Check out our newest Staff Spotlight Q&A with Senior Vice President Gary Jessee. Since 2017, Gary leverages his extensive experience with Medicaid managed care, long-term services and supports, Medicaid market advisory and research, and health care policy to design and implement creative solutions for clients such as state aging and Medicaid agencies, managed care organizations, private equity firms, and solutions partners. Click here to learn more about Gary and the invaluable work he does to help clients reach their goals in Medicaid.
The Department of Health and Human Services (HHS) will award 15 states $1 million grants to combat the national mental health and opioid crises. Certified Community Behavioral Health Clinics will receive enhanced Medicaid reimbursement for certain behavioral health services, including outpatient mental health and substance use counseling and medication-assisted treatment for substance use disorder (Politico, October 18).
On October 27, HHS and the Centers for Medicare and Medicaid Services (CMS) announced that more than half of all states have expanded access to 12 months of Medicaid and CHIP postpartum coverage. This announcement marks essential progress in the Biden administration’s Maternal Health Blueprint implementation, a strategy aimed at improving maternal health, specifically in underserved communities (CMS, October 27).
On October 20, Kentucky Governor Andy Beshear expanded coverage for dental, vision, and hearing care to more than 900,000 adults enrolled in the state’s Medicaid program. Beneficiaries will be eligible for these benefits starting January 1, 2023 (Associated Press, October 20).
California will end its COVID-19 public health state of emergency on February 28, 2023. The four-month lead time allows the state to focus on unwinding the remaining pandemic provisions (Politico, October 17).
From October 19 to October 26, CMS approved one appendix K waiver and 12 SPAs, two of which are COVID-19 disaster relief SPAs.
HHS Gives States $1M to Address Mental Health and Opioid Crises
- HHS announced it will provide 15 states $1 million grants to develop a plan for Certified Community Behavioral Health Clinics to combat the national mental health and opioid crises. These clinics will receive enhanced Medicaid reimbursement for the following behavioral health services: 24/7 mobile crisis support; outpatient mental health and substance use counseling; primary care screening; mental health care tailored for veterans; and medication-assisted treatment for substance use disorder. Grant funding comes from the Bipartisan Safer Communities Act, which passed in June 2022 (Politico, October 18).
Majority of States Expanded Medicaid Postpartum Coverage
- On October 27, HHS and CMS announced that more than half of all states have expanded access to 12 months of Medicaid and CHIP postpartum coverage, made possible by provisions in the American Rescue Plan. Georgia and Pennsylvania are the 25th and 26th states respectively to be approved for extended coverage, making approximately 418,000 total Americans eligible for care annually. If all states adopted this option, an estimated 720,000 individuals across the country would be guaranteed coverage for 12 months after pregnancy. This announcement marks essential progress in the Biden administration’s Maternal Health Blueprint implementation, a strategy aimed at improving maternal health, specifically in underserved communities (CMS, October 27).
- CMS is revising the Special Focus Facility program to implement stricter standards to make it more difficult for poor-performing facilities to meet requirements. The poor-performing nursing homes will have the opportunity to improve by demonstrating systemic quality improvements and meeting standards but if they are unable to do so, the facilities may be excluded from Medicare and Medicaid participation. The program revisions are part of the Biden administration’s commitment to boost nursing home safety and quality for both residents and employees. Currently, there are 88 nursing homes identified as “poor-performing” with consistent records of noncompliance (Modern Healthcare, October 21).
- On October 20, Health Affairs released a brief reviewing how dual-eligible participation affects total Medicare payments for dual-eligible beneficiaries, including Medicaid’s responsibility for Medicare cost sharing. Dual-eligible beneficiaries have higher Medicare spending levels than Medicare-only beneficiaries due to many factors, including higher rates of health conditions and exposure to social risk factors. The current fractured alignment between the Medicare and Medicaid programs contributes to higher spending levels and worse outcomes, which motivates efforts to integrate the Medicare and Medicaid benefits. The brief discusses potential strategies for approaching payments for dual-eligible beneficiaries (Health Affairs, October 20).
