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Reports from the Policy Front

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Reports from the Policy Front

by: 
Katherine Berland, Esq.

ANCOR's Government Relations staff distributes stories in the Washington Insiders Club (WICS) – a weekly round-up of top stories and headlines – to ANCOR Members to keep them up to date on policy and political developments of note to the disability community. The following entries highlight the most significant reports of the last two months.

 

DOL Appeals Injunction on Overtime Rule

December 5, 2016 — Last week, ANCOR informed members of the preliminary injunction issued by a federal district court judge which temporarily blocked the implementation of the Department of Labor's Overtime Exemption Rule. Yesterday, the Department of Labor filed its notice of appeal challenging the injunction.
 
The DOL issued statements following the November 22nd ruling and the December 1st appeal, stating: “The Department strongly disagrees with the decision by the court, which has the effect of delaying a fair day's pay for a long day's work for millions of hardworking Americans. The Department's Overtime Final Rule is the result of a comprehensive, inclusive rule-making process, and we remain confident in the legality of all aspects of the rule. We are currently considering all of our legal options.” Read the full statements from the Department of Labor.
 
ANCOR members who were able to attend our members-only call last Friday learned that organizations are approaching the injunction in a number of ways. Many are moving forward with plans put in place in anticipation of the original December 1 date. There has been a wide range of reporting on the last-minute injunction including recent articles in the Pittsburgh Post-Gazette and The Washington Post.
 
ANCOR members who are unsure of next steps now that there is a temporary injunction on the Department of Labor's Overtime Exemption Rule as well as a DOL appeal to the rule are reminded that they can receive up to three hours of legal consultation with Gilliland, Maguire, and Harper PC free of charge.
  
Contact Katherine Berland (kberland@ancor.org) for more information on this valuable member benefit, and stay tuned for more information and updates from the SOS Campaign: Funding the Future of Disability Services.

 

House Passes 21st Century Cures Bill, Senate Set to Vote December 7th

December 5, 2016 — Last week, the House voted overwhelmingly (392 to 26) to pass the 21st Century Cures Act (H.R. 34), a major piece of legislation whose primary intent is to develop and fund research on significant health and medical policy objectives. It includes $1 billion to address the opioid epidemic over two years as well as $4.8 billion in funding for the National Institutes of Health. At 996 pages, the bill includes a number of ancillary, but not insignificant, provisions. Leading Democrats in the Senate have cautioned against some provisions of the bill, specifically one that directs the FDA to consider "real world" evidence in addition to clinical trials, an expedited review process for medical devices, and permitting drug companies to share "off label" benefits of their products with insurance companies. The bill also folds in several provisions from the Mental Health Reform Act, a bill championed by Sen. Chris Murphy (D-CT). The CHIME Public Policy Group, a trade association for CIOs and senior IT leaders in healthcare related organizations, created a comparison chart and summary of major provisions in the legislation. 

The 21st Century Cures Act includes a pay-for that had previously been introduced in a major mental health bill as well as the Disability Community Act (DCA), which would reduce the federal match given to states that fail to implement electronic visit verification (EVV) as required over several years starting in 2019. Although there has been concern raised over the mandatory implementation of EVV, ANCOR approved of the language contained in this pay-for in the DCA, recognizing that there is increasing legislative pressure to mandate EVV. As written, this section would require stakeholder involvement at the state level, be minimally burdensome, and not require that services be provided solely in home, among other requirements. 

The bill is expected to pass the Senate when it comes up for a vote on Wednesday.

 

Trump Selects Price, Verma to Lead HHS and CMS

December 5, 2016 — Last week, president-elect Donald Trump announced his picks to lead the Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS). 

The selection to lead HHS is Representative Tom Price (R-GA), who currently chairs the House Budget Committee. Price is an orthopedic surgeon who has long advocated for a replacement plan to the Affordable Care Act (ACA) which would focus on tax credits for the purchase of individual and family health insurance policies. It would also increase reliance on health savings accounts (HSAs) and high-risk pools at the state level. Critics of his plan say it would result in increased deductibles and co-payments. He has expressed support for plans that would reform Medicaid by decreasing federal spending in exchange for increased state flexibility. Incoming Senate Minority Leader Chuck Schumer (D-NY) blasted the pick, saying, "Congressman Price has proven to be far out of the mainstream of what Americans want when it comes to Medicare, the Affordable Care Act, and Planned Parenthood. Thanks to those three programs, millions of American seniors, families, people with disabilities and women have access to quality, affordable health care."

