Medicaid Transportation Services in Jeopardy?

The White House has proposed removing non-emergency transportation from the list of mandatory Medicaid benefits.

The proposed FY 2020 budget released last week explained that

Statute allows, but does not require, States to provide non-emergency medical transportation (NEMT).  Instead, these services were made mandatory Medicaid benefits by regulation.  Further, a Government Accountability Office study found Medicaid NEMT spending totaled $1.5 billion in 2013, and NEMT programs face multiple challenges, including difficulties in obtaining costs and maintaining program integrity.  To address these issues, this proposal would update regulations to clarify the NEMT benefit is strictly optional.

Medical transportation has long been viewed as vital means for helping Medicaid patients keep doctors’ appointments and recover from their illnesses and injuries and for overcoming some social determinants of health.  Loss of this tool would be harmful for private safety-net hospitals and the patients and communities they serve.  NASH will closely monitor the progress of this proposal.

MACPAC Makes DSH, UPL Recommendations

Changes could come in Medicaid DSH and UPL payments if new MACPAC recommendations are adopted.

Last week the Medicaid and CHIP Payment and Access Commission released its annual report to Congress, with most of the report focusing on its analysis and recommendations for policy updates involving Medicaid disproportionate share hospital payments (Medicaid DSH) and Medicaid upper payment limit payments (UPL payments).

With Affordable Care Act-mandated cuts in Medicaid DSH payments scheduled to start in FY 2020 – this coming October – MACPAC recommended that these cuts be reduced and phased in over a longer period of time “…to give states and hospitals more time to respond to the cuts…”

MACPAC also recommended that Congress and the administration revise the current methodology for distributing Medicaid DSH money to the states to “…provide a stronger link between the distribution of those allotments and measures of hospital uncompensated care…”

The commission also addressed UPL payments, expressing concern about “…the discrepancy between reporting by states to show that they are complying with the UPL and the spending data they report to claim federal matching funds” and recommending “…instituting better data and process controls to ensure that state reporting on compliance with UPL lines up with those amounts they are claiming, and existing limits are enforced.

Medicaid DSH and UPL payments are especially important to NASH and private safety-net hospitals because of the significant number of low-income, Medicaid-covered, and uninsured patients they serve.

Learn more from MACPAC’s news release summarizing its recommendations and the entire MACPAC annual report.

More Potential Budget Obstacles for Private Safety-Net Hospitals

Part two of the Trump administration’s proposed FY 2020 budget brought more potential bad news for private safety-net hospitals.

 

Last week’s “lean budget” released by the White House included a number of challenges for private safety-net hospitals and this week’s release, intended to fill in some of the blanks that last week’s document left, brought more of the same.

Proposed Medicare challenges include:

  • a call for establishing a new process for calculating Medicare disproportionate share (Medicare DSH) uncompensated care payments
  • slashing Medicare bad debt reimbursement from 65 percent to 25 percent
  • continued movement toward site-neutral payments for outpatient services provided at hospital outpatient facilities

Newly proposed Medicaid challenges include:

  • extending Medicaid disproportionate share (Medicaid DSH) cuts beyond the currently planned six years
  • redesigning the formula for allocating Medicaid DSH funds to the states
  • authorizing states to verify beneficiaries’ Medicaid eligibility more than once a year
  • permitting states to apply means tests to Medicaid eligibility

The latest FY 2020 budget proposal also calls for:

  • consolidating Medicare, Medicaid, and children’s hospital medical education payments into single new capped medical education grant program
  • reduced 340B prescription drug discount program payments for some hospitals
  • reducing the grace period for payment of premiums for health insurance purchased on an insurance exchange
  • income-based increases in premiums for low-cost insurance purchased on those exchanges

All of these changes, if implemented, would pose problems for NASH members and most private safety-net hospitals.

Learn more from this week’s White House budget document.

HHS Talking to States About Medicaid Block Grants

In the absence of legislation to turn Medicaid into a block grant program, the U.S. Department of Health and Human Services is talking to some states about granting waivers that permit them – voluntarily – to turn their individual Medicaid programs into block grants.

HHS Secretary Alex Azar acknowledged this last week during a hearing of the Senate Finance Committee.  He did not disclose which states, or how many, with which HHS has had such discussions and he also noted that his staff is talking to state officials about waivers to permit them to adopt Medicaid per capita spending limits.

NASH has long been concerned about any effort to impose artificial limits on state Medicaid spending; such limits could be especially harmful to private safety-net hospitals because they care for so many Medicaid patients.  NASH’s most recent expression of this concern can be found in its 2019 advocacy agenda.

