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In this week’s newsletter you will find NAMD sent comments on eligibility and fair hearing process to CMS. Also covered in this issue is the executive order on ACA, mental health and substance use disorder; Hill hearings and happenings on Medicaid reform; MACPAC.

NAMD Update 1-31-2017

January 31, 2017
From the NAMD Desk
NAMD Responds to Eligibility and Fair Hearing Proposed Rule
Last week, NAMD submitted comments to CMS on its proposed rule on eligibility and fair hearing processes in Medicaid and CHIP. The proposed rule builds on a series of CMS rulemaking on eligibility and appeals under the Affordable Care Act and would establish additional requirements around the expedited fair hearing process that states must implement. In general, the Association’s letter expresses concern that the rule does not recognize the variation in process and procedure that is appropriate among states in the fair hearing process.
Read the letter here.
President Trump Issues Executive Order on ACA and State Flexibility
Following the inauguration earlier this month, President Trump issued an executive order on the enforcement of the Affordable Care Act (ACA) and state flexibility around healthcare programs. This executive order is intended to prepare for repeal of the ACA by Congress.
The executive order directs the leadership of the Department of Health and Human Services (HHS), as well as other relevant agencies, to provide greater flexibility to states in implementing their healthcare programs. It also directs HHS to “to waive […] implementation of any provisions or requirement of the [Affordable Care] Act that would impose a fiscal burden on any state or a cost […] or regulatory burden on individuals, families, health care providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or markers of medical devices, products, or medications.” It directs the agencies to revise regulations, as necessary, to carry out the executive order.


The executive order is available here.


In This Issue

Reg Update


As Administration Clarifies Policy Priorities, HHS Pulls Several Pending Rules
On January 22, the Department of Health and Human Services (HHS) asked the Office of the Federal Register to withdraw several pending rules, including the HHS’s 2017 federal poverty guidelines and items pertaining to the Food and Drug Administration, the National Institutes of Health, and the Office of the National Coordinator. The letter from HHS Deputy Executive Secretary Wilma Robinson said the items were being withdrawn “for further policy review and approval.” The delays in federal poverty guidance may be particularly noteworthy as these guidelines are used for determining eligibility for Medicaid and CHIP.
CMCS Releases Mental Health and SUD Parity Resources for States
The Center for Medicaid and CHIP Services (CMCS) released two resources recently for states on the implementation of mental health and substance use disorder (SUD) parity requirements in Medicaid. These resources aim to help states come into compliance with the final mental health parity regulation by the October 2, 2017 deadline.


The Parity Compliance Toolkit provides states with examples, tips, and key considerations on a range of parity issues. Some of these issues include: defining mental health and substance use disorder benefits and mapping benefits to classifications, addressing quantitative treatment limitations, and identifying and analyzing non-quantitative treatment limitations. The
Parity Implementation Roadmap seeks to provide a step-by-step approach for states to identify parity concerns and come into compliance with the regulation. It also suggests the types of organizations and staff that states may wish to engage in implementing the rule.


CMS Issues FAQ on Services Received through an IHS/Tribal Facility
Recently, CMCS released a frequently asked questions (FAQ) document to clarify its policy on services for American Indian/Alaska Natives (AI/AN) beneficiaries “received through” an IHS/Tribal facility. The recent FAQ addresses issues related to billing and payments for non-IHS/Tribal providers under this “received through” authority.


In particular, it clarifies that Tribal facilities enrolled as a provider of clinic services may not bill for services furnished outside the facility by a non-Tribal provider at the facility rate. This is what CMS refers to as the four walls limitation. The workaround to this four walls limitation, which the guidance explores in some detail, is for Tribal facilities to be enrolled in the state Medicaid program as a Federally Qualified Health Center (FQHC). This allows the Tribal facility to have a contract with a non-Tribal provider and properly claim for services furnished outside of the facility at the facility rate.
The guidance recognizes the time it may take states to implement the FAQ’s policy clarification. Thus, CMS notes it does not intend to review claims for Tribal services furnished outside of the four walls before January 30, 2021, unless there is evidence of bad faith efforts to engage in improper claiming.


