MACPAC: Slow Medicaid DSH Cuts

Slow the pace of scheduled cuts in Medicaid disproportionate share hospital payments (Medicaid DSH), the non-partisan agency that advises Congress and the administration will tell Congress in its next report of policy recommendations.

The Medicaid and CHIP Payment and Access Commission voted 16-1 recently to recommend to Congress that Medicaid DSH cuts, mandated by the Affordable Care Act but delayed three times by Congress, be reduced in size and spread out over a longer period of time.

Currently, Medicaid DSH allotments to the states are scheduled to be reduced $4 billion in FY 2020 and then $8 billion a year in FY 2021 through FY 2025.  MACPAC recommends that the cuts be reduced to $2 billion in FY 2020, $4 billion in FY 2021, $6 billion in FY 2022, and $8 billion a year from FY 2023 through FY 2029.

MACPAC commissioners also voted to urge Congress to restructure the manner in which Medicaid DSH allotments to the states are calculated based on the number of low-income individuals who reside in the states.

Most private safety-net hospitals receive Medicaid DSH payments and consider them a vital resource in helping to underwrite the uncompensated care they provide to uninsured patients.  NASH supports delaying the implementation of Medicaid DSH cuts and reducing the size of the cuts once implementation begins, doing so most recently in a letter to Senator Marco Rubio in response to Mr. Rubio’s introduction of Medicaid DSH legislation.

MACPAC is a non-partisan legislative branch agency that provides policy and data analysis and makes recommendations to Congress, the Secretary of the U.S. Department of Health and Human Services, and the states on a wide array of issues affecting Medicaid and the State Children’s Health Insurance Program.

Learn more about MACPAC’s actions on Medicaid DSH in the Fierce Healthcare article “MACPAC calls for Congress to delay cuts to safety-net hospitals.”

NASH Comments on Proposed Medicaid DSH Revamp

In mid-December, Senator Marco Rubio (R-FL) introduced the State Accountability, Flexibility, and Equity (SAFE) for Hospitals Act, which seeks to restructure the federal Medicaid disproportionate share hospital payment program (Medicaid DSH).  Hospitals that care for especially large numbers of Medicaid, low-income, and uninsured patients often receive supplemental payments, called Medicaid DSH payments, from their state government to help underwrite costs associated with such patients for which they are not reimbursed.  Medicaid DSH payments are funded in part by the federal government and in part by the individual states.

As part of his introduction of his bill, Senator Rubio contacted many stakeholder groups and invited them to review and comment upon his proposal.

Among the groups contacted was the National Alliance of Safety-Net Hospitals, and last week, NASH wrote to Senator Rubio to convey its views.

Instead of addressing specific aspects of the proposal, NASH offered three principles it believes should guide any effort to modify the Medicaid DSH program.  Those principles are:

  • Delay the scheduled Medicaid DSH cuts. (Significant reductions of Medicaid DSH allotments to states, mandated by the Affordable Care Act but delayed three times by Congress, are scheduled to take effect in FY 2020.)
  • Any changes in Medicaid DSH must reflect the role Medicaid DSH plays in state Medicaid programs.
  • Any changes in Medicaid DSH must preserve states’ flexibility to use Medicaid DSH resources in the manner they believe best serves their individual Medicaid programs.

Learn more about the SAFE Hospitals Act from Senator Rubio’s news release outlining the proposal and learn about NASH’s response to his request for stakeholder input from the letter NASH sent to Senator Rubio last week.

 

CMS Introduces New Waivers

The Centers for Medicare & Medicaid Services has introduced four new “state relief and empowerment waivers” that are widely viewed as new vehicles for states to circumvent Affordable Care Act requirements to implement their own new approaches to health care.

  • Through “account-based subsidies” waivers, states may direct public subsidies into defined-contribution, consumer-directed accounts that individuals use to pay for health insurance premiums or other health care expenses.
  • “State-specific premium assistance” waivers enable states to create their own subsidy programs.
  • “Adjusted plan options” authorizes states to provide financial assistance for different types of health insurance plans, including short-term and other health insurance policies that do not meet Affordable Care Act benefits and coverage requirements.
  • “Risk stabilization strategies” waivers give states greater flexibility to implement reinsurance programs or high-risk pools.

These waiver options have been introduced not through regulations but through guidance published in the Federal Register.  States must apply for these waivers, which must meet section 1332 federal standards for  comprehensiveness, affordability, coverage, and federal deficit neutrality.

Learn more about state relief and empowerment waivers in this CMS fact sheet and this guidance that was published in the Federal Register.

Medicaid Birthing Model Improves Outcomes

A federal program to improve birth outcomes among Medicaid-covered women has produced positive results:  lower rates of pre-term births, fewer low birthweight babies, fewer C-sections, lower delivery costs, and lower first-year health care spending.

The “Strong Start for Mothers and Newborns” program was a four-year initiative established by the Affordable Care Act and developed by the U.S. Department of Health and Human Services’ Center for Medicare and Medicaid Innovation to employ patient education, nutrition, exercise, preparation for childbirth, breast-feeding, and family planning rather than strictly medical interventions and was delivered through three evidence-based prenatal care models:  Birth Centers, Group Prenatal Care, and Maternity Care Homes.

