Manatt on Health Reform: Weekly Highlights – February 2015


Manatt on Health Reform: Weekly Highlights – February 2015

The President’s budget reveals the healthcare agenda for his Administration’s penultimate year. Medicaid expansion proposals advance in Arkansas and Wyoming; California’s Marketplace reports 9 out of every 10 enrollees remain eligible for coverage.

FEDERAL NEWS:

President Releases FY 2016 Budget with Expansive Medicaid/CHIP Agenda

President Obama unveiled his fiscal year 2016 budget on Monday, kicking off the lengthy federal budget process. The budget request outlines an expansive Medicaid/CHIP agenda for the penultimate year of the current Administration. Among the proposals that will require Congressional action, the Administration seeks to extend enhanced Medicaid payments to primary care providers through the end of 2016 and to expand the availability of these enhanced Medicaid payments to OB/GYNs, physician assistants and nurse practitioners; to allow states to provide 12-month continuous eligibility to adults enrolled in Medicaid; and to extend the Children’s Health Insurance Program, which expires this year, through 2019. Under administrative authority, Obama officials plan to extend permanently the 90% federal Medicaid matching funds to states for the development and operation of integrated eligibility and enrollment systems.

As Final Deadline Approaches, 9.5 Million Consumers Have Signed Up for Marketplace Coverage during 2015 Open Enrollment

HHS announced that 9.5 million consumers have signed up for or re-enrolled in health coverage through federal and state Marketplaces — 7.1 million individuals through the Federally-facilitated Marketplace (FFM) as of January 16 and 2.4 million people through State-based Marketplaces as of January 17. Of those who signed up on the FFM, 4.2 million (58%) are returning consumers while 3 million (42%) are new enrollees; nearly 87% of FFM enrollees qualify for financial assistance to help pay for the cost of their plans.

10 Million Enrolled in Medicaid/CHIP since October 2013

Over 10.1 million additional individuals have enrolled in Medicaid and CHIP since initial Marketplace open enrollment began in October 2013, according to CMS’ latest Medicaid/CHIP monthly enrollment report. Based on data as of November 2014, this reflects a 17.5% increase in average monthly enrollments compared to July – September 2013. States expanding their Medicaid programs saw a 25.5% enrollment increase, while those not expanding Medicaid saw only a 7% increase. Nearly 450,000 individuals signed up between October and November 2014, with Vermont seeing the highest monthly enrollment percentage increase for State-based Marketplace states (16%) and North Carolina experiencing the highest for Federally-facilitated Marketplace states (3%).

Report Profiles Most Common Reasons for Remaining Uninsured, Including Perceptions of Ineligibility and Unaffordability

Approximately 11 million non-elderly people gained health coverage in 2014, but 30 million remain uninsured, according to a new report by the Kaiser Family Foundation. Kaiser interviewed 10,500 people and found that a range of factors – not just technical difficulties entering Marketplace websites – led them to remain uninsured. Affordability concerns were the most commonly cited; however, 63% of uninsured adults, including many who appeared eligible for financial assistance, said they did not attempt to obtain Marketplace or Medicaid coverage, either because they thought they were ineligible or unable to afford coverage. Nearly 30% of those who tried to sign up for ACA coverage said the coverage offered was too expensive.

STATE HEALTH REFORM ACTIVITY:

Arkansas: Appropriation for Private Option Sails through Senate

The Arkansas Senate approved SB101, which appropriates fiscal year (FY) 2016 funding for the State’s Private Option for Medicaid expansion, by a 29 to 2 margin on the bill’s first vote, exceeding the 75% supermajority required for passage. In 2014, the FY 2015 appropriations bill passed with no votes to spare after former Governor Mike Beebe (D) initiated a compromise with a Republican Senator on workforce training initiatives, according to the Arkansas News Bureau. The bill must now be passed by the House, where last year’s appropriations bill took five votes to pass.

California: 92% of Marketplace Enrollees Remain Eligible for Coverage

Covered California announced that 92% of its 1.1 million qualified health plan (QHPs) enrollees remain eligible for 2015 coverage based on renewals conducted thus far. Approximately 85,000 enrollees were determined Medicaid eligible. Of the remainder, 576,000 took no action and will be automatically re-enrolled in their current health plan; of the 368,000 who reviewed their coverage options, approximately 54,000 selected a different carrier than they had in 2014. The Marketplace is working to renew the 8% of enrollees who, for various reasons, could not be auto-renewed or have not selected a plan.

