Posted by kemanuel
It is still unclear whether the American Health Care Act (AHCA), or H.R. 1628, will be signed into law. On March 6, 2017, the House Energy & Commerce Committee (E&C) and Ways & Means Committee (W&M) officially released the draft bill. The latest action was on April 6, 2017, H.Res.254 — 115th Congress (2017-2018) was placed on the House calendar. The rule provides for further consideration of H.R. 1628. The rule also provides that the further amendment printed Rules Committee Report 115-88 shall be considered as adopted.
So what exactly would AHCA change in relation to Medicaid?
For over fifty (50) years, states have created and implemented Medicaid programs entirely dependent on federal contributions. Medicaid is based on federal law. Although each individual state may have slight variances in the Medicaid program, because the state Medicaid programs must follow federal law, the state Medicaid programs are surprisingly similar. An example of a slight variance is that some Medicaid services are voluntary, like personal care services (PCS); some states offer PCS paid by Medicaid and others do not.
Currently, the federal government does not cap the federal contribution. However much a state spends – no matter how exorbitant – the federal government will match (at whatever percentage allotted for that state). For example, the federal government pays 66.2% of North Carolina’s Medicaid spending. Which means, BTW, that $264,800.00 of Cardinal’s CEO’s salary is funded by the federal government. These percentages are called Federal Medical Assistance Percentages (FMAP).
All this may change under the American Health Care Act (AHCA), or H.R. 1628, as approved by the House Ways and Means, Energy and Commerce, Budget, and Rules Committees.
The AHCA proposes many changes from the Affordable Care Act (ACA) germane to Medicaid. In my humble opinion, some of the replacements are stellar; others are not. No one (sane and logical) could argue that the ACA was perfect legislation for providers, employers, or recipients. It was not. It mandated that employers pay for health care insurance for their employees, which caused the number of part-time workers to explode. The ACA mandated the states to suspend Medicaid reimbursements upon a credible allegation of fraud, which, basically, could be a disgruntled employee lying with an anonymous accusation. This provision put many providers out of business without due process (Remember New Mexico?). The ACA also put levers in place that meant younger policyholders were subsidizing older ones. Healthy, young adults were paying for older adults. The ACA reduced payments for Medicare Advantage plans, hospitals, and other providers to save money. There was also a provider shortage due to the low reimbursement rates and regulatory audits. The Affordable Care Act was anything but affordable. At least the American Health Care Act does not protest itself to be affordable.
Here are some of the most poignant “repeal and replace” items in Trump-caid:
1. Health Savings Accounts
The AHCA will encourage the use of Health Savings Accounts by increasing annual tax free contribution limits. It will also modify ACA premium tax credits for 2018-2019 to increase the amount for younger adults and to reduce the amount for older adults. In 2020, the AHCA will replace ACA income-based tax credits with flat tax credits adjusted for age. Eligibility for new tax credits phases out at income levels between $75,000 and $115,000.
2. Cap on federal contributions
Beginning in 2020, the AHCA would cap federal contributions to state Medicaid programs. This will result in huge federal savings, but cause severe shortages on the state level. The federal per-enrollee caps would be based on states’ Medicaid expenditures in 2016, trended forward to 2019. A uniform, federal capped system would provide fiscal security for the federal government and shift the risk of over spending on the states.
The following categories would be exempt from the per-capita allotments (i.e. paid for outside of the per-capita caps): DSH payments, administrative payments, individuals covered under CHIP Medicaid expansion program or who receive medical assistance from an IHS facility, breast and cervical cancer patients, and partial benefit-enrollees
With the risk on the states, there is a high probability that optional Medicaid services, such as PCS, may be cut from the budget. If PCS were eliminated, more patients would enter long-term care facilities and fewer patients would be able to remain in their homes. The House bill essentially eliminates the enhanced funding levels that made possible states’ expansion of Medicaid to their poorest working-age adult residents. In all, 31 states expanded Medicaid under the ACA. While the House Bill does not prohibit Medicaid expansion; expansion will be difficult to remain funded by the states.
3. Presumptive eligibility program
The House bill would end the ACA’s special hospital presumptive eligibility program, under which hospitals can temporarily enroll patients who “appear” to be eligible and begin to get paid for their care while their full applications are pending. (What in the world does “appear to be eligible” mean. Is it similar to profiling?)
