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Trump-caid: Medicaid Under the AHCA
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.
Going to the Dentist? You May Need to Take a Pregnancy Test!
I go to the dentist for teeth cleaning. I go to an ob/gyn for my lady parts. They each are not entwined.
Recently, a number of dentists have contacted me they are receiving Tentative Notices of Overpayment (TNOs) stating that they owe money back to the state for dental services completed on women who had already given birth.
What?
First, what is Medicaid for Pregnant Women?
Basically, Medicaid for Pregnant Women (MPW) is a self-defining type of Medicaid coverage. It is Medicaid coverage for pregnant women.
According to DHHS, “Medicaid for Pregnant Women (MPW) only covers services related to pregnancy:
- Prenatal care, delivery and 60 days postpartum care
- Services to treat medical conditions which may complicate the pregnancy (some services require prior approval)
- Childbirth classes
- Family planning services
A pregnant woman may apply for this program before or after she delivers. A woman who has experienced a recent pregnancy loss may also be eligible.”
And routine dental services are covered for MPW recipients through the date of delivery.
But, the day after the child is born…BOOM…no routine dental visits.
Here is a hypothetical example of this new issue that I have recently been made aware:
Mary is pregnant and is covered by MPW. She makes a dental appointment for August 1, 2015. She is due September 1, 2015. She gives birth to a bouncing, baby boy, whom she names Paul on July 28, 2015. Even though Paul is early, he is healthy (this is a happy hypothetical). She shows up for her dental appointment with Dr. Peter on August 1, 2015.
Herein lies a delicate subject…due to its sensitive nature, I will now revert the hypothetical to myself, personally, and only for this narrow topic.
I had my beautiful 10-year old daughter at 28 weeks. She came three months early. Despite the early delivery, I had expanded in the stomach area at least as much as a normal pregnant woman, if not more so. Chalk it up to Harris Teeter birthday cakes. After my daughter was born, the insensitive, yet rule-following nurse actually had the audacity to place me on a scale (while I was conscious and alert!). I was horrified to discover that after all that I went through that I had lost a mere 4 pounds. She must have seen my look because she quickly explained that I had been pumped with so much fluid during the procedure that my weight was inflated. Likely story, I thought. The point of this short anecdote is that I looked the same after giving birth that I did prior to giving birth. Embarrassingly, my transition back to a normal, un-pregnant body extended for a much longer than expected period of time. Chalk it up to Harris Teeter birthday cakes.
Ok, going back to our hypothetical…
Mary really wants her teeth cleaned because, once she gives birth, she knows full well that she will not be able to undergo a teeth cleaning. So when she presents herself at Dr. Peter’s office and Dr. Peter asks whether she is still pregnant, she answers, “Yes, sir.”
Dr. Peter, undergoing all the due diligence that a dentist can be expected, has his assistant log on to NCTracks. According to NCTracks, Mary is eligible for MPW. No changes are noted on her eligibility. Satisfied with his due diligence, Dr. Peter cleans Mary’s teeth.
Two years later, Dr. Peter receives a TNO stating that he owes $10,000 back for services rendered to women after they gave birth.
Dr. Peter conducted his due diligence. Dr. Peter inquired as to the pregnancy status to the patient. Dr. Peter checked eligibility status with NCTracks.
What more would the state expect Dr. Peter do to determine whether his dental patients are indeed still pregnant? Ask them to pee in a cup? Hire a onsite ob/gyn?
You can imagine the consequences of each.
Yet, according to a number of dentists who have communicated with me, the state is placing the burden of knowing whether the dental patient is still pregnant on the dentist.
Talk about accountability! If NCTracks shows that the patient is eligible for MPW, shouldn’t NCTracks be held liable instead of the dentist?
Call me crazy, but I may or may not be extremely angry if my dentist asks me to pee in cup.
Medicaid Expansion, Polarization, and Diving Head-First Into the Unknown
I have always believed in the concept to think first, act second. I rarely react; I try to act. In politics, generally, this mantra is not followed. If a public poll states that the public is in favor of X, then the leaders need to consider X. If it is an election year, then the politicians will do X.
