nc live 6 8-2010 kohler presentation [compatibility mode]

Health ReformHealth Reform

Ann KohlerAnn KohlerDirector of Health Services

National Association of State Medicaid DirectorsAmerican Public Human Services AssociationAmerican Public Human Services Association

June 8, 2010

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Current Status> Legislative Status:g

• The House passed the Senate’s version of the bill;• The House passed a package of amendments to the Senate bill

through a reconciliation bill;through a reconciliation bill;• The Senate passed the reconciliation bill with minor changes;• The House passed the amended reconciliation bill; and• Both of the bills have been signed into law• Both of the bills have been signed into law.

> Implementation:• Staggered time-line of effective dates;• Major Medicaid and private-market changes effective 2014;• CMS, NASMD, NGA & State Representatives forming

workgroups to address Medicaid Changes.

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g p g

Key Components of Reform> Medicaid Changes:

• Expands Medicaid to everyone under 133% of FPL, with increased Federal funds for this population;

• Current eligibility levels, procedures and methodologies are frozen g y , p guntil 12/31/2013 for adults and 9/30/2019 for children (including CHIP);

• Restructures income calculation for many Medicaid beneficiaries (but y (not people with Disabilities) to IRS income calculation – Elimination of income disregards;

• Elimination of asset/resource test for individuals who have theElimination of asset/resource test for individuals who have the income calculation restructured;

• Mandatory increase to the provider rates Medicaid pays for primary care services (100% Federal funds)

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care services (100% Federal funds).

Key Components of Reform

> Medicaid (continued):• Expands Medicaid to any individual under 25 previously served

th h Child W lfthrough Child Welfare;• Creates State-plan option for family planning services;

> Other programs:> Other programs:• Includes grants and incentives to expand and subsidize high-risk

pools;p ;• Increases funding for ADRCs;• Establishes grants for School-based health services.

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Key Components of Reform> Long term Care> Long-term Care:

• Establishes the CLASS Act: • National long term care insurance program funded by payrollNational long term care insurance program funded by payroll

deductions;• Eligibility determined by ADLs, not finances;

C t ti f it b d l t th h• Creates new options for community-based long-term care through Medicaid;

• Provides FMAP incentives to increase long-term care in the gcommunity;

• Provides grants and demonstrations to address IMD coverage.

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Key Components of the Bill(s)

> Private Insurance Reforms:• “Community Rating” limits on variation in premiums for• Community Rating – limits on variation in premiums for

individuals within a geographic area;• Prohibits exclusion of pre-existing conditions;• “Guaranteed Issue/Renewal” – no one can be denied

coverage/dropped due to health conditions;• Removes annual/lifetime limits on care;Removes annual/lifetime limits on care;• Required Benefits Package (Including Rehabilitation, Habilitation,

MH treatment).

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K C t f th Bill( )Key Components of the Bill(s)> Individual mandate to buy insurance – allows some individuals to

“ t t” f d t“opt-out” of mandate;> Establishment of “Exchange”:

• Based on Massachusetts “Connector” model;;• Provides centralized marketplace to compare insurance and purchase plans;• Federal government provides subsidies for people with low-to-moderate income

to assist with the purchase of insuranceto assist with the purchase of insurance.> Competition:

• Establishes Health care nonprofit cooperatives;• State may offer an insurance plan up to 200% FPL

> State Innovation:• Waivers for states to try alternate coverage methods.

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Waivers for states to try alternate coverage methods.

Potential Impact to State Programs> Potential Issues:

• Eliminating income disregards;• Increased costs on state budgets due to mandatory Medicaid

expansions & costs associated with developing and operating the exchanges;

• Changes to eligibility systems & interoperability with the exchanges; • Loss of revenue through restructuring of drug rebate programs;• Reduction in “DSH”;• Large expansion may cause access issues for everybody (not just

Medicaid recipients).

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Medicaid recipients).

Potential Impact to State Programs> Potential Positive Changes:

• Greater availability of insurance in the private sector;• Broader range of services available through private insurance

plans;N i ti diti l i d i l f• No preexisting condition exclusion, denial of coverage or termination of coverage;

• CLASS act – LTC without Medicaid funding;g;• New Medicaid coverage for low-income people – including

individuals currently served in some State-only programs.

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Future Considerations

> State Budget issues:• 48 states experiencing budget shortfalls;48 states experiencing budget shortfalls;• Increased Federal Funds (FMAP) expire 1/1/2011;• Bills containing extensions to FMAP increase have passed both the g

Senate & House, but have not been reconciled;• Loss of FMAP would lead to significant rate cuts & service

reductions For more information on proposed cuts:reductions. For more information on proposed cuts: http://www.aphsa.org/Home/Doc/WhitePaperFMAP.pdf

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For More Information:

Ann Kohler, Director of Health ServicesN i l A i i f S M di id DiNational Association of State Medicaid Directors

American Public Human Services AssociationAnn.Kohler@aphsa.org

202.682.0100Ext. 299

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Use telephone or computer speakers

> Call 888.259.8414 for technical supportpp

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> April 21: Geoffrey Canada on Weaving a Community Safety Net> April 27: National Council Client Engagement and Retention Best Practice Findings

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