Read the guidance here.


CMS Releases Fact Sheet on T-MSIS Data Sharing with Federal Policymakers
On January 17, CMS published a fact sheet detailing its approach to sharing state Transformed Medicaid Statistical Information System (T-MSIS) data with entities which have a current Data Use Agreement (DUA) with CMS. These entities will be required to complete a Standard Limited Data Set DUA to obtain new state MSIS files at the end of January.
The fact sheet also discusses the current state of T-MSIS implementation, and includes information on future CMS efforts to improve T-MSIS data consistency and quality. Lastly, CMS discusses the challenges with analyzing T-MSIS data given the significant variability of state Medicaid programs. It notes that when T-MSIS data is publicly released researchers should pay careful attention to the context of the data to make appropriate comparisons.


Read the fact sheet here.


Duals Demonstrations Extended in Three States
CMS is providing an extension for three states with demonstrations for dual eligibles, which have an end date of December 31, 2018: Massachusetts, Minnesota, and Washington. The extension will allow the three demonstrations to continue until December 31, 2020. A
preliminary evaluation report by RTI International suggests early signs of progress in the three states, and CMS believes an extension will ensure a robust evaluation procedure and a stable environment for implementation. CMS also notes that an extension will minimize the risk of beneficiary disruption and support clearer decision-making in state budgeting.
For more information, please read this memo
that was sent to Washington, Massachusetts, and Minnesota.
CMS Report Highlights Medicaid Accomplishments
CMS recently published a report titled “Medicaid and CHIP: Strengthening Coverage, Improving Health.” The report reviews the changes made to Medicaid and CHIP by the ACA, including:
  • Coverage expansions;
  • Efforts to streamline eligibility and enrollment;
  • Progress on improving quality and controlling costs via managed care and other delivery system innovations;
  • Rebalancing the provision of long-term services and supports (LTSS) towards the community; and
  • Enhancing program integrity in fee-for-service and managed care.
Read the report here.


Alaska, California 1332 Waivers Under CMS Consideration
On January 17, CMS sent letters to Alaska and California acknowledging complete submissions of 1332 waivers under the ACA. The letters mark the formal beginning of the 180-day approval clock for these waiver submissions. Alaska’s waiver seeks to bolster its individual insurance market through enhanced insurance subsidies, while California aims to provide Exchange coverage to undocumented individuals without a federal subsidy.


CMS Awards Zika Grants to Impacted Medicaid Programs
On January 18, CMS announced that $66.1 million in funding will be made available to health departments in American Samoa, Puerto Rico, the U.S. Virgin Islands, and Florida to combat the spread of the Zika virus. The majority of the funds are directed to Puerto Rico, which has the highest incidence of locally transmitted Zika cases as reported to the Centers for Disease Control and Prevention.