I’m reminded of an awful book I read a couple of years ago. I can’t remember the name of it, but it began with a young teen-age couple at a lake. The boyfriend dives off of a dock into the lake and dies because his head hit a rock underneath the water. (I do not suggest reading the book). But I remember thinking… “How tragic,” then… “Why in the world would this guy dive head-first into a lake without knowing the depth or pitfalls? This was a preventable death.”
This is a perfect example of why we should think first, act second.
However, in politics, the polarization of the two parties, Republican and Democrat, sometimes causes politicians to RE-act according to the party lines. Nowhere is this polarization more prevalent than the concept of Medicaid expansion. See my blog: “To Expand, Or Not To Expand, A Nationwide Draw?” It seems that if a state has a Republican governor, without question, that state will refuse to expand (I know there are few exceptions, but there are few). If a state elected a Democratic governor, then the state has elected to expand Medicaid.
Are these issues so black and white? Or have we become so politically polarized that true intellect and research no longer matters? Doesn’t that actual state of the state matter in deciding to expand?
For example, according to a 50-state survey by USA Today, North Dakota is the best run state. North Dakota has zero budget deficit, and an unemployment rate of 3.1%, the lowest of all 50 states. North Dakota has opted to expand Medicaid.
On the other hand, according to the same study, North Carolina has an unemployment rate of 9.5%, which is the 4th highest in the nation. What does high unemployment mean? A large number of Medicaid recipients.
North Dakota has approximately 82,762 Medicaid recipients, according to the Kaiser Foundation for FYE 2010. Conversely, North Carolina, for the same year, had 1,813,298 Medicaid recipients.
So my question is: Can, or should, a state with 1.8 million Medicaid recipients adopt the same Medicaid eligibility rules as a state with 82,000 Medicaid recipients?
And how can we know the consequences of expansion prior to deciding to expand? Because, after all, shouldn’t we think first, act second? Who wants to dive into an unknown lake?
But issues that apparently no one had contemplated are cropping up…
States across America are seeing unexpected Medicaid costs increase. According to the Associated Press, prior to Medicaid expansion there were millions of Americans who were eligible for Medicaid but who, for whatever reason, had never signed up. Now that there has been so much publicity about health care, those former un-insured but Medicaid-eligible people are signing up in droves.
In California, State officials say about 300,000 more already-eligible Californians are expected to enroll than was estimated last fall. See article.
Rhode Island has enrolled 5000-6000 more than its officials expected. In Washington State, people who were previously eligible represent about one-third of new Medicaid enrollments, roughly 165,000 out of a total of nearly 483,000.
While the Feds are picking up the costs for Medicaid recipients now eligible because of the expansion (at least for a few years), state budgets have to cover these new Medicaid recipients signing up who had been eligible in the past.
For states blue or red, the burden of these unanticipated increased costs will be on the shoulders of the states (with federal contribution).
Going back to the extremely polarized view of Medicaid expansion (Democrats expanding and Republicans not expanding)…maybe it’s not all black and white. Maybe we should shed our elephant or donkey skins and actually research our own states. How many Medicaid recipients do we have? What does our budget cover now?
Maybe we should research the consequences before diving in the lake.
NCFast: Should We Go Back to Atari???
Computer systems have come a long way. I remember my Tandy3000 when I was growing up (which had Lotus Notes on it). I also remember the best video game was Pong. Yes, slowly, we advanced to Pac Man, Q-bert and Frogger. But when I bought (actually when my parents bought) my Atari, it worked as expected. When I wanted to play the Decathlon, if I wiggled my joy stick fast enough, I could be an Olympian. When I pushed the jump button for Donkey Kong, Mario jumped.
So, now in this day and age of computer advancement, someone please tell me why computer systems put into place in NC for DHHS simply do not work, have glitches, and fail. Seriously! Why, with a price tag of $21 million and counting (although one journalist cites the price tag at $48 million), why does NCFast not work??? NCFast is simply not fast. NCSlow would be more apropos.
