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.”

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.”

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.”

Safety-Net Hospitals, Others Benefit From Changes in Medicare Readmissions Program

Safety-net hospitals are among the leading beneficiaries of changes implemented this year in Medicare’s  hospital readmissions reduction program.

According to a new study, safety-net, academic, and rural hospitals have enjoyed improved performance under the program since Medicare began organizing hospitals into peer groups based on the proportion of low-income patients they serve rather than simply comparing individual hospital performance to that of all other hospitals.

While the current fiscal year is still under way, it appears that safety-net hospitals will enjoy a collective decline of $22 million in Medicare readmissions penalties while 44.1 percent of teaching hospitals and 43.7 percent of rural hospitals will face smaller penalties than last year.

NASH was one of the leading and most outspoken proponents of leveling the playing field in the readmissions reduction program, encouraging policy-makers to reform the program so it would compare hospital readmission rates among similar hospitals instead of to those of all hospitals.  NASH’s multi-year effort proved successful and private safety-net hospitals are now benefiting from that success.

Learn more about the readmissions reduction program and how changes in that program have significantly altered its outcomes in the JAMA Internal Medicine study “Association of Stratification by Dual Enrollment Status With Financial Penalties in the Hospital Readmissions Reduction Program.”

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.

The Commission wrapped up its work on the June 2019 Report to Congress on Medicaid and CHIP at the April meeting, with sessions reviewing four of the report’s five draft chapters on Thursday morning, and votes on potential recommendations later in the afternoon.

First on Thursday’s agenda was a draft June chapter on Medicaid prescription drug policy, which contained draft recommendations to provide states with a grace period to determine Medicaid drug coverage and raise the cap on rebates. The Commission then revisited hospital payment policy, with a draft chapter and recommendation on how to treat third-party payment in the definition of Medicaid shortfall when determining disproportionate share hospital payments. Next, commissioners considered two recommendations proposed as part of a June chapter on improving the effectiveness of Medicaid program integrity. The final morning session addressed the Commission’s proposed recommendation on therapeutic foster care.

The Commission returned from lunch for two presentations discussing preliminary findings of forthcoming congressionally mandated reports. The first afternoon session presented initial findings from a MACPAC review of state Medicaid utilization management policies related to medication-assisted treatment, to be issued in October. The session immediately following presented preliminary findings for a January 2020 study on Medicaid standards for institutions for mental diseases. Both reports are required as part of the SUPPORT for Patients and Communities Act (P.L. 115-271). Votes on June 2019 recommendations closed out the day.

Friday’s sessions opened with a review of the fifth draft chapter slated for June, on Medicaid in Puerto Rico. The second session of the morning reviewed a proposed rule issued by the Centers for Medicare & Medicaid Services in March to promote interoperability in federal health care programs. The April meeting closed with a review of evaluations of integrated care for dually eligible beneficiaries.

Supporting the discussion were the following presentations:

  1. Review of Draft Chapter for June Report and Recommendations on Prescription Drug Policy: Grace Period and Cap on Rebates
  2. Review of Draft Chapter for June Report and Proposed Medicaid Shortfall Recommendation
  3. Review of Draft Chapter on Improving the Effectiveness of Medicaid Program Integrity and Recommendations
  4. Review of Recommendation for June Report Chapter on Therapeutic Foster Care
  5. Preliminary Findings from Congressionally Mandated Study on Medication-Assisted Treatment Utilization Management Policies
  6. Preliminary Findings on Congressionally Mandated Study on Institutions for Mental Diseases
  7. Review of Draft June Report Chapter on Medicaid in Puerto Rico
  8. Review of Proposed Rule to Promote Interoperability in Federal Health Care Programs
  9. Evaluating Integrated Care: Review of Results from Literature

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.

 

Delay Medicaid DSH Cuts, Pelosi Says

Medicaid DSH cuts should be delayed, House Speaker Nancy Pelosi (D-CA) told a gathering of hospital officials.

According to Speaker Pelosi,

DSH cuts threaten to erode the health of community hospitals, safety-net hospitals and rural hospitals, [affecting] the health of not only the families that rely on Medicaid, but any person who relies on these hospitals for care.

NASH has long urged Congress to delay or even eliminate Affordable Care Act-mandated cuts of Medicaid disproportionate share payments, doing so twice in the past week: first in a letter to Senate Finance Committee chairman Charles Grassley (R-IA) and then in a message to all House members. NASH believes this cut would be especially harmful for the nation’s private safety-net hospitals.

Learn more about Speaker Pelosi’s remarks in the Becker’s Hospital Review article “House speaker urges Congress to ease Medicaid payment cuts to hospitals serving low-income patients.”

Medicare Advantage Permitted to Address Non-medical Needs

Starting in 2020, Medicare Advantage plans will be permitted to provide non-medical benefits to their chronically ill members.

As described in the Centers for Medicare & Medicaid Services’ “final call letter’ for 2020,

MA [Medicare Advantage] plans are not prohibited from offering an item or service that can be expected to improve or maintain the health or overall function of an enrollee only while the enrollee is using it.  In other words, the statute does not require that the maintenance or improvement expected from an SSBCI [special supplemental benefits for the chronically ill] result in a permanent change in an enrollee’s condition.  Items and services may include, but are not limited to:  meals furnished to the enrollee beyond a limited basis, transportation for non-medical needs, pest control, air quality equipment and services, and benefits to address social needs, so long as such items and services have a reasonable expectation of improving or maintaining the health or overall function of an individual as it relates to their chronic condition or illness.

The CMS final call letter offers permission to Medicare Advantage plans to offer such services; it does not require them to do so.

Such a policy change could be highly beneficial to many of the low-income patients served by private safety-net hospitals, which have long sought help with addressing the social determinants of health that often bring patients to them but limit their ability to recover from their illnesses and injuries.

Learn more from the Commonwealth Fund report “New Medicare Advantage Benefits Offer Social Services to People with Chronic Illness” and see CMS’s “Announcement of Calendar Year (CY) 2020 Medicare Advantage Capitation Rates and Medicare Advantage and Part D Payment Policies and Final Call Letter.”

 

NASH Asks Grassley, Senate Finance Committee to Delay Medicaid DSH Cut

Delay or eliminate the FY 2020 Medicaid disproportionate share payment cut, NASH has asked Senator Charles Grassley in a recent letter.

The cut, mandated by the Affordable Care Act but delayed three times by Congress, was envisioned as an appropriate response to what was expected to be a significant decrease in the number of uninsured Americans as a result of the 2010 health reform law.  In his news release, Senator Grassley, chairman of the Senate Finance Committee, notes that Congress has delayed implementing this Medicaid DSH cut three times and needs to address the issue definitively.

In its letter, NASH maintains that the Affordable Care Act has not reduced the number of uninsured Americans as much as anticipated, leaving private safety-net hospitals and others still to provide significant amounts of uncompensated care to their low-income and uninsured patients and therefore still in need of their full Medicaid DSH payments.

NASH also argues that uncertainty in the health care arena today – legislative and judicial challenges to the Affordable Care Act, states changing the eligibility criteria and benefits of their Medicaid programs, the instability of health insurance marketplaces, and more – makes this an inappropriate time to reduce payments to safety-net hospitals, possibly jeopardizing access to care in low-income areas as a result.

Learn more by reading Senator Grassley’s news release and NASH’s letter to him.