The selection to lead CMS is Seema Verma, who worked as a consultant with vice-president elect Mike Pence in his role as the governor of Indiana, to help craft the Healthy Indiana Plan. One feature of the state's Medicaid plan is cost-sharing, requiring beneficiaries to pay out-of-pocket premiums in order to access services. Verma's consulting company, SVC Inc., worked with the state of Kentucky on plan which would require low-income Medicaid beneficiaries to perform work activities in order to remain covered. Verma holds a master's of public health from Johns Hopkins University and was the 2016 recipient of the Sagamore of the Wabash award, an award given by the state of Indiana recognizing distinguished service. 

As is true of any high-level administrative position, these appointments are subject to Senate approval.

 

Autism Wandering Bill Hits Setback

December 5, 2016 — Last week, a group called Americans for Limited Government (ALG) issued a statement opposing Kevin and Avonte's Law (S. 2614/H.R. 4919), a bill that ANCOR strongly supports which would expand existing federal programs that provide grants to assist in the design, establishment, and operation of location tracking technology to locate people prone to wandering, including children with autism and adults with dementia. The bill would also provide funding for preventative measures including training and resources aimed at parents, school personnel, first responders, and other members of the public. The bill is named after two autistic children who wandered in separate incidents and who died. 

ALG's statement suggests that the bill would permit the government to authorize the involuntary insertion of tracking chips into people who are are unable to give consent due to Alzheimer's and other "fatal dementias". The statement contains several factual errors. The bill refers only to wearable tracking devices, not to insertable chips, and would require the consent of the individual (or their guardian). The bill is clear that participation in the program would be completely voluntary. 

The House Judiciary Committee had scheduled a markup of the bill, but that was abruptly postponed, leaving the future of the bill uncertain.

 

Republican Senator Urges Obama Administration to Halt Implementation of Key Rules

December 5, 2016 — Senator Ron Johnson (R-WI) recently sent letters to the Department of Labor (DOL), Environmental Protection Agency (EPA), and the Food and Drug Administration (FDA), urging these executive agencies to stop enforcing rules that president-elect Donald Trump has said he plans to overturn during his administration. In the letter to the DOL, Johnson singled out the new Overtime Rule, saying, "Given the substantial likelihood that this burdensome regulation will be undone, I urge the Labor Department to cease implementation of the regulation immediately to spare small businesses and industry the unnecessary and avoidable compliance costs that they currently face." In a statement on his website, Sen. Johnson issued a statement applauding the recent decision by a federal district court judge to temporarily block the Overtime rule. 

As we move into the next administration, Congress will likely use the Congressional Review Act (CRA) to roll back several recent regulations issued by the Obama administration. The CRA provides a "look back" period for regulations that were issued within 60 Congressional session days. This period extends back to May 2016, meaning that any regulations finalized after that period, which includes the Overtime Rule, may be overturned by a simple majority in both houses of Congress and the signature of the president. 

Source: The Hill

 

ANCOR Signs on to Letter Opposing ADA Education and Reform Act

December 5, 2016 — On November 22, the Consortium for Citizens with Disabilities (CCD), a coalition of more than 100 national disability organizations, of which ANCOR is an active member, sent a letter (attached below) to Senators Chuck Grassley (R-IA) and Patrick Leahy (D-VT), who are the chair and ranking member of the Senate Judiciary Committee, respectively, strongly opposing the ADA Education and Reform Act of 2016 (S. 3446). ANCOR joined nearly one hundred other national and regional organizations in signing the letter. The bill would prohibit private enforcement of the Americans with Disabilities Act (ADA) for violations of the law's physical accessibility requirements until after 180 days notice has been given to the business owner of the alleged violation.