- According to a Centers for Disease and Control Prevention (CDC) report released on October 18, people of color are more likely to be hospitalized with the flu and are less likely to be vaccinated against the flu than their white counterparts. CDC officials attribute the disparities in hospitalizations and vaccination uptake to lack of access to health care and insurance, misinformation, distrust of the health care system, and missed opportunities to vaccinate patients on behalf of providers. The CDC recommends that national, state, and community-based health organizations take coordinated action to increase vaccine access and uptake among people of color (Becker’s Hospital Review, October 19).
- Once the U.S. government stops purchasing COVID-19 vaccines, Pfizer plans to charge $110 to $130 per dose in the commercial market for adult doses. However, the manufacturer expects that many individuals, like those with private health insurance or coverage through Medicare and Medicaid, will continue receiving the vaccines for free. The company also operates an income-based assistance program that provides eligible individuals without insurance free vaccines (Modern Healthcare, October 21).
Kentucky Expands Medicaid Coverage
- On October 20, Kentucky Governor Andy Beshear (D) expanded coverage for dental, vision, and hearing care to more than 900,000 adults enrolled in the state’s Medicaid program saying, “the sweeping initiative will remove some of the health-related obstacles keeping people from getting jobs.” Beneficiaries will be eligible for these benefits starting January 1, 2023, with no special enrollment period required. The extended benefits will have no effect on Kentucky’s budget during the upcoming legislative session. Federal funds will cover 90% of the initiative’s $36 million in annual costs, with the remaining 10% being covered by the Kentucky Department of Medicaid Services (Associated Press, October 20).
California to End State of Emergency
- California Governor Gavin Newsom (D) announced the state will end its COVID-19 public health state of emergency on February 28, 2023. The four-month lead time allows the state to focus on unwinding the remaining pandemic provisions. Less than five percent (27 of the 596) of the original executive orders declared with the state of emergency in 2020 remain. Administrative officials will work with the legislature on statutory fixes for two provisions as follows: allow nurses to order and dispense COVID-19 medications and ensure the ability of lab workers to process COVID-19 tests (Politico, October 17).
- Section 1115
- On October 7, Nevada submitted a request for a new five-year section 1115 demonstration titled, “Whole Mouth Whole Body Connection for Adults with Diabetes.” The demonstration seeks to pilot the expansion of dental benefits for diabetic adults (21 through 64 years of age), which has been mandated by state law to address a gap in coverage. The proposed demonstration would expand statewide access to oral health services for Medicaid-enrolled Nevadans over the age of 21 through the diabetes treatment and management programs of federally qualified health centers. CMS will accept public comments through November 23.
- Section 1915(c) Appendix K
- New York
- Provides a one percent rate increase for select Nursing Home Transition and Diversion and Traumatic Brain Injury waiver services and limits retainer payments to up to three 30-day episodes not to exceed a total of 90 days.
- New York
- Administrative SPAs
- Vermont (VT-22-0015, effective July 1, 2022): Updates the recovery audit contractor (RAC) program exemption date to June 30, 2024.
- COVID-19 SPAs
- Michigan (MI-22-0010, effective May 1, 2022): Temporarily adjusts incontinence supply competitive bid rates. This time-limited COVID-19 SPA terminates at the end of the public health emergency (PHE).
- Nevada (NV-22-0013, effective June 1, 2022): Rescinds the establishment of the COVID-19 laboratory testing reimbursement at 100% of the Medicare rate that was approved on June 18, 2020 under NV-20-0009.
- Eligibility SPAs
- Washington (WA-22-0020, effective July 1, 2022): Increases the Personal Needs Allowance for all Medicaid in-home clients, including PACE enrollees, from 100% of the Federal Poverty Level to 300% of the Federal Benefit Rate.
- Payment SPAs
- District of Columbia (DC-22-0008, effective September 1, 2022): Allows pharmacies to receive reimbursement for the administration fee associated with providing Vaccines for Children program vaccine and immunizations.
- Maryland (MD-22-0015, effective July 1, 2022): Implements an eight percent rate increase for the Developmental Disabilities Administration Targeted Case Management (DDA TCM) program. In addition, implements a temporary 10% rate increase for DDA TCM services using 100% of 9817 funds for dates of service October 1, 2022, through December 31, 2022.
