New Medicaid Briefing Series: Priority Issues for State Lawmakers

Health Update

Click Here to Access Manatt’s New 7-Part Briefing Series, Funded by the Robert Wood Johnson Foundation.

Editor’s Note: Medicaid is woven into the fabric of states’ healthcare systems and economies. Covering one in five Americans, the Medicaid program is the single-largest insurer in every state, and is the largest source of funding for mental health, substance use disorder, long-term care and emergency services. Medicaid is also a critical engine in states’ economies and a significant item in their budgets.

In a new seven-part briefing series, funded by the Robert Wood Johnson Foundation, Manatt Health highlights key Medicaid issues—including children’s coverage, the opioid epidemic and managed care—to support state officials in evaluating their Medicaid programs, identifying challenges and opportunities, and taking action on pressing priorities. Issue 1—focusing on priority Medicaid issues for state officials—is summarized below. Watch for summaries of the remaining briefings in upcoming “Health Update” newsletters. Click here to download the full series free.      

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The Structure of the Medicaid Agency

Where  the agency and its leadership sit within state government can enable or impede the Medicaid director’s authority to make critical decisions about strategy, services and budget. For example, while Medicaid is the primary funder of behavioral health and long-term care services, in some states, responsibility for a delivery system and payment policy for these services is vested in agencies outside of the Medicaid director’s purview. States are increasingly questioning the rationale of this fragmented structure and consolidating authority for physical health, behavioral health and long-term care services under the Medicaid director.

Enabling Coverage and Access

When individuals churn on and off coverage, plans and providers are hard-pressed to manage care effectively—and patients are less likely to access “the right care at the right time in the right setting.” Therefore, a fundamental issue for state policymakers is the state’s policies and operating procedures with respect to Medicaid eligibility and enrollment.

With the rate of insured children declining in 2017 after more than a decade of consistent increases, children’s coverage is especially critical at this time. As a first priority, state policymakers should identify children’s coverage losses in their states and determine how to reverse any downsizing. In addition, before embracing any new proposals—such as adding work requirements or other coverage conditions—state policymakers should carefully assess their potential impact on continuous coverage.

Addressing the Needs of Special Populations

Elderly and Disabled Adults. Although they represent just 6% of Medicaid beneficiaries, adults who rely on community and institutional long-term services and supports consume over 40% of Medicaid resources. Accordingly, states are examining whether care is being delivered in the most appropriate setting and building the continuum of community-based care. Recognizing the importance of care management for these populations, states with more mature managed care programs are increasingly moving these individuals and the services they require into the managed care system. 

Behavioral Healthcare. Medicaid has become an important lever in addressing the most pressing behavioral health needs, including substance use disorder. States that have expanded Medicaid are initiating programs for adults transitioning from prison back into the community and into Medicaid coverage with the goal of improving care access and reducing mortality and recidivism rates. States also are reviewing their payment models and managed care contracts to identify opportunities to support physical and behavioral health services integration, including for people with opioid use disorder.

Buying Value: Quality, Cost-Effective Care

Most Medicaid agencies are abandoning cost-based reimbursement and adopting value-based payment policies. Through their Medicaid managed care programs, states are requiring or incentivizing their plan contractors to use value-based payment methodologies with providers. They also are incentivizing plans to meet new quality metrics linked to state priorities and initiating multipayer purchasing strategies that align payer approaches and bargaining power across Medicaid, public employee plans, commercial payers and Medicare.