Here at the Medicaid and the Law Blog, we’ve spent the past couple of days going through the American Rescue Plan Act, legislation introduced in the U.S. House of Representatives last Friday that is the latest attempt by Congress to respond to the COVID-19 pandemic. There are several provisions of the legislation that would revise and expand the Medicaid program, and we thought it would be of interest to highlight them here. … More
Category Archives: Medicaid
While CMS has been relatively quiet as of late from a public-facing perspective as it waits for new political leadership to arrive (including newly announced CMS Administrator, Chiquita Brooks-LaSure), a recent review by your Editors at www.MedicandandtheLaw.com of CMS’ website indicates a fast-paced effort to roll back a number of Trump-era Medicaid policies, particularly around waiver flexibilities. As I recently mentioned,… More
On Friday, February 12, the Centers for Medicare and Medicaid Services (CMS) took a first step to ending Medicaid work requirements. Acting CMS Administration Elizabeth Richter sent letters to Medicaid Directors in states which had previously received 1115 waiver approvals to implement so-called “community engagement” requirements, explaining CMS now does not believe that requiring employment as a condition for Medicaid coverage promotes the program’s objectives and intends to commence a process of determining whether to withdraw the waiver approvals. … More
A few years ago, we told you about the “ongoing saga” surrounding the ability of a Medicaid beneficiary or a provider of health care services to a Medicaid beneficiary to challenge a state Medicaid agency’s putative violation of a requirement of the Medicaid program. For example, section 1902(a)(8) of the Social Security Act says that a state Medicaid agency must provide Medicaid benefits “with reasonable promptness to all eligible individuals.” Well,… More
On January 28th, President Biden issued an “Executive Order on Strengthening Medicaid and the Affordable Care Act.” The E.O. states that the Biden Administration will promote policies that “protect and strengthen Medicaid and the ACA and … make high-quality healthcare accessible and affordable for every American.” To this end, the E.O. makes several important policy changes, including asking the HHS Secretary to establish a Special Enrollment Period for the ACA marketplace,… More
On December 4, 2020, the Supreme Court agreed to hear arguments to decide the legality of the Department of Health and Human Services’ (HHS’s) authorization for states to incorporate work requirements into their Medicaid programs. The consolidated cases, Azar v. Gresham and Arkansas v. Gresham, challenge the legality of work requirements in two states’ Medicaid programs—Arkansas and New Hampshire. On January 19,… More
Before discussing the new Medicaid guidance on social determinants of health, Medicaid and the Law would like to formally introduce its readers to Regina DeSantis, a new Law Clerk in the Washington, DC office who will become a regular contributor to the blog.
The social determinants of health (SDOH) describe the range of environmental, social, and economic factors that can impact health outcomes. According to the Centers for Disease Control and Prevention (CDC),… More
As my colleague Tom wrote about in a recent post, the Centers for Medicare & Medicaid Services (CMS) has finally responded to a growing chorus of stakeholders that government price reporting requirements, particularly Medicaid Best Price (BP), are stifling innovative value-based contracting arrangements (VBAs). As the proverbial wisdom goes, “nothing changes if nothing changes,” and CMS’ recently finalized proposal to allow manufacturers to report multiple BPs is meant to stimulate innovative changes in contracting for drugs and biologicals.… More
If you have not already read it, you can read our main summary of the Tennessee waiver approval HERE.
Now that we have had the chance to read and meditate on the historic Medicaid waiver approved on Friday January 8th, giving Tennessee permission from the Federal government to fundamentally alter Medicaid’s traditional “matching” financing structure for the 1.5 million Tennesseans who rely on the program for healthcare services,… More
For our discussion of the new “closed formulary” flexibility approved in Tennessee, you can read our follow-up post here.
On Friday January 8th, in the final days of the Trump Administration, CMS announced approval of a first-in-the-nation waiver that would permit Tennessee to transition from Medicaid’s longstanding, open-ended financing model to a modified “block grant” model – a financing system under which the Federal government has agreed to commit a discrete amount of dollars to the state,… More
Today we want to address a topic that many state Medicaid agencies will no doubt be thinking about in the coming months, as the COVID-caused pandemic continues to threaten state finances and Congress has somewhat tied states’ hands in responding to increased Medicaid expenditures by prohibiting coverage disenrollments. (Although as my colleague Ross Margulies has pointed out here, CMS has recently given states some additional flexibilities in this regard).… More
Hello readers of Medicaid and the Law! First and foremost, we here at the blog would like to wish our readers a very happy and healthy new year. We are looking forward to continuing to provide essential insight into some of the most important Medicaid and related health law issues to come in 2021.
Today, we will be providing an update on the “340B Contract Pharmacy Saga.” Back in September,… 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.… More
On November 9, 2020, the Centers for Medicare and Medicaid Services (“CMS”) announced it finalized the Medicaid and Children’s Health Insurance Program (“CHIP”) Managed Care final rule (“2020 final rule”). According to CMS, the 2020 final rule advances CMS’s efforts to streamline the Medicaid and CHIP managed care regulatory framework and “reflects a broader strategy to relieve regulatory burdens; support state flexibility and local leadership; and promote transparency, flexibility, and innovation in the delivery of care.”
We are back again with another 340B post. The 340B program has recently been a regular feature on the blog in the context of ongoing litigation discussed here and here. Today, we wanted to provide readers the details of an ongoing saga on a different aspect of the 340B program – the growing presence of contract pharmacies in the 340B space, and recent efforts by drug companies to curb this trend.… More
Last month, we described the announcement by the Department of Health and Human Services (HHS) announcing the allocation to Medicaid providers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. In the past couple of days, HHS has updated its policies regarding the Medicaid allocation (including the allocation to safety net providers) and we thought now would be a good time to highlight those updated policies.
