Democrats challenge Medicaid Commission, want financial changes
Democrats challenge Medicaid Commission, want financial changes
Democrats who will be responsible for Medicaid oversight in the House and Senate were quick to stake out their disagreement with the HHS Medicaid Commission recommendations issued late last year.
One commissioner, economist Robert Helms from the American Enterprise Institute, who voted in favor of the report and all of the recommendations, still issued a dissent stressing the need for a revamped financing mechanism for Medicaid (see Helms: Medicaid Formula).
Sen. Max Baucus (D-WY), who has taken over from Sen. Chuck Grassley (R-IA) as chairman of the Senate Finance Committee, said he was "disappointed with the final recommendations of Secretary Leavitt's Medicaid Commission."
Baucus said he was concerned that many of the Commission's recommendations would undermine federal oversight of the program and reduce the likelihood that America's most vulnerable people would be able to obtain the comprehensive health care they need.
On the House side, Rep. John Dingell (D-MI), incoming chairman of the House Energy and Commerce Committee, said while some in Congress thought the Commission's work would bear fruit, "I see no proof of that in this report. It is the job of Congress to review the Medicaid program and legislate necessary changes, not a hand-picked Commission stacked against working families."
Dead on arrival?
Families USA deputy director for health policy Rachel Klein said the Commission report "is and should be dead on arrival" in Congress. And AARP questioned increased flexibility for states to administer benefits under Medicaid "because they inevitably lead to cost shifting and unnecessary denial of care."
Virginia Commonwealth University professor Robert Hurley, a member of the State Health Watch editorial advisory board, tells SHW he doubts much will come of the Commission's recommendations because the group was stacked with "those willing to collaborate with the Bush administration" and given that control Congress has shifted to the Democrats, "their work is essentially moot."
In its report, the Commission said, "Fundamental reform is needed to ensure the long-term sustainability of the Medicaid program. More than simply sustaining the program, the Commission believes that Medicaid can and must continue to provide quality care to promote the best possible health for all beneficiaries. Taken as a whole, the recommendations set forth in this report promote Medicaid's long-term fiscal sustainability, while also emphasizing quality of care. Key principles that must be part of this transformation include recognizing the long-term value of investments in quality, supporting state flexibility, and changing how beneficiaries partner with the Medicaid program by encouraging personal responsibility for health care decisions and promoting and rewarding healthy behaviors."
Commission members said they believe beneficiaries' health will be improved through a more efficient Medicaid system that emphasizes prevention, provides long-term care services in the least restrictive appropriate environment, adopts interoperable forms of health information technology, coordinates care across providers and health care settings, and focuses on ensuring quality health care outcomes.
The Commission's recommendations include:
- Long-term care. Public policy should promote individual responsibility and planning for long-term care needs. Changes in Medicaid long-term care policy should address institutional bias and reflect what most seniors and people with disabilities say they want and need, which is to stay at home in their communities in the least restrictive or most integrated setting appropriate to their long-term care needs in a place they call home.
- Benefit design. States should be given greater flexibility to design Medicaid benefit packages to meet the needs of covered populations. This flexibility should include the authority to establish separate eligibility criteria for acute and preventive medical care services and for long-term care services and supports and the flexibility with benefit design to allow states the option to offer premium assistance to allow buy-in to job-based coverage or to purchase other private insurance. Federal Medicaid policy should promote partnerships between states and beneficiaries that emphasize beneficiary rights and responsibilities and reward beneficiaries who make prudent purchasing, resource utilization, and lifestyle decisions. States should have the flexibility to replicate demonstrations that have operated successfully for at least two years in other states, using an abbreviated waiver application process. Compliance with existing regulations regarding the public notice and comment period about state proposals that would significantly restructure Medicaid (1115 waivers and state plan amendments) should be monitored and enforced.
- Eligibility. Medicaid eligibility should be simplified by permitting states to consolidate and/or redefine eligibility categories without a waiver, provided it is cost-neutral to the federal government. The federal government should provide new options for the uninsured to obtain private health insurance through refundable tax credits or other targeted subsidies so they do not default into Medicaid. Because Medicaid's core purpose is to serve needy low-income individuals, especially those who are most vulnerable, a "scaled match" funding formula should be studied so the federal government would reimburse states at an enhanced matching rate for adding low-income populations to the program, with the match rate scaling back as they expand Medicaid to higher-income populations. Fiscal implications, including cost neutrality, should be considered.
- Health information technology. HHS should continue to aggressively promote and support implementing health information technology through policy and financing initiatives while ensuring interoperability. All Medicaid beneficiaries should have an electronic health record by 2012. State Medicaid agencies should include in contracts or agreements with health care providers, health plans, or health insurance issuers that as each provider, plan, or issuer implements, acquires, or upgrades health information technology systems, it shall adopt, where available, health information technology systems and products that meet recognized interoperability standards. HHS, state Medicaid agencies, and their vendors should assure that health information technologies that are acquired or upgraded continuously meet federal and state accessibility requirements.
- Quality and care coordination. States should place all categories of Medicaid beneficiaries in a coordinated system of care premised on a medical home for each beneficiary, without needing to seek a waiver or any other form of federal approval. The Commission recommended a number of reform proposals to support development and expansion of integrated care programs that would promote development of a medical home and care coordination, while also providing necessary safeguards for dual-eligibles. The Centers for Medicare & Medicaid Services (CMS) should establish a National Health Care Innovations Program to support implementation of state-led, systemwide demonstrations in health care reform and make data design specifications available to all other states for possible adoption. State Medicaid agencies should make available to beneficiaries the payments they make to contracted providers for common inpatient, outpatient, and physician services. States should collect and mine data on how Medicaid money is being spent to determine which programs, providers, and services are effective and which need improvement. CMS and Congress should support state innovation to deliver value for taxpayer dollars by purchasing quality health care outcomes as opposed to simply reimbursing for health care processes.
