Reprinted from HEALTH PLAN WEEK, the most reliable source of
objective business, financial and regulatory news of the health insurance
industry.
By Lauren
Flynn Kelly, Managing Editor
August 21, 2017 Volume 27 Issue 29
Congress has set the stage for a September
return to debate on stabilizing the individual health insurance market, with
major changes to Medicaid funding or expansion taking a back seat. But industry
experts warn that health plans and other stakeholders should keep a close eye
on conservative-minded Medicaid waivers that states may use to scale back
enrollment and eligibility.
The Trump administration’s favorable view of
Section 1115 demonstration waivers containing so-called conservative principles
could really set expansion back, says John Gorman, founder and executive
chairman of Gorman Health Group.
Kentucky, for example, recently amended its
waiver proposal to revise current terms of Medicaid coverage by linking
“employment activities” to Medicaid eligibility. That proposal also includes a
six-month “lockout” period, where individuals may not re-enroll in the program
for six months if they don’t pay their past due premiums. According to Families
USA, Indiana is the only state Medicaid program with an approved lockout
provision.
“I think it’s the waiver process that’s going to
be [used] first and foremost in cutting eligibility and making it more
difficult for people to enroll...with very adverse implications for both health
plans and for members,” observes Jerry Vitti, founder and CEO of Healthcare
Financial, Inc., a company that connects low-income, elderly and disabled
populations with public benefit programs. “More folks will be coming on and off
Medicaid, and you’re going to have adverse selection because you’ll have only
the sickest people on the plan,” he predicts. “Plans won’t get the premiums
until people come back on, when they are generally sicker and have untreated
ailments that will be costly. It’s a very sneaky and insidious way of lowering
costs, just because of the sheer volume and churn in the population.”
Gorman points to CMS’s recent approval of a
five-year extension of the Managed Medical Assistance demo in Florida, which is
one of 19 states that did not expand Medicaid under the ACA.
“Under New Era of State Flexibility,” declared
the Aug. 3 press release from CMS unveiling the waiver extension that includes
an additional $900 million in Low-Income Pool funding, which enables health
care providers to provide more care to uninsured or underinsured Floridians
rather than expands coverage. “Basically, what [CMS Administrator Seema Verma]
is saying is this administration prefers charity care to health insurance. If
Florida got that approved, Kentucky’s next, and I think this is much more of
what you’re going to see from the Trump administration,” predicts Gorman.
“There’ll be a domino effect,” adds Vitti. “The
idea of attacking Medicaid costs and eligibility and enrollment will happen one
state at a time. There’s no turning back.”
As for how Medicaid MCOs should prepare, it
varies “wildly” by state, says Gorman. “What a Medicaid plan has to do in
Florida is going to be very different than what a plan in an expansion state
has to worry about,” he remarks.
“But generally, we tell them, ‘Get back to
basics, make sure that core administrative functions that impact revenue, like
risk adjustment, are running like a Swiss watch, and that your clinical
infrastructure and processes are person-centered and supportive, not
restrictive.’”
https://aishealth.com/archive/nhpw082117-03?utm_source=Real%20Magnet&utm_medium=email&utm_campaign=116429696
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