deaths related to whether people with treatable chronic conditions, such as diabetes, heart disease and cancer, had access to health care.

It’s not just research that has made Medicaid expansion more palatable for Republican lawmakers, said Chris Pope, a health policy analyst with the Manhattan Institute, a free market policy center.

“As time goes by, the extent to which [Medicaid expansion] is associated with the Obama administration is weakening,” he said. “That makes it easier for Republicans in red states to move closer to expansion without being seen as complicit with Obamacare.”

“Plus,” Pope added, “the money is so attractive.”

Nevertheless, some Republicans are holding fast against expansion, warning that it is a financial risk their states can’t afford to take.

Missouri state Rep. Cody Smith, the Republican chairman of the House Budget Committee, told The Joplin Globe in August that he was “gravely concerned” about the Medicaid expansion initiative in his state. Missouri already spends a third of its budget on Medicaid, he pointed out. Smith did not respond to a message seeking comment.

“If we obligate ourselves to spend more money on Medicaid, those dollars have to come from other programs,” including education, Smith told the paper.

Red States Trickle In

Medicaid expansion was supposed to be a settled political issue after the Affordable Care Act passed in 2010. That’s because the law called for all states to expand Medicaid, offering eligibility to any adult earning up to 138% of the federal poverty line ($17,236 annual income for an individual), even those without children or a disability.

Federal and state governments share the financial burden of Medicaid, but Washington, D.C.’s share for the expansion population is higher than what it provides for the non-expansion Medicaid population. In the first years, the federal government paid 100% of the costs of the Medicaid expansion population. Starting next year, the federal match will be 90%.

The U.S. Supreme Court upended the original plan regarding expansion. In a 2012 ruling that otherwise upheld the ACA, the court made Medicaid expansion optional for states.

States with Democratic governors and legislatures signed up for the expansion for the start of its implementation in January 2014. A few Republican-led states, including Arizona, Michigan and Ohio, also joined immediately. Since then, red states have trickled into the expansion fold — including the three states that held initiatives last year and Montana. All are awaiting final federal approval.

And, if expansion proponents have their way, that trend will continue next year.

Donny Lambeth, a state representative in North Carolina, is among those Republican officeholders who have had a change of heart regarding expansion. He introduced a measure in the North Carolina House that would expand Medicaid, though with several wrinkles that depart from the plan by Democratic Gov. Roy Cooper.

Chief among those differences is a requirement that enrollees either work or enroll in a school or job training program. Lambeth also would raise taxes on hospitals to pay for the state’s increased Medicaid expenses.

“These are proud people who are working and want to take care of their families, but they can’t afford private insurance,” Lambeth said. He added that the trend of rural hospitals closing will continue unless expansion passes.

Eleven rural hospitals have closed in North Carolina since 2007, according to the North Carolina Rural Health Research Program at the University of North Carolina. Across the country, the program says 161 rural hospitals have shut their doors since 2005.

Support for expansion in North Carolina has come at the local level as well. The county commission in rural Graham County, by the Tennessee border, voted in September to urge the legislature to pass expansion.

“Republican leadership in the state just took the national Republican stance on it and opposed it just because it was something the Democrats had pushed,” said Dale Wiggins, the Republican chairman of the GOP-majority commission. “People doing what their political party wants rather than what the people of this country needs — that’s wrong.”

In Oklahoma, Republican lawmakers haven’t budged noticeably on expansion, but proponents got a boost in September when the former speaker of the House, Kris Steele, a Republican who had been wary of the ACA while in office, came out in favor of expansion at a town hall meeting.

“I believe [expansion] improves lives of working individuals and gives them an opportunity to be healthy and ultimately flourish in society,” Steele said in an interview. “From a conservative aspect of it, I think it makes sense for Oklahoma to have our own tax dollars to come back to our state to help out citizens.”

Strongest Prospects in Kansas

Prospects for expansion are likely strongest in Kansas. The legislature passed expansion in 2017, only to have the bill vetoed by then-Gov. Sam Brownback, a Republican. This year, the House passed an expansion bill in its legislative session but a Senate committee came up one vote shy of moving the measure to the floor.

Democratic Gov. Laura Kelly has redoubled efforts for passage next year. At the same time, Republican Senate Majority Leader Jim Denning has promised to put out his own expansion bill and has asked a special Senate committee to explore the issue.

In an interview with Stateline, Kelly said she is confident expansion will pass next year. “This is a huge issue in Kansas,” she said. “Everybody is up for re-election in 2020, and I think it is essential that this gets passed if they stand any chance of getting re-elected.”

