Medicaid

Arizona can enact Medicaid enrollment reductions as planned despite a progressive Democrat’s recent request to scrutinize the cuts, the Obama administration’s top health official said Friday.

Last week, Rep. Raúl Grijalva (D-Ariz.) called on the Centers for Medicare and Medicaid Services to closely study the Health and Human Services Department’s endorsement of a plan that would let the cash-strapped Arizona to drop as many as 280,000 people from its Medicaid rolls. The state had been seeking a waiver for a healthcare reform requirement to maintain Medicaid eligibility standards until 2014, but HHS Secretary Kathleen Sebelius informed the state last month it could allow the cuts without special permission because the program was already operating on a waiver that expires Sept. 30.

Grijalva, co-chairman of the Congressional Progressive Caucus, said Sebelius’s advice amounted to federal guidance that should be open to a 90-day comment period, and he asked HHS to hold a public hearing in the state and prepare a fiscal analysis on the impact of dropping a quarter-million people from Medicaid rolls.

The leader of the Congressional Progressive Caucus wants federal health regulators to closely study their endorsement of a plan that would let Arizona drop as many as 280,000 people from its Medicaid rolls.

In recent months, Arizona Gov. Jan Brewer (R) had been asking Health and Human Services Secretary Kathleen Sebelius to release the cash-strapped state from a healthcare reform law requirement to maintain Medicaid eligibility levels until 2014. But in mid-February, Sebelius informed Arizona it did not need a healthcare reform waiver to reduce Medicaid enrollment because the state’s Medicaid program for poor individuals was already operating on a federal waiver that the state could simply let expire on Sept. 30.

“Neither the [healthcare reform law] nor Medicaid law or regulation prior to its enactment require a state to renew a demonstration beyond its expiration,” Sebelius wrote to Brewer. “Arizona may choose to terminate its current demonstration on September 30, 2011, and either not pursue a new demonstration or pursue a different demonstration.”

Three weeks later, Rep. Raul Grijalva (D-Ariz.) is calling on the Centers for Medicare and Medicaid Services (CMS) to give closer review of Sebelius’s guidance to Arizona. Grijalva wants to open up the guidance to a 90-day comment period; hold a public hearing in Arizona with the healthcare industry and CMS officials; and prepare a fiscal analysis on the impact of dropping a quarter-million people from Medicaid rolls.

“[S]lashing the programs that have prevented further societal hardships would be a mistake,” Grijalva wrote to CMS Medicaid director Cindy Mann on Friday. “Input and consideration from the communities that may be impacted and a sound fiscal analysis must be completed before moving forward with this guidance.”

Sen. Orrin Hatch (R-Utah), the top Republican on the Senate Finance Committee, grilled federal officials Wednesday about their decision to postpone the use of private contractors to recoup fraudulent Medicaid claims.

Last year's healthcare reform act extended the use of so-called Recovery Audit Contractors (RACs) to the Medicare Advantage and prescription drug programs. The law also called on states to "fully implement" RAC programs for their Medicaid programs starting April 1, but federal regulators indefinitely postponed that requirement last month.

"I am sincerely concerned about the helter-skelter approach being taken to implement the new healthcare law's tools to address improper payments," Hatch said in his opening remarks at a healthcare fraud hearing. "For example, the recent stop and start and then reverse guidance by [the Centers for Medicare and Medicaid Services] to states and healthcare organizations on Medicaid RACs is mind-boggling."

Peter Budetti, the director of program integrity at CMS, said the agency has had "extensive interaction" with the states and is working to make the program as successful as possible.

Medicaid continues to dominate the health policy agenda this week as the Obama administration weighs how much flexibility to give states, and federal officials prepare to testify about the fraud and abuse in federal health programs.

Governors warn Congress of healthcare reform law's costs: Republican governors ripped into Democrats' healthcare reform law on Tuesday, testifying before Congress that the law's massive Medicaid expansion and other federal mandates will hurt their states. The governors were in town for this weekend's winter meeting of the National Governors Association.

Mississippi Gov. Haley Barbour and Utah's Gary Herbert told the Energy and Commerce Committee that states were left out of the debate on Capitol Hill over the past couple of years. They also told the sympathetic Republican-led panel that they need much more flexibility to run their own healthcare programs. Read the Healthwatch report.

Dueling reports on health law's costs issued as governors testify on Capitol Hill: Dueling reports on the healthcare reform law's impact on states surfaced Tuesday as governors testified on Capitol Hill.

A new bicameral report from Republicans on the Senate Finance and House Energy and Commerce panels estimated that the law's Medicaid expansion would cost $118 billion over 10 years, almost twice the Congressional Budget Office's score. Simultaneously, the Robert Wood Johnson Foundation issued a report saying states would get $82.3 billion from the federal government in Medicaid and state exchange subsidies. Healthwatch's Julian Pecquet has the run-down.

