CMS Initial Medicaid Guidance on Section 2001 of Health Care Law Establishing New Eligibility Group (April 9, 2010)

CMS released initial Medicaid guidance on Section 2001 of Health Care Law Establishing New Eligibility Group. To view the document click here.

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Arizona's CHIP Plan Spared Elimination

Arizona's Children's Health Insurance Program plan (CHIP), which was slated for elimination on June 15, will no longer be cut due to the federal health reform law that President Obama signed into law March 23. According to the Arizona Health Care Cost Containment System, the reprieve came in the form of a maintenance-of-effort provision applicable to children's health care through 2019. It prevents states from changing eligibility requirements in such a manner that would force individuals off existing rolls.

The Legislature now must repeal the action that eliminated the KidsCare program, AHCCCS spokeswoman Monica Coury told BNA April 7. It is expected to do so before the June 15 sunset date.

But the restoration of the program means the state's budget falls out of financial balance, and now must be reconciled either by additional spending cuts or tax increases, something Arizona's legislators have been opposed to doing.

No agreement has been reached on how the fiscal hole may be patched. Arizona's budget must be balanced, under the state's constitution.

The maintenance-of-effort requirement applies to Medicaid generally and was included in the federal stimulus bill, but was scheduled to expire at the end of 2010, according to the AHCCCS website.

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Arizona 1st State to Drop CHIP Program

Arizona Gov. Jan Brewer (R) has signed budget legislation that removes the statutory authorization for the state Children's Health Insurance Program (CHIP), thus making Arizona the first state to do so amid fiscal constraints. Brewer and Republicans who control the Arizona Legislature said the elimination of the program, known here as KidsCare, was necessary to help close the state's budget deficit, which is pegged at $2.7 billion in fiscal 2011 beginning on July 1. KidsCare would lose funding June 15.

Meanwhile, Arizona House Democrats, led by Minority Leader David Lujan and Assistant Leader Kyrsten Sinema, are working to head off the program's demise.
They asked House Speaker Kirk Adams (R) in a letter dated March 22 that the authorization be reinstated, and that funding be provided through repeal of a sales tax exemption on retail warranties.

The elimination, Democrats argue, may also have consequences beyond children's health, jeopardizing an estimated $7 billion in federal Medicaid matching funds to the state.
The federal health overhaul plan signed March 23 by President Obama requires states to continue “maintenance of effort,” or providing health care at the same funding level as when the legislation was signed. Elimination of KidsCare would put Arizona in violation of that new law, Democrats argue.

Other states, including California, have considered eliminating their CHIP programs, but none has done so.


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State of Idaho Witholding Medicaid Payments to Providers for 30 Days

The Idaho Department of Health & Welfare plans to delay payment to all providers in the state for the entire month of June, 2010. They are doing this to meet budget cuts to the Medicaid appropriation for FY 2010. The state of Idaho’s constitution does not allow the state to end the fiscal year with a deficit, so their solution is to end the year paying for only 11 months of expenses with 12 months of revenue.

Thank you to Russ McCoy with the South Park, Inc. dba Developmental Options for bringing this to ANCOR's attention. Read more!

New Reports on Medicaid and State Conditions

Kaiser releases a new report on Medicaid’s Continuing Crunch in a Recession: A Mid-Year Update for State FY 2010 and Preview for FY 2011. From the beginning of state fiscal year 2010, fiscal pressures have escalated and additional program reductions have become a necessity to balance state budgets. Half-way through the states' fiscal year, a total of 44 states and D.C. report that Medicaid enrollment and spending trends are above projected levels. Twenty-nine states report that additional mid-year cuts are likely. The February 22nd issue brief reports on interviews with all Medicaid directors about several issues, including the effects of the recession. Their primary concern is the upcoming end of the enhanced federal Medicaid match (as provided in the ARRA) and what that will mean for state budgets.

