Update from Washington
For The Arc of Michigan
Presented By:
Nicole Jorwic, J.D.
Director of Rights Policy,
The Arc of the United States
MEDICAID AND THE
AHCA
Medicaid
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The largest insurer in the country today
73 million individuals are covered
Up from 4 million individuals when began in 1965 with a total cost of
$900 million, a result of
– High poverty rates
– Erosion in employer based group plans for lower
wage workers
– Aging population
– Longer life spans for persons with disabilities
– People with disabilities and senior citizens
account for about 48% of the total Medicaid
budget and about 21% of the beneficiaries;
•
Projected to serve 77.5 million individuals in 2024 at a total cost of
$920.5 billion, with federal share of 61%
Medicaid Provisions in the
ACA
• Disability-Specific Provisions
• Money Follows the Person (MFP)
• Expired; Congress must act to extend it.
• Community First Choice Option
• Authorized in the ACA; Provides 6% extra federal
matching; creates entitlement to “personal care”; in
CA.,CO.,MD.,MT.,N.Y.,OR.,TX., & WA.; Congress must
save it
• Expanded HCBS State Plan Amendment
(not waivers) now In many states for a
variety of disability and mental health
populations
 Health Homes for state identified
Medicaid
• Medicaid Restructuring
• Restructuring of Medicaid as a state matching funds “entitlement” to the
states based on formula favoring poorer state since its beginning in 1965
as part of the “Great Society”
– Elimination of many federal mandates and rules
through one of two strategies:
• Block grants
• Per capita caps*
What does this mean
for Individuals with
Disabilities?
Reminder:
Savings = CUTS
• Primary goal is to reduce the federal deficit and
reduce the ten year projected growth of federal
Medicaid funding.
• Estimated “savings” over ten years may be as
much as $1 trillion according to the
Congressional Budget Office- $834 billion from
Medicaid outlay
Why ACA matters
• Biggest legislative advance for people with
disabilities since the ADA
• Insurers may not discriminate against people with
pre-existing conditions
• No annual or lifetime caps
• Essential health benefits include
– “rehabilitative services and devices”
– mental health and behavior health services
– preventive and wellness services
• Premium subsidies to make insurance affordable
• Children to age 26
Why ACA matters
(continued)
• Expanded eligibility for Medicaid
• Four incentives to expand home and
community based long term supports and
services:
– Community First Choice option
– State Plan Home and Community Based Services
option
– Extends Money Follows the Person Rebalancing
Demonstration
– Creates Balancing Incentives Program
American Health Care ActHealth Provisions
• In 2020 replaces premium tax credits with more limited
tax credits. Tax credits vary by age and start at $2,000
per year for individuals up to age 29 and the maximum
is $4,000 per individuals age 60 or older.
• Repeals cost-sharing subsidies that helped people
with incomes below 250% of poverty ($29,780 for an
individual, $60,750 for a family of four).
• Replaces tax penalty for not purchasing insurance with
penalty on premiums for people who let their coverage
lapse.
• Repeals the tax penalty on employers who do not
provide health insurance and repeals the tax credits
for low wage small employers.
American Health Care ActHealth Provisions
• Repeals the tiering of the health plans and the requirement that
each tier meet an actuarial value (AV). This was one way people
could gauge the generosity of the plan’s coverage, what percentage
the individual would be expected to pay and added some
consistency across health plans. These provisions, combined with
the essential health benefit requirement, helped ensure that people
who had health care needs would be able to find plans that met their
needs.
• States may apply for waivers for the requirements to provide
essential health benefits, if states make that change it would also
mean that the prohibition on lifetime and annual caps would be
lifted.
• States have the option to waive the prohibition on using health
status to determine premium cost for people who have had a gap in
continuing coverage. States would be required to have a high risk
pool or another similar program in place in order to do so.
• Allows for an increase in age rating meaning that older individuals
will pay more starting 2018 unless states adopt other rules.
• Repeals funding for Prevention and Public Health Fund.
Per capita caps
• Cuts would grow each year. As health care costs rise, or if
there is a public health crisis, states must absorb costs.
• States will likely impose Medicaid cuts in eligibility, benefits,
and provider payments.
• Medicaid is states’ biggest source of federal funding, so cuts
under per capita caps will squeeze state budgets overall.
• Hits seniors and people with disabilities the hardest, because
the majority of Medicaid spending covers their health care &
home care.