Although the Trump administration has reviled both the ACA and Medicaid expansion, the Manhattan Institute’s Pope says that the administration’s actions may have pushed Republicans to seek expansion. From the beginning, the administration has encouraged states to customize their Medicaid programs, for example by requiring beneficiaries to work.

Conservative states such as Arkansas and Kentucky fashioned their expansion applications to the federal government around such proposals.

“The Trump administration by expanding options has made it more attractive to states,” Pope said.

A federal judge earlier this year threw out work requirements in Arkansas, Kentucky and New Hampshire. Those cases have been appealed. Arizona and Maine have both suspended plans to implement work requirements, and Democratic governors in Michigan and Virginia have raised alarms about carrying them out in their states.

The administration may want to give states flexibility in running their Medicaid programs, but it has also made clear it has no interest in encouraging expansion.

When Utah’s Republican governor and lawmakers this year tried to do a limited expansion that would have extended Medicaid eligibility only to residents with incomes below the poverty line, the Trump administration said it would not pay the higher federal match for a partial expansion. It said it didn’t want to encourage more states to expand Medicaid, even partially.

 

 

 

 

CMS pitches ramped up oversight of Medicaid payments, promises block grant guidance

Posted on by • Posted in 2020 Election Issues, America's Essential Hospitals, American Hospital Association (AHA), Center for Medicare and Medicaid Services (CMS), Health Policy, Health System, Hospital, Hospital Industry, Medicaid, Medicaid Block Grants, Safety Net Hospitals, Safety-Net Providers • Leave a comment

https://www.healthcaredive.com/news/cms-pitches-ramped-up-oversight-of-medicaid-payments-promises-block-grant/567135/

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UPDATE: Nov. 13, 2019: This brief has been updated to include comments from provider groups.

Dive Brief:

  • CMS proposed a new rule Tuesday that would establish stricter requirements for states to report information on supplemental Medicaid payments to providers in a bid to clamp down on spending and promote transparency.
  • The agency will also soon release guidance on how states can test alternative financing approaches in the safety net program like block grant and per-capita cap proposals for “certain optional adult populations,” CMS Administrator Seema Verma said Tuesday at the National Association of Medicaid Director’s annual conference in Washington, D.C.
  • Later this year, CMS will also issue guidance on how states can promote value-based payments and social determinants of health factors in Medicaid, Verma said. The Center for Medicare and Medicaid Innovation is currently developing several new payment models to push providers to take on more risk for their patient populations in those programs.

Dive Insight:

The moves are in line with sweeping changes from the Trump administration moving more power to the states and asking more from recipients. The CMS administrator teased late last month the agency would soon release new guidance for states to inject flexibility into their Medicaid programs.

“We shouldn’t ration care but instead make how we pay for care more rational,” Verma said Tuesday. “Medicaid must move toward value-based care.”

Speaking to the Medicaid directors Tuesday, Verma said the changes are aimed preserving Medicaid for future generations.

“Going forward there will be no new [State Innovation Model] grants, no more open-ended one-off district waivers,” she said. “We must move forward with a more unified, cohesive approach across payers, across CMS, across states.”

The proposed rule, called Medicaid Fiscal Accountability (MFAR), will add more scrutiny to supplemental payments, which are Medicaid payments to providers in addition to medical services rendered to Medicaid beneficiaries, such as payments supporting quality initiatives or bolstering rural or safety net providers.

Some states rely heavily on these additional payments to offset low Medicaid reimbursement or support struggling hospitals. Provider lobbies did not take kindly to the new rule.

“We share the government’s desire to protect patients and taxpayers with transparency in federal programs, but today’s proposal oversteps this goal with deeply damaging policies that would harm the healthcare safety net and erode state flexibility,” Beth Fledpush, SVP of policy and advocacy for America’s Essential Hospitals, said in a statement.

AEH, which includes more than 300 member hospital and health systems, many of which are safety net providers, asked CMS to withdraw the proposal. The American Hospital Association told Healthcare Dive it was still reviewing the rule and declined comment.

However, government oversight agencies like the Government Accountability Office and the Office of Inspector General have recommended changes to these payments, which have increased from 9.4% of Medicaid payments in 2010 to 17.5% in 2017, according to CMS.

MFAR would also propose new definitions for “base” and “supplemental” payments in order to better enforce statutory requirements around and eliminate vulnerabilities in program spending.

Verma has long teased CMS support of block grants, an idea popular with conservatives, but Tuesday’s speech solidifies the agency’s support of such proposals. A handful of red states have been mulling over capped spending to gain more clarity around budgets.