Kaiser Update on State Fiscal Conditions and Medicaid on How States Used ARRA Enhanced FMAP and State-by-State Measure of State Fiscal Distress.
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State of the States: The State We're In Report Examines Health Reform Efforts in 2009 and Initiatives Underway in 2010

This new Robert Wood Johnson Foundation report it examines how states responded to declining job-based coverage and rising health care costs, as well as Medicaid eligibility and CHIP enrollment in 2009, when many states went forward with meaningful health care reforms despite the fiscal challenges they faced. Read more!

New York Governor Proposes Budget With Reduced Medicaid Spending Growth

Governor David A. Paterson (D) January 19 proposed a fiscal year 2010-2011 state budget that would reduce the growth in New York's Medicaid program and impose some $240 million in new health care assessments and surcharges. The $134 billion budget for the fiscal year that starts April 1 would reduce Medicaid reimbursement for hospitals, nursing homes, and home care providers by $459 million in FY 2010-2011.

The state's Medicaid caseload is expected to increase by 400,000 in FY 2010-2011.

Under the budget, the state expects to recover $1.2 billion from fraud and abuse in the Medicaid program, a $300 million increase from the current fiscal year.

The budget also would reinstitute a requirement that health insurers obtain prior approval from the state before imposing rate increases.

Further information on the health care portion of the budget is available at http://publications.budget.state.ny.us/eBudget1011/fy1011artVIIbills/HMH_ArticleVII_MS.pdf


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Connecticut Budget Update

Governor Rell of Connecticut announced rescissions of up to 5% in various state agency line items at the end of the day November 5. The Governor can make line item cuts up to 5% without need for Legislative approval. The total of the rescissions is $34M. The deficit is now projected at $400M by the Office of Policy and Management (the Governor’s budget office) and at $628 by the Comptroller. The Secretary of OPM stated yesterday that the intention is to balance the budget through cuts, not higher taxes.

Most of the cuts in the human services state agency accounts are in the “Personal Services” line – the account for state personnel salary/wage expense. The DCF residential Board and Care – Foster and Residential and Emergency Services had the largest reductions that have the potential to affect community providers. In DDS, the autism pilot was reduced, but other service delivery accounts were not touched. DMHAS wasn’t cut. DSS cuts include a reduction in “Aid to the Disabled,” a large account. Medicaid wasn’t cut.

The Governor’s press announcement
The proposed rescissions (14 pages)

Thank you to Stan Soby of Oak Hill for providing ANCOR with this update.

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Iowa State Budget Update

Thursday, October 8, 2009 Governor Chet Culver of Iowa announced a 10% across the board cut. Up until now, Medicaid providers in Iowa had been exempted from the two previous cuts due to the federal stimulus dollars.

Most Medicaid eligible recipients in Iowa have their local match paid by their county of legal settlement rather than the state. The only savings to the state would be for persons who are state cases and do not have a determined county of legal settlement. The estimate for ICFs/MR is that with a 10% rate cut the state would forfeit $12M in federal funding to save only $400,000 in state dollars, or a loss of $30 for every dollar saved.

It is unsure at the point whether Iowa may require legislative action for cutting Medicaid. That would mean the Governor Culver would have either to call for a special legislative session or wait until the next session convenes in January.

Thank you to Rod Braun from Christian Opportunity for this update.
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Drug Store Groups Sue Three States Over Medicaid Reimbursement Rates.

The National Association of Chain Drug Stores, the National Community Pharmacists Association and other smaller groups filed lawsuits Wednesday in New York, California and Washington State because the Medicaid reimbursement rates are not based on how much it costs the pharmacies to buy the drugs. The three states were charged with violating the Social Security Act and failing to get the new drug prices approved as required by the Centers for Medicare & Medicaid Services.
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WICS Live: Around the States

New Hampshire: Medicaid Funding Running Out, According to State Officials.Just two weeks into the state’s new fiscal year, rising unemployment and increased Medicaid enrollment is pushing the state’s Medicaid budget into the red. The new budget projected a 1% increase in Medicaid enrollment in the current fiscal year, which began July 1st. As of July 14th, the state’s Medicaid director predicted that the Medicaid program was only 39 new enrollees away from running a deficit. Already, providers have laid off staff and limited Medicaid services. Read more!