Hill Update
Senate Holds Hearing for HHS Nominee; Vote Scheduled Later This Week
On January 24, the Senate Finance Committee (SFC) held a hearing on the nomination of Rep. Tom Price (R-GA) to serve as Secretary of the U.S. Department of Health and Human Services (HHS). A recording of the hearing is available on the SFC website here. SFC will be holding its vote to advance Price to the full Senate for confirmation on January 31.
The four-hour hearing covered a range of topics. Key takeaways for Medicaid stakeholders include the following:
  • CMMI demonstration authority: Price expressed skepticism at the wide-ranging authority the Center for Medicare and Medicaid Innovation (CMMI) possesses, citing the attempted Medicare Part B drug demonstration as an example of a demonstration which, due to its size, should not be considered a demonstration. That said, Price stated he is a supporter of innovation and hopes to steer CMMI towards a more patient-focused strategy.
  • Medicaid reform: Price noted concern that physicians’ ability to see Medicaid patients is limited, in response to questions from the Committee. In addition, he did not commit to proposals to block grant the Medicaid program, but stated his role as HHS Secretary would be to implement whichever reforms Congress created.
  • IMD exclusion: Price indicated he would be willing to work with Congress to review the Medicaid statute prohibiting federal funds for inpatient stays in Institutions for Mental Disease (IMDs).
  • CHIP: Price strongly committed to the future of CHIP, stating that not only would he support extending the program for five years per MACPAC’s recommendation, he believed an eight-year extension would be appropriate.
ACA Replacement Plans Introduced in Senate
Last week, Republican Senators introduced two ACA replacement proposals. The first bill, introduced on January 23 by Sens. Bill Cassidy (R-LA), Susan Collins (R-ME), Shelley Moore Capito (R-WV), and Johnny Isakson (R-GA), is titled the Patient Freedom Act. The legislation would:
  • Repeal Title I of the ACA while maintaining certain consumer protections, including prohibition of annual or lifetime caps, coverage for mental health and substance use disorders, continue providing coverage for individuals with preexisting conditions, and other features.
  • Allow states to choose from one of three options for their insurance markets and Medicaid programs – retain the ACA’s structure; design a unique insurance system without federal support; or utilize federally-funded Roth Health Savings Accounts (HSAs) created by the legislation.
  • The Roth HSAs would be funded via a federal tax credit, and may be administered by the federal government or the states. States administering the HSA program would receive 2 percent of the annual amount deposited in the HSAs to address population health. States may include the Medicaid expansion population in the HSA system, and states which did not expand Medicaid would still have the tax credit amount reflect the federal expenditures associated with expansion, as if it had taken place. HSA assets would not count towards Medicaid eligibility determinations, except for long-term services and supports.
  • States must create a standard health plan which contains a high deductible health plan with a Tier 1 prescription drug benefit, which meets HHS network adequacy guidelines and covers child immunizations without cost-sharing. States may enroll uninsured individuals in this standard plan, so long as the individual may easily opt out. Enrollment penalties modeled on Medicaid Part D, along with medical underwriting, will apply to individuals who do not maintain continuous coverage after the initial open enrollment period for the standard plan.
The legislative language of the Patient Freedom Act is available here. A section-by-section summary is available here.


Separately, on January 25 Sen. Rand Paul (R-KY) introduced ACA replacement legislation, S. 222, titled the Obamacare Replacement Act. The legislation would:
  • Repeal most of the core insurance reforms of the ACA.
  • Allow premiums paid under employer-sponsored insurance to be deducted from taxable income.
  • Expand the use of HSAs for individuals and lift several restrictions on how HSAs may be used.
  • Allow insurers to sell plans across state lines.
  • Allow individuals to form Independent Health Pools (IHPs) to increase their purchasing power in insurance markets.
  • Allow Association Health Plans (AHPs) to be treated as a single large group plan under ERISA.
  • Provide new flexibility to states in Medicaid plan design through existing waiver authority, though this flexibility is not elaborated upon.
A section-by-section summary of the legislation is available here. Legislative text is not currently available.


House Hearings Set the Stage for Medicaid Reform Discussions
The House is poised this week to kick off Medicaid reform policy discussions by teeing up two hearings in the Energy and Commerce Committee (E&C) to explore Medicaid oversight and certain program integrity legislation introduced in the previous Congress.


On January 31, E&C will hold a hearing titled “Medicaid Oversight: Existing Problems and Ways to Strengthen the Program.” A witness list and submitted testimony is available here. The hearing will include testimony from HHS Office of the Inspector General, the Government Accountability Office, among others.


On February 1, E&C will hold another hearing titled “Strengthening Medicaid and Prioritizing the Most Vulnerable.” This hearing will review three Medicaid program integrity legislative provisions introduced in the 114th Congress, including excluding lottery winners from Medicaid eligibility, tightening eligibility for certain classes of immigrants, and addressing how annuities are counted towards assets for purposes of determining eligibility for Medicaid LTSS.