The letter notes that the bill is unnecessary and overly burdensome on people with disabilities. It is unnecessary because there are already resources available to businesses and members of the public to educate and assist with accommodating people with disabilities throughout the country. The ADA has been law for more than a quarter century, which disability advocates argue is sufficient notice for businesses to understand their obligations under the law. The additional 180 day period would only serve to continue to disadvantage people with disabilities who are unable to fully access public spaces due to a business owner's ignorance of or willful disregard for the law. AS the letter notes, "This onerous burden...means that effectively there is no incentive for businesses to come into compliance until someone with a disability, after being denied access, provides the business with specific written information about the particular provision of the law that has been violated...and gives the business 180 days to comply with the law. Until that happens, individuals with disabilities affected by the violation are effectively shut out from the business's services."

The letter also notes that the ADA does not provide for damages to be awarded to plaintiffs in private enforcement cases, but allows only injunctive relief (requiring the business to make modifications to become compliant). Some states do permit damage awards under state law, which would not be impacted by this proposed legislation.

CCD Letter to Senate Opposing S. 3446 November 2016

 

Kaiser Releases Medicaid Fact Sheet Examining Changes Likely to Come with New Administration

December 5, 2016 — The Kaiser Family Foundation has released a new fact sheet that examines key questions around the potential changes President-elect Donald Trump and the next Congress may seek to make in Medicaid, a program that covers 73 million people nationally. 

Depending on how it is structured, a repeal of the Affordable Care Act could reverse the expansion of Medicaid coverage that helped bring the nation’s uninsured rate to a historic low. The brief also examines the prospect of capping and reducing federal financing for Medicaid through a block grant or a per capita cap. These approaches are typically designed to save the federal government money and provide states with additional flexibility but, depending on how they are structured, could put populations and providers who disproportionately rely on Medicaid funding -- including the elderly and people with disabilities, nursing homes and safety net hospitals – at risk.

The fact sheet also discusses how executive powers can be used to make changes to Medicaid without congressional action, including new regulations and Medicaid waivers.

 

CMS Issues Final Rule on Medicaid and CHIP Eligibility Appeals

December 5, 2016 — On November 30, the Centers for Medicare & Medicaid Services (CMS) issued a final rule that includes finalized Medicaid and the Children’s Health Insurance Program (CHIP) provisions associated with the eligibility changes under the Affordable Care Act of 2010 and previous legislation. The final rule supports modernization of notices and appeals processes and the coordination of eligibility notices and appeals across insurance affordability programs. Other provisions complement the simplification of eligibility and enrollment and the shift to MAGI-based financial methodologies codified in the final rule published in March 2012, including coverage for former foster care youth, optional eligibility pathways, and financial methodologies for medically needy individuals, and verification of citizenship and immigration status.

 

Federal Court Grants Injunction for DOL Overtime Rule, Suspends Compliance Deadline

November 23, 2016 — On November 22, a federal district court judge issued a preliminary injunction (order attached below) in the case of State of Nevada v. United States Department of Labor (E.D. Tex., No. 4:16-CV-00731). As we reported on in September, two separate cases were brought, one by 21 states, and another by business organizations, challenging the rule. (See WICs article, "States, Chambers of Commerce Challenge DOL Overtime Rule, September 26, 2016.) The injunction applies nationwide, meaning that, for now, the rule's compliance date of December 1, 2016 is no longer in effect. This applies to private litigation as well as to DOL and state enforcement. The injunction permits additional time for the court to consider arguments and issue a final ruling. If the court rules against the DOL, it is highly likely the DOL will appeal, prolonging the legal process and opening the door for the rule to come back into play. While the December 1 deadline for compliance is currently suspended, there are additional factors to take into consideration when determining whether to change existing plans for compliance. We encourage providers to consult with an attorney familiar with state and federal wage and hour laws.

