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Newsletter: 1115 Waivers; Chronic Care; Jobs Available; HCBS; Delivery System and Payment Reform

-RECAP: NAMD July All-Director Call
-NAMD Executive Director Testifies before House E&C on 1115 Waivers
-NAMD Sends Letter to Senate Finance Committee Chronic Care Workgroup
-Nevada Seeking Administrative Services Officer
-Oregon Looking for Chief Health Systems Officer (Medicaid Director)
-North Dakota Seeking Medicaid Director
-NAMD Opening for Policy Analyst
-HHS OIG Report Finds Gaps in MSIS Managed Care Encounter Data Reporting
-CMS ReleasesĀ 2014 Open Payments Data
-DOJ Publishes ADA Primer for State and Local Governments
-CMS Issues FAQ on HCBS Settings, Addresses Heightened Scrutiny Process
-CMS Releases Informational Bulletin on Housing in Medicaid
-CMS Issues Info Briefs on State Strategies for Reducing Early Childhood Tooth Decay
-House Rules Committee Updates 21st Century Cures Legislation
-Republican State Attorneys General Write to Congress on 1115 Waiver Approvals
-House, Senate Democrats Send Letter to HHS on Access Regulation
-RECAP: House E&C Health Subcommittee Holds Hearing on 1115 Waiver Approvals
-NJ Launches Medicaid ACO Demonstration Project
National Journal Reports on Medicaid Expansion Negotiations Post King v. Burwell
Kaiser Health News Reports on Supreme Court Upholding ACA In KingĀ v. Burwell
Dallas Morning News Reports on Medicaid Fraud Recoupment Challenges

-Annals of Internal Medicine Article Analyzes, Criticizes State HCV Coverage Policies
-KFF Releases Delivery System and Payment Reform Tracking Tool
-Commonwealth Fund Issue Brief Highlights Survey Results Highlighting Benefits of Medicaid Coverage
-American Society of Clinical Oncology Proposes Value Framework for Cancer Treatments, Considers Cost Impact on Value


RECAP: NAMD July All-Director Call
On July 2, NAMD held its monthly All-Director call. Directors discussed a number of topics, including:

  • Medicaid managed care proposed rule
  • The Future of the Medicaid management information system (MMIS)
  • Incorporating a Sister Agency into Medicaid
  • Therapy Services Under the State Plan vs. Waivers
  • HCV

NAMD Executive Director Testifies before House E&C on 1115 Waivers
On June 24, NAMD Executive Director Matt Salo testified before the House Energy and Commerce (E&C) Committee Subcommittee on Health at a hearing titled “Examining the Administration’s Approval of Medicaid Demonstration Projects.”

Salo’s testimony focused on the key role Medicaid plays in driving innovation to deliver high-quality, fiscally responsible care to the nation’s most vulnerable populations. He noted that the Medicaid statute, approved 50 years ago, is not up to the task of providing the tools states need to deliver care to these modern-day, increasingly complex populations. In light of this, all states rely on Medicaid waiver authorities to tailor their programs to the specific needs of their beneficiaries. Under section 1115 demonstration waivers, states like Arizona have operated statewide managed care, while other states like Arkansas, Michigan, Iowa, and Indiana have pursued alternative Medicaid expansion approaches. The flexibility afforded under the 1115 demonstration is a valuable tool for states to continue innovating and reshaping their delivery systems through vehicles like the Delivery System Reform Incentive Payment (DSRIP) model.

Salo also noted that the 1115 demonstration meets accountability expectations from the federal government, including evaluations, budget neutrality demonstrations by the state, and public comment periods. However, the waiver process can be reformed to give both states and the federal government the tools to more efficiently meet their respective needs. The focus for such reforms should be to speed innovation with a focus on coordination, health outcomes, and program integrity, rather than process measures or specific program design. Reform should also grant states a “pathway to permanency” to allow long-standing demonstrations to no longer undergo the renewal process, streamline waiver reviews and approvals, and strike a balance between the flexibility to innovate and the accountability expectations of the federal government.

Read the testimony on the NAMD website here.

NAMD Sends Letter to Senate Finance Committee Chronic Care Workgroup
On June 17, NAMD sent a letter to the Senate Finance Committee’s chronic care workgroup. The letter highlights the innovative work state Medicaid agencies are doing to drive care coordination and improve outcomes for beneficiaries with chronic disease. These approaches include utilizing managed care to deliver care management, building health homes, utilizing the Accountable Care Organization (ACO) model, and other strategies. The letter also discusses Medicaid’s work to foster physical and behavioral health integration. NAMD recommended to the Senate workgroup that it consider the Medicaid experience as the workgroup moves forward exploring solutions to improve chronic care.

