Manatt on Medicaid: Monthly Expansion Recap

Emerging News on Expansion

Congress Restarts Debate on the AHCA, Which Would Significantly Cut Medicaid Funding and Coverage

House Republicans have revived the debate over the AHCA, and are discussing a potential vote on a new AHCA amendment that would allow states to waive some ACA consumer protections. The AHCA would phase out federal Medicaid expansion funding, which would result in 14 million people losing coverage by 2024 and the 31 expansion states plus the District of Columbia losing approximately one-third of their total Medicaid funding by 2026, according to a state-by-state analysis from Manatt Health.

Action Expected Soon on Medicaid Work Requirements and Waiver Requests

Several states have requested—or announced their intention to request—federal approval for new waiver authority related to their Medicaid expansion populations, including to implement work requirements for non-disabled adults. While CMS has not previously approved any state requests to implement work requirements, the Trump Administration has signaled it may approve such requests. Arizona and Kentucky have recently submitted 1115 waiver requests that include work requirements for their Medicaid expansion populations, while Wisconsin and Maine are planning to propose work requirements for their traditional Medicaid populations.

New State Medicaid Expansion Activity

Iowa: Medicaid Agency Implementing Risk Corridors for MCOs for Medicaid Expansion and Disabled Populations

The State has amended its managed care organization (MCO) contracts, with CMS approval, to include risk corridor payments to MCOs to offset some MCO losses for the Medicaid expansion and disabled populations, according to documents obtained by the Des Moines Register. The State will cover all MCO losses for the expansion population provided at least 94% of plan revenue is spent on services. For disabled Medicaid enrollees, the State will cover losses for costs that are 8%-12.5% above projections. State officials estimate the risk corridor payments will cost the State $10 million and the federal government up to $225 million. The State's three Medicaid MCOs have reported more than $450 million in losses since April 2016, the start of State's Medicaid managed care program. Risk corridors are increasingly common in Medicaid managed care.

Kansas: House Fails to Override Governor's Medicaid Expansion Veto

Governor Sam Brownback (R) vetoed legislation that would have expanded the State's Medicaid program, citing a lack of work requirements and saying the bill "burdens the state budget with unrestrainable entitlement costs." The veto was upheld in the House on Monday after a motion to override the veto fell three votes short.

Louisiana: Majority Approve of Medicaid Expansion

The 2017 Louisiana Survey found that 72% of Louisianans surveyed now approve of Medicaid expansion in the State, though only 42% view the ACA favorably, compared to 31% in 2014. The annual survey, which is conducted by the Louisiana State University Reilly Center for Media and Public Affairs, queried Louisianans between February and March of 2017 to assess residents' opinions of State government services.

North Carolina: House Republicans Introduce Medicaid Expansion Legislation

House Republicans, including three of the five Health Committee chairmen, filed legislation to expand Medicaid and primarily fund the expansion through an assessment on hospitals. The legislation includes annual premiums equal to 2% of household income, and work requirements. In addition, Republican legislative leaders agreed to withdraw their request for a preliminary injunction against Governor Roy Cooper's (D) Medicaid expansion plan; Governor Cooper has yet to submit that plan to CMS for approval.

South Dakota and Tennessee: Governors Remain Hesitant on Medicaid Expansion Following AHCA Failure

Tennessee Governor Bill Haslam (R) and South Dakota Governor Dennis Daugaard (R) said they are unlikely to convene legislative special sessions to consider Medicaid expansion following the failure of the AHCA last month. Governor Haslam ordered a special session in 2015 to consider his Medicaid expansion plan but stated, "It's awfully early for that right now." Governor Daugaard's Chief of Staff said healthcare at the federal level remains in flux.

Virginia: Legislature Rejects Medicaid Expansion Proposal

Citing rising Medicaid costs, the House rejected Governor Terry McAuliffe's (D) budget amendment which would have restored his authority to implement Medicaid expansion. Governor McAuliffe said he was "disappointed" in the outcome but is committed to continuing efforts to expand Medicaid in the State.

Wisconsin: State Would Have Saved $1 Billion by 2019 Had State Expanded Medicaid

An analysis from the Wisconsin Legislative Fiscal Bureau commissioned by State Representative Peter Barca (D) estimates that the State would have saved $1 billion in healthcare costs for non-pregnant and non-disabled individuals by FY 2019 if it had fully expanded Medicaid to 138% of FPL in 2014. Currently, adults with incomes up to 100% FPL are eligible for Medicaid in Wisconsin.

National Reports

Uninsurance Rate Among Veterans Dropped 40% Following ACA Implementation, Greatest Coverage Gains Were in Expansion States

The uninsurance rate among veterans decreased by nearly 40% between 2013 and 2015, from 9.6% to 5.9%, following implementation of the ACA's coverage provisions, according to the Urban Institute. Coverage gains were largest among veterans with incomes below 138% of FPL in Medicaid expansion states. While the Department for Veterans Affairs provides health insurance to veterans who meet minimum duty requirements or other qualifying conditions, nearly 552,000 veterans were uninsured in 2015.

Heritage Foundation Report Suggests Quicker Rollback of Medicaid Expansion

A Heritage Foundation report argues that Congress should amend the AHCA to accelerate the proposed rollbacks of federal Medicaid expansion funding by limiting enhanced federal matching rates to expansion adults enrolled in Medicaid before July 1, 2017. The report also recommends Medicaid block grants for disabled and long-term care populations, and a premium support model for non-disabled Medicaid-eligible adults to enroll in private health plans. The report notes that the AHCA provision to allow states to condition Medicaid eligibility on work requirements is "likely to be unworkable or difficult to administer and enforce."

Cuts to Medicaid Funding Would Disproportionately Impact Older Adults

Medicaid funding cuts, through reductions in Medicaid expansion funding or capped funding, would disproportionately impact adults age 50-64, given that Medicaid covers nearly 20% of all older adults and nearly 50% of older adults with multiple chronic conditions, behavioral health problems, or physical disabilities, according to a Commonwealth Fund analysis of their Survey of High Need Patients. Older adults with multiple chronic conditions, functional limitations, or disabilities who receive Medicaid report lower rates of skipping medication or medical care due to cost, compared to non-Medicaid enrollees with similar health needs, implying that loss of Medicaid coverage would reduce access to care for this high-needs group.



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