Medicaid Pocket Primer

http://kff.org/medicaid/fact-sheet/medicaid-pocket-primer/?utm_campaign=KFF-2017-January-Medicaid-State-Fact-Sheets&utm_source=hs_email&utm_medium=email&utm_content=41471819&_hsenc=p2ANqtz-_S79w90jSbC_aQNCkHzxPacGPZs7cC1nG5ZS0uvISb4SYLhCIP5ePQipcV2y2vvfgT5bXqOi8B2t5k6zuxzez1QOppJw&_hsmi=41471819

Figure 1: Medicaid’s Role for Selected Populations

WHAT IS MEDICAID?

Medicaid is the nation’s public health insurance program for people with low income. The Medicaid program covers more than 70 million Americans, or 1 in 5, including many with complex and costly needs for care. The vast majority of Medicaid enrollees lack access to other affordable health insurance. Medicaid covers a broad array of health services and limits enrollee out-of-pocket costs. The program is also the principal source of long-term care coverage for Americans. As the nation’s single largest insurer, Medicaid provides significant financing for hospitals, community health centers, physicians, and nursing homes, and jobs in the health care sector. The Medicaid program finances over 16% of all personal health care spending in the U.S.

HOW IS THE MEDICAID PROGRAM STRUCTURED? 

Medicaid is a federal-state program. Subject to federal standards, states design and administer their own Medicaid programs. Beyond the federal requirements, states have extensive flexibility to determine covered populations, covered services, health care delivery models, methods for paying physicians and hospitals, and many other aspects of their Medicaid programs. States can also get Section 1115 waivers to test and implement approaches that diverge from federal Medicaid rules but that the Secretary of Department of Health and Human Services (HHS) determines advance program objectives. All Americans who meet Medicaid eligibility requirements are guaranteed coverage.

The federal government matches state Medicaid spending on an open-ended basis. The guarantee of federal matching funds increases state resources for coverage of their low-income residents and also permits state Medicaid programs to respond to demographic and economic shifts, changing coverage needs, technological innovations, public health emergencies such as the opioid addiction crisis, and disasters and other events beyond states’ control. Medicaid is a complex program because it has evolved over time to serve diverse populations with a wide range of needs, including many individuals who are very poor and very frail, and because of wide variation across state Medicaid programs. The Centers for Medicare and Medicaid Services (CMS) within HHS is the federal agency responsible for Medicaid. Title XIX of the Social Security Act and a large body of federal regulations govern the program, defining federal Medicaid requirements and state options and authorities.

Medicaid Financing: The Basics

http://kff.org/report-section/medicaid-financing-the-basics-issue-brief/

 Figure 1: Medicaid costs are shared by the states and the federal government.

 

Why risk adjustment is a crucial component of individual market reform

https://www.brookings.edu/blog/up-front/2017/01/25/why-risk-adjustment-is-a-crucial-component-of-individual-market-reform/

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The mantra of ‘Repeal and Replace’ has escalated in recent weeks, though what, specifically, the ‘Replace’ component might look like is still unclear. However, many of the current proposals include, at a minimum, some type of continuous coverage provision that allows people with chronic health conditions who have continuously maintained coverage to buy health insurance at standard rates. For example, Paul Ryan’s A Better Way proposal and Tom Price’s Empowering Patients First Act would each prohibit insurers from charging sicker patients more than standard premiums in the individual market as long as they have maintained continuous coverage since before becoming sick.

Such provisions are important to keep patients from seeing their health insurance premiums sky-rocket after becoming sick, which would defeat the purpose of insurance in the first place. However, these provisions also require that insurers sell policies to these patients at premiums that they know will not cover their expected health care spending, generating losses for the insurance company. On its own, this would create a situation where insurers have a strong financial incentive to avoid enrolling these sicker patients.

Risk adjustment combats disincentives to provide coverage for sicker patients

In order to mitigate these incentives for insurance companies to avoid sicker patients, policymakers will need to include a risk adjustment program in any replacement reforms that require insurers to issue insurance to any applicant (also known as “guaranteed issue”) and set limits on adjusting premiums to fully reflect an enrollee’s health status. Continuous coverage provisions are one example of such limits, but risk adjustment will be necessary to combat against adverse selection across a wide range of potential reforms.