4. Home equity and eligibility
Under current law, states disregard the value of a home when determining Medicaid eligibility for an individual in need of long-term community-supported care. The bill would take away this state flexibility, capping the equity value at $500,000.
5. Disproportionate Share Hospital Payments
The AHCA would repeal the Medicaid DSH reductions set in motion by the ACA in 2018 for non-expansion States, and 2020 for expansion states.
6. Section 1115 Waivers
States with Waivers will not be penalized for having a Waiver. In other words, the expenses and payments under the Waiver will be treated in the same manner as if the state did not have a Waiver. However, if a state’s waiver contains payment limitations, the limitations in the new law, not the Waiver, apply.
Again, the future of the AHCA is uncertain. We all remain watchful. One change that I would like to see is that due process is afforded to providers prior to suspension of all funds when there is a credible allegation of fraud.
Posted in Access to Care, Affordable Care Act, Alleged Overpayment, CMS, Decrease in Medicaid Spending, Due process, Eligibilty, Federal Government, Federal Law, Federal Medical Assistance Percentage, Health Care Providers and Services, HHS, Home Health Care Agencies, Home Health Services, Hospitals, Knicole Emanuel, Legal Analysis, Legal Remedies for Medicaid Providers, Legislation, Long Term Care Facilities, Medicaid, Medicaid Advocate, Medicaid Appeals, Medicaid Attorney, Medicaid Audits, Medicaid Billing, Medicaid Budget, Medicaid Contracts, Medicaid Costs, Medicaid Eligibility, Medicaid Expansion, Medicaid Funds, Medicaid Providers, Medicaid Reform, Medicaid Reimbursements, Medicaid Services, Medicaid Spending, Medicare and Medicaid Provider Audits, NC DHHS, Obamacare, Personal Care Services, Post-Payment Reviews, Suspension of Medicaid Payments, Tax Dollars, Taxes, Taxpayers
Tags: Affordable Care Act, AHCA, AHCA and Medicaid, American Health Care Act, Credible Allegations of Fraud, Disproportionate share hospital payments, DSH payments, Federal contributions, Federal Medical Assistance Percentages, H.R. 1628, Health savings accounts, Hospitals and Medicaid, Long Term Care Facilities, Medicaid, Medicaid Eligibility, Medicaid eligibility and home equity, Medicaid Expansion, Medicaid waivers, Personal Care Services, Presumptive eligibility program, Section 1115 Waivers
Posted by kemanuel
Regardless how you voted, regardless whether you “accept” Trump as your president, and regardless with which party you are affiliated, we have a new President. And with a new President comes a new administration. Republicans have been vocal about repealing Obamacare, and, now, with a Republican majority in Congress and President, changes appear inevitable. But what changes?
What are Trump’s and our legislature’s stance on Medicaid? What could our future health care be? (BTW: if you do not believe that Medicaid funding and costs impact all healthcare, then please read blog – and understand that your hard-working tax dollars are the source of our Medicaid funding).
WHAT IS OUR HEALTHCARE’S FORECAST?
The following are my forecasted amendments for Medicaid:
- Medicaid block grants to states
Trump has indicated multiple times that he wants to put a cap on Medicaid expenses flowing from the federal government to the states. I foresee either a block grant (a fixed annual amount per state) or a per capita cap (fixed dollar per beneficiary) being implemented.
What would this mean to Medicaid?
First, remember that Medicaid is an entitlement program, which means that anyone who qualifies for Medicaid has a right to Medicaid. Currently, the federal government pays a percentage of a state’s cost of Medicaid, usually between 60-70%. North Carolina, for example, receives 66.2% of its Medicaid spending from Uncle Sam, which equals $8,922,363,531.
While California receives only 62.5% of its Medicaid spending from the federal government, the amount that it receives far surpasses NC’s share – $53,436,580,402.
The federal funding is open-ended (not a fixed a mount) and can inflate throughout the year, but, in return, the states are required to cover certain health care services for certain demographics; e.g., pregnant women who meet income criteria, children, etc. With a block grant or per capita cap, the states would have authority to decide who qualifies and for what services. In other words, the money would not be entwined with a duty that the state cover certain individuals or services.
Opponents to block grants claim that states may opt to cap Medicaid enrollment, which would cause some eligible Medicaid recipients to not get coverage.
