Kentucky proposes premium assistance and high deductible health plans to cover expansion enrollees under an 1115 waiver; New York Legislature expresses unanimous support for a reimbursement increase for safety-net hospitals; and a new literature review documents Medicaid expansion's positive impacts on state economies.
A Kaiser Family Foundation analysis of more than five dozen studies found positive effects of Medicaid expansion on multiple state economic outcomes, and a reduction in income- and race-based coverage disparities. Specifically, the report found that general fund spending on Medicaid grew more slowly in expansion states compared to non-expansion states and that spending per capita is at or below projections in nearly two-thirds of expansion states, despite higher-than-anticipated expansion enrollment in many states. The studies also found reduced uncompensated care costs in expansion states, and most found that expansion had either a positive or a neutral effect on employment and labor markets. The authors note that additional research will be needed to assess expansion's economic impacts once states begin paying a larger share of expansion costs. The analysis also found largely positive impacts of expansion on uninsurance rates, access to care, utilization of services, and health outcomes, though the report concludes that long-term research is needed to better determine expansion's impact on health outcomes.
Medicaid expansion has increased access to primary care and prescription drugs and made care more affordable for enrollees, according to a report from the Assistant Secretary of Planning and Evaluation at HHS. Research cited in the report found that visits to community health centers increased 46% in expansion states compared to 12% in non-expansion states, and that there was a 41% increase specifically in preventive visits in expansion states while non-expansion states saw no change. Expansion states also saw a 50% decrease in uninsured hospital discharges in addition to a 20% increase in Medicaid discharges. In 2014, Medicaid prescription rates increased 25% in expansion states compared to 3% in non-expansion states. On affordability measures, the report cites a survey that found 78% of expansion enrollees would not have been able to afford their care prior to enrolling in Medicaid expansion. The report also reviews expansion's impact on uninsurance rates and found that expansion states cut their uninsured rates in half while non-expansion states cut their rates by one-third.
CMS issued an informational bulletin clarifying public notice and input requirements that states must follow when changing provider payments under a Medicaid State Plan. The bulletin addresses in detail three types of public notice policies: all proposed changes to provider payment rates or methodologies; reduced or restructured payments that may impact access to care; and institutional provider rates. The bulletin permits states to use a single mechanism to meet all requirements under certain circumstances, including that the public is notified of changes prior to the effective date, that parties interested in institutional rates have a reasonable opportunity for review and comment, and that stakeholders have a chance to provide input on the impact of payment changes as it relates to access to care prior to submission to CMS. Requirements addressed in the bulletin were either longstanding or recently codified in CMS' final rule, "Methods for Assuring Access to Covered Medicaid Services," finalized in November 2015.
A CMS State Medicaid Directors (SMD) letter clarifies how states can demonstrate their compliance with the conditions and standards necessary to receive enhanced funding for eligibility and enrollment systems, first detailed in a December 2015 rule. The SMD letter, which reviews new Advanced Planning Document (APD) requirements, is the second in a series addressing subject areas affected by the rule. The letter highlights that, among other new conditions, states must demonstrate in their APDs their ability to process Medicaid applications based on modified adjusted gross income with minimal mitigations or workarounds, and they must submit mitigation plans and strategies to address potential risks or system failures. CMS indicated it may establish additional new conditions in future SMD letters.
New special enrollment period (SEP) verification processes recently implemented by CMS in response to insurer concerns about high SEP-enrollee costs may deter SEP enrollment, particularly by healthy individuals, according to a report from the Urban Institute. Until this year, applicants were only required to attest to their SEP eligibility. Moving forward, applicants must submit documentation with their application for verification purposes. On average, 33.5 million individuals lose coverage each year outside of an open enrollment period for reasons that qualify for a SEP, but, according to research cited in the report, only 5% of SEP-eligible consumers enrolled through an SEP in 2015. The authors argue that low SEP utilization rates contribute to high SEP enrollee costs and that instituting barriers to SEP enrollment will further encourage only less healthy individuals to comply with application requirements. The authors recommend replacing CMS' documentation-based process with a data-based, electronic verification system that only requires documentation if electronic verification fails. The authors further note that loss of minimum essential coverage accounts for 94% of SEP eligibility and that such losses can be verified through data-matching with a consumer's previous insurer.