A risk adjustment program would make behind-the-scenes financial transfers to insurers to adequately compensate them for enrolling these sicker patients when they are not allowed to charge the individual higher premiums. Risk adjustment will be necessary to promote a well-functioning market where private insurers compete based on the value they deliver and not simply by avoiding sicker patients.

Improving Quality and Value in the U.S. Health Care System

https://www.brookings.edu/research/improving-quality-and-value-in-the-u-s-health-care-system/

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Executive Summary

The U.S. health care system faces significant challenges that clearly indicate the urgent need for reform. Attention has rightly focused on the approximately 46 million Americans who are uninsured, and on the many insured Americans who face rapid increases in premiums and out-of-pocket costs. As Congress and the Obama administration consider ways to invest new funds to reduce the number of Americans without insurance coverage, we must simultaneously address shortfalls in the quality and efficiency of care that lead to higher costs and to poor health outcomes. To do otherwise casts doubt on the feasibility and sustainability of coverage expansions and also ensures that our current health care system will continue to have large gaps — even for those with access to insurance coverage.

There is broad evidence that Americans often do not get the care they need even though the United States spends more money per person on health care than any other nation in the world. Preventive care is underutilized, resulting in higher spending on complex, advanced diseases. Patients with chronic diseases such as hypertension, heart disease, and diabetes all too often do not receive proven and effective treatments such as drug therapies or selfmanagement services to help them more effectively manage their conditions. This is true for insured, uninsured, and under-insured Americans. These problems are exacerbated by a lack of coordination of care for patients with chronic diseases. The underlying fragmentation of the health care system is not surprising given that health care providers do not have the payment support or other tools they need to communicate and work together effectively to improve patient care.

While many patients often do not receive medically necessary care, others receive care that may be unnecessary, or even harmful. Research has documented tremendous variation in hospital inpatient lengths of stay, visits to specialists, procedures and testing, and costs — not only by different geographic areas of the United States, but also from hospital to hospital in the same town. This variation has no apparent impact on the health of the populations being treated. Limited evidence on which treatments and procedures are most effective, limited evidence on how to inform providers about the effectiveness of different treatments, and failures to detect and reduce errors further contribute to gaps in the quality and efficiency of care. These issues are particularly relevant to lower-income Americans and to members of diverse ethnic and demographic groups who often face great disparities in health and health care.

Reforming our health care delivery system to improve the quality and value of care is essential to address escalating costs, poor quality, and increasing numbers of Americans without health insurance coverage. Reforms should improve access to the right care at the right time in the right setting. They should keep people healthy and prevent common, avoidable complications of illnesses to the greatest extent possible. Thoughtfully constructed reforms would support greater access to health-improving care — in contrast to the current system, which encourages more tests, procedures, and treatments that are at best unnecessary and at worst harmful.

This report reviews the evidence on a range of payment and delivery system reforms designed to improve quality and value. It reaches several conclusions:

What’s the biggest test Trump will face in 2017? ‘Bipartisan support’ for Obamacare’s replacement

https://www.brookings.edu/opinions/whats-the-biggest-test-trump-will-face-in-2017-bipartisan-support-for-obamacares-replacement/?utm_campaign=Economic+Studies&utm_source=hs_email&utm_medium=email&utm_content=41494378

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President-elect Trump created a huge challenge for himself by vowing to repeal Obamacare and replace it with “something great,” with details to follow the election. Now he must deliver without creating a lasting political liability for his new administration.

Repeal is easy. The money aspects of Obamacare—subsidies to make insurance affordable, penalties for not having insurance, expanded Medicaid funding and added taxes—can all be scrapped by using the budget reconciliation process that requires only a majority vote in each chamber and the president’s signature.

But repeal by itself would create a human and political disaster. At least 20 million people would lose their health insurance; millions of others would be unable to buy affordable coverage in a chaotic individual insurance market; many doctors, hospitals and other health providers would lose paying customers; and states would feel the pinch of cuts in federal Medicaid money. Ironically, many of the states that made the most dramatic progress reducing their uninsured populations under Obamacare, and would suffer the most disruption from repeal, are the Rust Belt and Appalachian States that put Trump over the top. To avoid starting the new administration in a political hole, “Repeal” must be followed promptly by “Replace” (with a smooth transition between the two), as the president-elect himself pointed out on “60 Minutes.”