Procedurally, the injunction stemmed from a filing made by plaintiffs in the case. (Note that while two separate cases had originally been filed, the court consolidated them into a single case. In the injunction order, the judge addressed arguments set forth by State plaintiffs.) The judge had to determine whether the party requesting the injunction could demonstrate a "substantial likelihood of success on the merits" of the case. To do so, the judge walked through the arguments set forth in the complaint. One argument made is that the Fair Labor Standards Act (FLSA) does not apply to states. This point was been decided by the Supreme Court in 1985. The States argued that Supreme Court case should be overruled. The judge in this case noted that the court was bound to follow Supreme Court precedent, and so could not rule that the FLSA does not apply to states. The judge did, however, note that subsequent cases have limited the power of Congress to enact legislation that affects state and local governments, implying that should this case come before the Supreme Court on appeal, it could overturn the precedent and rule in favor of the State plaintiffs. 

The judge then went through what is known as a Chevron analysis, which courts apply to determine whether an agency has the authority to promulgate a regulation. The analysis has two steps: 1) whether Congress has spoken directly to the question at issue, and 2) if Congress has not spoken directly to it, whether the regulation represents a "permissible construction" of the statute. The judge agreed with the State plaintiffs' argument that the plain language of "executive, administrative and professional" employees is clear on its face, and that Congress was clear that the overtime exemption should be based on duties rather than salary level. The judge determined that the final rule does not carry out Congress' intent in this regard, and so does not meet step one of the Chevron analysis. Because it failed to meet step one, the judge did not conduct the second step. 

The other major component of the complaint challenging the rule deals with the automatic update mechanism, which would change the threshold every three years. Because the judge determined the rule itself is not lawful, it also concluded that the DOL did not have authority to implement the automatic updating mechanism. 

Finally, to support the injunction, the judge had to determine whether the anticipated injury from the rule's implementation was "imminent and not speculative". Here again, the judge sided with the plaintiffs. The judge cited estimated costs as well as the detrimental effect on government services that benefit the public as justification for the injunctive relief granted. 

The judge's determinations regarding the arguments set forth are not the final disposition of the case. The court said, "A preliminary injunction preserves the status quo while the Court determines the Department's authority to make the Final Rule as well as the Final Rule's validity." The injunction gives the court additional time to hear the case on the merits and issue a ruling. Once that ruling is handed down, it is highly likely to be appealed. The legal process is set to be a lengthy one, and it is likely that the new administration and Congress will be in place before the litigation process concludes. ANCOR is actively monitoring legislative and administrative actions that could significantly change the final rule and impact this litigation. We will continue to keep our members informed of developments.

Injunction issued 22November2016 (Nevada v. DOL)

 

DOL Issues Guidance Regarding State Law Prohibitions on Subminimum Wage

November 23, 2016 — On November 17, the Department of Labor’s (DOL's) Wage and Hour Division issued Administrator’s Interpretation 2016-2, "Effect of state laws prohibiting the payment of subminimum wages to workers with disabilities on the enforcement of section 14(c) of the Fair Labor Standards Act." 

The Administrator’s Interpretation (AI) clarifies the effect of state laws prohibiting the payment of subminimum wages to workers with disabilities on the enforcement of section 14(c) of the FLSA. It states that the FLSA does not preempt a state law that limits or prohibits the payment of wages lower than the state’s minimum wage and that section 14(c) certificate holders must comply with both federal and state laws. The AI notes that the Wage and Hour Division reviews 14(c) certificate applications on a case-by-case basis. The AI identifies that in states that limit or prohibit payment of subminimum wages, there may be circumstances in which a 14(c) certificate holder may pay commensurate wage rates to workers with disabilities under the certificate and comply with state law (e.g., if the certificate holder has a contract with the Federal Government that is covered by the Service Contract Act).

 

DOL Persuader Rule Blocked by Federal Court

November 23, 2016 — On November 16, a federal district court issued a permanent injunction blocking the implementation of the Department of Labor's (DOL's) "Persuader Rule". The injunction makes permanent a preliminary injunction that was issued over the summer. (See WICs article, "Federal Court Issues Injunction to Temporarily Block DOL 'Persuader' Rule," July 1, 2016.) The rule sought to require that employers disclose any "actions, conduct or communications" that would "affect an employee's decisions regarding his or her representation or collective bargaining rights." Currently, disclosure is necessary for a more limited set of communications, such as a document prepared by an outside firm or organization. The rule sought to expand the reporting requirement to include any communication between an employer and a third-party, including oral communication. Industry groups have argued that the rule would have a chilling effect on the ability of employers to seek legal counsel, as well as be in violation of both first amendment free speech rights and attorney-client privilege.