WICS Live: Around the States

State Briefs. Colorado: $5.3 Million Recovered By AG’s Medicaid Fraud Control Unit: The amount is the highest the state has recovered since the unit began keeping records in 1983 and possibly since the unit’s formation in 1978. The money comes from civil fraud cases and criminal restitution, with the bulk of the amount stemming from interstate settlements between large companies and the federal government, in conjunction with the states.

North Carolina: State Will Repay $300 Million In Incorrectly Charged Federal Funds: A database error in November 2008 to reflect FMAP changes incorrectly charged public hospital payments to the federal government instead of a state account. The state has made CMS aware of the error and reached a repayment plan for the federal government to recoup the funds. Read more!

WICS Live: Around the States

Governors Question Medicaid Expansion While Some States Do More With CHIP. At last month’s National Governors Association meeting in Biloxi, Mississippi, the nation’s governors voiced their concern with emerging health reform proposals in Congress. Governors on both sides of the aisle fear states will have additional Medicaid obligations under the reform proposals without any additional money to pay for them. While many governors support health care reform, the precarious financial situation in their states make it a terrible time to shift additional costs to the states, the governors told HHS Secretary—and former Kansas governor—Kathleen Sebelius. At the same time, at least 13 states have expanded their state CHIP programs over the last year, investing millions of dollars to cover an additional 250,000 uninsured children. The new CHIP reauthorization law providing over $30 billion in new financing over the next five years, paid largely with an increase in federal tobacco taxes, that allows states to expand coverage to children at higher incomes. States that have expanded eligibility include Alabama, Colorado, Arkansas, Indiana, Iowa, Montana, Nebraska, North Dakota, Oklahoma, Oregon and West Virginia. Read more!

WICS Live: Around the States

Washington: Department of Social and Health Services Barred from Eliminating Services to Certain Adults with Disabilities. The U.S. District Court for the Western District issued the temporary restraining order July 13th, directing the agency to ensure that medically necessary services are available to 900 Medicaid beneficiaries affected by the state’s budget cuts. On July 1st, the Department reduced Medicaid-funded long-term services and supports to people with disabilities residing in family homes and boarding homes, which was mandated by the state’s 2009-2011 operating budget. On June 1st, beneficiaries were notified via letter that services were being terminated, but did not including information about replacement services or how to appeal termination of the services. The plaintiffs charged that the Department failed to provide adequate notice, which denied them their right to due process and amounted to discriminated under the Americans with Disabilities Act, forcing plaintiffs to go without community-based services to maintain their independence in the community and enter institutions. While failing to certify the plaintiffs as a class, the court urged the Department to complete case management activities for those individuals to ensure that medically necessary services are provided.


In other news, the court was scheduled July 31st to hold a hearing on a motion for a preliminary injunction issued July 2 preventing the Department from reducing Medicaid in-home health care services for 3,500 children with disabilities. In the July 2nd order, the court blocked the state agency from carrying out the reductions, scheduled to take effect July 1st, until August 1st. The temporary restraining order applies to reductions in the Medicaid-funded personal care services for children age 20 and younger. The state's 2009-2011 operating budget also directs the department to reduce in-home personal care hours for children.

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WICS Live: Around the States

Tennessee: CMS Approves TennCare Proposal to Allow MCOs to Coordinate Beneficiaries’ Long Term Services and Supports. Currently, TennCare enrollees may have to with different entities for physical, behavioral, and long-term care. Now, the enrollee will be able to work with their managed care organizations (MCOs) to coordinate all needed services. The approval of the waiver brings the state closer to implementing legislation enacted in 2008 aimed at expanding home care and community-based services for individuals with disabilities and the elderly under TennCare, the state’s Medicaid program. Integrating long-term services into the managed care delivery system will take between six months and nine months to implement, according to state officials, since contracts with insurers need to be renegotiated and appropriate rates must be set. Read more!