By way of background,… More
As many of our astute readers are aware, on June 17, 2020 CMS released a long-awaited Medicaid proposed rule addressing a number of far-ranging issued involving Medicaid coverage and payment for prescription drugs, including new regulations to encourage the development value-based purchasing arrangements between states and manufacturers. Over the next several days we will be posting our thoughts on a number of these key policy proposals, including CMS’… More
Since the COVID-19 pandemic began to seriously affect the United States in March, Congress has passed four major pieces of legislation to address the public health crisis. CMS has also jumped into action and has issued a series of waivers designed to ensure that the American health care system can function without bureaucratic obstacles preventing the appropriate delivery of care. Today, we want to highlight some of the major Medicaid provisions of those four pieces of legislation;… More
We haven’t posted on the blog in a while due to the rapid increase in our workload due to the coronavirus pandemic. We’re preparing a longer post that will go through everything that’s happened in Medicaid legislatively and administratively in the past six weeks that will be up soon, but wanted to flag an important development in today’s post.
On March 27, President Trump signed the Coronavirus Aid,… More
As my colleague Tom Barker wrote last week, the second emergency COVID-19 supplemental bill (officially referred to as the Families First Coronavirus Response Act), signed by the President on March 18, 2020, included a new section 6008 increasing each state Medicaid program’s federal medical assistance percentage (FMAP) by 6.2% during the period of the current national emergency to the extent they abide by certain minimum standards.… More
The global pandemic caused by the novel corona virus has certainly shaken up our normal way of life and will do so for the foreseeable future. Times like this reinforce the importance of public health insurance programs like Medicare and Medicaid. Our post today addresses many of the ways that CMS and Congress are bolstering the Medicaid program to respond to the unique challenges posed by the pandemic. We’ve updated this post to reflect the fact that,… More
UPDATED 2.25.2020 to reflect decision in Wolf v. Cook County, Illinois
Last summer, we wrote about the Department of Homeland Security’s (DHS) public charge rule. As a reminder, that rule added some definition to the grounds of inadmissibility to the United States because of the likelihood that an applicant for an immigration benefit – such as a green card applicant or an individual seeking a visa to enter the United States – is likely to become a “public charge.” We’re interested in that here at the Medicaid and the Law Blog because one of the factors that the final regulation would consider is whether the applicant has ever used Medicaid in the past or was likely to do so.… More
The Centers for Medicare & Medicaid Services (CMS) suffered a big loss in court last week. The United States Court of Appeals for the D.C. Circuit upheld a lower court ruling that blocked CMS from implementing one of the hallmarks of the Trump Administration’s efforts to restructure the Medicaid program. We first wrote about the agency’s attempts to require some Medicaid recipients to participate in community engagement activities back in 2018. … More
UPDATED: It’s out! The much anticipated guidance, entitled the “Healthy Adult Opportunity” (HAO), from CMS introducing ways to revamp Medicaid financing has been out for nearly a week and we have had some time to review the guidance in more detail. We’ve update our questions below with answers based on our review of the guidance document.
Earlier this year, we wrote about a lawsuit involving the 340B drug pricing program. We sometimes write about the 340B program because it is integrally linked to the Medicaid prescription drug rebate program. So today, we wanted to call attention to a proposed regulation issued by the Massachusetts Medicaid program (which is called “MassHealth”) that shows that link clearly.
Section 1927 of the Social Security Act requires pharmaceutical manufacturers to provide a rebate to state Medicaid plans if they want to have their drugs covered by Medicaid. … More
We’ve posted previously the long-standing rumor (substantiated by several folks within the Administration) that CMS is working on a guidance document to states to receive their Medicaid funding through a block grant. In June, the Office of Management and Budget (OMB) received a guidance document entitled, “State Medicaid Director Letter: Medicaid Value and Accountability Demonstration Opportunity.” This document was widely reported by press as the block grant guidance document. … More
Earlier this week, CMS released for publication a proposed rule that would add some degree of transparency and oversight to the somewhat opaque world of Medicaid financing. It’s a topic that’s fascinated us here at the Medicaid and the Law Blog for some time and we’ve written about it on a couple of occasions. Over the years, Congress and CMS (and even before there was a CMS,… More
For much of the past two years, enrollment in the Medicaid and CHIP programs has been declining. In May, 2017, enrollment in both programs was 74.6 million people. As of May of this year, enrollment had declined by 2.5%, to 72.8 million. This decline has applied across the board, in almost every state, for adults and for children.
Superficially, this might make sense;… More
Last Fall, we wrote about a proposed regulation issued by the Department of Homeland Security that involved one of our favorite topics: the intersection of immigration and health care law. My colleague Christian Springer and I have been following this proposed regulation very closely, and last week, it was issued in final form. Because it has generated enormous press attention and because it has significant implications for the Medicaid program,… More
On July 25, 2019 the Senate Finance Committee voted to advance their long-awaited drug pricing package to the Senate floor (we anticipate a Floor vote sometime this Fall). The Prescription Drug Pricing Reduction Act (PDPRA) of 2019, as the package is called, proposes numerous drug pricing reforms across Federal healthcare programs (including Part B and Part D), but for today’s blog post we will focus on some of the many Medicaid provisions included in the final mark-up.… More
Last week, CMS issued a proposed rule as part of a broader Administration-wide initiative to reduce regulatory and administrative burdens. The proposed rule would absolve states from many of the requirements of a final regulation issued by CMS in 2015 that requires states, before reducing or restructuring payments in their Medicaid programs, to conduct a review (called an access monitoring review plan, or AMRP) of the effect of the proposed rate reductions or restructuring on access to services. … More
On June 19, the House of Representatives passed the funding bill for the Department of Health and Human Services for fiscal year 2020. CMS is funded in this annual legislation and this funding bill is often a vehicle for Congress to express its support or displeasure for some of CMS’s activities during the year.