The program, operated in 219 separate sites in 32 states, served participants with especially challenging socio-economic risk factors:  unemployment, lack of a high school degree or GED, food insecurity, transportation challenges, chronic health problems, and previous poor birth outcomes.  The objective of the program was to find ways to overcome these social determinants of health and produce better birth outcomes and now, a new, independent evaluation has found that it did.

Learn more about Strong Start for Mothers and Newborns and what it has produced in the official program evaluation document.

Election Brings Good News for Medicaid

Medicaid came out on top in elections throughout the country last week.

With the arrival of a Democratic majority in the House, attempts to repeal the Affordable Care Act, including its Medicaid expansion, appear to have come to an end – at least for now.

Voters in three states approved ballot questions to expand their states’ Medicaid programs.

And two states elected governors likely to expand their states’ Medicaid programs.

Learn more about what the mid-term elections meant to Medicaid and its future in this Washington Post story.

 

Medicaid Expansion Helping Diabetics

The Affordable Care Act’s Medicaid expansion has led to a 40 percent increase in the number of prescriptions for diabetes medicine filled in the 30 states that expanded their Medicaid programs.

Meanwhile, there was no change in the number of diabetes-related prescriptions filled in states that did not expand their Medicaid programs.

This is considered important because it suggests that many low-income people who either could not afford their diabetes medicine or whose illness was undiagnosed are now being treated for the disease – a significant development because every diabetic who is treated for the condition represents a cost savings of $6394 a year, mostly because of fewer hospitalizations.

Because diabetes is especially prevalent in the low-income communities urban safety-net hospitals serve, these hospitals have played a major role in bringing much-needed treatment to their communities, improving their health of their residents, and helping to reduce health care costs.

Learn more about how Medicaid expansion is improving the health of low-income people with diabetes and lowering health care spending in this California Healthline report or go here to see the Health Affairs study “Medicaid Eligibility Expansions May Address Gaps in Access to Diabetes Medications” on which that report is based.

Pay Raise Didn’t Lead More Docs to Participate in Medicaid

The temporary rate increase that the Affordable Care Act provided as means of encouraging more doctors to serve Medicaid patients did not work, according to two new studies published in the journal Health Affairs.

According to the studies, the increase in the number of physicians who decided to begin serving Medicaid patients as a result of the fee increase was negligible.

Among the reasons the studies’ authors offer for the lack of growth in the participation of doctors are the limited nature of the pay raise and the documentation required to receive it.

Despite this, the authors note, access to care did improve as a result of the Affordable Care Act’s Medicaid expansion.

Learn more about the studies, their results, and their significance by going here to see the Health Affairs report “No Association Found Between The Medicaid Primary Care Fee Bump And Physician-Reported Participation In Medicaid and here for the study “Physicians’ Participation In Medicaid Increased Only Slightly Following Expansion.”

Hospital Government Payment Losses Could Reach $218 Billion by 2028

A recent study concluded that hospitals can expect to lose about $218 billion in federal Medicare and Medicaid payments between 2010, when the latest round of major cuts began, and 2028.

Among those cuts cited in the study, which was commissioned by the American Hospital Association and the Federation of American Hospitals, are:

  • $79 billion for DRG documentation and coding adjustments
  • $73 billion for Medicare sequestration
  • $26 billion for Medicaid disproportionate share payments (Medicaid DSH)
  • $11 billion in cuts associated with the American Taxpayer Relief Act of 2012

Other cuts came, or will be coming, through regulatory changes, the introduction of value-based payment programs, and other means.

Learn more about these cuts and their potential implications in this Healthcare Dive story.

 

Verdict: Medicaid Expansion Improved Care and Access

A new review of studies published since the Affordable Care Act’s Medicaid expansion has concluded that expansion improved care, access to care, and coverage in states that expanded their Medicaid programs.

Among the improvements cited by studies are:

  • greater use of primary care
  • more preventive health visits
  • more behavioral health care
  • shorter hospital stays
  • fewer avoidable hospital admissions
  • reduced access problems
  • reduced reliance on hospital ERs as a primary source of care
  • improved monitoring and compliance rates for patients with diabetes and hypertension
  • higher rates of screening for prostate cancer and Pap smears

In addition, hospitals provided less uncompensated care and had better margins.

Learn more in the Health Affairs study “The Effects Of Medicaid Expansion Under The ACA:  A Systematic Review,” which can be found here, or go here for a Healthcare Dive summary of the study.

HHS Unveils Spring Regulatory Agenda

The U.S. Department of Health and Human Services has published a comprehensive list of the regulatory actions it plans to take in the coming months.

Included on the list are regulations that have been proposed, that are being finalized, and that are currently under development.  They address Medicare, Medicaid, Food and Drug Administration endeavors, medical devices, the 340B prescription drug discount program, and more.

Among the policy changes contemplated through future regulations are measures to reduce regulatory burdens for hospitals, address the opioid problem, facilitate the use of non-Affordable Care Act-compliant health insurance plans, and more.

Go here to see a complete list of the areas for proposed regulatory action by HHS and for links to brief statements about the contemplated actions.