The White House wants a say, too: WH spokesman Jay Carney also addressed Medicaid at Tuesday's briefing.

"We are committed to working with governors to help them manage their Medicaid costs, their Medicaid programs, and the Department of Health and Human Services has been an active and constructive partner with the states, with the governors, to answer their questions and ensure they are aware of the substantial flexibility that exists in the Affordable Care Act," Carney told reporters. "It’s important to remember that the Affordable Care Act will cover the overwhelming majority of the costs associated with the Medicaid expansion and will, in fact, reduce the amounts they spend to care for the uninsured. A lot of independent experts have actually estimated that the states will have a net savings in their Medicare program because of the Affordable Care Act."

Ryan knocks Obama for not shoring up Medicare funding: The Obama administration is violating federal law by declining to submit a proposal to shore up the Medicare program, House Budget Committee Chairman Paul Ryan (R-Wis.) charged Tuesday. Federal officials retort that the law doesn't legally bind them to do anything. Healthwatch's Julian Pecquet has the story.

Dueling reports on the healthcare reform law's impact on states surfaced Tuesday as governors testified on Capitol Hill.

A new bicameral report from Republicans on the Senate Finance and House Energy and Commerce panels estimated that the law's Medicaid expansion would cost $118 billion over 10 years, almost twice the Congressional Budget Office's score. Simultaneously, the Robert Wood Johnson Foundation issued a report saying states would get $82.3 billion from the federal government in Medicaid and state exchange subsidies.

The new Medicaid enrollees, the foundation's report says, "have lower associated costs because, on average, they do not have the same health issues" as previous beneficiaries.

The bicameral report, meanwhile, warned about future costs to states because of the expansion of Medicaid to more than 15 million people, starting in 2014.

The top Republicans dealing with healthcare policy in the House and Senate released a report Tuesday that estimates the cost of the healthcare reform law's Medicaid expansion at $118 billion - almost twice the Congressional Budget Office's estimate.

The bicameral report comes as three governors prepare to testify Tuesday morning before the Energy and Commerce Committee about the program's impact on their state budget. The report, titled 'Medicaid Expansion in the New Health Law: Costs to the States', contains a state-by-state analysis of the law's financial impact.

"Governors of both political parties were clear when Congress was debating the $2.6 trillion health law that they could not afford a massive expansion in Medicaid," said Senate Finance Committee ranking member Orrin Hatch (R-Utah). "Washington didn't listen and plowed forward instead by putting 16 million Americans onto the Medicaid rolls to keep the federal price tag down.

President Obama on Monday told the nation's governors he wants to hear all their ideas about ways to reform Medicaid, their No. 1 budget buster.

Obama invited the state executives to the White House and proposed they create a bipartisan group to negotiate with the Department of Health and Human Services (HHS). The governors are in town for the winter meeting of the National Governors Association.

"If you can come up with more ways to reduce Medicaid costs while producing quality care to those who need it, I will support those proposals," Obama promised.

A senior administration official told reporters after the meeting that the White House hopes the bipartisan commission will focus on issues such as coordinating care, preventing hospital readmissions and trying to keep people out of nursing facilities if they'd rather stay in their own homes.

Mississippi Gov. Haley Barbour (R), a possible 2012 presidential candidate, said anemic enrollment in new federal high-risk insurance pools is proof that states need more flexibility to run their Medicaid programs.

Enrollment in new federal insurance pools for individuals with preexisting conditions have fallen far short of original projections. Just more than 12,000 have enrolled as of February, far less than the 375,000 the Centers for Medicare and Medicaid Services actuary projected for the end of 2010.

The pools were included in the healthcare reform law to provide temporary coverage until 2014, when insurance companies can no longer discriminate against individuals with preexisting conditions.

Barbour, making the case for states to have more flexibility to shape Medicaid programs for the poor, said the lackluster showing in federal high-risk pools is indicative that the states are in a better position to determine their healthcare destinies.

The governors said block grants would provide states with the flexibility to tinker with the safety net for the poor.

Fresh off their defense against efforts to repeal the healthcare reform law, progressive groups are now gearing up for a showdown with state governors looking to slash Medicaid and children's health programs.

The pro-reform Families USA and 129 groups have signed on to a new letter calling on House members to maintain the reform law’s requirement for states to maintain Medicaid and Children’s Health Insurance Program eligibility standards. The letter will be released Tuesday morning before governors ask the House Energy and Commerce Committee for a reprieve from healthcare reform’s Medicaid requirements as they grapple with massive budget deficits.

According to Families USA, the groups signing the letter include representatives of people with health problems and disabilities, seniors, children, women, care providers, small-business owners, minorities, religious groups and consumers.

Under healthcare reform, states that tighten their Medicaid eligibility requirements before 2014 would stand to lose their federal match for the program. The law also requires states to maintain eligibility standards for children in the Medicaid and CHIP programs through Sept. 30, 2019.