This year’s bill is no different. Section 239 of the legislation (H.R.… More
New Executive Order Could Restrict Medicaid Coverage for Non-U.S. Citizens Seeking Immigration Benefits
We have written in the past about the link between Medicaid and immigration. Last October, we described a proposed rule issued by the Department of Homeland Security that would strengthen the “public charge” grounds for inadmissibility to the United States. If this proposed rule is finalized, many non-U.S. citizens seeking immigration benefits (such as a visa, adjustment in status or naturalization) could see those benefits denied if they utilized public benefits such as Medicaid.… More
One of the things that gets drummed into your head working with Medicaid is this: Medicaid is a payer of last resort. Medicaid can only pay for a health care service when there is no other payer available. If a Medicaid beneficiary has virtually any other source of health insurance coverage, that coverage pays first.
This requirement is set forth in the basic rules of the Medicaid program;… More
The majority members of the Senate Finance Committee released a report last month that delves into the mysterious world of Medicaid supplemental payments. We thought we’d go through it here, especially in light of some of the litigation going on across the country involving Medicaid disproportionate share (DSH) payments, a form of Medicaid supplemental payments.
The Finance Committee report found that total Medicaid supplemental payments in fiscal year 2016 totaled nearly $50 billion,… More
On April 11, 2019, the Massachusetts House Committee on Ways and Means released its FY 2020 budget (H.3800). The legislation includes provisions authorizing MassHealth (the Massachusetts Medicaid program) to negotiate supplemental rebates directly with drug manufacturers, and provides for further proceedings before the Health Policy Commission for manufacturers refusing to negotiate supplemental rebates at levels satisfactory to the Commonwealth. These provisions represent amendments to a MassHealth drug pricing proposal included in Governor Baker’s FY 2020 filing in January.… More
Attorneys Ross Margulies and Tom Barker to Speak at AHLA’s Institute on Medicare and Medicaid Payment Issues
Foley Hoag attorneys and Medicaid and the Law bloggers Ross Margulies and Tom Barker are presenting at the American Health Lawyers’ Association Annual Institute on Medicare and Medicaid Payment Issues in Baltimore this week.
Ross’s presentation will address Medicare and Medicaid payment issues for innovative therapies. Tom’s will provide an update on Medicaid § 1115 waivers.… More
If our readers have been paying attention to the news, one thing is apparent: drug pricing is trending. As we’ve written on here before, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) has proposed significant revisions to the discount safe harbor regulations that protect existing rebate arrangements under Medicare Part D and Medicaid Managed Care. … More
One of the most common misperceptions of the American health care system is that if an elderly individual – maybe a parent or a grandparent – has to enter a nursing home, their stay will be fully covered by the Medicare program. But that is not accurate. Medicare does not cover long-term care. It will pay for up to 100 days in a skilled nursing facility per spell of illness,… More
On January 31, 2019 the HHS Office of Inspector General (OIIG) issued a proposed rule that will be published in the Federal Register on February 6. The proposed rule has the potential to fundamentally re-structure the prescription drug marketplace in the United States by dramatically altering the economics of pharmaceutical pricing. Although much of the attention surrounding the rule has been focused on its effect on the Medicare Part D prescription drug program,… More
It was just earlier this week that we were writing about a flurry of solicitations released by the the Massachusetts Executive Office of Health and Human Services (EOHHS) seeking bids from manufacturers of select, generally high-priced outpatient drugs for supplemental rebates in MassHealth’s fee-for-service and managed care programs. At that time, we noted that this exercise was likely foreshadowing the release of Governor Baker’s budget proposal.… More
A recent news article suggests that Trump Administration officials are considering allowing states to receive their Medicaid funding through a block grant. The article did not specify how CMS would accomplish such a goal without a statutory change. Details are supposedly being developed, but until we see those details, it’s hard to know exactly what the agency is considering.
My colleagues and I at the Medicaid and the Law Blog thought it might be helpful to provide some background on the concept of block grants in Medicaid,… More
In an interesting (intriguing even?) turn of events, in late December 2018 the Massachusetts Executive Office of Health and Human Services (EOHHS) announced through its public bidding site that it was seeking bids from manufacturers of select, generally high-priced outpatient drugs for supplemental rebates in MassHealth’s fee-for-service and managed care programs. While the state has before used the public bidding process successfully to negotiate supplemental rebates for the state’s Medicaid program (for example,… More
On December 13, 2018, the Medicaid and CHIP Payment and Access Commission (MACPAC) held its December 2018 public meeting.