- South Carolina (SC-22-0009, effective July 1, 2022): Implements a rate increase for Children’s Personal Care, Enhanced Nursing, Registered Nurse, and Licensed Practical Nurse services.
- Service SPAs
- Illinois (IL-22-0020, effective July 1, 2022): Provides for 12 months of extended postpartum coverage to individuals who were eligible and enrolled under the Medicaid state plan during their pregnancies (including during a period of retroactive eligibility).
- Maryland (MD-22-0009, effective April 1, 2022): Provides assurances that Maryland’s coverage and reimbursement for COVID-19 vaccines, testing, and treatment during the mandatory American Rescue Plan period aligns with section 1905(a)(4)(F) of the Social Security Act.
- North Carolina (NC-22-0019, effective July 1, 2022): Updates the state plan to align with the Mental Health Parity and Addiction Equity Act of 2008 to include mobile crisis management services.
- Oregon (OR-22-0018, effective July 1, 2022): Adds two provider types, Licensed Dietician, and Licensed Genetic Counselor, to the Other Licensed Practitioner section of the state plan.
- Vermont (VT-22-0003, effective January 1, 2022): Adds mandatory coverage of routine patient costs in qualifying clinical trials per the Consolidated Appropriations Act of 2021 to the state’s alternative benefit plan.
- Since the federal COVID-19 PHE was declared in March 2020, it has had a significant economic impact on both Medicaid spending and enrollment. The most recent Kaiser Family Foundation (KFF) brief analyzes Medicaid enrollment and spending trends for FY2022 and FY2023. State Medicaid directors assisted in providing the data, with 49 states responding to KFF’s survey. Key findings include the following:
- After a sharp increase in FY2021, Medicaid enrollment slowed to an 8.4% increase in FY2022 and is expected to decline by approximately 0.4% in FY2023 due to the assumption that the PHE and maintenance of eligibility requirements will end.
- State Medicaid agencies expect total Medicaid spending to reach a peak rate of 12.5% in FY2022 (federal and state funding) and slow to 4.2% in FY2023. This is based on the belief that fiscal relief would expire mid-2023.
- State economic conditions worsened with the onset of the COVID-19 pandemic but recovered quickly when compared to previous recession periods because of improved state economic conditions and federal fiscal relief.
- State revenue growth is expected to slow in FY 2023 and states’ longer-term fiscal outlooks remain uncertain (KFF, October 25).
- A group of 35 state attorneys general filed an amicus brief in the U.S. Court of Appeals for the 10th Circuit supporting Oklahoma’s authority to regulate its pharmacy benefit managers (PBMs). Under the laws being challenged, Oklahoma requires PBM pharmacy networks to have sufficient geographic coverage; allows in-network pharmacies to have preferred-participation status provided certain criteria are met; and prohibits PBMs from providing incentives to use particular PBM-affiliated pharmacies. These PBM regulations are facing legal challenges from the Pharmaceutical Care Management Association (PCMA), a PBM lobbying association, on the grounds that federal Medicare Part D and Employee Retirement Income Security Act laws pre-empt Oklahoma’s laws. A district court ruled against the PCMA, and the matter is currently on appeal to the U.S. Court of Appeals for the 10th Circuit (Health Payer Specialist, October 21).
- On October 18, the D.C. Council voted to spend approximately $8.83 billion over a five-year period to provide health care coverage for more than a third of D.C. residents. Three payers, AmeriHealth, MedStar Health, and Amerigroup, were awarded contracts to manage the city’s Medicaid contract after a long, contentious procurement process. Additionally, the council voted to impose new regulations on the D.C. Housing Authority after a September 30 S. Department of Housing and Urban Development report highlighted the agency’s deficiencies in several areas, including federal violations, mismanagement of funds, and resident safety (MSN, October 18; The Washington Post, October 7; Health Payer Specialist, October 19).