Learn more from the article “Trump health chief reveals talks with states on Medicaid block grants,” which can be found in the online publication The Hill.

Sneak Preview of Medicaid Spending Limits?

The imposition of spending limits for individual Medicaid recipients has been discussed in Washington policy circles for years and was offered in the White House’s recent FY 2020 budget proposal.  While deliberations on such a proposal have never advanced in a meaningful way, the state of Utah is doing more than talking about such an approach:  it has petitioned the Centers for Medicare & Medicaid Services for a Medicaid waiver that would enable it to introduce such a system in its state Medicaid program.

Under the state’s proposed Medicaid waiver, Utah asks the federal government to limit its own Medicaid contributions to a fix amount for each Medicaid enrollee – a per capita limit, as this approach has often been called.  Utah has joined this request with a proposal to expand its Medicaid program, as permitted under the Affordable Care Act – but to do so only for individuals earning up to 100 percent of the federal poverty level and not the 138 percent level authorized by the 2010 health care reform law.

While the request is still under consideration in Washington, state officials are reportedly optimistic:  they expect to begin enrolling new recipients on April 1.

NASH has long been concerned about any effort to impose artificial limits on state Medicaid spending; such limits could be especially harmful to private safety-net hospitals because they care for so many Medicaid patients.  NASH’s most recent expression of this concern can be found in its 2019 advocacy agenda.

Learn more about Utah’s effort to implement a policy that some in Washington have sought for years but that has failed to gain wide support in the Washington Post article “Utah is testing the Trump administration’s dream of limiting Medicaid spending.”

“Medicaid Shortfall” Definition Changing?

The Medicaid and CHIP Payment and Access Commission last week discussed possible changes in how “Medicaid shortfall” is defined for the purpose of determining how much Medicaid disproportionate share money (Medicaid DSH) safety-net hospitals should receive.

The discussion came in the wake of a court decision last year that ruled that third-party payments toward Medicaid-covered services could not be included in hospitals’ Medicaid shortfall calculations.

MACPAC commissioners discussed several statutory changes that would seek to minimize the impact of the court ruling:

  • Include third-party payments in the definition of Medicaid shortfall.
  • Exclude from the Medicaid DSH definition of Medicaid shortfall all payments and costs for patients who have third-party coverage.
  • Explore new rules that address different types of third-party coverage.

MACPAC is an advisory body whose recommendations to Congress are not binding but its views are respected and often find their way into future public policy.

This subject is important to private safety-net hospitals because the vast majority of those hospitals receive Medicaid DSH payments.

Learn more about MACPAC’s deliberations on Medicaid shortfalls and Medicaid DSH from the Fierce Healthcare article “MACPAC considers recommending change to definition of ‘Medicaid shortfall’ at safety net hospitals.”

 

Trump Budget Brings Bad News for Private Safety-Net Hospitals

The FY 2020 federal budget proposed by the Trump administration this week would bring pain for private safety-net hospitals if adopted.

Highlights of the proposed spending plan include:

  • More than $135 billion in cuts in Medicare uncompensated care payments (Medicare DSH) and Medicare bad debt reimbursement over the next 10 years.
  • Continued extension of Medicare site-neutral payment outpatient policies.
  • $48 billion in cuts in graduate medical education spending over the next 10 years.
  • $26 billion in new Medicaid disproportionate share (Medicaid DSH) cuts.
  • Repeal of the Affordable Care Act’s Medicaid expansion and all funding to pay for that expansion.
  • Support for legislation to introduce Medicaid block grants and limits on spending per recipient.
  • New restrictions on the 340B program.

Responsibility for adopting a budget rests with Congress, not the president, and this proposed budget is considered unlikely to gain much support in Congress.

As appropriate, NASH will engage in advocacy in support of the needs of the nation’s private safety-net hospitals.

Learn more about the administration’s proposed budget from numerous media reports or by going directly to the source:  fact sheets the White House has prepared offering budget highlights and the budget document itself.

 

MACPAC Meets

The Medicaid and CHIP Payment and Access Commission met for two days last week in Washington, D.C.

The following is MACPAC’s own summary of the sessions.

MACPAC looked ahead to its June 2019 report to Congress on the initial day of the March 2019 Commission meeting. In the morning, sessions focused on potential recommendations to create a grace period for states to determine coverage policies for outpatient prescription drugs and removing or raising the rebate cap; a uniform definition of therapeutic foster care; and treatment of third-party payment when determining hospitals’ Medicaid shortfall for disproportionate share hospital payments.