Dr. Paul Jeffrey, the Director of Pharmacy for MassHealth, spoke on MassHealth’s drug pricing approach, in particular with respect to a drug pipeline he described as “alarming” in terms of cost but “sensational” in terms of potential impact. Although Dr. Jeffrey suggested that implementing a closed formulary would require waiver authority (which CMS denied Massachusetts last year),… More
Court Case Involving Massachusetts Health Care Law Shows Relationship Between Medicare Payments and Medicaid
In 2006, former Massachusetts Governor Mitt Romney signed Chapter 58 of the Massachusetts Acts of 2006 into law. Chapter 58 was designed to ensure that all Massachusetts residents would have access to some form of health insurance, and it accomplished this through reforms to the individual insurance market; subsidies to purchase health insurance; and an expansion of the Massachusetts Medicaid program, known as “MassHealth.” Many observers have suggested that the enactment of Chapter 58 in Massachusetts paved the way for enactment of the Affordable Care Act at the federal level four years later (although Governor Romney strenuously denied this during his campaign for President in 2012).… More
Despite all of the drama surrounding the 2018 midterm elections, one thing was clear: Medicaid had a big night on November 6, 2018.
In particular, the electorate in the Red states of Nebraska, Idaho, and Utah voted to expand Medicaid (i.e. extend Medicaid coverage to low-income able-bodied adults). Although the Montana electorate rejected a ballot measure that would have permanently funded the Medicaid expansion in that state beyond 2019,… More
In a wide-ranging speech on CMS’s efforts to lower Medicaid drug costs, Administrator Seema Verma announced yesterday that CMS has approved Michigan’s proposed state plan amendment to utilize value-based payment arrangements with drug manufacturers. With CMS’s blessing, Michigan can now enter contracts with pharmaceutical companies in which manufacturers provide the state supplemental rebates when their drugs fail to meet specified treatment benchmarks.
Michigan is the second state that has received CMS’s approval to pursue value-based purchasing agreements.… More
On November 13, 2018 CMS (as mandated by Congress in the 21st Century cures Act) issued a State Medicaid Director Letter providing states with guidance on both: (1) existing authority for states to provide support for adults with serious mental illness (SMI) and/or children with a serious emotional disturbance (SED); and (2) a new demonstration opportunity to permit states to offer care for certain individuals with serious mental illness residing in Institutions for Mental Disease (IMDs).… More
We have written recently about the interrelationship between the Medicaid program and U.S. immigration law. Our post generated a lot of interest and now there’s a new development to report.
On October 10, 2018, the Department of Homeland Security (DHS) published a proposed regulation in the Federal Register that, if finalized, may have an effect on individuals seeking admission to the United States,… More
In prepared remarks delivered by Administrator Seema Verma on September 27, 2018 at the 2018 Medicaid Managed Care Summit, the Administrator previewed the release of an impending guidance document on a new/updated “work requirement” demonstration. As noted in the prepared remarks:
Additionally, in January, we released a groundbreaking new demonstration opportunity in response to state requests to test work and community engagement incentives among able-bodied adult beneficiaries.… More
Some things in the world would be much simpler if they stayed separate, but we all can’t have what we want. As health care lawyers, Tom Barker and I are used to navigating complex and intersecting fields of law such as tax, contracts, fraud and abuse, insurance, and federal health care program coverage and reimbursement. But we also know a bit about immigration law from our pro bono work representing individuals seeking lawful status in the U.S.… More
The United States Supreme Court will have the opportunity to hear an important case out of Fifth Circuit Court of Appeals affecting how states pay community health centers for Medicaid beneficiaries enrolled in a managed care plan. Community health centers represent the largest primary health care safety net for the nation’s poorest urban and rural communities.
This is a brief post about a CMS proposed rule that sort of slipped under the radar last week. But it has the potential to raise some eyebrows because it is clearly designed to make it harder for labor unions to collect dues from some home health care workers who are paid directly by Medicaid.
Section 1902(a)(32) of the Social Security Act prohibits reassignment of Medicaid funds, and only allows Medicaid funds to be paid directly to individuals performing health care services,… More
It has not been a good week for states that want to try innovative Medicaid waivers. First, CMS shot down Massachusetts’ attempt to re-structure the 25-year old Medicaid prescription drug rebate program to achieve additional savings on the cost of prescription drugs. And then on Friday, the United States District Court for the District of Columbia effectively blocked Kentucky’s attempt to impose “community engagement” requirements on some Medicaid recipients. … More
It was a busy day for CMS today. After keeping everyone in suspense for months, CMS finally issued its decision on the Massachusetts state Medicaid program waiver request that proposed to limit access to covered outpatient drugs to Medicaid (in Massachusetts, called “MassHealth”) enrollees. As many observers predicted, CMS did not approve the state’s request. Notably, however, the CMS response letter provided a pathway for Massachusetts to achieve a substantially similar result. … More
We have written in the past about the strange quirk in Medicaid law that prohibits Medicaid from paying for medical services for individuals who are patients in an “institution for mental disease” – a facility that has more than 16 beds and that is “primarily engaged” in providing diagnosis, treatment and care to individuals with mental illness. This prohibition – commonly known as the “IMD Exclusion” – is a vestige of the original Medicaid program,… More
If recent history provides us with any guideposts on how the current Administration will review and approve (or not approve) State waiver requests, today’s news may come as a bit of a surprise. In the wake of recent approvals of never-before-seen waivers — including the imposition of new work requirements in Kentucky, Indiana , and Arkansas — today we learned that CMS has said no to lifetime limits on Medicaid benefits in the state of Kansas.… More
We have posted over the past several months about some interesting Medicaid litigation across the country involving Medicaid disproportionate share (DSH) payments. In this post, we try to explain a bit more about disproportionate share payments, how the payments work, and how the program has evolved over the past three and a half decades. As we discuss – this evolution has often been circuitous,… More
In the midst of a busy day on Capitol Hill yesterday, President Trump signed a long-anticipated Executive Order (EO) entitled, “Reducing Poverty in America by Promoting Opportunity and Economic Mobility.” Notably, the EO directs various Federal agencies (including the Department of Health and Human Services) to review existing guidelines on publish assistance programs to ensure they are in line with the President’s outlined “Principles of Economic Mobility.”… More
Last summer we wrote about an interesting court case involving payments to disproportionate share hospitals (DSH) under the Medicaid program. It’s one of the hottest issues in Medicaid right now; seven courts have invalidated the CMS policy that is at issue. The most recent decision came last week, in the US Court of Appeals for the First Circuit, involving a challenge brought by New Hampshire hospitals.… More
On March 23, CMS finalized updates to the Medicaid National Drug Rebate Agreement (NDRA) for the first time in 27 years to incorporate legislative and regulatory changes that have occurred since the Agreement was first published. As my colleague previously wrote, CMS proposed changes to the NDRA in November 2016—most, though not all, of the proposed changes were finalized.
