Manatt on Health Reform: Weekly Highlights

Oklahoma proposes Medicaid coverage for 175,000 currently uninsured; a report finds State-based Marketplaces boost Medicaid enrollment growth rates; and CMS issues a final rule on mental health parity in Medicaid and CHIP.

STATE MEDICAID EXPANSION ACTIVITY:

Arkansas: Medicaid Expansion Only Item on Special Session Agenda

Governor Asa Hutchinson (R) announced that his Medicaid expansion renewal plan, called "Arkansas Works," will be the only agenda item for the special legislative session set to begin April 6. The Governor removed his Medicaid managed care plan from the agenda at the request of legislative leadership. Governor Hutchinson's managed care plan proposed transitioning certain high-risk populations and services from the State's traditional Medicaid program to full-risk managed care. Additionally, the Governor said he would use the savings and increased revenue from his managed care plan to decrease the wait list for a Medicaid waiver program that provides services to individuals with developmental disabilities. Legislators had developed an alternative managed fee-for-service bill that was not on the special session agenda.

Indiana: CMS to Assess Impact of Alternative Medicaid Expansion on Access to Care

CMS received expedited approval from the Office of Management and Budget to evaluate the impact of Indiana's alternative Medicaid expansion on beneficiaries' access to care, according to Modern Healthcare. Three beneficiary surveys will focus on the program's transportation benefit waiver, the application process, and the requirement that individuals with incomes from 100% to 138% of FPL contribute monthly to a health savings account or lose coverage. CMS requested this emergency approval so that the impact of the State's expansion program could "adequately inform" CMS's decision making regarding Indiana's and other states' 1115 waivers, in particular the upcoming renewal process for Indiana's non-emergency medical transportation waiver, due December 1, 2016. After approving the State's waiver in 2015, which expanded Medicaid through a health savings account-like model, CMS contracted with a vendor to oversee the State's self-evaluation as well as two other contractors to conduct a separate evaluation. Governor Mike Pence (R) has expressed concerns that two independent evaluations may produce conflicting results and about the objectivity and potential conflicts of interest among the federal vendors.

Nebraska: Senate Rejects Medicaid Expansion for Fourth Consecutive Year

The Legislature voted 28-20 to remove LB 1032 from this year's legislative agenda, effectively rejecting the Medicaid expansion bill which would have provided healthcare coverage to an additional 77,000 residents. The bill proposed a three-year pilot program that would enroll the majority of expansion adults into qualified health plans on the Marketplace, excluding the medically frail and those with cost-effective employer sponsored insurance. Governor Pete Ricketts (R) and other opponents of the bill, including State Medicaid Director Calder Lynch, raised concerns about the bill's long-term costs, while supporters promised to continue their Medicaid expansion efforts next year.

New Hampshire: Senate Reauthorizes Medicaid Expansion

The Senate voted 16-8 to approve the House's bill to renew the Medicaid expansion program through 2018. The bill now goes to Governor Maggie Hassan (D) who has pledged to sign the legislation into law. The bill includes several new requirements for the Medicaid expansion program, including that enrollees be employed or engaged in a job search. However, the bill also includes a severability provision that would permit renewal of the program even if CMS does not approve some of the new requirements, including the work provision.

FEDERAL & STATE MEDICAID REFORM ACTIVITY:

CMS Requires Mental Health and Substance Use Disorder Parity for Medicaid and CHIP

CMS final rules apply the Mental Health Parity and Addiction Equity Act (MHPAEA) to Medicaid managed care organizations (MCOs), Medicaid Alternative Benefit Plans, and CHIP, largely adopting requirements included in the proposed rules. These final rules, which are modeled on existing parity regulations applicable to commercial health insurers, clarify states' responsibilities for overseeing and ensuring parity where Medicaid benefits are offered through MCOs and interrelated delivery systems, extend parity protections to long term care benefits, and clarify parity requirements for Early and Periodic Screening, Diagnostic and Treatment (EPSDT) benefits for children. MCOs are required to comply with the provisions of the final rule within 18 months of the publication date.

Medicaid and CHIP Enrollment Growth Rates Higher in State-Based Marketplaces

States that use State-based Marketplaces (SBMs) have experienced higher Medicaid enrollment growth compared to those using HealthCare.gov, according to a report from The Commonwealth Fund. The report attributes the higher growth rates—measured as the percentage change in Medicaid and CHIP enrollment between the six months prior to the first open enrollment period and November 2015—to the federal requirement that SBM states enable their Marketplace to make final Medicaid eligibility determinations, whereas states that use HealthCare.gov have the option of processing eligibility determinations through their State Medicaid agency (assessment states) or through HealthCare.gov (determination states). The report also found that determination states tend to experience higher Medicaid enrollment growth than assessment states. These findings, according to the authors, indicate that Medicaid enrollment will be adversely impacted if Kentucky replaces its SBM with HealthCare.gov, as Governor Matt Bevin (R) has announced he intends to do. The authors suggest that the "biggest impact [of the transition] may accrue to the State's Medicaid program," and that the "adverse impact" on Medicaid enrollment may be felt both by new applicants and current enrollees renewing their coverage.