NCFast has a Medicaid eligibility backlog of approximately 86,000 applications.
While the food stamp backlog has mostly been cleared, an even larger backlog is looming. Acting Medicaid Director Sandy Terrell warned lawmakers that nearly 86,000 Medicaid applications are delayed beyond federal processing timelines.
Why is a backlog of Medicaid eligibility important?
Imagine you are on Medicaid and pregnant. You apply for Medicaid for your unborn child. And the Department of Health and Human Services (DHHS) tells you that there is a backlog. Your child is born (healthy), but you cannot take your baby to the pediatrician for the first check-up because the baby has not received a Medicaid card.
Or imagine you are an adult on Medicaid suffering from cancer. April 1, 2014, the Department of Health and Human Services (DHHS) re-processes your Medicaid eligibility. You have been on Medicaid for years and depend on Medicaid to get your monthly prescriptions for pain, etc. But now it is May 6, 2014, and your Medicaid eligibility has not been processed. You go to the pharmacy that you go to every month and the pharmacist says, “Sorry. We cannot give out medication hoping to get paid in the future. Your Medicaid application has not been processed.”
Are we as North Carolinians just doomed to hire contractors who cannot meet the standards required? Or are we poorly choosing contractors? Are these contractors overstating their abilities? Or are we not conducting due diligence to determine whether these contractors are overstating their abilities?
What if Superman told us, “Trust me! I can fly! I am super strong! I will foil all of your villains!” Only to find out that Superman is Verne Troyer in costume?
Why should we care?
Three reasons:
1. People are not getting food stamps in a timely way.
2. People are not getting Medicaid eligibility applications timely processed.
3. We, as taxpayers, paid for this computer system and expect it to run reasonably well.
My Atari, at least, met expectations!
$12 Million of Illinois Medicaid Dollars Paid for Services Rendered to the Deceased
Who would want state Medicaid dollars paying for services that are not medically necessary? What about services getting paid out for services rendered to dead people?
I mean, I am no doctor, but I fail to see why someone who is deceased would need dentures, dialysis, or a wheelchair.
Yet, the state of Illinois recently identified that it paid overpayments for Medicaid services to roughly 2,900 people after the date of their deaths, equaling approximately $12 million. See AP story.
How do state agencies verify eligibility for the multi-million number of Medicaid recipients within a state? Or, for that matter, how does the federal government determines eligibility for the nation’s Medicare population? Determining eligibility for Medicaid and Medicare is a large-scale, daunting task for both the federal government and the state government.
A key component of Medicaid and Medicare eligibility is that the person receiving the services is alive. Yet Illinois failed to check on the status of Medicaid recipients’ lives.
Improper payments of $12 million for Medicaid services delivered to the deceased are, obviously, disconcerting for taxpayers. We want Medicaid services to be provided to those people who need the services, and I cannot fathom what Medicaid services a deceased person would need.
Apparently, who determines Medicaid eligibility in Illinois has been a hotly, disputed and ideologically polarized debate. Illinois had hired Maximus Health Services, a private company, to verify Medicaid eligibility, including determining which recipients passed away. The company was said to be achieving a Medicaid eligibility-removal rate of 40 percent. Last year the contract between the state of Illinois and Maximus ended and the work was transferred into the hands of state employees.
The question remains in my mind, however, who has the duty to inform the state that a Medicaid recipient has passed away? Is the burden on the state employees to discover the deaths, as it appears to be in Illinois? Are Medicaid providers continuing to bill for deceased recipients? Obviously the deceased person does not have the burden to inform the state of his or her passing. Where should the responsibility lie? And where does it lie?
Illinois Governor Pat Quinn blamed the managed care companies. He stated that, in most of the cases that managed care insurance companies incorrectly billed for Medicaid services for deceased people.
This brings up another entity on which the burden of discovering the deaths of Medicaid recipients may lie.
We, in North Carolina, have a messy, unsupervised managed care organization (MCO) system for those suffering with mental health issues, are developmentally disabled and suffer from substance abuse. We currently have 10 MCOs, which are all in the process of merging to form only 3-4. Are the MCOs responsible for knowing when Medicaid recipients die?