Governor Jerry Brown (D) signed into law a rule that prohibits the State from claiming assets, such as cars and homes, of deceased Medi-Cal recipients, effective January 1, 2017, as part of the 2016-2017 State budget. The new law will still allow the State to recover assets from Medi-Cal recipients above the age of 55 who received long-term care services through Medi-Cal, unless the individual is survived by a spouse or registered domestic partner. Additionally, the new law prohibits estate recovery if a home is of "modest value" (has a fair market value of 50% or less of the average price of homes in the county where it is located). The State has claimed $1.1 billion in assets through recovery since its 1993 inception.
The Department for Medicaid Services released a draft 1115 demonstration application to transform the coverage options available under Medicaid expansion (named "Kentucky HEALTH"), as well as introduce delivery system reforms targeting substance use disorder (SUD), chronic disease management, and managed care. Kentucky HEALTH proposes two coverage options for the expansion population: a premium assistance program for employer-sponsored insurance, and a "consumer driven health plan," a high-deductible plan with managed accounts to fund the deductible and enhanced healthcare benefits, such as vision, dental, over-the-counter medications and gym membership. The proposal would require monthly premiums (from $1 to $15) and impose a six month lockout period for those who fail to pay, which can be obviated by participation in a financial or health literacy course. Enrollees who are disenrolled for failure to comply with redetermination requirements are subject to the same lockout period. Able-bodied adults without dependents would also be required to participate in "community engagement and employment development" programs, a provision that goes beyond what CMS has approved in any state thus far. The waiver also includes delivery system reforms such as: a multi-county pilot program to improve access to mental health and SUD services; the adoption of chronic disease management programs best practices by Medicaid managed care programs; and cost control mechanisms and payment incentives for managed care organization to improve quality. The Kentucky HEALTH proposal, which is modeled after Indiana's Medicaid program, estimates $2.2 billion in savings over five years. The proposal is open to public comment through July 22, after which it will be submitted to CMS for approval. The proposal makes good on Governor Matt Bevin's (R) December announcement that he would overhaul the State's Medicaid expansion program.
A new University of Michigan study found a rapid and sustained drop in uninsurance among nonelderly hospital patients in the first eight months of the State's Medicaid expansion program (April through December of 2014), compared with the corresponding months in 2012 and 2013. Uninsured patients accounted for approximately 6% of nonelderly adult discharges in 2012 and 2013 but only 2% in 2014. The study also showed the number of discharges for nonelderly adults with Medicaid increased from 23% in 2012 to 30% in 2014. Hospitals experienced a uniform shift in patient payer mix during that time: 88% had more Medicaid-covered patients in 2014 compared with the same time period in each of the two years preceding expansion. The study's authors analyzed data from 130 hospitals using the Michigan Health and Hospital Association's Michigan Inpatient Database.
The legislature passed a bill refining the definition of safety-net hospitals and raising reimbursement rates for hospitals that fall under the new definition shortly before the end of the 2016 legislative session. The bill provides for an "enhanced safety net hospital supplemental rate adjustment" for hospitals whose patient population is more than 50% Medicaid enrollees or uninsured, have no less than 40% of its inpatient discharges covered by Medicaid, and are a public or federally-designated critical access or sole community hospital, among other criteria. The bill has no funding attached to it and is written to take effect after next year's budget negotiations occur. A signature from Governor Andrew Cuomo (D) would represent the Governor's support for safety-net hospitals, but funds would still need to be allocated through budget negotiations.
Governor Dennis Daugaard (R) announced that he will not call a special legislative session to address Medicaid expansion, despite weeks-long efforts to rally enough support from lawmakers to approve a proposal. Governor Daugaard said he had heard from legislators that they needed more time to evaluate the proposal, though the Governor felt the plan would "increase healthcare access at no additional state cost and guarantee that the federal government won't shift its responsibility to pay for Native American healthcare to the state." The administration suggested the possibility of a special session as recently as last month, after CMS updated its reimbursement policies for care delivered through the Indian Health Service, which increased the State's projected cost savings from expansion by $18 million.
