In the newsletter we cover 1115 Waviers; duals; pharmacy; drug pricing; managed care and MACPAC.

Bi-Weekly Update
June 18, 2019
In This Issue
From the NAMD Desk

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November 11-13
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Regulatory Update


CMS Issues FAQ on 90/10 Systems Funding in 1115 Waiver Demonstrations
On June 13, the Centers for Medicare and Medicaid Services (CMS) issued a set of Frequently Asked Questions
(FAQs) providing guidance to states on how to use Advanced Planning Documents (APDs) to obtain enhanced federal match for state systems within the context of an 1115 waiver demonstration. Highlights include:
  • States may submit an APD for a proposed 1115 prior to CMS approval of the 1115;
  • States may submit a separate APD for 1115 demonstration activities but are not required to do so. CMS does require a separate budget within the APD for 1115 activities and provides templates for how to do this. 
CMS Publishes Patients Over Paperwork RFI with Specific Questions on Duals
On June 6, the Centers for Medicare and Medicaid Services (CMS) issued a Request for Information (RFI) on its Patients Over Paperwork initiative, aimed at reducing regulatory and administrative burdens in the health care system. This RFI is the second associated with the initiative. It asks broad questions on what additional steps CMS can take to achieve its goals.
Most notably for Medicaid Directors, the RFI seeks stakeholder input in three areas pertaining to dually eligible Medicare-Medicaid beneficiaries:
  • Aligning Medicare, Medicaid and other payer coding, payment and documentation requirements and processes;
  • Clarifying or simplifying regulations or operations that pose challenges for beneficiaries dually enrolled in both Medicare and Medicaid and those who care for such beneficiaries; and
  • Simplifying beneficiary enrollment and eligibility determination across programs.
The RFI comment period closes on August 12, 2019.
OIG Pharmacy Rebate Rule Under OMB Final Review
On June 10, the Office of Management and Budget (OMB) updated its website to indicate that the Health and Human Services Office of the Inspector General (OIG) proposed rule to overhaul pharmaceutical rebates in Medicare Part D and Medicaid is under final review. OMB approval is the final step in the process of finalizing a regulation, generally indicating a final rule is imminent.
NAMD submitted comments on the proposal which noted several operational challenges and unintended consequences for states if the final rule included Medicaid in its changes. At this point it is not clear if the rule as proposed was revised to reflect these concerns.


On the Hill
Group of Senate Republicans Send Letter to PhRMA Requesting Cooperation in Tackling Prices
On June 5, a group of eight Republican Senators sent a letter to Pharmaceutical Research and Manufacturers of America (PhRMA), calling on the drug manufacturer trade group to provide specific ideas on how its members would work with Congress to reduce prescription drug prices. The letter calls out the significant discrepancy in pricing in the United States compared to other countries, citing data showing 42 percent of global pharmaceutical industry revenues were made in the U.S. in 2016. The Senators request PhRMA’s solutions to address international pricing, promote price transparency, and lower prices.
Senate Judiciary Hearing Analyzes Implications of Health Care Market Consolidation
On June 12, the Senate Judiciary Subcommittee on Antitrust, Competition Policy, and Consumer Rights held a hearing examining vertical integration trends in the health care industry. The hearing explored how vertical integration and consolidation can align financial incentives to provide high-quality care, but at the potential cost of monopolies in markets that have also seen horizontal integration. Subcommittee members and witnesses alike agreed that the potential benefits of consolidation would require modernized regulatory frameworks, with more transparency into federal approval of mergers and a lower threshold of potential market consolidation triggering federal review of a merger.



Reports & Publications


SHVS: Measuring Health Disparities in Medicaid Managed Care
State Health and Value Strategies (SHVS) released an issue brief providing examples from a handful of states that have begun the work of identifying, evaluating, and reducing health disparities within their Medicaid managed care programs. The brief also offers an approach for other states interested in measuring disparities in health care quality in Medicaid managed care as a step towards achieving health equity, such that all Medicaid managed care enrollees have a fair and just opportunity to be as healthy as possible.
The companion State Health Policy Highlight, A Roadmap for Using Measurement to Address Health Disparities in Medicaid Managed Care, provides an overview of the step-by-step approach for states interested in measuring disparities in health care quality within Medicaid managed care.
The full issue brief is available here.
KFF: Medicaid Financial Eligibility for Seniors and People with Disabilities: Findings from a 50-State Survey
A new KFF issue brief presents state-level data and tables on Medicaid financial eligibility criteria and adoption of the major coverage pathways related to old age and disability as of 2018. The 50-state survey found that the income limits associated with the age and disability-related pathways to Medicaid eligibility vary across states but generally remain low. The median income limit was 74 percent of the federal poverty level for individuals eligible based on old age or disability, 48 percent of poverty for individuals eligible as medically needy, and 250 percent for working people with disabilities. The analysis also finds that greater shares of states that have adopted the Affordable Care Act’s Medicaid expansion also have adopted key optional age and disability-related pathways to expand coverage for these populations, compared to non-expansion states.