Additional issues to be considered
The Commission report also said there were some issues beyond the scope of its charter that policy-makers cannot ignore, including the opened-ended, federal-state financing arrangement and procedure for determining the amount of federal dollars flowing to states under the Federal Medical Assistance Percentage formula (see Helms: Medicaid Formula), whether the projected work force supply is adequate to support the nation's health care delivery system, especially with an increased focus on home- and community-based services, and barriers to cost-effective home- and community-based health care caused by barriers to access to affordable housing.
The report said the Commission members recognize that many of the challenges facing Medicaid are symptoms of broader changes in the overall health care environment, including a reduction in the percentage of working adults who receive insurance through their employers, insufficient private financing for long-term care services, and a large and growing number of uninsured. "Medicaid and this Commission cannot solve these larger issues, and until all areas of the health care system are engaged, certain challenges are likely to persist in Medicaid, in spite of the best efforts and intentions of this Commission," the report said.
Joy Johnson Wilson, federal relations counselor for the National Conference of State Legislatures (NCSL), who was a voting member on the Commission, tells State Health Watch the Commission recommendations mirror much of what NCSL has been calling for in recent years and thus should be pleasing to many state legislators.
Asked how Congress is likely to react, Ms. Wilson says many of the Commission recommendations "are widely supported across party and philosophical lines. I believe there are many things there that Democrats support such as ensuring that everyone has a medical home, removing the institutional bias in long-term care, and encouraging more consumer involvement in health care decision making."
Disagreement over flexibility
She says NCSL recognizes that while state legislatures want to have greater state flexibility, there are other interests that believe states should have less flexibility, and those differences aren't new.
Something Ms. Wilson believes hasn't received enough attention from those reading the Commission report is the role that housing availability plays in long-term care solutions. "The housing portion costs a lot and isn't medically related," she says. "We should spend more time talking about low-income housing. We need to find a way to help people use the equity they have in their homes to pay for long-term care without losing their homes. That's not a Democrat or Republican issue. It's a cross-cutting issue that involves more than just health care."
Another issue she calls attention to is the Commission statement about the need to study alternative insurance models. She says Democrats and those who support government-funded universal coverage would support such a study.
As this report was being drafted, Ms. Wilson said it was too early to tell how Congress will react to the Commission's recommendations. She said it will be important to see what is in President Bush's budget proposal and what priorities Congress will want to take up beyond its initial 100-hour issues.
Comprehensive strategy
Former Indiana state Medicaid director Melanie Bella, who now is a senior vice president at the Center for Health Care Strategies, tells SHW the Commission's recommendations "provide a comprehensive framework for states to improve the quality and cost-effectiveness of care for Medicaid beneficiaries. The Commission aptly recognized the significant financing challenges that states face regarding long-term investments in quality, health information technology, etc. Thus, states should be particularly pleased with the recommendations on changing the scoring methodology, amortizing costs over longer periods of time, and providing enhanced match/demonstration grants to be recouped over a longer time horizon."
Ms. Bella says such recommendations recognize that states need innovative ways to finance the upfront costs of investments in health information technology and quality improvement. States also are very interested in improving the quality of care for those with chronic needs and integrating care for adults who are dually eligible for Medicaid and Medicare, she says. "A significant set of recommendations focuses on promoting integrated care programs for duals, placing all beneficiaries in a medical home, and establishing a National Health Care Innovations Program to support continued advancements in the delivery of care for adults and children with the most chronic and high-cost health care needs, she says.
Like Ms. Wilson, Ms. Bella expresses the hope that Congress will give due consideration to the Commission's recommendations. "The recommendations draw from leading Medicaid experts and stakeholders from across the country," she says. "They were developed through a nonpartisan process. Medicaid should not be a partisan issue and, hopefully, these recommendations will be ones that policy-makers at all levels will consider."
Commission member Robert Helms, an American Enterprise Institute economist, tells State Health Watch it is easy to be pessimistic about the fate of the Commission's recommendations given the comments from Democrats in Congress. "[HHS secretary] Mike Leavitt can try to do it, but getting Congress to listen will be tough," Mr. Helms says. "There is a lot in there that governors should like, things the National Governors Association has been pushing for. There are some good ideas there that Congress will be forced to look at over the next 10 years. Increases in the number of aged and disabled people in this country are going to force a reevaluation."
Download the Commission's report at http://aspe.hhs.gov/medicaid/122906rpt.pdf. Contact Ms. Wilson at (202) 624-5400, Ms. Bella at (609) 528-8400, Mr. Helms at (202) 862-5800, and Mr. Hurley at [email protected].
Democrats who will be responsible for Medicaid oversight in the House and Senate were quick to stake out their disagreement with the HHS Medicaid Commission recommendations issued late last year.Subscribe Now for Access
You have reached your article limit for the month. We hope you found our articles both enjoyable and insightful. For information on new subscriptions, product trials, alternative billing arrangements or group and site discounts please call 800-688-2421. We look forward to having you as a long-term member of the Relias Media community.