On March 26,… More
Our readers may remember our discussion of the ongoing saga surrounding enforcement of the entitlement to Medicaid. We have covered it several times before (here and here) on this blog. Aside from discussing the topic because it allows us to flex our legal muscle with italicized case names, we also believe it’s critical for our readers to understand how Medicaid entitlement has evolved over time. … More
In the past several months, we have highlighted some fascinating Medicaid litigation against CMS in several US District Courts across the country. This litigation deals with the Medicaid disproportionate share hospital (DSH) requirements of section 1923 of the Social Security Act. But what we haven’t focused on – until now – is how the DSH program fits into the overall Medicaid financing system. It’s a topic of enormous complexity with a rich 35-or more year history. … More
My colleague Tom Barker and (my former boss) Professor Sara Rosenbaum just finished a series of back-to-back sessions on enforcing the Medicaid entitlement – the sessions were entertaining and engaging for all involved. We have written about this topic previously – notably here and here. Tom and Sara’s excellent slide deck can be viewed here:
During the opening session of AHLA yesterday, we had the opportunity to hear remarks for Calder Lynch, current Counselor to CMS Administrator Seema Verma and potential replacement pick for outgoing CMCS Director. Lynch reiterated the three pronged approach the current administration is taking to Medicaid (as previously outlined by administrator Verma):
- Program Integrity
According to Lynch,… More
Good morning from snowy Baltimore! Myself, along with my colleagues Tom Barker, Sean Ahern, and Erik Schulwolf are excited to be here here at AHLA’s Institute on Medicare and Medicaid Payment Issuers. Over the next few days we plan on blogging about our insight, key sessions, and other fun tidbits and developments as we take in all of the great information at this annual gathering of the health bar.… More
We’re certain that no one has forgotten about the January CMS policy announced by the current administration that supports states seeking to adopt work and community engagement requirements as part of their Medicaid programs through section 1115 waivers. We certainly have not. We previously covered this topic in-depth following CMS’ policy announcement and the approval of Kentucky’s 1115 waiver containing a work requirement.… More
The past couple of weeks have involved a flurry of healthcare-related developments, including on the Medicaid drug pricing front. On February 9, 2018, President Trump signed into law the Bipartisan Budget Act of 2018, which revises the rebate formula for line extensions applicable to certain drugs in the Medicaid program. Then later that same day, the Council of Economic Advisors issued a report titled “Reforming Biopharmaceutical Pricing at Home and Abroad,” which among other things,… More
Since August, 2017, a new class of transformative therapies referred to as cell therapies or gene therapies have been approved by the US Food and Drug Administration (FDA). These new cell and gene therapies are typically administered once, as opposed to repeatedly over the course of the patient’s lifetime.
Payers, providers, and manufacturers have been considering how existing payment systems – particularly Medicare and Medicaid – can recognize the value of these new treatments. … More
On December 15, 2017, CMS Director Brian Neale informed State Medicaid Directors of CMS’ intent to phase out funding for Designated State Health Programs (DSHP) in Section 1115 waivers. CMS will no longer approve waiver requests under Section 1115 for DSHP funding, and will not renew portions of existing waivers that provide DSHP funding.
On November 17th, Arizona’s state Medicaid agency (the Arizona Health Care Cost Containment System, or AHCCCS) sent a letter to CMS proposing policies that it believes will build on past successes and “leverage conservative principles.”
In the letter, AHCCS seeks input from CMS on ideas to “modernize” the prescription drug benefits offered under the state’s Medicaid plan.
(Also, notably, though not the topic of this blog post,… More
The MassHealth program is embarking on a dramatic shift away from fee-for-service Medicaid to a reimbursement model that relies more on value and quality. The Baker Administration hopes to accomplish this through enrolling some MassHealth enrollees into accountable care organizations, or ACOs,… More
We have written in the past about enforcing the entitlement to Medicaid through the federal court system. In light of a recent opinion by the United States Court of Appeals for the 8th Circuit, it seems that this judicial saga continues.