- In Florida, the Agency for Health Care Administration (AHCA), issued final actions against Medicaid managed care plans for breaching and/or violating the terms of their contract with the state. The final actions mount to more than $23.1 million in liquidated damages and/or levied sanctions against the plans. AHCA issued these final actions against Sunshine Health Plan and Staywell Health Plan, both owned by Centene, as well as Humana Medical Plan. The final actions are assigned across nine broad categories: administration and management; coverage and authorization of services; enrolled services; financial requirements; grievance and appeal system; marketing; provider services; quality of care; and reporting (Florida Politics, October 14).
Private Sector Updates
- On October 24, the American Hospital Association (AHA) wrote a letter to U.S. Congressional leaders Schumer, McConnell, Pelosi, and McCarthy asking them to consider some of the challenges hospitals and health systems are facing across the country and requesting Congress to prioritize certain issues. The letter details the following issues and considerations:
- Workforce Shortages: address patient discharge backlog, make certain waivers permanent, increase GME slots.
- Targeted Relief to Hospitals: extend or make permanent various rural hospital programs, pass the Improving Seniors Timely Access to Care Act, create a metropolitan anchor hospital (MAH) designation, stop damaging cuts (AHA, October 24).
- Researchers at the University of Pittsburgh have implemented real-time whole-genome sequencing (WGS) to monitor and reduce health care-associated infections at one of the university hospitals. Infectious disease professor Alexander Sundermann and his team of researchers were able to demonstrate through preliminary data the feasibility of WGS-surveillance in real-time and its utility in controlling hospital infection outbreaks. Researchers ran a pilot program using technology, Enhanced Detection System for Healthcare-Associated Transmissions (EDS-HAT), and found out of 2,750 unique patients, 297 samples were associated with approximately 100 clusters, while traditional prevention approaches only identified 15 outbreaks in 130 patients, demonstrating these prevention techniques missed and misidentified transmissions (Modern Healthcare, October 20).
- The March of Dimes officially released its 2022 report on “maternity care deserts” (defined as any county without a hospital or birth center offering obstetric services or no obstetric providers) detailing the U.S. maternal care crisis. Currently, 36% of counties across the country are maternity care deserts. The report also offers several policy solutions for Congress and state governments to consider including passing Medicaid postpartum extension to 12 months, expanding telehealth services, accounting for areas of chronic disease as main contributors, and strengthening network adequacy requirements for health plans (Stat, October 11; March of Dimes, October).
Insurers and Vendors
- On October 25, Centene awarded a pharmacy benefits contract to Cigna’s Express Scripts. The contract is valued at $40 billion and comes on the heels of Centene recently having settled multimillion dollar claims with many states regarding its PBM practices (Health Payer Specialist, October 25).
- Elevance’s Anthem Blue Cross Blue Shield was excluded from the list of Kentucky’s managed Medicaid contract awards in 2019. Anthem has repeatedly protested the awards, citing procedural violations in bid evaluations and a possible conflict of interest involving one state official who had a role in reviewing bidders’ proposals. The state’s selections were upheld by an appeals court in September 2022, but Elevance has asked for a rehearing of that decision. Kentucky’s Cabinet for Health and Family Services has filed a response to the request for a rehearing, asserting the appeals court decision as “thorough and well-reasoned” (Health Payer Specialist, October 24).
- The Department of Justice (DOJ) is requesting more information from CVS Health on its $8 billion acquisition of Signify Health before allowing the acquisition to proceed. Signify Health is the country’s largest provider of home health risk assessment and its purchase by CVS Health will allow the company to have prime access into the lucrative home health market. DOJ’s request extends CVS Health’s procurement deal by 30 days; however, the company still expects to close the deal in the first half of next year. The federal government is also looking at other health care mergers including UnitedHealth Group’s $5.4 billion merger of home health provider LHC and Amazon’s $3.9 billion acquisition of primary care provider One Medical (Modern Healthcare, October 20).
Sellers Dorsey Updates
- Check out our newest Staff Spotlight Q&A with Senior Vice President Gary Jessee. Leveraging his experience as the former Medicaid director of Texas, Gary has been instrumental in leading the firm’s growth since 2017. Click here to learn more about Gary and the invaluable work he does.