More Medicaid Matching Funds for Only Partial Medicaid Expansion?

The federal government is considering providing an unusual amount of federal Medicaid matching funding for only partial state Medicaid expansion.

At least that’s what Centers for Medicare & Medicaid Services administrator Seema Verma told a health care conference in Georgia last week.

The state of Georgia has proposes partially expanding its Medicaid population.  Under the Affordable Care Act, states that fully expand their Medicaid programs under the terms established by the 2010 health care law receive nine dollars in federal matching funds for every one dollar they spend on their Medicaid expansion population.  States that only partially expand their Medicaid programs, on the other hand, currently are eligible to receive only their usual federal matching rate:  generally one federal dollar for every state dollar, with states with higher poverty rates receiving as much as slightly more than three dollars for every state dollar they spend.

Last week, however, CMS’s Verma said that when Georgia submits its Medicaid waiver application to CMS seeking only partial expansion of its Medicaid program, the federal agency will consider providing Affordable Care Act-level Medicaid matching funds rather than the traditional federal Medicaid matching rate.

Such a policy shift could be very beneficial for private safety-net hospitals in states that have not expanded their Medicaid programs, extending coverage to some of the currently uninsured, low-income residents of the communities in which those hospitals are located.

Learn more about the Georgia plan for partial Medicaid expansion and the possibility of CMS treating it like an Affordable Care Act Medicaid expansion in the Atlanta Journal-Constitution article “Trump official open to increased funding for Georgia Medicaid waiver.”

Tackling Social Determinants of Health

Two states are working to address social determinants of health through their Medicaid programs.

In California and Oregon, the state Medicaid programs are using care coordination and funding from multiple sources, including traditional Medicaid funding, alternative payment approaches, and savings from care coordination to provide services such as housing, food, and legal assistance while also building the capacity of health care and community groups to support such efforts.  Both states obtained federal Medicaid waivers to enable them to expend Medicaid resources on non-Medicaid-covered services.

Learn more about how California and Oregon are using their Medicaid programs to address social determinants of health in the Health Affairs report “Medicaid Investments To Address Social Needs In Oregon And California.”

CMS Speeds Up Medicaid Review Process

The federal government has greatly increased the speed with which it is reviewing and approving state applications to modify their Medicaid programs.

Most often, such applications involve Medicaid state plan amendments and section 1915 waiver requests.

According to a recent post on the CMS blog (in CMS’s own words),

  • Between calendar years 2016 and 2018, there was a 16 percent decrease in the median approval time for Medicaid SPAs [note:  state plan amendments].
  • Seventy-eight percent of SPAs were approved within the first 90 day review period during calendar year 2018, a 14 percent increase over 2016.
  • Between calendar year 2016 and 2018, median approval times for 1915(b) waivers decreased by 11 percent, 1915(c) renewal approval times decreased by 38 percent, and 1915(c) amendment approval times decreased by 28 percent.
  • The backlog of pending SPA and 1915 waiver actions pending additional information from the states was reduced 80 percent from previous years.

Learn more in the CMS blog entry “CMS Streamlines Medicaid Review Process and Reduces Approval Times so States Can More Effectively Manage Their Programs.”

New Poverty Level Standards to Jeopardize Medicaid Eligibility?

The Trump administration is considering changing how the federal government measures inflation for the purpose of calculating the federal poverty level.

Such a change, if implemented, could potentially reduce inflation-related increases in the federal poverty level, which in turn could limit the ability of some individuals and families to qualify, or continue to qualify, for a variety of public safety-net services – including, potentially, Medicaid.

Among the possible alternatives to the current methodology for calculating inflation is the Chained Consumer Price Index for All Urban Consumers.  The Obama administration also explored substituting this index for the current inflation factor.

Any change that makes it more difficult for people to qualify for Medicaid could be particularly damaging to private safety-net hospitals, which are generally located in communities with especially large numbers of low-income residents.  If patients lose their Medicaid eligibility because the criteria for participating in the program change, that could leave such hospitals serving even more uninsured patients and providing even more uncompensated care than they already do.

The federal Office of Management and Budget has issued a request for comment about various inflation factor calculation alternatives.  Go here to see OMB notice Request for Comment on the Consumer Inflation Measures Produced by Federal Statistical Agencies.  Comments are due in late June.  Learn more from the New York Times article  “Trump Administration Seeks to Redefine Formula for Calculating Poverty.”

MACPAC Seeks Input on IMDs

A 2018 law calls for the Medicaid and CHIP Payment and Access Commission to report to Congress on institutions for mental diseases, or IMDs, receiving Medicaid payments.  The law specifies that MACPAC solicit input from a variety of sources, including the Centers for Medicare & Medicaid Services, state Medicaid and mental health agencies and authorities, Medicaid insurers, Medicaid advocates, and others.

To help fulfill this requirement, MACPAC is now soliciting views from stakeholders.  Among the many subjects on which MACPAC seeks input are (in MACPAC’s words),

  • state requirements, including certification, licensure and accreditation applied to IMDs seeking Medicaid payment and how states determine if requirements have been met;
  • standards (e.g., quality standards, facility standards, and clinical standards) that IMD providers must meet in order to receive Medicaid payment and how the state determines if standards have been met;
  • a description of IMDs receiving Medicaid payment including the number of these facilities, and the types of services provided; and
  • a description of Medicaid funding authorities used to pay IMDs and any coverage limitations placed on the scope, duration or frequency of services provided in IMDs.

MACPAC’s report to Congress is due at the end of the year and comments on the issues outlined above are due to MACPAC by May 31.  Learn more from this MACPAC request for comment.