Read the letter on NAMD’s website here.

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Nevada Seeking Administrative Services Officer
The Administrative Services Officer functions as the business manager for a large division or major program area or facility, with responsibility for accounting, budgeting and business management of various services and operations. Incumbents function as managers who train, supervise and evaluate the performance of subordinate supervisors; develop policies and procedures; and allocate staff and resources to accomplish goals and objectives.

Full posting and application.

Oregon Looking for Chief Health Systems Officer (Medicaid Director)
The Chief Health Systems Officer (CHSO) is responsible for ensuring proper regulatory and operational management and oversight of Oregon’s health delivery system provided by Oregon’s 16 Coordinated Care Organizations (CCO’s). The CHSO leads the management teams for Mental, Physical and Dental Services, Community Partnerships, Mental Health Residential, including the state hospital services for youth, and Regulatory, Compliance, Rates, Licensing and Contract functions in this newly consolidated business unit. A critical responsibility is to ensure systemic healthcare transformation in the coordinated care model occurs at the coordinated care organization level, and that state operations are effective and efficient.

As the Medicaid Director, this position provides overall leadership and direction for all development of strategic direction, health policy, and coordination with program implementation for everything related to the Oregon Health Plan, coordinated care model and other medical assistance programs. This includes ensuring that budget and administrative rules align and are compliant with federal and state laws.

Full posting and application.

North Dakota Seeking Medicaid Director
The State of North Dakota is looking for the Director of Medical Services, which is responsible for administration of Medicaid, the State Children’s Health Insurance Program, and Home and Community-Based Services. The Division has approximately 65 staff who are responsible for policy development, program administration, utilization review, and implementation of federal and state laws. Oversee a biennial budget of $2 billion.

Full posting and application.

NAMD Has Opening for Policy Analyst
The National Association of Medicaid Directors (NAMD) seeks a Policy Analyst to address a broad range of issues. NAMD is focused primarily on supporting the state Medicaid Directors both collectively through the use of consensus-based advocacy, as well as individually through best practices and technical assistance. Broad topics covered by analyst will include reforms to the health care delivery system and payment incentives, and innovations designed to improve quality and contain costs.

Full posting and application.

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HHS OIG Report Finds Gaps in MSIS Managed Care Encounter Data Reporting
This week, the Health and Human Services Office of the Inspector General (OIG) published a report titled “Not All States Reported Medicaid Managed Care Encounter Data as Required.” OIG analyzed 3Q FY 2011 data from 38 states with Medicaid managed care programs that are required to submit encounter data to the Medicaid statistical information system (MSIS).

OIG found that 8 states did not submit encounter data within the 6 week deadline after the end of the quarterly MSIS reporting period, with CMS knowingly accepting 6 MSIS claims files that contained no encounter data. In interviews with these states, OIG learned that data systems issues imposed limits on collectable encounter data; 4 states had since resolved the systems issues and the remaining 2 were actively addressing the problem. OIG also found 11 states did not report encounter data for all managed care entities, also due to data systems limitations.

OIG made 2 recommendations to CMS, both of which the agency agreed with:

  • CMS should use its authority to withhold FFP from states for noncompliance with encounter data submission requirements.
  • CMS should monitor encounter data to ensure states report data for all managed care entities.

It may be worth noting that the proposed NPRM for Medicaid managed care includes several new requirements and penalties related to encounter data reporting and transmission to CMS. Read the report at

CMS Releases 2014 Open Payments Data
On June 30, the Centers for Medicare and Medicaid Services (CMS) published 2014 data on financial payments made by drug and device manufacturers to providers on its Open Payments database. This is the second year such payment information is available via the ACA’s Open Payments program, and it details transactions totaling nearly $6.5 billion.

View the data at

DOJ Publishes ADA Primer for State and Local Governments
Recently, the United States Department of Justice (DOJ) published a guide on implementing the Americans with Disabilities Act (ADA) for state and local government audiences. The primer outlines the responsibilities of government entities as required by the DOJ’s revised 2010 regulations implementing the ADA, which fall into three overarching categories:

  • General nondiscrimination requirements.
  • Making the built environment accessible.
  • Planning for success (primarily transition planning, grievance procedures, and staff training).

Each category contains specific detailed information on the DOJ ADA rules, with links to the rules themselves and other DOJ technical assistance resources.

