Study Looks at Medicaid and Managed Care

A new Commonwealth Fund study examines how managed care plans have tackled serving new members in Affordable Care Act-authorized Medicaid expansion states.

According to the report, these managed care organizations have

…focused on identifying and helping high-risk populations and addressing the social determinants of health. MCOs are testing value-based payment strategies that link payment with performance and are increasingly focused on engaging patients in their care. Leaders report common challenges: setting appropriate payment rates; managing members whose needs differ from traditional Medicaid beneficiaries; ensuring access to specialty care; and effectively implementing payment reform and practice transformation.

Learn more about how managed care plans have served the Medicaid expansion population in the Commonwealth Fund report “Medicaid Payment and Delivery Reform:  Insights From Managed Care Plan Leaders in Medicaid Expansion States,” which can be found here.

A New Wave of Medicaid Expansion?

Spurred by the Trump administration’s invitation to states to apply for approval to make work requirements a part of their Medicaid program, a number of states that spurned the opportunity created for expansion under the Affordable Care Act may consider pursuing Medicaid expansion in the near future.

Currently, some elected officials in Idaho, Kansas, North Carolina, Utah, Virginia, and Wyoming appear to be considering what they once considered unthinkable:  making more of their residents eligible for Medicaid.

For the most part, expansion talk is coming from moderate Republican legislators who believe a work requirement may help soften the staunch opposition to Medicaid expansion among their more conservative Republican colleagues – and at this point it is all still just talk.

Ten states have already sought federal approval to establish a work requirement as part of their Medicaid programs and one state, Kentucky, has already had such a request approved.

Learn more about how a federal move to reduce the number of people on the nation’s Medicaid rolls may actually result in an increase in nation-wide Medicaid enrollment in this Washington Post story.

NAUH Asks Congressional Leaders to Delay Medicaid DSH Cut

Delay cuts in Medicaid disproportionate share (Medicaid DSH) allotments to states, NAUH has asked congressional leaders.

Medicaid DSH payments, which help private safety-net hospitals with the cost of caring for their low-income and uninsured patients, were slated for cuts under the Affordable Care Act in anticipation of a steep decline in the number of uninsured Americans.  While the reform law has helped millions obtain insurance, safety-net hospitals continue to serve large numbers of low-income and uninsured patients.  Recognizing this, Congress has twice delayed this Medicaid DSH cut but its moratorium on the cut ended on December 31.

Now, NAUH has asked the leaders of Congress to restore the Medicaid DSH cut delay as part of their current budget deliberations.

See NAUH’s letter to congressional leaders here.

ACA Improves Access to Surgical Services

The Affordable Care Act’s Medicaid expansion has improved access to surgical services for Medicaid patients.

Or so says a new study published in JAMA Surgery, which reports that

In this study of patients with 1 of 5 common surgical conditions, Medicaid expansion was associated with a 7.5–percentage point increase in insurance coverage at the time of hospital admission. The policy was also associated with patients obtaining care earlier in their disease course and with an increased probability of receiving optimal care for those conditions.

As a result, the study found,

The ACA’s Medicaid expansion was associated with increased insurance coverage and improved receipt of timely care for 5 common surgical conditions.

This development is especially relevant to private safety-net hospitals because they serve so many more Medicaid patients in the predominantly low-income communities in which they are located.

Learn more about the study, its findings, and the implications in the JAMA Surgery report “Association of the Affordable Care Act Medicaid Expansion With Access to and Quality of Care for Surgical Conditions,” which can be found here.

Safety-Net Hospitals Under the Gun

Safety-net hospitals across the country – including private safety-net hospitals – face a new challenge:  adjusting to several cuts in the supplemental payments they receive from the federal government to help them serve the low-income residents of the communities in which they are located.

First there is a $2 billion cut in Medicaid disproportionate share hospital payments (Medicaid DSH).  These are payments made to hospitals that serve especially large numbers of low-income patients.  These payments help safety-net hospitals with the unreimbursed expenses they incur caring for such patients.  This cut, mandated by the Affordable Care Act but twice delayed by Congress, took effect on January 1.  In many states the value of Medicaid DSH cuts will exceed the reductions in uninsured care that hospitals have experienced since the Affordable Care Act made health insurance more widely available.

Second there is a 28 percent cut in Medicare payments for prescription drugs dispensed through the section 340B prescription drug discount program.  This cut, too, took effect on January 1.

Finally, federal funding has lapsed for the Children’s Health Insurance Program (CHIP) and for community health centers.

Safety-net hospitals are considering a number of moves to offset these losses.  Among them:  reducing or eliminating services, laying off staff, discontinuing the provision of transportation assistance, and eliminating post-discharge assistance to patients.  One safety-net hospital is even considering discontinuing providing chemotherapy to cancer patients because such drugs are especially expensive and often reimbursed through the 340B program.

These cuts have serious implications both for private safety-net hospitals and for the communities they serve.

Learn more about the cuts private safety-net hospitals face, their implications, and how they might respond to them in this Stateline article.