Senate Democrats Send Letter to Governors on Potential Medicaid Reforms
On January 19, Senate Finance Committee (SFC) Ranking Member Ron Wyden (D-Ore.), along with the Democratic members of the Committee, sent a letter to all governors asking for feedback on the expected impact of proposals to block grant or cap Medicaid. The senators voiced fears over “huge permanent cost shifts to states,” as well as compromised access to “the critical health care services for tens of millions of low-income children and families, seniors, and individuals with disabilities.” The letter came as Republican senators and governors convened to discuss potential changes to the Medicaid program.
Please find information here.


National Governors Association Sends Bipartisan Letter to House Republicans
On January 24, the National Governors Association (NGA) sent a bipartisan letter to House Republicans in response to their December 2 letter to governors requesting feedback for potential changes to the ACA. While stressing that all states have taken a different approach on improving access to high-quality and affordable healthcare, NGA urged Congress to consider a set of universally applicable concepts. Namely, NGA emphasized the importance of:
  • The role of governors in legislative processes in order to achieve minimally disruptive transition;
  • Meaningful flexibility in “replace and repeal” implementation, so that states can shape their markets according to their unique preferences and priorities;
  • Support for vulnerable populations;
  • Protection against unforeseen risks (i.e., economic downturns, costly pharmaceutical products, or epidemics); and
  • Continued federal funding, described as “critical” to supporting the infrastructure for health care payment and delivery reforms that drive value into the health care system.
Find information on the letter  here.


CBO Report Analyzes Impact of ACA Repeal on Insurance Markets
Recently, the Congressional Budget Office (CBO) published a report on the estimated impact on health insurance coverage and premiums if the 2015 legislation repealing the ACA was enacted. The report was prepared at the request of the Senate Minority Leader and the ranking members of the Senate Finance Committee and the Senate Health, Education, Labor, and Pensions Committee. The report estimates that in the year following repeal, the uninsured population would increase by 18 million, with the figure increasing to 32 million by 2026. It also estimates that premiums in the individual market would increase by 20 – 25 percent in the first year, and double by 2026 as Medicaid expansion is eliminated and marketplace subsidies cease.


Read the report here.


In the News


Modern Healthcare Reports on Network Adequacy Assessments
The article explores how state work to track access to care under new CMS reporting requirements may impact providers and provider payment. The access monitoring reports, mandated by a 2015 rule, are an instrument CMS intended to improve the care for fee-for-service beneficiaries. The article notes that these beneficiaries tend to disproportionately suffer from complex medical needs when compared to other groups.
Please find article here.


Nebraska’s Heritage Health Managed Care Program

This article explores ten key aspects of Nebraska’s integrated managed care program, Heritage Health , for clients, providers, and stakeholders, as provided by Nebraska Medicaid Director Calder Lynch. Lynch stresses that while not necessarily “new” (Nebraska has administered managed care programs for the past twenty years), Heritage Health will combine physical health, behavioral health, and pharmacy services into a single comprehensive and coordinated system for clients. “Our goal for Heritage Health is simple: improved health outcomes for our members,” Director Lynch said.


Please find the article  here.


Take Note


MACPAC and MedPAC Release Updated Data Book on Duals
On January 24, the Medicaid and CHIP Payment and Access Commission (MACPAC) and the Medicare Payment Advisory Commission (MedPAC) issued the fourth edition of their joint data book: Beneficiaries Dually Eligible for Medicare and Medicaid. This data book is part of an ongoing effort by MedPAC and MACPAC to create a common understanding of dually eligible beneficiaries, a relatively small group that accounts for a disproportionate share of both Medicare and Medicaid spending. The data book provides updated information on the makeup of this population, their use of services, and expenditures. It also reveals several key findings, including:
  • The majority (59 percent) of the 10.4 million dually eligible beneficiaries in 2012 were age 65 and older. This age group accounted for about 60 percent of Medicaid spending on dually eligible beneficiaries;
  • Most dually eligible beneficiaries (72 percent) were eligible for full Medicaid benefits; and
  • Dually eligible beneficiaries accounted for 15 percent of all Medicaid enrollees but 33 percent of all Medicaid spending.
Please find link to report  here.