The full report is available here.


MACPAC June 2019 Report to Congress Includes Recommendations on DSH, MDRP
On June 14, the Medicaid and CHIP Payment and Access Commission (MACPAC) published its June 2019 report to Congress. The report tackled several areas of importance and includes recommendations on:
  • Pharmacy and the Medicaid Drug Rebate Program: Commissioners recommended allowing states to restrict or exclude coverage of a product for 180 days after approval by the Food and Drug Administration (FDA), similar to Medicare Part D plans and the Exchanges; and remove the rebate cap of 100 percent of Average Manufacturer Price (AMP) put in place by the Affordable Care Act.
  • Third-Party Payments in Medicaid Shortfall Definition for DSH: Commissioners recommended removing from the definition of Medicaid shortfall to exclude costs and payments for Medicaid-eligible patients for whom Medicaid is not the primary payer.
  • Program Integrity: Commissioners recommend a comprehensive review of state program integrity activities to identify the most successful strategies and circulate findings among the states; and to remove the requirement for states to establish a Recovery Audit Contractor (RAC).
  • Therapeutic Foster Care: Commissioners recommended that CMS and the Administration for Children and Families develop joint subregulatory guidance to assist states in understanding what therapeutic foster care services can be covered under Medicaid and how to promote effective collaboration with other state agencies.
The report also includes an analysis of Medicaid funding in Puerto Rico, highlighting challenges with its unique Medicaid funding structure.
Milbank: Evaluation of SIM Initiative Round One in Six States
On June 3, the Milbank Memorial Fund published a research brief synthesizing recent publications evaluating six states participating in Round One of CMS’s State Innovation Models (SIM) Initiative. Three broad themes emerged from the evaluations:
  • States can transform Medicaid payment models, but they may have a greater impact when aligned with other payers.
  • States were able to leverage federal funds to make targeted investments in health information technology to enhance communication across provider types, including behavioral health care providers.
  • States face more work in overcoming challenges such as behavioral health provider shortages and patient dissatisfaction with some changes in care delivery. 
AMA: 2019 Opioid Progress Report
On June 6, the American Medical Association (AMA) published its 2019 Opioid Progress Report. The report assesses steps taken and results achieved in addressing the ongoing opioid epidemic. Highlights include:
  • Opioid prescriptions decrease. Opioid prescriptions decreased 33 percent between 2013-2018, including a 12.4 percent decrease between 2017-2018
  • PDMP use increases. Physicians and other health care professionals used state prescription drug monitoring programs more than 460 million times in 2018-an increase of 167 million from 2017, and 390 million more queries than in 2014
  • Education increases. Physicians and other health care professionals completed continued medical education courses, reviewed education and training resources and accessed other opioid prescribing, pain management, opioid use and substance use disorder treatment and other related areas more than 700,000 times in 2018-an increase of 150,000 from 2017
  • More physicians certified to treat opioid use disorder. More than 66,000 physicians (as well as a growing number of nurse practitioners and physician assistants) now are certified to treat patients in-office with buprenorphine-an increase of more than 28,000 from 2016
  • Naloxone co-prescribing increases. Nearly 600,000 naloxone prescriptions were dispensed in 2018-almost a threefold increase from the 136,000 dispensed in 2016

In the News


Vox: Can Medicaid Handle Another Recessions?
Despite the enduring period of economic recovery that the country currently enjoys, state spending on Medicaid remains high. An analysis from the Pew Charitable Trusts, found that in 2016, Medicaid accounted for 17.1 percent of state budgets, up from 14.3 percent in 2007. That share has been rising since the recovery began. This trend is especially concerning for states that have expanded Medicaid and will now take on a larger share of funding for that population. And, when a new recession occurs, states worry that an uptick in enrollment could cripple state budgets.
In this article, Vox’s Dylan Scott discusses the impact of economic recession on state Medicaid programs with Pew’s Barb Rosewicz.

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