Medicaid Expansion Helps Save Hospitals

Hospitals in states that took advantage of the Affordable Care Act to expand their Medicaid programs are six times less likely to close than hospitals in non-expansion states.

And the impact of Medicaid expansion is even more beneficial for hospitals that serve rural communities.

These are among the new findings in a new study that examines the effect of Medicaid expansion on hospital finances and hospital closures.  Among those findings,

We found that the ACA’s Medicaid expansion was associated with improved hospital financial performance and substantially lower likelihoods of closure, especially in rural markets and counties with large numbers of uninsured adults before Medicaid expansion.

According to the study, these hospitals, as a result of Medicaid expansion, served fewer uninsured patients and provided less uncompensated care than they previously had, thereby improving their financial health.  This effect has been especially pronounced in communities with especially large numbers of uninsured patients – communities like those served by urban safety-net hospitals.

For this reason, the study’s authors conclude that

Future congressional efforts to reform Medicaid policy should consider the strong relationship between Medicaid coverage levels and the financial viability of hospitals. Our results imply that reverting to pre-ACA eligibility levels would lead to particularly large increases in rural hospital closures. Such closures could lead to reduced access to care and a loss of highly skilled jobs, which could have detrimental impacts on local economies.

 To learn more, go here, to the Health Affairs web site, to see the study “Understanding The Relationship Between Medicaid Expansions And Hospital Closures.”

The Continued Need for Medicaid DSH

While the Affordable Care Act has greatly increased the number of Americans with health insurance and reduced the demand for uncompensated care from hospitals, many hospitals still see significant numbers of uninsured patients.

Some of those patients simply have not taken advantage of the health reform law’s creation of easier access to affordable insurance while others live in states that have not expanded their Medicaid programs.

Hospitals that care for especially large numbers of such uninsured patients qualify for Medicaid disproportionate share hospital payments, commonly referred to as Medicaid DSH.  The purpose of these payments is to help these hospitals with the unreimbursed costs they incur caring for such patients.

The Affordable Care Act calls for reducing Medicaid DSH payments to hospitals.  Many hospitals and hospital groups – including the National Association of Urban Hospitals – oppose this cut and are asking Congress to block its implementation.

The Commonwealth Fund recently published a commentary calling for delaying scheduled Medicaid DSH cuts.  Go here to see the article “Keep Harmful Cuts in Federal Medicaid Disproportionate Share Hospital Payments at Bay.”

 

House Members Seek Delay of DSH Cuts

221 members of the House of Representatives have written to House leaders asking them to delay cuts in Medicaid disproportionate share payments (Medicaid DSH) that are scheduled to begin on October 1.

The cuts, mandated by the Affordable Care Act, have already twice been delayed by Congress, both times for two years, and now, a majority of House members have written to House speaker Paul Ryan and minority leader Nancy Pelosi asking them to advance legislation to delay Medicaid DSH cuts once again.

The purpose of Medicaid DSH payments is to help hospitals that serve especially large numbers of low-income patients to absorb some of the losses they incur serving uninsured and underinsured people.  All private safety-net hospitals receive Medicaid DSH payments and NAUH recently wrote to House members asking them to sign this letter asking Mr. Ryan and Ms. Pelosi.

See the letter to House leaders here and see NAUH’s letter to House members here.

NAUH Urges House to Delay Medicaid DSH Cuts

The House of Representatives should delay the proposed implementation of major cuts in Medicaid disproportionate share (Medicaid DSH) allotments to the states.

The reduction of Medicaid DSH allotments, mandated by the Affordable Care Act, has already been delayed twice by Congress, and now, a bipartisan letter is being circulated among House members asking House Speaker Paul Ryan and House minority leader Nancy Pelosi to move legislation to delay the Medicaid DSH cuts again for another two years.

In its message, NAUH has asked House members to sign onto the letter, which is being circulated by Representatives Eliot Engel (D-NY), John Culberson (R-TX), and Steve Palazzo (R-MS).

All private safety-net hospitals receive Medicaid DSH payments and all consider them a vital source of revenue to help them serve the low-income residents of the communities in which they are located.

Go here to see NAUH’s message to House members.

NAUH Comments on Proposed Cut of Medicaid DSH Payments

NAUH has expressed its opposition to a proposed change in how the federal government allocates Medicaid disproportionate share (Medicaid DSH) funding to states.

In a formal comment letter to the Centers for Medicare & Medicaid Services, which proposed the change in state Medicaid DSH allotments, NAUH wrote that it opposed CMS’s proposed division of the cuts between so-called “low-DSH states” and “non-low-DSH states,” maintaining that non-low-DSH states would, under the CMS proposal, bear too great a share of the overall reductions of state Medicaid DSH allotments.

The Affordable Care Act requires a reduction of federal Medicaid DSH spending based on the expectation that improved access to health insurance would result in fewer uninsured Americans – as it has.  For the past several years Congress delayed implementation of this requirement but its most recent delay expires in 2018 and in July CMS published a proposed rule outlining how it would implement the statutory requirement.

NAUH’s objection is to how CMS proposes implementing that reduction.

See NAUH’s formal comment letter to CMS here.