MEDICAID NEWS RECAP – JANUARY 2021

Officials on Friday announced the awarding of contracts to four companies to shift the Medicaid population to managed care from fee-for-service. The companies are: Blue Cross Blue Shield of Oklahoma; Humana Health Horizons in Oklahoma; Oklahoma Complete Health; and United Healthcare. The contracts for managed care will cost about $2.2 billion and are among the largest awarded in state history. Managed care, also called privatization, is expected to take place Oct. 1, despite opposition from several health care organizations and lawmakers. Gov. Kevin Stitt is a strong backer of managed care.  read more

Medicaid expansion will add $1.9 billion to Missouri’s state budget in the coming fiscal year, with most of it paid for with federal funds and the rest from anticipated savings from a cut in state costs for the current program. The budget Gov. Mike Parson delivered to lawmakers Wednesday anticipates approximately 275,000 low-income adults will enroll for medical coverage. Missouri voters in August approved expanding Medicaid to everyone in households with incomes at or below 133 percent of the federal poverty guideline.   read more

The Coronavirus pandemic and the consequential economic recession accentuated the importance of the Medicaid program last year. By February, the Medicaid enrollment rate increased to 7.4 percent, and 76.5 million people were enrolled in the jointly funded program. In 2021, the new administration, economy, and ongoing public health emergency are sure to impact the safety net program. Some of the critical areas to monitor in the new year will be enrollment, coverage, eligibility, demonstration waivers, and program financing. Here is a summary of what to expect and what state Medicaid plans can do to curb costs.   read more

Arkansas should be able to set work requirements for some of its Medicaid recipients, including the use of Medicaid dollars to buy private insurance for low-income people, 18 states told the U.S. Supreme Court this week. Arkansas’ work requirement for its Medicaid expansion has previously been blocked as lawmakers debated the future of the expanded coverage program that has sharply divided Republicans during the past several years. Earlier in December, the Supreme Court announced it would hear the appeals involving the Arkansas and New Hampshire work requirements — both of which had been struck down by lower courts.  

Opposition in the state Legislature is growing to changes to how prescription drugs are paid for in the state’s Medicaid program, with more than 40 lawmakers backing a letter to reverse the policy. At issue is the state’s plan to “carve out” Medicaid prescription drugs that advocates and lawmakers worry will hurt safety net providers that participate in what’s known as the 340B program. The program allows providers to purchase prescription drugs at a discounted price and in turn provide services like food and housing assistance to lower-income New Yorkers. Many of the prescription drugs impacted included medication for HIV and hepatitis C treatment.  read more

Six months after the public health emergency ends, states will need to have completed certain Medicaid eligibility and enrollment processes, CMS has indicated. They must prepare in advance in order to meet these expectations, a Kaiser Family Foundation issue brief explained. As the coronavirus vaccines start to roll out and the end of the public health emergency seems to be in sight, state Medicaid programs must consider how they will return to normal policies. During the coronavirus pandemic, CMS established waivers meant to streamline administrative processes while states were addressing urgent coronavirus-related demands.  read more

As President Joe Biden settles into the Oval Office, his new administration has named Elizabeth Richter acting administrator for the Centers for Medicare and Medicaid Services, where she will serve on an interim basis until a permanent chief is chosen. Picking a new administrator will require Senate confirmation. The change was reflected on CMS’ website, which lists Richter as acting administrator. She has served with CMS since 1990, beginning with the Bureau of Policy Development, where she worked on inpatient hospital payment policy. She then worked on a variety of Medicare payment issues.  read more

The Trump Administration’s grandiose healthcare plans didn’t come to fruition, like the promised repeal and replace of the Affordable Care Act, the pledged overhaul of the prescription drug rebate system, and international price indexing for Medicare Part B (physician-administered) drugs. Yet, Secretary Azar’s Department of Health and Human Services (HHS) and Administrator Verma’s Centers for Medicare and Medicaid Services (CMS) have implemented a number of high-profile regulations that will likely have a lasting impact on the pricing and reimbursement of medical services and technologies.  read more

CMS has officially withdrawn its proposed Medicaid fiscal accountability rule. CMS proposed the rule in November 2018. It aimed to promote transparency and fiscal integrity by establishing new reporting requirements for state supplemental payments to Medicaid providers. But last August, some hospital associations called on CMS to withdraw the rule, arguing that it could exacerbate the challenges U.S. hospitals. The hospital associations, including America’s Essential Hospitals and the American Health Care Association, argued that finalizing the rule would introduce “unprecedented restrictions on states’ ability to fund their share of the Medicaid program” at a time when hospitals are facing challenges and an uncertain future due to the COVID-19 pandemic.  read more

Tennessee’s Medicaid program may be in for some changes soon, but state lawmakers must give the green light first. Last week the federal government approved a Medicaid block grant waiver amendment for Tennessee. It would be the first state to get Medicaid funding in a lump sum. The Tennessee General Assembly is considering a joint resolution about the TennCare waiver. It would authorize and implement what the federal government has already approved, but there’s a lot of unknowns that come with the plan.  read more

The ambitious Medicaid transformation initiative remains on track for a July 1 debut, state health officials told legislators Tuesday. Dave Richard, the state’s deputy secretary for Medicaid, said that “we’re on target, we’re on schedule and our commitment to you is that we’re going to do everything possible” to go live with the managed care plans. At stake with Medicaid transformation: three-year prepaid health plan contracts for four insurers that are projected to be worth $6 billion a year starting with the 2021-22 fiscal year which begins July 1.  read more

Ohio’s Medicaid program has named Gainwell Technologies as its sole pharmacy benefit manager in a $158 million contract, The Columbus Dispatch reported Jan. 11. Gainwell will replace multibillion dollar conglomerate PBMs such as CVS Caremark and Express Scripts. Ohio’s Medicaid Director Maureen Corcoran told the Dispatch that switching to a single, state-controlled PBM will save the state $150 million to $200 million per year. But it will cost the state some revenue, such as $23 million from a tax on health insurance corporations that it can no longer collect, according to the Dispatch.  read more

Earlier this year, my colleague Ross Margulies and I told you about a new proposed rule issued by CMS that makes several changes to the Medicaid prescription drug rebate program, or the MDRP.  Recently, CMS finalized the rule and we thought we’d take this opportunity to tell you about it.  On balance, we think that the rule succeeds in CMS’s stated goals of increasing access to innovative health care therapies to Medicaid beneficiaries as well as clarifying some longstanding questions about the operation of the MDRP. But before we begin, a little bit of background about the MDRP.  read more

As of December 1, Aetna dropped CVS competitor Walgreens from its Illinois Medicaid plan. Aetna’s decision to exclude the Walgreens chain from its Aetna Better Health of Illinois pharmacy network affects about 400,000 residents in the state, according to the Chicago Tribune. Many in this population are poor, unemployed and disproportionately suffering from COVID-19. Nearly 2,000 pharmacies participate in Aetna’s Better Health of Illinois network, Aetna Medicaid said by statement, including other national pharmacy chains such as Walmart, regional chains such as Osco and many independent pharmacies.  read more

Centene Corporation has entered into an agreement to acquire Magellan Health in a deal valued at $2.2 billion. The deal has been unanimously approved by the boards at both companies, according to an announcement issued on Monday. Should the acquisition be finalized, Magellan will continue to operate independently under Centene’s Health Care Enterprises arm. Magellan’s CEO Kenneth Fasola and senior management will maintain leadership positions at Centene.”There is a critical need for a fundamentally better approach to supporting people with complex, chronic conditions through better integration of physical and mental health care.  read more