Kansas: House Committee and Hospital Association Move Medicaid Expansion Forward

A flurry of Medicaid expansion activity, as reported by the Kansas Health Institute, continues to keep the possibility of Medicaid expansion on the table despite Governor Sam Brownback’s (R) historic opposition. Vision 2020 Committee Chairman Representative Tom Sloan (R) announced he expects to have a draft Medicaid expansion bill by February 9, and the House Health and Human Services Committee Chair, Representative Dan Hawkins (R), while a vocal opponent of the ACA, has tentatively expressed openness to a conservative, alternative approach to Medicaid expansion. Kansas Hospital Association executives reported that CMS officials have indicated their expansion proposal — which would leverage employer-sponsored insurance, provide the option to purchase high-deductible plans or create a health savings account, and require cost sharing — was “within the boundaries of what would be accepted.”

Minnesota: Governor’s Budget Appropriates $11.7 Million for Marketplace

Governor Mark Dayton’s (D) proposed budget allocates $11.7 million to Minnesota’s Department of Human Services (DHS), much of which is to support MNsure’s eligibility and enrollment operations, according to the StarTribune. Minnesota’s Human Services Commissioner Lucinda Jesson explained that Medicaid and State health programs “have a much bigger piece of enrollment than anticipated” due to the unexpected low enrollment in qualified health plans. The share of MNsure costs allocated to DHS, if the Governor’s budget is approved, would increase from 29% to 65%. Inclusive of the Governor’s proposed budget and federal Medicaid funding and Marketplace grant monies, MNSure is poised for an $85 million budget for IT fixes.

Montana: Governor Projects Medicaid Expansion Savings of $59 Million 2016-2017

Governor Steve Bullock (D) issued a press release highlighting projected savings of $59 million in State general fund savings for the first two years of implementation (FY 2016 and 2017) of the Healthy Montana Plan, a bill to expand Medicaid to Montana residents under 138% of the federal poverty level by contracting with an insurer to provide healthcare through a private provider network at negotiated rates. The estimated savings result from reductions to certain State-funded health programs, as enhanced Medicaid funding becomes available to cover services for these enrollees, and from replacing regular Medicaid funding with enhanced Medicaid funding for certain services and enrollees. The analysis also estimates new federal revenues of $683 million.

Ohio: Governor’s Budget Proposes Continued Medicaid Expansion Funding, Premiums for Some Enrollees

Governor John Kasich (R) released a State budget plan this week calling for the continuation of funding for Medicaid expansion over fiscal years 2016 and 2017. The Ohio Medicaid Department is also seeking permission from the federal government to charge premiums for Ohioans at or above 100% of the federal poverty level. Nearly 100,000 Medicaid beneficiaries would be required to pay between $15 and $22 per month, which is expected to generate State savings of approximately $1.6 million in 2016 and $3.2 million in 2017.

Tennessee: Special Session on Medicaid Expansion Begins

Following a statewide tour to promote his proposed Medicaid expansion approach – Insure Tennessee – Governor Bill Haslam (R) advocated for the plan during the first meeting of the Legislature’s Special Session, drawing a strong distinction between “Obamacare” and Insure Tennessee. The discussion and negotiations will continue until a vote is expected on Thursday. Prior to the Special Session, the Governor announced that Senator Doug Overbey (R) agreed to carry the measure following Senate Republican leader Mark Norris’ withdrawal of support.

Wyoming: Senate Committee Advances Medicaid Expansion Bill

The Senate Labor, Health and Social Services Committee approved SF0129, a bill sponsored by Senator Michael Von Flatern (R) to expand Medicaid to new adults based on Governor Matt Mead’s (R) proposed expansion approach (the SHARE Plan). The bill was amended in the Committee to require Health Savings Accounts (HSAs) for Medicaid enrollees, which triggered debate regarding the feasibility of pre-loading the HSA with a balance of $500. The bill will now move to the full Senate for a vote; the Senate Appropriations Committee, having discussed the potential administrative costs of the HSA amendment, recommended against passage to the full Senate.

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