On the other hand, proponents of per capita caps, opine that this could result in more money for a state, depending on the number of Medicaid eligible residents.
2. Medicaid Waivers
The past administration was relatively conservative when it came to Medicaid Waivers through CMS. States that want to contract with private entities to manage Medicaid, such as managed care organizations (MCOs), are required to obtain a Waiver from CMS, which waives the “single state entity” requirement. 42 CFR 431.10. See blog.
This administration has indicated that it is more open to granting Waivers to allow private entities to participate in Medicaid.
There has also been foreshadowing of possible beneficiary work requirements and premiums.Montana has already implemented job training components for Medicaid beneficiaries. However, federal officials from the past administration instructed Montana that the work component could not be mandatory, so it is voluntary. Montana also expanded its Medicaid in 2015, under a Republican governor. At least for one Medicaid recipient, Ruth McCafferty, 53, the voluntary job training was Godsend. She was unemployed with three children at home. The Medicaid job program paid for her to participate in “a free online training to become a mortgage broker. The State even paid for her 400-mile roundtrip to Helena to take the certification exam. And now they’re paying part of her salary at a local business as part of an apprenticeship to make her easier to hire.” See article.
The current administration may be more apt to allow mandatory work requirements or job training for Medicaid recipients.
3. Disproportionate Share Hospital
When the ACA was implemented, hospitals were at the negotiating table. With promises from the past administration, hospitals agreed to take a cut on DSH payments, which are paid to hospitals to help offset the care of uninsured and Medicaid patients. The ACA’s DSH cut is scheduled to go into effect FY 2018 with a $2 billion reduction. It is scheduled to continue to reduce until FY 2025 with a $8 billion reduction. The reason for this deduction was that the ACA would create health coverage for more people and with Medicaid expansion there would be less uninsured.
If the ACA is repealed, our lawmakers need to remember that DSH payments are scheduled to decrease next year. This could have a dramatic impact on our hospitals. Last year, approximately 1/2 of our hospitals received DSH. In 2014, Medicaid paid approximately $18 billion for DSH payments, so the proposed reductions make up a high percentage of DSH payments.
4. Physician payment predictability
Unlike the hospitals, physicians got the metaphoric shaft when the ACA was implemented. Many doctors were forced to provide services to patients, even when those patients were not covered by a health plan. Many physicians had to increase the types of insurance they would accept, which increased their administrative costs and the burden.
This go-around, physicians may have the ear of the HHS Secretary-nominee, Tom Price, who is an orthopedic surgeon. Dr. Price has argued for higher reimbursement rates for doctors and more autonomy. Regardless, reimburse rate predictability may stabilize.
Posted in "Single State Agency", 1915 b/c Waiver, California Medicaid, CMS, Congress, Decrease in Medicaid Spending, Doctors, Federal Government, Federal Law, Health Care Providers and Services, HHS, HMS, Hospital Medicaid Providers, Hospitals, Knicole Emanuel, Legal Analysis, Legislation, Managed Care, Medicaid, Medicaid Advocate, Medicaid Attorney, Medicaid Audits, Medicaid Costs, Medicaid Providers, Medicaid Recipients, Medicaid Reform, Medicaid Reimbursements, Medicaid Services, Montana Medicaid, NC, NC DHHS, North Carolina, Obamacare, Physicians, Primary Care, Primary Care Physicians, Psychiatrists, Tax Dollars, Taxes, Uninsured
Tags: 42 CFR 431.10, Affordable Care, Affordable Care Act, Block grant, California Medicaid, Disproportionate share hospital, DSH payments, Federal funding, Federal Government, Federal portion of Medicaid, Health and Human Services, Health care, HHS, Managed care, Managed Care Organizations, Mandatory work requirements, Medicaid, Medicaid beneficiaries, Medicaid block grants, Medicaid Costs, Medicaid Eligibility, Medicaid enrollment, Medicaid Expansion, Medicaid per capitat cap, Medicaid Providers, Medicaid Waiver, Medicaid waivers, Medicare, Montana Medicaid, Patient Protection and Affordable Care Act, Per capita cap, Physicians who Accept Medicaid, Primary Care, Primary Care Physician, Privatization, Single state agency, Single state entity, Tom Price, Trump