Kentucky: New Benefit Enrollment System Facing Challenges

Benefind, a new web-based portal for enrollment in Medicaid, SNAP, and the State's cash assistance program, has created confusion and delays for consumers, thousands of whom received erroneous notices indicating coverage termination, according to several media reports. Governor Matt Bevin (R) and other administration officials acknowledged the widespread problems and said they are working to rapidly correct them, including adding 185 workers to manage the high volume of calls and visits to local benefit offices. The rollout and challenges faced by Benefind come as Governor Bevin continues efforts to dismantle kynect, Kentucky's State-based Marketplace, and transition to HealthCare.gov by the end of the year. Governor Bevin indicated that he intends to use Benefind, which was developed by the previous administration, as an integrated platform for enrollment into Medicaid and other social service programs, but reiterated that Benefind is entirely unrelated to the shuttering of kynect.

Ohio: State to Request Medicaid Cost Sharing Waiver

Governor John Kasich's (R) administration will seek a federal Medicaid waiver to permit mandated cost sharing for all non-disabled Medicaid recipients regardless of income, in accordance with last year's State budget. Under the waiver, beneficiaries would be required to contribute 2% of their family income or $99, whichever is less, into a health savings account (HSA) or be disenrolled from Medicaid beginning in January 2018. The State Medicaid program would contribute $1,000 to enrollees' HSAs, from which enrollees would draw copayments until the account is depleted. To date CMS has not approved disenrollment from Medicaid for failure to pay a premium for enrollees below the federal poverty line. A draft of the waiver will be made available for public comment on April 15.

Oklahoma: Proposal Would Extend Medicaid to Uninsured and Transition Current Enrollees to the Marketplace

The Oklahoma Health Care Authority (OHCA) has proposed extending Insure Oklahoma, the State's premium assistance program, to 175,000 currently uninsured adults ages 19-64 earning up to 133% of FPL, and moving 175,000 children and pregnant women from Medicaid to the Marketplace, where they would be eligible for federal tax subsidies. The "Medicaid Rebalancing Act of 2020" would require federal approval and would cost the State an estimated $100 million, which would be matched by $900 million in federal funds. The transition of current Medicaid enrollees to the Marketplace would not occur until maintenance of effort requirements expire on October 1, 2019, but would then save the State an estimated $60 million. The plan would also restore Medicaid provider reimbursement rates to current levels "as soon as possible." This proposal was introduced as an alternative strategy to address the State's anticipated budget shortfall instead of the previously announced 25% provider reimbursement rate cut effective June 1; OHCA's CEO Nico Gomez described the cuts as "a last resort."

STATE STAFFING NEWS:

Tennessee: Medicaid Director to Resign

Governor Bill Haslam (R) announced that Medicaid Director Darin Gordon will step down at the end of June. Gordon, who is currently the longest-serving Medicaid director in the country, has led the State's Medicaid agency since 2006. Governor Haslam said he hopes to appoint a replacement by the end of the State's legislative session in mid-April.

FEDERAL MARKETPLACE & HEALTH REFORM NEWS:

CMS Releases Language Accessibility Taglines in 63 Languages

CMS provided translations of language accessibility taglines that Marketplaces, web brokers and qualified health plan (QHP) issuers are required to include on notices and websites for individuals with limited English proficiency. Marketplaces and QHP issuers—and web brokers later this year—are required to include taglines in the top 15 non-English languages spoken in a state. To aid in complying with this requirement, CMS also identified the top 15 non-English languages spoken in each state, totaling the 63 tagline translations. The technical guidance CMS released also reviews requirements related to telephonic interpreter services and website translations.

Supreme Court Orders Parties in ACA Contraceptive Case to Consider Hypothetical Scenario

The Supreme Court is requiring the parties in Zubik v. Burwell to submit briefs describing how contraceptive coverage may be provided to employees through their employer's health insurance plan without violating the employer's preference to exclude contraceptive coverage from the plans. Zubik v. Burwell asks the Court to determine if religiously affiliated employers are unjustly burdened by the accommodation process for the ACA's requirement to cover contraceptive care. This order suggests the court may be considering an alternative to the current accommodation process that is less restrictive, as reported by Health Affairs.

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