The court agreed with the arguments put forth challenging the rule in handing down a ruling. The DOL may appeal this ruling, but any legal action will likely not be resolved prior to the new administration and Congress that will be sworn in in January. ANCOR will continue to monitor the litigation and the rule, and inform members of any significant updates.

 

Chicago Tribune Highlights Issues in Disability Service System

November 21, 2016 — The Chicago Tribune published an article last week as the first in a series that will highlight challenges and tragedies in the Illinois disability service system. Importantly, the article notes the significant workforce crisis in the state and how that has impacted individuals receiving services. Read the responses from ANCOR member and Illinois state provider association, IARF, and the Illinois Protection and Advocacy agency which both ask for greater support in administering HCBS programs.

Read ANCOR's initial response here:

http://www.ancor.org/sites/default/files/news/ancor_statement_on_chicago_tribune_article.pdf

ANCOR Member talking points here:

http://www.ancor.org/sites/default/files/news/ancor_tps_re_chicago_tribune_article.pdf

 

President-Elect Trump's Stance on Disability Issues

November 14, 2016 — As we prepare for the 115th Congress and a new Administration in 2017, you can review the RevUp questionnaire responses from President-Elect Trump on disability issues, here: http://www.aapd.com/our-focus/voting/2016-election/presidential-candidate-questionnaire/trump-campaign-response-rev-questionnaire/

Also – you can read up on Andrew Bremberg, who is leading Health and Human Services policy for the transition team, here: http://www.healthcare-informatics.com/news-item/payment/reports-andrew-bremberg-will-lead-trump-s-hhs-transition-team

 

More Statewide Transition Plans Receive Initial Approval for HCBS Rule

November 14, 2016 — CMS has recently issued additional initial approval letters for additional states in the process towards compliance with the CMS HCBS Settings Rule. States include South Carolina, Indiana, and Arkansas. As these letters are being issued, CMS is posting them online soon thereafter here: https://www.medicaid.gov/medicaid/hcbs/transition-plan/index.html

 

BREAKING: CMS Prepares to Issue Request for Information on Integration, Access and HCBS

November 7, 2016 — CMS is getting set to publish a Request for Information (RFI) on November 9 in the Federal Register. The RFI is entitled: Federal Government Interventions to Ensure the Provision of Timely and Quality Home and Community Based Services AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

This request for information seeks information and data on additional reforms and policy options that we can consider to accelerate the provision of home and community-based services (HCBS) to Medicaid beneficiaries taking into account issues affecting beneficiary choice and control, program integrity, ratesetting, quality infrastructure, and the homecare workforce. Comments will be received for up to 60 days after publication. CMS officials had referenced this upcoming RFI in SOS meetings with ANCOR and ANCOR will be submitting comments to respond. ANCOR will also provide a summary and template for members to use to submit their own individual comments in the coming weeks.

Preview the RFI here: https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-27040.pdf

 

CMS Releases Reports on 1915(c) Data, Medicaid LTSS

November 3, 2016 — CMS recently updated its reports and evaluations website to include data tables for Medicaid LTSS Expenditures (FY 1981-2014) and 1915(c) Expenditure Report (FY 2014). CMS sent the following message to announce the updated reports:

Medicaid long-term services and supports (LTSS) Report

The Centers for Medicare & Medicaid Services (CMS) posted the Medicaid Long-Term Services and Supports Beneficiaries 2012 report which provides updated estimates of the number of people who receive Medicaid long-term services and supports (LTSS).  Over 4.8 million people received Medicaid-funded LTSS during calendar year 2012, maintaining a three year level. Most LTSS beneficiaries (3.4 million or 70 percent) received home and community-based services (HCBS), including people who also received institutional services during the year.  Fifty-five percent of beneficiaries were under age 65, including children and youth under age 21 (16 percent) and people age 21 through 64 (39 percent).  Older adults comprised 45 percent of beneficiaries.  For each age group, a majority of people received HCBS, but older adults were less likely to receive HCBS than people under age 65.   