Our State Auditor, Beth Wood, has not conducted a similar audit in North Carolina, to my knowledge, but it would not surprise me if NC is also providing Medicaid services to the deceased.
To my knowledge, the federal government has not conducted an audit of the Medicare services to determine whether Medicare funds are being spent on the deceased. Again, I would not be surprised to discover that Medicare funding is being spent on those whom have passed.
This is yet again another example of how the failure of the state government to supervise itself and its contractors costs taxpayers money.
NC Health Agency Mapping Medicaid Overhaul Plan
By EMERY P. DALESIO, Associated Press
RALEIGH, N.C. (AP) — Gov. Pat McCrory’s health agency on Wednesday planned to unveil its latest version of ideas on how to change North Carolina’s $13 billion Medicaid health care system for about 1.7 million poor and disabled people.
The state Department of Health and Human Services was scheduled to present its framework for revamping Medicaid to an advisory group set up by McCrory. The plan could get some touch-ups before it’s presented to state lawmakers next month. The Legislature is expected to take up the proposed changes beginning in May.
It’s been almost a year since McCrory and state health Secretary Aldona Wos proposed largely privatizing management of Medicaid while keeping ultimate responsibility in state hands. About $3.5 billion of the shared state and federal program’s cost is paid by state taxpayers.
McCrory and Republican legislative leaders have blamed spiraling Medicaid costs left by preceding Democratic administrations for not providing teachers and state workers with raises last year. But Medicaid has also proved tough to manage under the GOP’s watch.
McCrory has said overhauling Medicaid is at the top of his legislative agenda and “may be the toughest battle” with lawmakers cool to earlier ideas to pay managed-care organizations a set fee and force them to work out how to deliver care within that budget.
The North Carolina Medical Society — which represents about 12,500 physicians and physician assistants in the state — the North Carolina Hospital Association, and other advocates for medical professionals and consumers have proposed a more conservative shifting of the risk for cost overruns.
The groups proposed expanding the more than 20 accountable care organizations already operating across North Carolina. The small networks of physicians or hospitals are paid by Medicaid for each procedure they perform. Organizations that meet savings and treatment goals get to keep a portion of the savings generated. If patient costs exceed standards, it must share losses with the state.
Problems in North Carolina’s Medicaid program have persisted for years and haven’t quit since McCrory took office last year and installed Wos as DHHS secretary.
A decision by the agency to delay recalculating Medicaid patient eligibility for three months could cost the state up to $2.8 million. Lawmakers have criticized the agency for not reporting those costs while they were developing the state budget last summer.
A group of North Carolina doctors filed a class-action lawsuit last month after flawed computer programs severely delayed payments they were due for treating Medicaid patients. The lawsuit alleges that managers at DHHS and its contractors were negligent in launching NCTracks, a nearly $500 million computer system intended to streamline the process of filing Medicaid claims and issuing payments.
The lawsuit alleged NCTracks’s software was riddled with thousands of errors that led to delays of weeks and sometimes months before doctors and hospitals received payment. That forced some medical practices to borrow money to meet payroll and others to stop treating Medicaid patients, the lawsuit said.
Earlier this month, DHHS announced it would spend up to $3.7 million on no-bid, personal service contracts with two firms that would advise the agency on running the Medicaid program. Internal McCrory administration memos released to The News & Observer of Raleigh describe understaffed and underskilled workers in the Medicaid division needing emergency help.
Lessons From Early Medicaid Expansions Under The Affordable Care Act
Another shared article. Very interesting!! Look specifically at Issue #4.
Lessons From Early Medicaid Expansions Under The Affordable Care Act
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June 14th, 2013
by Benjamin Sommers, Emily Arntson, Genevieve Kenney, and Arnold Epstein Benjamin Sommers, Emily Arntson, Genevieve Kenney, and Arnold Epstein
The Affordable Care Act (ACA) will dramatically expand Medicaid in a number of states starting in January 2014. In this month’s issue of Health Affairs, new research from DeLeire and colleagues on Wisconsin’s 2009 BadgerCare expansion and from Price and Eibner on predicted cost and coverage impacts of the Medicaid expansion provides insights on the implications of state decision-making about whether to expand the program.