The federal Medicaid statute imposes roughly 80 requirements on a state Medicaid plan. For example, a state Medicaid plan must make medical assistance available “with reasonable promptness.” Social Security Act § 1902(a)(8). … More
Back in July, my colleague Tom Barker told you about a CMS proposal to institute a fundamental reimbursement methodological change for 340B drugs used in the hospital outpatient setting. We have noted before the link between the Medicaid prescription drug rebate program and the 340B program. As a refresher, in order to have its outpatient drugs covered by Medicaid, the manufacturer must agree to three separate requirements. First,… More
On November 6, 2017 the Centers for Medicare & Medicaid Services (CMS) issued an information bulletin on changes and improvements to the existing Section 1115 waiver process. Under Section 1115(a) of the Social Security Act, the Secretary of Health and Human Services is permitted to waive compliance with any of the requirements of section 1902 of the Act (which generally sets forth the requirements for state Medicaid programs in order to receive Federal financial assistance) in order to pilot or test projects which,… More
On September 8, 2017, following the mandated 30-day public comment period, the Baker Administration concluded its review of the pending MassHealth Section 1115 Demonstration Amendment Request. The submitted waiver request can be viewed online here. Once received at CMS, the agency will have to time to review the proposal, and must also solicit additional public feedback, prior to finalizing any waiver.
An appeal recently filed in the United States Court of Appeals for the First Circuit could give further clarity regarding the CMS’s ability to discount Medicaid DSH payments for hospitals that received funds from Medicare and private insurers.
DSH Uncompensated Care Costs and the FAQ Policies
The Medicaid Act requires state Medicaid programs to increase payments to hospitals that treat a disproportionate share of Medicaid and uninsured patients. … More
CMS Proposes Fundamental Reimbursement Methodological Change for 340B Drugs Used in Hospital Outpatient Setting
We have noted before the link between the Medicaid prescription drug rebate program and the 340B program. As a refresher, in order to have its outpatient drugs covered by Medicaid, the manufacturer must agree to three separate requirements. First, the manufacturer must agree to provide a rebate to Medicaid equal to the greater of 23.1% of the average manufacturer price (AMP) of the drug, or AMP minus the best price of the drug. … More
Since the beginning of this year’s legislative session, Governor Baker has expressed concern over the growth in enrollment in MassHealth, the state’s Medicaid program. A look at the numbers explains why. Prior to the enactment of the Affordable Care Act’s Medicaid expansion in 2014, there were 1.3 million people enrolled in MassHealth. By April of this year, that number had increased by 28.4%, to nearly 1.7 million state residents.… More
Partner Tom Barker joined POLITICO’s Pro Health Care Briefing: Medicaid as a Driver of Care Innovation in the States on Tuesday to discuss how states are reshaping Medicaid to deliver more value to patients and taxpayers. Watch a video from the live event here:
Partner Tom Barker will speak at POLITICO’s Pro Health Care Briefing: Medicaid as a Driver of Care Innovation in the States on Tuesday, June 13, 2017. This event brings together experts and leading voices from around the country to discuss how states are reshaping Medicaid to deliver more value to patients and taxpayers, no matter the future of the Affordable Care Act.
Additional featured speakers include Trish Riley,… More
Another state is stepping up to bat following Secretary Price’s and CMS Administrator Verma’s letter to state governors promising enhanced flexibility for their Medicaid programs. Wisconsin has recently unveiled its plan to submit a new Section 1115 waiver application to CMS by May 26, 2017. In short, the Wisconsin waiver seeks to infuse the state’s Medicaid program with features from the commercial sector, and it does this by borrowing some elements from the Healthy Indiana Plan (HIP 2.0) and Kentucky waivers,… More
On March 22, 2017, the Massachusetts Secretary of the Executive Office of Health and Human Services (EOHHS) sent a letter to CMS Administrator Seema Verma taking her and HHS Secretary Tom Price up on their offer to grant states more flexibility under the Medicaid program. In her letter, Secretary Sudders pointed to four aspects of the Medicaid program from which Massachusetts would like “immediate relief” and greater flexibility:
- Flexibility in benefit design;…
Price and Verma to State Governors: Just Come and Ask Us for Flexibility – What Providers & Drug Manufacturers Could Expect
The last several weeks have been nothing short of enthralling, like an episode of House of Cards. After seven years of campaigning on the repeal of the Affordable Care Act (ACA), Republicans were ultimately unable to create consensus for their highly anticipated repeal-and-replace legislation known as the American Health Care Act (AHCA). But as the drama on the Hill comes to an end (at least until tax reform is picked up),… More
Recent reports say that Mayo Clinic will give preference to privately insured patients over Medicaid and other publicly-funded patients under a new policy, which the Minnesota Department of Human Services is currently investigating. MPR News spoke to partner Tom Barker about the implications of the new Mayo Clinic policy under federal law. Click here to read the full article. More
It’s official—the 115th Congress has set its sights on overhauling the Medicaid program. We predicted as much (here and here) shortly after the November 2016 presidential elections, but now we have some insight into exactly what those proposed changes to Medicaid will be.
There is little doubt now that Republicans have set their sights on Medicaid as part of their effort to repeal the Affordable Care Act (ACA). On February 24, 2017, a House Republican Discussion Draft Bill (Draft Bill) dated February 10, 2017, was leaked to the press. The Draft Bill repeals major provisions of the ACA and includes some replacement proposals as well. However, one of the Draft Bill’s prominent focus areas is Medicaid. … More
On January 30, 2017, President Trump signed an executive order (“EO”) that has generated considerable confusion in the administrative law space, and has produced at least one lawsuit thus far. The EO requires that for every new regulation issued by an executive agency, two regulations must be identified for elimination (“repeal”). This requirement is coupled with another provision that imposes an immediate cap on net costs imposed by new regulations (“offsets”). … More
One of the most pressing issues before the 115th Congress and newly inaugurated President Trump will be to determine how the Medicaid expansion population will fit into a broader reform package for the Medicaid program as a whole. Many state governors in expansion states have expressed concern that the long-standing Republican proposal of block-granting Medicaid will leave them exposed to unsustainable financial pressures.