Medicaid Expansion Cuts
impact people with I/DD
Exact numbers not available by type of disability, but we
know:
• People in the Medicare waiting period (about 1.5
million in any given year)
• People who do not qualify for SSI either due to
disability or income
• Low wage workers and people without access to
employer sponsored health insurance
• Dependents under age 26 without access to insurance
• Parents and caretakers
Medicaid Expansion
• Codifies the Supreme Court decision that made the Medicaid
expansion a state option and repeals the state option to
extend coverage to adults above 133% of federal poverty
($16,400 for an individual, $47,550 for a family of 4).
• Repeals the requirement that Medicaid alternative benefit
programs cover essential health benefits including
rehabilitative and habilitative services and devices, mental
health services, prescription drugs and other basic health care
services required by the ACA.
• Incentivizes states to take the option to create work
requirements for adults (exempts seniors, children, people
with disabilities and parents of kids under age 6 or parents
with a child with a disability).
• Require eligibility redeterminations every 6 months for
expansion enrollees.
Impact of Per Capita
Caps
Escalation of the Funding
Gap
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Per Capita Caps
• Beginning in FY 2020 the bill converts Medicaid financing to a
per capita cap and sunsets enhanced match for states that
expanded Medicaid resulting in an over $800 billion cut to the
Medicaid program over 10 years.
• Under the per capita caps proposal only an increase in
eligibility and a small inflator would adjust the federal
payment.
• The per capita cap proposal would force states to find funding
to make up the difference in the federal support or figure out
what eligibility group to cut, what services to roll back, how to
lower reimbursement for services or make up for the federal
support.
• Creates a state option for Medicaid block grants for children,
adults who are not seniors or people with disabilities or both
children and adults. It is unclear how people with disabilities
will be defined in this and other exemption provisions.
Other Harmful Medicaid
Provisions
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Eliminates the extra 6 percent increase in federal match for states that
choose the Community First Choice Option, an option that lets states provide
a comprehensive community based alternative to facility-based services.
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Reverts the mandatory Medicaid income eligibility level for children back to
100 percent of federal poverty level ($11,880 for an individual, $24,300 for a
family of 4) for children between the ages of 6-19 (from its current level of 133
percent of poverty).
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Eliminates the 3 month retroactive coverage requirement (changes it to the
month of application). This change could make it more difficult for states to
make eligibility determinations to cover people in emergency situations; force
many people into medical bankruptcy; and raise uncompensated care costs
for hospitals.
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Through the restructuring and major funding cuts, would jeopardize support
to school children with disabilities who receive numerous supports and
services as part of their education plans. In 2017, 68 percent of school
superintendents reported using Medicaid funds for school nurses, counselors,
speech therapists, and other health professionals.
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HCBS SETTINGS RULE
New Guidance
• Released this Tuesday, May 9, 2017
• Extends timeline for bringing settings into
compliance to March 2022
• Timeline for transition plans remains 2019
• Note on Heightened Scrutiny
Trends in State
Transition Plans
• Some states are using the HCBS regs as a real
opportunity implement systems change to support
full integration
– Including phasing out sheltered workshops, setting size limits
on residential settings, and expanding capacity of non-disability
specific settings
• Varied approach to presumptively institutional
settings, especially “settings that isolate”
– Some states are being rigorous in identifying settings that are
presumed institutional (such as settings on the grounds of
institutions, campuses, and sheltered workshops)
– Other states are only identifying settings on the grounds
of/adjacent to public institutions and have said they will seek to
continue funding these settings
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For initial approval:
• States that include methods to validate their
systemic assessments included in the plan
• Included outcomes of the assessment and any
needed remediation strategies (legislative changes,
contract changes and changes to regulations)
• Appropriate 30 day comment period and inclusion
of a summary and response to comments collected.
For full approval:
 A comprehensive site-specific assessment of EVERY HCBS
setting, including necessary strategies for validating results.
 Draft remediation strategies with a timeline for the
remediation strategies that align with the end of the HCBS
transition period (March 17, 2019).
 Site specific remediation strategies
 Identifying a heightened scrutiny process for settings that
are identified as presumed to be institutional.
For full approval (cont’d.)
 Identify a process for communicating with beneficiaries who
may be impacted by changes, closures, etc.
 Establish ongoing monitoring and quality assurance processes.
 Process to evaluate privately-owned homes, can’t assume
they don’t have characteristics that isolate.
 Plans to ensure that there is adequate capacity in the state for
non-disability specific settings
 No reliance on reverse integration for non-residential services
Questions?
Feel free to contact me:
[email protected]
-(202)783-2229 x322