Since 2010, six states have already expanded Medicaid to cover some or all of the low-income adults targeted for coverage under health reform. To provide additional information on the impacts of such expansions, we undertook an in-depth exploration of the experiences of these states – California, Connecticut, the District of Columbia, Minnesota, New Jersey, and Washington – through qualitative interviews with 11 high-ranking Medicaid officials across all six states. In analyzing these interviews, we identified several key policy lessons that help elucidate the opportunities and challenges of expanding Medicaid under the ACA. Below are some of our preliminary findings.
Lesson #1: All the early ACA Medicaid expansions occurred in states with pre-existing state or local insurance programs for low-income adults.
The changes in Medicaid eligibility in these six states (including Washington, DC) all built upon pre-existing state- or locally-funded health insurance programs for the poor. In all cases, state officials described the early expansion as, in part, a way to capitalize on the availability of federal funding to subsidize coverage states had already been paying for with state or local funds. Despite the fact that these expansions built on pre-existing programs, four states — California, Connecticut, the District of Columbia, and Minnesota — expanded insurance to a significant number of new individuals who had not previously received public coverage, and in general, Medicaid provided a more generous set of benefits than the pre-existing programs.
Many states will face similar circumstances in 2014: according to the Kaiser Family Foundation, as of 2012, 14 other states provided insurance to low-income adults that fell short of comprehensive Medicaid coverage, and 6 provided Medicaid to some adults below 133 percent of the poverty level. Thus, like the six early-expander states, many others in 2014 will also be building upon previous state expansions as well as extending coverage to new enrollees.
Lesson #2: Expansion-related predictions are challenging.
Another theme with particular relevance for the 2014 expansion was that enrollment and cost estimates proved challenging, often diverging significantly from the actual outcome. While some states did quite well in their projections, several states underestimated costs and/or enrollment significantly. In one state, nearly twice as many new Medicaid beneficiaries enrolled compared to projections. The resulting budget pressure in the state led legislators to consider cutting back the expansion. Another state reported underestimating capitation rates to managed care plans, requiring a significant adjustment after the first year.
Looking ahead to 2014, these experiences should be a note of caution regarding the uncertainties associated with projecting enrollment and costs associated with Medicaid expansions. How will the predictions for 2014 compare to these early expanders’ experiences? On the one hand, the Medicaid expansions in these states built upon pre-existing programs, suggesting that their ability to make accurate projections should have been greater than will be the case for many states under the ACA. However, it is also possible that these more narrowly-targeted expansions received less attention and/or resources for making accurate projections than the broad-based expansion that will be implemented under the ACA in 2014.
Lesson #3: Barriers to coverage and access remain after expanding eligibility.
While state Medicaid officials agreed that access to care had improved for both new Medicaid enrollees and for those transferred from less generous pre-existing programs, they also reported that many barriers to care remained. First, several early expander states had difficulties enrolling very low-income adults and keeping them enrolled, in part because some of these adults experience transient housing and other unstable social circumstances. Several officials said that culturally and linguistically competent outreach conducted through community-based providers was an important means of overcoming these challenges.
Even after enrollment, some beneficiaries reportedly encountered challenges in obtaining care. Care coordination in fee-for-service Medicaid was an area of concern, and several officials also lamented the shortage of providers in rural areas — though they pointed out that this is neither a new problem nor one caused by the Medicaid expansion. While access barriers may be ameliorated by the Affordable Care Act’s increase in primary care payment rates in Medicaid for 2013-2014, the state Medicaid officials we interviewed were fairly skeptical that the temporary pay increase would significantly increase provider participation in Medicaid.
Lesson #4: Behavioral health is a critical need for this population.