President Trump’s nominee for HHS Secretary,… More
On January 20, 2017, President Donald Trump signed an Executive Order (EO) entitled “Minimizing the Economic Burden of the Patient Protection and Affordable Care Act Pending Repeal” to signal a clear message that “repeal and replace” of the Affordable Care Act (ACA) is a priority for the new administration. On the same day, the White House Chief of Staff, Reince Priebus, issued a memorandum to executive agencies ordering an immediate “regulatory freeze” and directing the Departments to send no regulation to the Federal Register “until a department or agency head appointed or designated by the President .… More
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. … More
Currently, nearly 10 million Americans are dually-eligible for both Medicare and Medicaid. These “dual eligibles” are low-income seniors and individuals with disabilities who are separately eligible for and receive coverage under both the Medicare and Medicaid programs. In general, Medicare acts as the primary payer for dual-eligibles, while Medicaid provides “wrap-around” coverage for these individuals, helping with some out-of-pocket costs (such as premiums, copayments and deductibles) and offering coverage for services not otherwise covered by Medicare (vision,… More
As we noted here last month, Medicaid is a 1960s-era health insurance plan operating in a 21st century world. As Medicare and commercial payers have started taking steps to move away from payment by volume to paying for value, it’s important to recognize that the same innovation needs to occur in Medicaid. In fact, one could argue that this innovation is even more critical in Medicaid.
Why? … More
The nomination of Seema Verma by President-Elect Trump for the position of CMS Administrator sends a clear signal that the Trump Administration considers Medicaid one of its top healthcare reform priorities. Seema Verma is the the “architect” of the Healthy Indiana Plan 2.0” waiver (HIP 2.0), a consumer-driven Medicaid expansion demonstration approved by the Obama Administration under a Section 1115 waiver. Most recently, Verma was also involved in designing Kentucky’s proposed “Kentucky HEALTH” (“HEALTH”) Section 1115 waiver,… More
As we continue our coverage of the potentially seismic changes to the Medicaid Program under a Trump Administration, we’d like to take a momentary detour into the weeds—it’s inevitable in Medicaid after all—and touch on a recent development that may be of interest to some of our readers.
Last week, we wrote about the importance of the Medicaid program, especially given its size as, by far, the largest health insurance plan in the United States. We noted that Medicaid covers 71 million people (this number increased dramatically after the Affordable Care Act was enacted in 2010). We said that “Medicaid is important for all of us” – whether you are a program beneficiary, a taxpayer who helps pay for it,… More
Dear readers: this post is going to be a bit different from our regular posts, in that we are going to try to refrain from getting too far in the weeds, and avoid too much legalese. Why? Because the results of the November election will likely have major implications not only for the Medicaid program itself, but for the millions of individuals it serves. We are fortunate to have a platform here and it is our hope that,… More
On November 4, 2016, the Centers for Medicare & Medicaid Services (“CMS”) sent word to the Massachusetts Executive Office of Health and Human Services (EOHHS, referred to here as “MassHealth”) that it approved a major amendment to Massachusetts’ section 1115 demonstration project through June 30, 2017. At the same time, CMS also approved an extension of this same demonstration through June 30, 2022. Approval of Massachusetts’ waiver amendment comes after nearly a year of negotiations and may ultimately result in the transition of the vast majority of MassHealth enrollees into newly-formed Accountable Care Organizations (“ACOs”) operating under one three models,… More
In light of the growing cost (and demand for) specialty pharmaceutical products, and the corresponding stress this growth has had on state Medicaid coffers, CMS is now actively encouraging states Medicaid programs to engage in value based purchasing (VBP) arrangements with manufacturers. On Thursday July 14, CMS released guidance documents to state Medicaid agencies and manufacturers regarding participation in these VBP arrangements.
As states consider creative ways to finance high cost drug spend,… More
Here is another video from my recent guest lecture at George Mason University. Discussing the evolution of U.S. healthcare delivery and financing was particularly challenging because of the many ongoing and approaching changes, such as the Medicare Part B Drug Payment Model, the implementation of MACRA, the launch of CMMI’s Oncology Care Model, and the steady expansion of value-based arrangements in the private market.
The Office of Inspector General (OIG) recently issued a report titled “State Efforts to Exclude 340B Drugs from Medicaid Managed Care Rebates.” In its report, OIG wanted to study the different methods that states were using to prevent illegal “duplicate discounts” that occur as a result of the interaction between the Medicaid drug rebate program and the 340B drug-discount program. OIG revealed that the systems a majority of states have for preventing duplicate discounts are actually quite vulnerable,… More
On January 21, 2016, the Centers for Medicare & Medicaid Services (CMS) published a long-awaited final rule entitled “Medicaid Program: Covered Outpatient Drugs.” CMS actually proposed this rule in February, 2012, so it’s taken almost four years for the agency to finalize the many policies on which they sought comment – almost all of which flow from the enactment of the federal health care reform law that was enacted in 2010,… More
As states and the federal government alike grapple with Medicaid in the 21st century, we at www.medicaidandthelaw.com believe it is helpful to take a step back and view the program in a historical perspective. This slide deck was created by Tom as part of a presentation to key government officials considering various Medicaid reforms. More
On July 30, the country marks the 50th anniversary of the enactment of the Medicare and Medicaid programs. Fifty years ago, President Lyndon Johnson signed the two programs into law.