In the afternoon, the Commission turned its attention to Puerto Rico’s Medicaid program, with a new analysis on Puerto Rico’s Medicaid enrollment, spending, available financing, and implications for the future. The Commission also considered potential June recommendations focusing on improving performance and return on investment for state program integrity activities.

Several other important topics were also on the March agenda, including a session on Medicaid coverage of recovery support services for beneficiaries with substance use disorders (SUDs) in the afternoon. On the meeting’s second day, the Commission reviewed a draft letter to the Secretary of the U.S. Department of Health and Human Services, laying out the eligibility groups that should be included in the department’s forthcoming data book on Medicaid beneficiaries with SUDs. MACPAC’s input on eligibility groups was required in the SUPPORT for Patients and Communities Act. A review of the proposed rule affecting safe harbors for prescription drug rebates was the topic of the second session, with the final session presenting findings on how various states have approached care coordination in integrated care models.

Supporting the discussion were the following presentations:

  1. Potential Recommendations on Coverage Grace Period and Rebate Cap
  2. Mandated Report: Therapeutic Foster Care
  3. Treatment of Third-Party Payment in the Definition of Medicaid Shortfall: Potential Recommendations
  4. Medicaid in Puerto Rico: Financing and Spending Data Analysis and Projections
  5. Medicaid Program Integrity: Proposed Recommendations
  6. Recovery Support Services for Medicaid Beneficiaries with Substance Use Disorder
  7. Responding to SUPPORT ACT Requirement: Eligibility Groups for HHS Data Book on Medicaid and Substance Use Disorders
  8. Proposed Rule Affecting Safe Harbors for Prescription Drug Rebates
  9. Analysis of Care Coordination Requirements in Integrated Care Models

Because NASH members and private safety-net hospitals serve so many Medicaid patients, MACPAC’s deliberations are especially relevant to them because its recommendations often find their way into future Medicaid and CHIP policies.

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 variety of issues affecting Medicaid and the State Children’s Health Insurance Program.  Find its web site here.

Surprise Medical Bills Lead Patients to Change Hospitals

Patients who receive surprise medical bills are more likely to change hospitals than those who do not, a new study has found.

According to an analysis of behavior by obstetrics patients,

…11 percent of mothers experienced a surprise out-of-network bill with their first delivery, and this was associated with an increase of 13 percent in the odds of switching hospitals for the second delivery, compared to mothers who did not experience a surprise bill.

The study found that this switching often paid dividends for those who switched:

Mothers who switched hospitals after a surprise out-of-network bill reduced their relative risk of receiving a second surprise medical bill by 56 percent, compared to mothers who did not switch after receiving their first surprise bill.

NASH staff recently met with staff of the Senate Health, Education, Labor and Pensions (HELP) Committee to share private safety-net hospitals’ views on this emerging issue.

Learn more about the implications for hospitals when they send surprise medical bills in the Health Affairs study “Consumers’ Responses to Surprise Medical Bills in Elective Situations.”

800 Hospitals Face Medicare Penalties

800 hospitals will see their Medicare payments reduced one percent this year because they are among the 25 percent of hospitals in the U.S. with the highest rate of hospital-acquired conditions.

Among the 800 hospitals are 110 that are being penalized for the fifth year in a row.

Medicare’s hospital-acquired condition reduction program tracks a variety of medical problems, including infections, blood clots, sepsis, hip fractures, bedsores, and others.  Every year, the 25 percent of eligible providers – the program excludes significant numbers of hospitals – are penalized even if their performance for hospital-acquired conditions is superior to the previous year.

Critics of the program say it creates unachievable goals and  penalizes hospitals that are doing an excellent job of reducing hospital-acquired conditions and that there is virtually no statistical difference in performance between some hospitals that are and some hospitals that are not penalized.  Program proponents maintain that all hospitals can and should do an even better job than they already are of reducing their patients’ hospital-acquired conditions.

NASH has long been concerned about the degree to which private safety-net hospitals are at a disadvantage in such programs because of the disproportionately large numbers of low-income patients they serve who pose special health and socio-economic challenges when hospitalized.

Learn more about Medicare’s hospital-acquired conditions reduction program, the penalties some hospitals face in the coming year, and the arguments for and against the program in the Kaiser Health News article “Medicare Trims Payments To 800 Hospitals, Citing Patient Safety Incidents.”