Read the primer at

CMS Issues FAQ on HCBS Settings, Addresses Heightened Scrutiny Process
On June 26, the Centers for Medicare and Medicaid Services (CMS) issued a Frequently Asked Questions (FAQ) document providing additional guidance on its expectations around settings requirements under the home and community-based services (HCBS) final rule. The FAQ focuses primarily in the rule’s heightened scrutiny process, under which a state may submit evidence that a setting presumed institutional in nature complies with the rule. The FAQ clarifies the following issues:

  • The criteria CMS will use to assess state-submitted evidence and evidence from other parties under heightened scrutiny, including whether each HCBS settings quality is met, whether every individual receiving services at the setting receive the same community integration as persons in that community not receiving Medicaid HCBS, and whether the evidence indicates the setting does not meet the criteria for an institution.
  • State-submitted information should display how a setting overcomes its presumed institutional in nature qualities, rather than focusing on the aspects and/or severity of the disabilities of individuals served in the setting. States should utilize CMS’s previously issued exploratory questions to assist in the identification of appropriate evidence. Evidence from on-site reviews may be submitted, and CMS may conduct an on-site review during its review of the evidence.
  • Methods for states to show a setting presumed to isolate individuals does not do so, including evidence of individuals’ participation in typical community activities.
  • Evidence submissions for heightened scrutiny must be subject to a public comment period.

Read the FAQ here:

CMS Releases Informational Bulletin on Housing in Medicaid
On June 26, the Centers for Medicare and Medicaid Services (CMS) released an informational bulletin on Medicaid coverage of housing-related activities for those with disabilities. CMS emphasizes that federal financial participation (FFP) is not available for room and board, but that funding is available for certain housing-related activities that are discussed in the guidance.

The document focuses on the types of housing-related services that can be covered and the state pathways for covering them. CMS describes three categories of potential housing-related services: individual housing transition services; individual housing and tenancy sustaining services; and state-level housing related collaborative activities.

The guidance then explores the authorities that states can use to cover these housing-related activities and the limitations under each pathway. Key authorities include:

  • 1915(c) HCBS Waivers. States may reimburse for housing transition and tenancy sustaining services, such as supporting the beneficiary with searching for housing and coordinating the move. States may also support community transition services that are necessary to establish a household, such as providing security deposits.
  • 1915(i) HCBS State Plan Optional Benefit. Housing-related services that can be covered under this option are similar to the services under the 1915(c) waiver. The main differences are that this authority can be used to serve those who do not meet an institutional level of care, and states cannot waiver state wideness or limit the number of individuals served.
  • 1915(k) Community First Choice State Plan Optional Benefit. This pathway allows states to reimburse certain services linked to an assessed need in the person-centered plan, including certain transition costs to move from an institution to community setting.
  • 1915(b) Waivers. Savings from covered services can be used to fund additional services to waiver participants, including housing-related services discussed in the bulletin.
  • 1905(a) State Plan Services – Targeted Case Management. This can be used to link individuals to housing resources, help them find housing, and support the identification of resources to help individuals maintain housing during crisis.
  • 1115 Waivers. States may include housing-related services discussed in the bulletin as a component of the waiver.
  • MFP Rebalancing Demonstration. States are providing housing-related services for those individuals transitioning from institutions to HCBS settings, as well as supports to assist individuals in remaining in their house.

The guidance is available here:

CMS Issues Info Briefs on State Strategies for Reducing Early Childhood Tooth Decay
Last week, the Centers for Medicare and Medicaid Services (CMS) released three informational briefs for state audiences discussing strategies and approaches for reducing early childhood tooth decay. These briefs provide an introduction to the topic, outline effective leading steps to take, and provide advice for state Medicaid and CHIP program managers on this topic.

The briefs are available on the dental coverage page, under the section titled “Tools to Help States Improve the Delivery of Dental and Oral Health Services.”

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House Rules Committee Updates 21st Century Cures Legislation
Last week, the House Rules Committee filed updated legislative text on the 21st Century Cures initiative, which the committee will vote on this Wednesday. Once the legislation clears the Rules committee a consideration of the legislation by the full House is anticipated to occur in the very near future, possibly late this week. The updated text, a summary of changes, and a section-by-section summary are available on the Rules Committee website.

The latest version of the legislation features an altered package of offsets, as well as changes to other provisions, including:

  • Reductions in enhanced funding for the National Institutes of Health from $10 billion to $8.75 billion in light of disagreements over offsets;
  • Capping a proposed add-on Medicare payment to hospitals for new antimicrobial drugs administered at discharge at 0.02 percent of total hospital payments for the fiscal year;
  • A proposed Medicare Part B reimbursement policy for drugs infused via durable medical equipment (DME) at average sales price plus 6 percent;
  • Applying civil monetary penalties for violations of HHS grants and contracts.