In September, Tennessee unveiled its plan to move to a block grant system that would set a floor for federal contributions adjusted on a per capita basis if enrollment grows. Any savings would be shared between the state and the government.

Tennessee must submit a formal application to CMS to later than Nov. 20. If approved, it would become the first state to use a block grant funding mechanism in Medicaid. Additionally, Utah submitted a waiver application seeking per-capita Medicaid caps in June; Oklahoma Gov. Kevin Stitt, a Republican, is reportedly considering such a program; and Alaska and Texas have both commissioned block grant studies.

 

 

 

CMS retains 340B, site-neutral payment cuts in final hospital payment rule

Posted on by • Posted in American Hospital Association (AHA), Center for Medicare and Medicaid Services (CMS), District Court, District Court of Appeals, Health Policy, Health System, Hospital, Hospital Industry, Medicaid, Medicare, Medicare 340B Drug Discount Program, Medicare Site Neutral Payment, Outpatient Prospective Payment System (OPPS), Safety Net Hospitals, Safety-Net Providers • Leave a comment

https://www.fiercehealthcare.com/hospitals-health-systems/cms-retains-340b-site-neutral-payment-cuts-final-hospital-payment-rule?utm_medium=nl&utm_source=internal&mrkid=959610&mkt_tok=eyJpIjoiWTJZd1pqWXpZbVUwWTJKbSIsInQiOiJLV2JJQWM1clQ3OVBiaURjdFVUUUg2K093U21XZm0zVHNPa1hTUjdTWEdxSWZpYklsako0TVMrZFYxazVGZHFkOHJ3M1pWNlwvYW5pVWpPcjM1TEtVRnErOWgxU3NKc1dcLzk3TnZTc1pLZVI0Ymcrb0V1ZEZ2eDh1djFwa1FlaW50In0%3D

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The Trump administration finalized a hospital payment rule Friday that retains proposed cuts to off-campus clinics and the 340B drug discount program. 

The changes outlined in the hospital Outpatient Prospective Payment System (OPPS) rule come despite both cuts being struck down in legal challenges and amid major pushback from providers.

Site-neutral payments

The agency decided to move ahead with the two-year phase-in of the cuts to outpatient services for clinic visits furnished in an off-campus hospital outpatient setting. The goal is to bring payments to off-campus clinics in line with standalone physicians’ offices.

“With the completion of the two-year phase-in, the cost sharing will be reduced to $9, saving beneficiaries an average of $14 each time they visit an off-campus department for a clinic visit in [calendar year] 2020,” the Centers for Medicare & Medicaid Services (CMS) said in a fact sheet.

However, the two-year project that was supposed to start in 2019 has been halted because of a federal court ruling.

CMS decided to move forward with the cuts for off-campus clinics.

“The government has appeal rights, and is still evaluating the rulings and considering, at the time of this writing, whether to appeal the final judgment,” the agency said.

The American Hospital Association (AHA) said that the site-neutral payment rule was misguided and that CMS ignored the recent court ruling. 

“There are many real and crucial differences between hospital outpatient departments and the patient populations they serve and other sites of care,” said Tom Nickels, executive vice president of the AHA, in a statement.

CMS also finalized a proposed cut for the 340B program that cuts payments by 22.5% in 2020.

CMS has installed prior cuts in 2018 and 2019 to the program that requires drug companies to provide discounts to safety-net hospitals in exchange for getting their products covered on Medicaid.

However, a court ruling has struck down the cuts, and CMS is currently appealing the decision.

CMS said that it hopes to conduct a 340B hospital survey to collect drug acquisition cost data for 2018 and 2019, and the survey will craft a remedy if the appeal doesn’t go their way.

“In the event the 340B hospital survey data are not used to devise a remedy, we intend to consider the public input to inform the steps we would take to propose a remedy for CYs 2018 and 2019 in the CY 2021 rulemaking,” the agency said.

Hospital groups commented that CMS should drop both the 340B and site-neutral cuts because of the legal challenges.

Several groups weren’t happy that the cuts were still there.

“The agency also prolongs confusion and uncertainty for hospitals by maintaining unlawful policies it has been told to abandon in clear judicial directives,” said Beth Feldpush, senior vice president of policy and advocacy for America’s Essential Hospitals, in a statement Friday.

The hospital-backed group 340B Health added that CMS needs to stop this “unfunny version of ‘Groundhog Day’ and restore Medicare payments for 340B hospitals to their legal, statutory level.”