Section 1915(c) Data Reports:

CMS also posted annual updates to two reports that describe recent section 1915(c) Home and Community Based Services (HCBS) waiver program data.  Medicaid 1915(c) Waiver Data Based on the CMS 372 Report, 2012 - 2013 identifies the number of people who received HCBS waiver program services, and Medicaid expenditures and duration of service for participants during 2012 and 2013.  The other report, Medicaid Expenditures for Section 1915(c) Waiver Programs in FY 2014, provides data and trends regarding waiver expenditures.  Both reports presents data for each 1915(c) waiver program as well as state and national totals.  Key findings include:   Over 1.5 million people received 1915(c) HCBS waiver program services in 2013, a 3.8 percent increase from 2012. The average waiver program participant received services for most of the year, an average of 10.1 months.  Average annual waiver program expenditures per person were $26,478; this figure is 74 percent of average total Medicaid spending ($35,666) for individuals meeting an institutional level of care. Total 1915(c) HCBS waiver program expenditures have grown by less than five percent each year from FY 2011 through FY 2014, compared to double-digit average percentage increases from FY 1996 through FY 2010.  1915(c) HCBS waiver programs accounted for a lower percentage of all Medicaid home and community-based services, 51%, than in any year since FY 1995, as some states closed their 1915(c) waiver programs and covered HCBS within state plan benefits such as personal care, home health, and Community First Choice as well as through Managed LTSS.    

Additional reports that include other years are available here.

 

Urban Institute Reports on Block Grants and Per Capita Caps

November 3, 2016 — In a report dated September 8, 2016, the Urban Institute looked at block grants and per capita caps as a mechanism for controlling Medicaid expenditures. The abstract for the report states, "Block grants and per capita caps have been proposed as mechanisms for controlling Medicaid expenditures. Block grants would allocate money to states based on current overall spending levels in each state, and per capita caps would allocate funds based on current spending per enrollee. In this brief we show that federal spending (adjusted for the size of each state’s low income population) varies across states by more than 5 to 1 and spending per enrollee varies on the order of 2 to 1. In general, high income states will get larger block grants and higher spending per enrollee caps because they spend more today. These disparities would be locked in under these kinds of proposals."

The report analyzes proposals to block grant or institute per capita caps in Medicaid, and then sets forth the impact those proposals would have on a state-by-state basis. The report concludes that it would be very challenging to implement these proposals, given the wide variation in federal spending across states, and that the case for adopting these proposals is "weak" on other grounds as well.

 

ACL Releases Final Independent Living Rule

November 3, 2016 — On October 26, the Administration for Community Living (ACL) released a final rule for Independent Living. The announcement sent out by ACL is below:

Today, the final rule for Independent Living (IL) programs went on display in the Federal Register. The rule was developed in close coordination with the independent living network and addresses the requirements of the Rehabilitation Act of 1973, as amended by the Workforce Innovation and Opportunity Act (WIOA).

Specifically, the final rule:

  • Clarifies requirements surrounding WIOA’s addition of new core services to:

    • Facilitate the transition of individuals with significant disabilities from nursing homes and other institutions to home and community-based settings

    •  Provide assistance to individuals with significant disabilities who self-identify as being at risk of entering institutions so that the individuals may remain in the community

    • Facilitate the transition of youth with significant disabilities who are no longer in school and no longer receiving services under section 614(d) of IDEA.

  • Clarifies several key definitions. For example:

    • “Consumer control” adds specificity to definition in the context of individuals to mean that the person with a disability has control over his or her personal life choices, independent living plan and has the right to make informed choices about content, goals and implementation. Prior to the final rule, “consumer” was sometimes interpreted to include the parents or caregivers of the person with a disability

    • “Personal assistance services” is now defined to explicitly include assistance with activities outside of employment, such as social activities and parenting.