Of particular note for Directors are the offset provisions, two of which would directly impact Medicaid programs:

  • An offset which would limit federal Medicaid reimbursement for durable medical equipment (DME) to Medicare rates remains intact from previous versions of the legislation.
  • A new proposal would require pharmaceutical manufacturers to exclude authorized generics from their average market price (AMP) calculations, which would result in higher average AMPs and thus higher rebates under the Medicaid drug rebate program.

NAMD will continue to monitor this legislation and keep Directors informed of relevant developments.

Republican State Attorneys General Write to Congress on 1115 Waiver Approvals
On June 23, 10 Attorneys General sent a letter to the House Energy and Commerce Committee (E&C) voicing their concern about the approval process for section 1115 waiver demonstrations in Medicaid. The letter states that CMS considering a state’s non-expansion status as a factor in whether that state’s 1115 waiver is approved or renewed constitutes unlawful coercion to administer a federal program, per the Supreme Court’s 2012 ruling upholding the ACA. The Low-Income Pool (LIP) negotiations in Florida provide context for the letter’s remarks.

Read the letter at

House, Senate Democrats Send Letter to HHS on Access Regulation
Recently, the Ranking Members of the committees of jurisdiction over Medicaid sent a letter to the Department of Health and Human Services (HHS) urging the agency to finalize the proposed regulation on methods for assuring access in Medicaid. This access regulation was initially proposed in 2011 and was intended to expand CMS’ oversight of access to care in Medicaid.

In the letter, the members of the House Energy and Commerce Committee and the Senate Finance Committee discuss the need for CMS to promulgate this final regulation in light of the Supreme Court ruling in Armstrong v. Exceptional Child Center, Inc. They assert that this ruling raises a pressing need for CMS to provide greater oversight of rates in the program as a component of access to care.

The letter can be viewed here:

RECAP: House E&C Health Subcommittee Holds Hearing on 1115 Waiver Approvals
On June 24, the House Energy and Commerce (E&C) Subcommittee on Health held a hearing titled “Examining the Administration’s Approval of Medicaid Demonstration Projects.” A recording of the hearing, witness list, and submitted witness testimony are available on E&C’s website here. Additionally, the testimony of NAMD Executive Director Matt Salo, who spoke on the second witness panel at the hearing, is available on the NAMD website here.

The majority of the hearing focused on testimony from the Government Accountability Office (GAO), which highlighted results from its study into the 1115 waiver demonstration approval process. GAO stated that CMS had no published criteria for 1115 approvals, and did not make any criteria available until requested to do so by GAO. GAO also highlighted its longstanding concerns with CMS’s application of budget neutrality rules to 1115 demonstrations. GAO and CMS have disagreed for nearly two decades as to how these provisions should be interpreted and applied, with GAO believing 1115 demonstrations have cost the federal government more than not having such waivers in place. GAO recommended that Congress consider statutory solutions to this issue.

On the second witness panel, NAMD Executive Director Matt Salo called for a more streamlined waiver approval process that struck a balance between the need for state flexibility to implement innovative programs and the federal government’s need for accountability and budget neutrality. He also agreed with testimony from former Mississippi Governor Haley Barbour on the need for a “pathway to permanency” to allow long-standing waivers to no longer go through the renewal process. Joan Alker of the Georgetown University Center for Children and Families noted that more transparency and attention to budget neutrality was warranted.

Republicans on the subcommittee, led by Chairman Joe Pitts (R-PA), expressed concern about the lack of transparency in the 1115 approval process and sought to discern why demonstrations are quickly approved in some states but not others. A common theme in their comments was the need for predictability for the states in the waiver process. Democrats responded by noting the steps the ACA has taken to implement GAO recommendations around transparency, specifically the public comment process at the state and federal levels that must take place during the approval of new 1115 demonstrations.

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NJ Launches Medicaid ACO Demonstration Project
On July 30, NJBIZ published an article titled “State’s first Medicaid ACOs approved.” The article discusses the launch of New Jersey’s Medicaid Accountable Care Organization (ACO) demonstration. The demonstration will feature three ACOs operating in urban areas throughout the state for a three year period.