WICS Live: Around the States

Colorado: Last Fiscal Year Saw Record Medicaid Enrollment. As of June 30th, nearly 500, 000 Coloradans were enrolled in the program, the highest amount in the program’s 40 year history. The number is 14% higher than the same month last year and 11% higher the total enrollment over the previous fiscal year. This figure means approximately 10% of state residents are currently enrolled in Medicaid. There was also record enrollment in the state’s CHIP. The increase in Medicaid enrollment comes at the same time the state must fill budget gaps. Despite Federal stimulus funding, the state has had to cut reimbursement rates to providers and with another $1 billion budget gap looming over the next two years, more program cuts are to be expected. Read more!

WICS Live: Around the States

California: State Officials Seeking Broader Waiver Authority to Boost Federal Funding.The current Section 1115 Demonstration Waiver, which was approved in 2005, prohibits intergovernmental transfers and provider taxes as means of drawing down additional Federal funds and includes a “coverage initiative” that provides funding for county initiatives to offer care to about 100,000 previously uninsured individuals (see related Budget Round Up article). The $18 billion waiver expires in August 2010, and the Schwarzenegger administration is already putting together a concept paper for Centers for Medicare and Medicaid (CMS) officials. The state is apparently looking at changes to financing safety-net hospitals, whose finding is capped under the current waiver but provide significant care to the state’s uninsured population. The state is likely to propose to address the needs of high-cost populations, such as individuals with disabilities and children with special needs, according to state officials. Governor Arnold Schwarzenegger (R) also wants flexibility in the next waiver to address eligibility standards and funding. There is some uncertainty, however, how any new state waiver will mesh with the current federal health reform debate—or if it will need to. Read more!

CMS Places Moratorium on Alaska Waiver Services

CMS issued Tuesday a moratorium on all new Medicaid waiver services in Alaska, effective immediately, and putting services on hold for over 1000 individuals.
A CMS team spent a week in a “focused site visit” reviewing implications of a an assessment backlog of about 2000 people waiting for service. CMS left the site visit instructing Alaska to immediately address the backlog and other issues of non-compliance and followed with a written report reiterating those instructions and additional corrective action, including the moratorium on new admissions or enrollments into Alaska’s four HCBS waiver programs. Alaska must now send a detailed report to CMS by September 1st. According to the Anchorage Daily News, the moratorium is expected to last four or five months. Thank you to Emily Ennis, Executive Director of Fairbanks Resource Agency for providing additional information on this issue. Read more!

CMS June 17th Letter to Medicaid Directors Summarizing ARRA

This letter is one of a series designed to provide guidance on the implementation of the American Recovery and Reinvestment Act of 2009 (ARRA), Public Law 111-5. It summarizes most sections of ARRA that impact titles XIX (the Medicaid program) and XXI (the Children’s Health Insurance Program, or CHIP) of the Social Security Act (the Act) and provides detail on the sections specific to payments that should not be counted for purposes of eligibility for Federal programs. This letter includes information on the FMAP and disregard of one-time only SSI $250 check for purposes of all federally funded programs. Read more!

Iowa Makes Good on Pledge to Use Enhanced FMAP Exempt Providers from Across Board Cuts

Iowa Governor Chet Culver implemented an across-the-board cut of 6.5% in his FY09 budget. For FY10 beginning July 1, 2009 there was an additional across-the-board cut of 4.8% on top of the previous 6.5%. The good news for Iowa providers is that the Governor made a commitment to them that they would be exempted from the across-the-board cuts if Congress came through with the enhanced FMAP funding via the American Recovery and Reinvestment Act (ARRA) of 2009. The Governor kept his commitment and providers were exempt. Thanks to Rod Braun of Christian Opportunity for this update. Read more!