Manatt on Health Reform: Weekly Highlights

Montana’s Medicaid expansion waiver seeks monthly premiums and a “third party administrator”; Rhode Island’s Medicaid working group recommends pursuing a DSRIP waiver; and Utah’s Medicaid expansion discussions are put on hold until 2016.

MEDICAID EXPANSION & REFORM NEWS:

Positive Results Seen in Expansion States

In recognition of Medicaid’s 50th anniversary, the most recent Health Affairs publication included several analyses of the quality, cost, and utilization of care in three Medicaid expansion states—Ohio, Connecticut, and California. Taken together, the studies addressed oft-cited concerns about Medicaid expansion, such as the impact on health outcomes and increased use of services, particularly of the emergency room. A study in Ohio demonstrated that previously uninsured individuals in a waiver program with patient centered medical homes had significantly improved health between 2012 and 2013 compared to their uninsured counterparts; additionally, program costs were 29% below the expected budget. A study of the Health Care Coverage Initiative in California, which required previously uninsured patients to receive care from an individual primary care provider (PCP), found that enforcing this policy resulted in increased PCP visits and reduced emergency room visits and hospitalizations. One study in Connecticut, which expanded Medicaid in 2010, found that between 2010-2013 its level of uncompensated care was about one-third lower than it would have been without expansion, based on a comparison with other northeastern states during that period.

Alaska: Budget Prohibits Medicaid Expansion, Governor Continues to Consider Options

Though Governor Bill Walker (I) signed a State budget that prohibits appropriated funds to be used for Medicaid expansion, the Governor told reporters that he continues to weigh his options on Medicaid expansion, and his spokesperson announced that he would lay out his Medicaid expansion plans this Thursday, reports the Alaska Dispatch News. At the request of Governor Walker and legislators, respectively, Alaska’s Department of Law and Legislative Affairs Agency reviewed the Medicaid provision and found that the restriction may violate the confinement clause in the Alaska constitution because it could have the effect of amending existing law. Some Democratic legislators have urged the Governor to convene a special legislative session in the fall to consider Medicaid expansion.

Montana: Medicaid Expansion Waiver Seeks Premiums, Third Party Administrator

Montana’s Health and Economic Livelihood Partnership (HELP) Program waiver application, now posted by the State for public comment, requests permission to contract with a third party administrator for the delivery of and payment for healthcare services for most of the new adult population up to 138% of the federal poverty line (FPL), a mechanism not used in any other state’s expansion. Additionally, the State requests permission to impose monthly premiums equal to 2% of annual income and disenroll participants with incomes above 100% of the FPL who fail to pay. The waiver also seeks 12 month continuous eligibility for new adults.

Rhode Island: Medicaid Working Group Final Report Recommends DSRIP Waiver

The Working Group to Reinvent Medicaid, established through Executive Order in February, issued its second and final report to Governor Gina Raimondo (D) this week identifying 10 strategic goals for Rhode Island’s Medicaid system and recommending Rhode Island seek federal funds through a Delivery System Reform Incentive Program (DSRIP) 1115 waiver to support the creation of “integrated provider organizations that will be responsible for the total cost of care and healthcare quality and outcomes of an attributed population.” The strategic goals include paying providers based on the quality of services rather than volume; coordinating medical, behavioral, and long-term care; and shifting Medicaid spending from high-cost institutional settings to community-based providers. Governor Raimondo’s 2016 budget, signed in June, included many reforms suggested in the Working Group’s first report released in May.

Utah: Medicaid Expansion Negotiations Pended Until 2016

After several months of behind-closed-doors negotiations between Governor Gary Herbert (R) and legislative leaders, the working group announced it will not strike a deal on Medicaid expansion this legislative session. The working group hopes to introduce a compromise plan next year, after the 2016 legislative session opens in January.

MARKETPLACE ACTIVITY:

Slow Enrollment in Small Business Health Options Program

CMS announced that as of May 2015, approximately 10,700 small employers participate in the Federal Small Business Health Options Program (SHOP) Marketplace, representing approximately 85,000 covered lives. This figure may underestimate total enrollment, as it does not include employers who began coverage through SHOP in 2014 and have not yet renewed through HealthCare.gov for 2015. Since November 2014, more than 500 businesses have enrolled each month in the 33 states that use the Federal SHOP system.

Illinois: Marketplace Moves to the Department of Insurance

The Illinois Department of Insurance announced that effective August 1, it will begin administering Get Covered Illinois, the State's Partnership Marketplace, which has operated from within the governor's office since it was established under former Governor Pat Quinn (D). Headed by an appointee of current Governor Bruce Rauner (R), the Insurance Department will operate the Marketplace moving forward with a more limited budget and reduced resources, including 15 fewer staff positions.

FEDERAL & STATE HEALTH STAFFING UPDATES:

President Obama Nominates Andy Slavitt as Administrator of CMS

President Obama nominated Andy Slavitt, who has served as the Acting Administrator of CMS since March 2015, as the next CMS Administrator. Slavitt previously served as the Group Executive Vice President for Optum, a subsidiary of UnitedHealth Group, where he oversaw the delivery of technology and operational solutions to healthcare clients, including the technology fix to HealthCare.gov in the months after its initial launch. Slavitt also served as Chief Operations Officer and Chief Executive Officer at Ingenix, now Optum Insight. The nomination must be confirmed by the Senate.

Nevada: Amy Parks Appointed as Acting Insurance Commissioner

Amy Parks was appointed Acting Nevada Insurance Commissioner by the Director of Nevada's Department of Business and Industry, following previous Commissioner Scott Kipper’s resignation in June. Parks previously served as Chief Insurance Counsel of the Department of Insurance. It remains unclear when a permanent commissioner will be appointed.

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