  • Addresses the roles and responsibilities of the State Independent Living Council, as defined by WIOA. For example, the final rule:

    • Includes additional details of what must be a part of the SILC Resource Plan to carry out the functions of the SILC

    • Addresses the SILC’s authority to conduct resource development activities to support the provision of services by Centers for Independent Living

    • Clarifies the expanded role of the SILC in the development of the State Plan for Independent Living.

The rule will become effective November 25, 2016.

Over the coming months, ACL will be working with grantees and stakeholders as needed to answer questions and support CILs and SILCs as they implement the rule. Please send questions to ILFinalRuleFeedback@acl.hhs.gov. These will help us determine needs for additional technical assistance and develop materials to meet them.

For more information:

 

CMS Releases the 2017 Medicaid Managed Care Rate Development Guide

October 31, 2016 — Last week, the Centers for Medicare & Medicaid Services (CMS) released the 2017 Medicaid Managed Care Rate Development Guide for rating periods starting between January 1, 2017 through June 30, 2017 which can be found here.  The Guide provides detail around CMS' expectations of information to be included in actuarial rate certifications and will be used as a basis for CMS’ review.

 

Kaiser Releases Annual 50-State Medicaid Survey

October 23, 2016 — The Kaiser Family Foundation's Commission on Medicaid and the Uninsured recently released its 16th annual 50-state Medicaid Budget Survey. The survey shows that Medicaid enrollment and total Medicaid spending in FY 2016 have slowed substantially from the year prior, and that they will continue to slow going into FY 2017. This is due in part to the enrollment surge caused by the Affordable Care Act's (ACA's) expansion tapering off. 

The Kaiser survey also shows an increase in state Medicaid spending growth in FY 2017 tied to the requirement for the 32 Medicaid expansion states (including Washington, DC) to start paying a five percent share of expansion costs beginning January 1, 2017. The federal government paid 100 percent of the expansion costs in 2014-2016. Among expansion states, the median growth in state Medicaid spending is projected to be 5.9 percent in FY 2017 (higher than the national average of 4.4%), up from 1.9 percent in FY 2016 (lower than the national average of 2.9%). For non-expansion states, state Medicaid spending is projected to increase by 4 percent in FY 2017 (just below the national average), compared to 3.9 percent in FY 2016 (above the national average). Total Medicaid spending and enrollment growth in expansion states outpaced growth in non-expansion states in FY 2016 and are projected to do so again in FY 2017. Compared to FY 2015, the differential in these rates across expansion and non-expansion states narrowed in FY 2016 and is projected to narrow further in FY 2017.

Pressure to control Medicaid spending continues as growth in overall state revenues slows, or in some states, revenues decline. A 70 percent drop in oil prices since 2014, for example, has resulted in falling tax revenue in oil-dependent states such as Alaska, North Dakota, and others, causing budget shortfalls with implications for Medicaid programs.

Other key findings of the survey include:

  • The majority of states are refining their pharmacy programs to control costs.

  • A majority of states have adopted or are expanding pharmacy strategies to deal with the opioid crisis, including imposing quantity limits, expanding access to naloxone, and implementing new Centers for Disease Control and Prevention criteria for prescribing opioids.

  • States continue to increase reliance on managed care. At least 75 percent of Medicaid beneficiaries are enrolled in risk-based managed care organizations (MCOs) in 28 of the 39 states (including DC) that contract with MCOs to serve their Medicaid enrollees.

  • Twenty-nine states are adopting or expanding other delivery system reforms in FY 2016 or FY 2017, such as patient-centered medical homes and Accountable Care Organizations.

  • In long-term care services and supports, nearly every state reported actions to expand the number of people served in community settings.

These and other findings from the 50-state survey (conducted by analysts at the Foundation and Health Management Associates) were discussed at a public briefing held jointly by Kaiser and the National Association of Medicaid Directors (NAMD). The following new reports are available:

An archived webcast of the briefing, as well as copies of presentation slides and other materials, are available on kff.org.

 

Katherine Berland is ANCOR's Director of Public Policy. She can be reached at kberland@ancor.org.