Read the article here:

National Journal Reports on Medicaid Expansion Negotiations Post King v. Burwell
On June 30, the National Journal published an article titled “How Far is Obama Willing to Go to Expand Medicaid?” The article focuses on the extent to which the Obama administration will be willing to provide states with certain flexibilities to explore alternative Medicaid expansion approaches in light of the ACA withstanding its latest Constitutional challenge. The administration’s efforts to “get states to yes” by allowing Medicaid to purchase private insurance or require premium payments are discussed as examples of such flexibilities.

NAMD Executive Director Matt Salo is quoted in the article in reference to the Healthy Indiana 2.0 waiver approval. “I didn’t think the administration was going to approve the proposal the way it did. That was more flexibility than I would have predicted,” he said. “However, they’ve made statements that they acknowledge they’ve gone outside of their comfort zone and are not going to be approving anything similar until there’s some evaluation/analysis of Indiana to see how it’s impacted access.”

Read the article here:

Kaiser Health News Reports on Supreme Court Upholding ACA in King v. Burwell

On Thursday, June 25, the Supreme Court delivered a 6-3 decision upholding the availability of premium tax credits on health insurance exchanges established by the federal government. Kaiser Health News reported on the ruling, noting that this preserves the availability of subsidies in the 34 states with federally-run exchanges. The majority opinion, written by Chief Justice John Roberts, stated that “Congress passed the Affordable Care Act to improve health care markets, not to destroy them.”

The ruling found that the language of the ACA itself allowed for federal exchange subsidies, and did not rely on the Administration’s interpretation of the statutory language. This means these subsidies are available as a matter of law, not administrative interpretation, and will remain available should the Presidency change political parties.

Read the article here:

Dallas Morning News Reports on Medical Fraud Recoupment Challenges
On June 21, The Dallas Morning News published a story titled “Medical fraud is easy, Texas case shows – but recouping the cash isn’t.” The article reports on the burdens on government with recouping fraudulent medical claims, particularly in the context of the electronic health records incentive program. It also notes the difficulty with the “pay-and-chase” model of program integrity approaches to healthcare programs.

Read the article here:

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Annals of Internal Medicine Article Analyzes, Criticizes State HCV Coverage Policies
On June 30, Annals of Internal Medicine published an article titled “Restrictions for Medicaid Reimbursement of Sofosbuvir for the Treatment of Hepatitis C Virus Infection in the United States.” The study authors reviewed fee-for-service hepatitis C coverage policies for the 50 states and the District of Colombia, finding 42 formal coverage policies in their review. They found that 74% of states limited access to Sofosbuvir, the breakthrough hepatitis C treatment for the majority of 2014, to persons with advanced liver fibrosis. Two-thirds of states limited the providers who could prescribe the drug and 88% included drug or alcohol use in their criteria. The article’s conclusion states that these coverage policies do not conform to recommendations from professional organizations and alleges they violate the Medicaid statute.

Read the article here:

KFF Releases Delivery System and Payment Reform Tracking Tool
Recently, the Kaiser Family Foundation released an interactive tool which maps the status of various delivery system and payment reform models and programs being employed by the states in their Medicaid programs. The tool allows users to click on a state and view its implemented models, including Medicaid managed care, Patient Centered Medical Homes, Health Homes, Accountable Care Organizations, and Delivery System Reform Incentive Payment waivers.

View the tool at

Commonwealth Fund Issue Brief Highlights Survey Results Highlighting Benefits of Medicaid Coverage
Recently, the Commonwealth Fund published an issue brief titled “Does Medicaid Make a Difference?” The brief includes findings from the Fund’s 2014 biennial health insurance survey, which found that Medicaid coverage provides access to care that is broadly comparable to that available under private insurance. Additionally, adults in Medicaid reported receiving better care than the uninsured population and had better protection from healthcare costs than the uninsured and the privately insured.

View the results at:

American Society of Clinical Oncology Proposes Value Framework for Cancer Treatments, Considers Cost Impact on Value
On June 22, the American Society of Clinical Oncology published a conceptual framework for assessing the value of cancer treatments in the Journal of Clinical Oncology. The article notes the growth of health care spending and its projections to 2020, with a focus on the growth of the cost of cancer care. It also discusses the trend of increasingly shifting costs for such care onto patients, creating a difficult situation for both patients and providers seeking effective cancer treatments utilizing high-cost drugs. In order to begin a conversation on the value of high-cost cancer treatments, a framework for evaluating the value proposition of such treatments is proposed, which includes the treatment’s clinical benefit, toxicity, and costs (both for the drug acquisition and the cost to the patient).

Read the framework here:

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