CMS Adopts Rule to Protect Medicaid Payments

A new Medicaid provider reassignment regulation eliminates the ability of states to divert any portion of Medicaid payments to third parties.

Such diversion was authorized, in a limited manner, in 2014, when CMS created an exception to the existing prohibition on the diversion of provider payments to third parties.  That exception involved diversion of payments to selected third parties, mostly in-home personal care workers, but in this new, final regulation, the agency eliminates this exception, maintaining that it is inconsistent with the Social Security Act.

Learn more about the new regulation in a CMS news release or see the new regulation itself.

Senate Finance Committee Reports on Supplemental Medicaid Payments

The majority members of the Senate Finance Committee have published a report on supplemental Medicaid payments.

According to the new document,

This report seeks to increase educational understanding of Medicaid supplemental payments, as well as outline the reporting mechanisms for these payments to ensure adequate stewardship of taxpayer dollars. 

The report consists of descriptions of the different types of supplemental Medicaid payments that states make to some providers, including:

  • Medicaid disproportionate share payments (Medicaid DSH)
  • non-DSH payments
  • upper-payment limit payments (UPL payments)
  • demonstration supplemental payments
  • medical education payments

It also describes the magnitude of these payments, noting that supplemental Medicaid payments accounted for $50 billion of the $600 billion spent on Medicaid by the federal and state governments in 2016, the most recent year for which comprehensive data is available.  In addition, it outlines how those payments are distributed while also considering how these payments affect the overall adequacy of Medicaid payments to providers; this varies from state to state.

Finally, the report reviews how the states finance their Medicaid programs, including through provider taxes, intergovernmental transfers, and certified public expenditures, and how states report their supplemental Medicaid payments to the federal government.

All private safety-net hospitals receive supplemental payments from their state Medicaid programs and consider those payments essential resources supporting their ability to serve the residents of the low-income communities in which they are generally located.

To learn more, see the report “Greater Transparency of Supplemental Payments Needed,” which was prepared by the majority staff of the Senate Finance Committee.

Uninsured ED and Inpatient Visits Down Since ACA

Uninsured hospital admissions and emergency department visits are down since passage of the Affordable Care Act.

And Medicaid-covered admissions and ER visits are up, according to a new analysis.

The report, published on the JAMA Network Open, found that ER visits by uninsured patients fell from 16 percent to eight percent between 2006 and 2016, with most of this decline after 2014, while uninsured discharges fell from six percent to four percent.

The rate of uninsured ER visits declined, moreover, at a time when overall ER visits continued to rise.

While the Affordable Care Act is likely the cause of most of these changes, other contributing factors include the emergence of urgent care facilities, telemedicine, and free-standing ERs as well as new payment models and rules.

The study’s findings are especially good news for private safety-net hospitals because they care for so many more low-income patients than other hospitals and have benefited from the Affordable Care Act’s expansion of access to insurance, whether through Medicaid expansion or the private health insurance market.

Learn more in the JAMA Network Open article “US Emergency Department Visits and Hospital Discharges Among Uninsured Patients Before and After Implementation of the Affordable Care Act.”

Bureaucratic Requirements May Be Driving Medicaid Enrollment Decline

State eligibility redetermination processes may be pushing down Medicaid enrollment nation-wide.

Last year, national Medicaid enrollment fell 1.5 million, more than half of them children, and according to a new report from Families USA, much of that decline may be attributable to the challenging eligibility redetermination requirements imposed on Medicaid-eligible individuals by some states.

Those requirements include a 98-page packet that Tennessee sends to individuals seeking to retain their Medicaid eligibility; Arkansas’ limit of 10 days to respond to requests for information to redetermine eligibility; and Missouri’s decision to discontinue using data from other public safety-net programs to redetermine eligibility.

Others point to an improving national economy and new Medicaid work requirements as the primary causes of declining Medicaid enrollment.

Declining Medicaid enrollment can be especially challenging for private safety-net hospitals because they are located in lower-income communities than the typical hospital.  When Medicaid enrollment falls, these hospitals often find themselves serving more patients without health insurance and providing more uncompensated care.

Learn more in the Families USA report “The Return of Churn: State Paperwork Barriers Caused More Than 1.5 Million Low-Income People to Lose Their Medicaid Coverage in 2018.”

MACPAC Recommends Changes in Medicaid Shortfall Definition

Hospitals’ calculation of their Medicaid shortfall would change under a recommendation that MACPAC voted to make to Congress.  That change, in turn, could affect hospitals’ future Medicaid disproportionate share payments.

Last week the Medicaid and CHIP Payment and Access Commission voted overwhelmingly to change how hospitals calculate their Medicaid shortfall:  the difference between what they spend caring for their Medicaid patients and what Medicaid pays them for that care.  Under MACPAC’s proposal, hospitals would need to deduct from their shortfall total all third-party payments they receive for the care they provide to their Medicaid patients.

If this proposal were to be adopted, it has the potential of changing Medicaid DSH allocations among the states and change the distribution of Medicaid DSH funds within individual states, although the Congressional Budget Office estimates that it would have little impact on either measure.

Complicating the MACPAC recommendation is last year’s federal court ruling that third-party payments could not be deducted from hospitals’ Medicaid shortfall totals because the Centers for Medicare & Medicaid Services lacks the authority to implement such a policy.  Making such a change therefore would require action by Congress.

Learn more about the MACPAC recommendation and its potential implications for hospitals and their Medicaid DSH payments in the Fierce Healthcare article “’Medicaid shortfall’ definition should change when tallying DSH payments, MACPAC says.”