I am very proud to say that I have been involved in health care law and policy for more than one-half of the lifetime of these important social programs. My first job out of college – right after the 15th anniversary of Medicare and Medicaid –… More
On May 26, 2015 the Centers for Medicare & Medicaid Services (CMS) released its long-awaited proposed rule designed to modernize the Medicaid managed care regulations (last updated in 2002) to reflect changes in the use and growth of the managed care program and to align the program more closely with other existing healthcare programs, including Medicare/Medicare Advantage and qualified health plans offered by Exchanges.
As of FY 2011,… More
If the Office of Management and Budget’s website is to be believed, CMS will release the long-awaited Medicaid managed care rule in the coming weeks (our conversations with senior CMS officials indicated a similar timeline.) The federal regulations governing Medicaid managed care have not been updated since 2002 and much has changed in the program since then, most notably managed care enrollment numbers: between 2002 and 2015 the percentage of managed care enrollees has grown from roughly 50% to nearly 80%. … More
On March 31, the United States Supreme Court concluded, in a long-awaited decision, that the alleged failure of a state Medicaid plan to comply with the provisions of the federal Medicaid Act is not enforceable in the federal courts by alleging that the state plan has been adopted in violation of the Constitution’s Supremacy Clause. Armstrong v. Exceptional Child Center. The decision, while relatively narrow, (more on that in a bit) does seem to largely foreclose federal judicial enforcement of the requirements of the Medicaid statute against the states.… More
On March 9, 2015 the Office of Inspector General (OIG) for the Department of Health and Human Services announced the publication of a new report documenting the OIG’s audit of “personal care services” provided in New York State between 2007 and 2011 (this Report followed on the heels of a 2009 Report focused on personal care services in New York City which resulted in a $70 million dollar settlement with the Federal government in 2011). … More
Could the same “state’s rights” argument that struck down the Medicaid expansion, save the subsidies?
To completely ignore the Supreme Court’s oral arguments last week in King v. Burwell would be a disservice to you, our readers. Even though this is a Medicaid blog, in a post-ACA world is it increasingly difficult to separate out the individual pieces of our insurance system. The ACA (at least in how it was designed) was intended to create a continuum of coverage: Medicaid for the lowest income Americans,… More
The big news out of Ohio today is the announcement by the State Medicaid Director John McCarthy that, at the end of week, 61,000 Ohioans are set to lose their Medicaid coverage for failure to verify household income. According to McCarthy, the federal government requires states to verify income each year to ensure that Medicaid recipients still qualify for coverage.
So what do the Federal rules and regulations say about Medicaid income verification?… More
We frequently read about state Medicaid programs receiving or being granted “waivers” by CMS, but what does that mean exactly? What is a “waiver”? What is the history of Medicaid waivers? How does the process work? We hope to answer these questions in this blog post.
The Legal Standard
A “waiver” refers to authority that the Secretary of Health and Human Services possesses under section 1115 of the Social Security Act:
“(a) In the case of any experimental,… More
Yesterday I had the opportunity to speak at the Pharmaceutical Strategic Patient Access and Support Conference in Charlotte about how access and patient support executives should position their programs for individuals otherwise Medicaid-eligible living in non-expansion states. Here is the presentation, for your enjoyment.
Note: for a fairly up-to-date analysis of where states stand on the Medicaid expansion, check out this nice break down by the Advisory Board.
As we previously discussed, the agreement between Indiana and CMS last week to expand Medicaid in that state has big implications for the Medicaid program. First, Indiana’s agreement with CMS has seemed to trigger a handful of other Red States that now appear ready to rethink agreements with CMS. … More
As if eligibility for public health insurance programs in the United States weren’t confusing enough, the issues become even more complicated when the applicant isn’t a U.S. citizen. This presentation (created by Editor Tom for a class he teaches at George Washington University), with a few case studies, walks through some of the pathways to coverage and even points out a few surprising results!
[Updated at 1:12 p.m.]
Hello dear readers. For those of you just joining us, this is a very new blog and we are still exploring different content options. Today we are going to try out a new feature, “What’s New in Medicaid Today.” We can’t promise yet that you will see this daily, but if you do find it helpful, comment, and you may just convince us to make this a regular routine.… More
The Supreme Court of the United States heard oral arguments this morning in Armstrong v. Exceptional Child Center, Inc., an appeal from a decision from the United States Court of Appeals for the Ninth Circuit that tees up a major question of federalism in the Medicaid program: can a Medicaid provider (or beneficiary) use the Supremacy Clause of the U.S. Constitution to enforce a provision of the Medicaid statute against a state where the Congress chose not to create enforceable rights under that statute.… More
The Affordable Care Act extends and simplifies Medicaid eligibility beginning January 1, 2014, by replacing Medicaid’s previous multiple categorical groupings and limitations with one simplified overarching rule: all individuals aged <65 years with incomes less than 138 percent of the federal poverty level ($15,415 for an individual or $26,344 for a family of 3 in 2012) who meet citizenship/lawful US status and state residency requirements are entitled to Medicaid benefits.… More
Enforcing Medicaid’s Entitlement Still Uncertain in the Wake of the Supreme Court’s Douglas Decision
The Medicaid statute begins with seven words: “A state plan for medical assistance must,” and the statute then proceeds to list 83 requirements that a state Medicaid plan is required to meet.1 Absent from the statute, however, is any remedy for Medicaid beneficiaries or providers who are harmed by a state’s failure to satisfy any one of those requirements. An aggrieved party can always petition the Centers for Medicare &… More