The political challenge is that the replacement for Obamacare must have broad bipartisan support—and not just because Republicans have only 52 seats in the Senate and need 60 votes to quash a filibuster. More importantly, as the history of Obamacare illustrates, health reform supported by only one party is unlikely to survive in this deeply polarized nation. If President Trump is to create a lasting legacy in health care, not just another political football, he needs buy-in from most of his own party and a significant fraction of Democrats.

 

Republican governors have a stake in keeping the Medicaid expansion. Will congressional Republicans listen?

https://www.brookings.edu/blog/fixgov/2017/01/24/medicaid-governors-and-congress/

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The House and Senate took the first steps two weeks ago towards an eventual repeal of parts of the Affordable Care Act (ACA). At the same time, significant uncertainty as to how efforts proceed from here remains. There are disagreements among congressional Republicans on virtually every component of a path forward, including a timeline, the connections between a repeal bill and an approach to replacement, and what, if any, components of the law should be preserved.

One important set of actors, however, has already begun to weigh in on the process: several of the nation’s Republican governors. In particular, a number—including Charlie Baker of Massachusetts, Rick Snyder of Michigan, John Kasich of Ohio, Asa Hutchinson of Arkansas, and Brian Sandoval of Nevada—have voiced concerns about eliminating the Medicaid expansion. Together, these governors—several of whom recently met with members of the Senate Finance Committee to discuss the law—lead roughly one third of the 16 states that chose to expand Medicaid and currently have Republican executives. According to new data from the Kaiser Family Foundation, they represent roughly 2.2 million individuals who enrolled in Medicaid in 2015 thanks to the ACA’s expansion, or roughly 6 percent of the total population in these states. (By comparison, the national average for states for which Kaiser was able to obtain data is roughly 7 percent of a state’s population.)

In the case of Medicaid, as political scientist Shanna Rose has demonstrated, Republican governors have a long history of taking a different tack than their national counterparts. One source of this state-level variation involves the ability of the Secretary of Health and Human Services to waive provisions of federal law, at a state’s request, to allow for Medicaid pilot, or demonstration, programs. Beginning in earnest during the Reagan administration and escalating in particular under Clinton, governors nationwide have experimented with service delivery through waivers. Some feared that this experimentation could lead to restricted access, but research by Frank Thompson and Courtney Burke finds that, pre-ACA, governors more often than not used section 1115 Medicaid waivers to expand access for low-income Americans. This historical trend has continued throughout the ACA era, as governors have bargained with the Obama administration to secure waivers that expand access to Medicaid in their states.

 

Why Republicans can’t – and won’t – repeal Obamacare

https://www.brookings.edu/opinions/why-republicans-cant-and-wont-repeal-obamacare/?utm_campaign=Economic+Studies&utm_source=hs_email&utm_medium=email&utm_content=41494378

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Now that the Republicans control both the presidency and both houses of Congress, they must put up or shut up on their promise to repeal and replace Obamacare. Here is a flat-footed prediction: the effort will fail for three reasons. First, the Affordable Care Act (aka the ACA or Obamacare) has largely succeeded not failed, as president-elect Trump and other Republicans falsely allege. Second, it is impossible for the stated goals of repeal to be achieved. Finally, the political fallout from the consequences of partial or total repeal would be devastating. When it comes to casting votes, enough Republicans will conclude that repeal is a bad idea and will join Democrats to sustain the basic structure of the health reform law.

2016 Health Care Year in Review

http://www.commonwealthfund.org/publications/blog/2016/dec/2016-health-care-year-in-review

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This was a tumultuous year in health care and elsewhere. Wherever we looked, the improbable and unbelievable became true and believable: from Brexit to a President-elect Trump to alleged foreign sabotage of our political institutions. Historians will dissect the remnants of these events for decades. For us, for now, let’s focus on health care, which is plenty.

Incomes Aren’t Keeping up with Employees’ Health Plan Costs

http://www.commonwealthfund.org/interactives-and-data/infographics/2016/incomes-arent-keeping-up-with-employees-health-plan-costs

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