Most of the officials we interviewed commented that the expansion population had a greater-than-expected use of behavioral health services, including substance abuse treatment. We identified two primary implications of this: First, it offers the possibility of major improvement in care for a population that has traditionally had difficulty obtaining needed services. Second, states will likely need to improve the availability and quality of mental health services, which requires both additional provider capacity and better care coordination for patients with complex behavioral health needs.
However, it is important to take these comments in context. Several officials noted that this trend of unexpectedly high behavioral health needs is unlikely to be as pronounced in the 2014 expansion to 133 percent of the federal poverty level, because the early expansions targeted much lower-income individuals, who have higher rates of substance abuse and severe mental illness than adults with incomes closer to or above the poverty level. Moreover, it is possible that Medicaid take-up was lower under these early expansions without the added benefit of the individual mandate and public relations efforts that will occur in 2014, and therefore the early expansions disproportionately drew in individuals who were in poor health.
Lesson #5: While the early expansions required significant administrative effort, these states — like all states — still face major implementation challenges for 2014.
Despite their experiences over the past two years, most Medicaid officials in early expansion states felt that they were still not fully prepared for the administrative challenges of the 2014 expansion. Nonetheless, there were some lessons to be learned from the bumps in the road they experienced during the implementation. Administrative challenges in the early expansion included the need to hire more staff (which was not always possible, given budget constraints), the sometimes arduous transfer of beneficiaries from pre-existing programs to Medicaid, and the high volume of new applications. One state official reported that the lack of sufficient staff capacity to handle new applications contributed to a lawsuit. Another state had to print out and manually transfer beneficiary information from the state’s pre-existing insurance eligibility system to Medicaid.
Most officials voiced the opinion that two primary challenges for 2014 are similar in states with or without early expansions: coordinating with the new insurance exchanges and converting their eligibility systems to the Modified Adjusted Gross Income standard required by the ACA.
Lesson #6: The so-called ‘Woodwork Effect’ was not apparent in these early expansions, but it would be premature to rule it out even in states that choose not to expand in 2014.
Most state officials said they had not seen evidence that their early eligibility expansions had resulted in significant increases in enrollment among previously-eligible groups. Nevertheless, most officials predicted that the ACA’s individual mandate, media coverage, streamlined application process, and availability of Exchange subsidies will bring previously-eligible but uninsured people into the program. In this often-voiced view, eligibility expansions are not the issue driving the woodwork effect. Instead, it is these other factors that will occur in 2014 regardless of whether a state chooses to expand Medicaid to 133 percent of the federal poverty level, meaning that all states should plan for increased Medicaid enrollment in 2014 whether or not they participate in the expansion.
Lesson #7: Political context matters a great deal in implementing a Medicaid expansion.
Officials described the support for Medicaid expansion among key stakeholders as nearly universal, though the intensity of support varied. Hospitals, consumer advocates, and community health centers were most vocal and “extremely supportive” of the goals of expanding coverage and bringing federal dollars into the states to do so. Doctors, insurers, and the business community were described as more “lukewarm” but still in favor. More generally, these states all have governors — five Democrats, one Republican — who have declared their support for the 2014 Medicaid expansion, and have what one Medicaid director called a very “pro-coverage” culture.
This culture in government, among stakeholders, and public opinion can, as one official described, grease the wheels and enable programs to more easily overcome implementation challenges along the way. Actively incorporating stakeholders at each step during the implementation process and keeping them apprised of impending changes or new challenges can be critical to maintaining support over time.
Conclusion
The experiences of the six “early expander” states under the Affordable Care Act provide a range of potentially valuable lessons for policymakers to consider as the 2014 Medicaid expansion approaches. Though these six states are distinct in many ways from other states, aspects of the lessons that emerged from interviews with these officials have potential implications for other state policymakers, whether or not they choose to expand Medicaid in 2014, and whether or not they have pre-existing state or local coverage programs.
Overall, the lessons of the six early expansion states show the promise of significant gains in coverage and access to care for populations in need, but also offer cautionary notes on the administrative challenges, significant cost and enrollment uncertainty, and remaining barriers to care that policymakers will need to take on over the coming years of immense change in the Medicaid program.
