Manatt on Health Reform: Weekly Highlights

Arkansas's “Private Option” is projected to have a net impact of $438 million on state funds 2017-2021; Iowa selects MCOs for proposed Medicaid managed care transition; and, the DC Marketplace launches a robust dual-language provider directory tool.

MEDICAID EXPANSION & REFORM NEWS:

Alaska: Legislature to Sue Governor over Medicaid Expansion

Alaska's Legislative Council voted 10-1 to sue Governor Bill Walker (I) over his plans to expand Medicaid by executive action, seeking to bar Governor Walker from a September 1 expansion until a court can rule on the constitutionality of his action. Legislative leaders said the lawsuit will hinge on whether the expansion population is a mandatory or optional coverage category under federal law. According to Alaska law, the Governor can only accept federal funds unilaterally for mandatory Medicaid enrollment categories. In July, Alaska's Division of Legal and Research Services opined that expanding Medicaid unilaterally was likely within Governor Walker's statutory authority.

Arkansas: Preliminary Report Shows Private Option Projected to Have Net Impact of $438 Million on State Funds

Preliminary data indicate that Arkansas’s Medicaid expansion, known as the “Private Option,” is projected to generate $567 million in revenue and cost $130 million, for a net impact on state funds of $438 million between 2017 and 2021. The State realized the greatest savings from shifting certain categories of beneficiaries from traditional Medicaid into the Private Option (which has a higher federal matching rate and thus results in lower state spending) and from reductions in uncompensated care spending. The report includes a recommendation that the State focus its attention on spending growth in traditional Medicaid; while spending in Arkansas’s traditional Medicaid program has only grown 2% in the past year, CMS projects increases of nearly 6% on average for the next decade. The firm will continue to analyze data and issue a final report in October.

Arkansas: Governor Indicates Continued Support for Medicaid Expansion, Desire for Greater Flexibility

At the joint meeting of the Legislative Healthcare Reform Task Force and the Governor’s Medicaid Advisory Council, Governor Asa Hutchinson (R) indicated that he would continue to support Medicaid expansion if the federal government provides greater flexibility, reports Arkansas Online. Governor Hutchinson outlined elements of a “potential plan,” including: charging premiums to enrollees above 100% of the Federal Poverty Level, limiting enrollment in the private-insurance marketplace, eliminating non-emergency medical transportation coverage, adding a linkage to work, and establishing mandatory premium assistance enrollment for those with access to employer-based insurance. The Governor acknowledged that continuing expansion would cost approximately $50 million-$60 million annually, but that ending it completely would leave up to 220,000 people uninsured and remove up to $1.7 billion from the State economy.

Iowa: State Selects Four MCOs to Participate in Transition to Managed Care

Iowa's Department of Human Services (DHS) issued intent-to-award notices to four managed care organizations (MCOs) as part of the State’s transition to Medicaid managed care. The four insurers—Amerigroup Iowa, Inc.; AmeriHealth Caritas Iowa, Inc.; UnitedHealthcare Plan of the River Valley, Inc.; and WellCare of Iowa, Inc.—will provide comprehensive risk-based managed care to a majority of the 560,000 Iowa Medicaid enrollees starting January 1, 2016. While a portion of Iowa's Medicaid population is currently enrolled in managed care for some services, few MCOs currently provide comprehensive benefit plans, according to DHS. Iowa’s Medicaid managed care transition is contingent on CMS waiver approval.

Minnesota: Insurer Sues State and Seeks to Postpone Enrollment

Because the State denied UCare's continued participation in its Medical Assistance program (Minnesota Medicaid) and MinnesotaCare (the Basic Health Program) as a result of its first competitive bidding process, the insurer is suing the State and has requested an injunction to postpone enrollment until the issue has been resolved, reports the Associated Press. The insurer currently serves 370,000 low-income individuals in Minnesota and in its lawsuit cites the public burden of shifting all of their enrollees to new plans as well as the “irreparable harm” this shift would inflict on UCare’s business.

MARKETPLACE UPDATES:

D.C.: Health Benefit Exchange Authority Launches Robust Provider Directory Consumer Tool

In a bid to make information about exchange providers more accurate and consolidated, the DC Health Benefit Exchange Authority (HBX) introduced its Universal Doctor Directory 1.0, which enables consumers to search for and filter lists of physicians by name, area of practice, location, and qualified health plan participation. Prior to implementing the Universal Doctor Directory 1.0, consumers would have to go to individual health plans’ websites to search for this information. The Doctor Directory, which is powered by Consumers’ CHECKBOOK, was also released with a Spanish Language Beta version.

Washington: Marketplace Announces Staffing Cuts, Leadership Transitions

Washington's Health Benefit Exchange Board voted to decrease Exchange staffing levels by 15% after the Legislature appropriated $14 million less in Exchange funding for 2015-2017 than in its previous two-year budget, according to the Puget Sound Business Journal. The Board also officially appointed Pam MacEwan as Interim CEO to succeed Richard Onizuka when he steps down later this month. Separately, current CFO Bob Nakahara announced his resignation, effective August 26th, according to State of Reform. The Exchange did not provide details on when a replacement would be named.

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