RECAP: MACPAC January Meeting
On January 26, MACPAC convened for its monthly public meeting. During the morning session, the Commission reviewed draft chapters on disproportionate share hospital payment (DSH), which are planned for publication in this year’s March Report to Congress. The commissioners examined the current status of pending DSH allotment reductions, as well as recommendations for improving the targeting of DSH payments to providers. The Commission also reviewed draft chapters on access monitoring, assessing the differences between access in fee-for-service and managed care settings, while discussing ways to better leverage data and private sector relationships.


In the afternoon, MACPAC staff reviewed the commission’s previous work on Medicaid financing reforms, and detailed the differences in three general approaches to Medicaid reform – block grants, capped allotments (similar to CHIP), and per capita caps. Staff provided commissioners with model projections of block grant and per capita cap proposals operating under different base years and growth rates. This analysis illustrated the significant differences resulting from adjusting these policy levers. Commissioners recognized the complexity of these models and the many technical elements that should be considered by policymakers as they embark on Medicaid reform debates.


Finally, MACPAC staff presented findings from its
recent review of program integrity in Medicaid managed care. It concluded that clear contract language is an important way states can promote program integrity in this delivery model. Commissioners also explored how the provisions of CMS’s managed care rule may impact program integrity in managed care.


The meeting agenda and additional information is
available here.


New Coalition Seeks to Streamline Prior Authorization
Together with fifteen advocacy organizations, the American Medical Association (AMA) announced last week it hopes to work with health plans to streamline prior authorization for medical tests, procedures, devices, and drugs. The organizations together drafted 21 principles for health plans to use to reform their prior authorization requirements under following broad categories of concern:
  •  Clinical validity
  • Continuity of care
  • Transparency and fairness
  • Timely access and administrative efficiency
  • Alternatives and exemptions
Read more  here.


Report Discusses Medicaid’s Role in Driving Population Health
A new report, released by the National Academy of Social Insurance, examines opportunities for Medicaid to advance population health. Among other strategies, it explores the need for a longer-term timeframe to calculate savings from Medicaid demonstrations, the need for a fast track approval process for Medicaid demonstrations, spreading the use of tools that screen for social determinants of health, and improving data sharing between behavioral and physical health providers. The report also explores challenges Medicaid programs face in improving population health.
The report is available here.


KFF Fact Sheets Highlight the Role of Medicaid
A new collection of state Medicaid fact sheets from the Kaiser Family Foundation (KFF) discuss the role and reach of Medicaid. The fact sheets for each state are accessible via an interactive map of the U.S. and display a wide range of data, including:
  • How Medicaid affects health coverage and access to care;
  • How Medicaid works and who is covered;
  • What the state spends on Medicaid and how the program is financed;
  • The potential implications of repeal of the Affordable Care Act (ACA) and restructuring federal funding for Medicaid through a block grant or per capita cap.
The fact sheets are available here.
NCQA Toolkit: A Practical Guide to Implementing the National CLAS Standards
In December 2016, the National Committee for Quality Assurance (NCQA) issued a toolkit designed to help organizations implement national culturally and linguistically appropriate services (CLAS) standards and improve health equity. This toolkit is targeted to entities serving minority and disadvantaged populations, including racial and ethnic minorities, and to linguistic minorities, people with low health literacy, sexual and gender minorities, and people with disabilities. It provides practical tools and examples of CLAS, in addition to efforts to implement the National CLAS Standards that can be adapted for use by health care organizations.


Please find the toolkit here.


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