Medicaid Directors: Trump Administration Should Formally Include States in Development of Medicaid Regulations


Over the course of the last several blog posts, we’ve discussed how the Medicaid program could potentially be transformed under the incoming Trump Administration.  We also described the central role that state-led demonstration waivers would play in defining the parameters of this transformation.  Now, the association for State Medicaid directors is weighing in on precisely this issue.  The National Association of State Medicaid Directors (NAMD)recently published a document laying out the group’s priorities for the Medicaid program in the first 100 days of the incoming Trump Administration.  In the document, NAMD asserts that the first 100 days are a critical period for federal and state agencies to “to align the current realities for running a Medicaid program and the vision for high performing Medicaid programs….”

NAMD identifies four broad principles that the organization believes should inform Medicaid’s continued evolution.  Specifically, the NAMD states the Medicaid program should:

  • Ensure sustained consumer engagement in their healthcare, which produces good outcomes.
  • Ensure access to necessary and appropriate services.
  • Ensure it is cost-efficient and purchasing value.
  • Ensure it remains a leader and driver in improving the broader health care system overall.

The First 100 Days

NAMD emphasizes that the first 100 day of the incoming Trump Administration is important in setting the tone for the future development of the Medicaid program.  Accordingly, NAMD calls on the Trump Administration to coordinate with its Board of Directors on specific areas relating to Medicaid, including:

  • Alternative payment methodologies (APMs),
  • The dual-eligible population,
  • Prescription drugs,
  • Medicaid Managed Care,
  • Behavior health issues,
  • Access to services,
  • Home and community based services,
  • Implementation of the Fair Labor Standards Act (FLSA),
  • Medicaid Management Information Systems, and
  • Transformed Medicaid Statistical Information Services (T-MSIS).

NAMD is also requesting that the incoming Administration adopt two procedural updates to the process for developing Medicaid regulations and guidance. First, NAMD wants the Administration to “build in a step” for engaging states during the pre-conceptual phase of the development of regulations and guidance.  Second, NAMD would like the incoming Administration to establish a distinct process which would allow state Medicaid leaders to review federal regulations and guidance prior to finalization.


There are several things that stand out from NAMD’s document.  For one, NAMD (likely due to the bipartisan nature of the organization, and the current “state split”) did not mention the Medicaid expansion.  Still, this is a notable omission considering that the Medicaid expansion is responsible for an enormous increase in the Medicaid population. Moreover, as we’ve discussed previously on this blog, many states are increasingly interested in expanding the scope of  what can be done under expansions using the authority of Section 1115 waivers.

Another notable aspect of NAMD’s document was the organization’s proposals to address rising prescription drug costs in the Medicaid Drug Rebate Program (MDRP).  In one specific proposal, NAMD wants to be able to employ some the same drug benefit design tools as used in Medicare Part D and by private payers, such as being able to exclude some FDA-approved drugs from coverage based on comparative efficacy or efficiency.  NAMD points out that under current law, state Medicaid programs are required to cover all drugs, regardless of comparative efficacy or efficiency, so long as a manufacturer has signed the Drug Rebate agreement..  NAMD does not, however, offer any thoughts as to what constitutes “efficacy or efficiency”, terms which are wrought with complex issues that make value based strategies extraordinarily difficult to implement.

NAMD also expressed concerns regarding the effects that the FLSA’s minimum wage and overtime requirements could have on state Medicaid home and community-based services budgets.  Indeed, this particular example highlights NAMD’s overarching point that, despite Medicaid being a state-federal partnership, the federal government often engages in decision-making that inadvertently affects state Medicaid programs, sometimes in negative ways.  The Trump Administrative is likely to be more receptive to this line of criticism than the current administration, which could translate to increased flexibility for State Medicaid Directors on not only on how they run their programs, but also on how much influence they can exert on crafting federal policy, to the extent that there is any.

NAMD also emphasized the critical issues that do not often capture popular attention, but are nevertheless the essential nuts and bolts of a proper functioning Medicaid program (and of all of healthcare really): information technology.  Regardless of whether the repeal of the ACA will also eliminate the crisscrossing of enrollee information that came to characterize the relationship between Medicaid and the Marketplaces, effective and efficient capabilities in the transferring of information should undoubtedly continue to be a high priority of Medicaid moving forward.

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