Medicaid

Ohio releases next generation MyCare Ohio program RFA

This week’s In Focus section delves into the Next Generation MyCare Ohio managed care program, spotlighting the request for applications (RFA) that the Ohio Department of Medicaid (ODM) released on May 31, 2024. The MyCare Ohio Program, which serves people who are dually eligible for both Medicaid and Medicare, is undergoing a substantial transformation. Transitioning from the financial alignment initiative (FAI) demonstration model used in 29 counties, it is evolving into a statewide, fully integrated dual eligible special needs plan (FIDE-SNP) model. This shift is more than procedural; it signifies a pivotal moment of transition to new federal D-SNP requirements.  

Background 

The MyCare Ohio Program launched in May 2014 as a Centers for Medicare & Medicaid Services (CMS) FAI demonstration. MyCare Ohio integrates Medicare and Medicaid benefits for dually eligible members enrolled in competitively selected MyCare Ohio managed care plans, providing one care coordinator and streamlined communication and services. It serves 150,000 individuals in 29 counties.  

CMS is sunsetting all FAI demonstration programs on December 31, 2025, prompting ODM to convert to the FIDE-SNP model.  

Next Generation RFA 

The MyCare Ohio Program will convert to the Next Generation MyCare Ohio Program in January 2026. ODM is modeling portions of the program after the state’s Next Generation Medicaid managed care program. The Next Generation MyCare Ohio Program initially will be implemented in the 29 currently participating counties and then expand statewide, covering a total of 250,000 eligible individuals. Medicaid managed care organizations (MCOs) that serve the program will need to become CMS-approved FIDE-SNPs. MCOs awarded a Next Generation MyCare Ohio contract will need to notify CMS of their intent to establish a statewide FIDE-SNP in Ohio by fall 2024 to begin operations in January 2026. 

ODM anticipates selecting up to four Next Generation MyCare Ohio MCOs to serve enrollees statewide, though a decision on the number of plans will be finalized as awards are made and based on what is most advantageous to the state.   

MCOs will need to develop a member-focused strategy with care coordination as a priority. MCOs will also increase focus on behavioral health coordination. According to ODM, goals for the Next Generation program include: 

  • Focusing on the individual 
  • Improving individual and population wellness and health outcomes 
  • Creating a personalized care experience 
  • Supporting providers in continuously improving care 
  • Improving care for people with complex needs to promote independence in the community 
  • Increasing program transparency and accountability 

Next Generation MyCare will advance these goals through a population health approach, designed to address inequities and disparities in care.  

The program will enroll dually eligible individuals ages 21 and older. This is a change from the current program, which enrolls dual eligibles who are 18 years old and older. The eligible age increase is being made to align with the Medicaid early and periodic screening, diagnostic, and treatment (EPSDT) benefit.  

The new program also will continue to offer all the same services available through Ohio’s home care, PASSPORT (long-term services and supports), and assisted living waivers. 

Evaluation 

Applications initially will be reviewed to confirm the applicant meets the mandatory requirements. Applicants who meet the mandatory requirements will proceed to review and evaluation of responses to application questions that fall into seven topic areas, with a total of 1,000 available points (see Table 1).  Of note, if an applicant is not currently serving as either a Next Generation MCO or a MyCare Ohio MCO, the applicant will receive zero points for qualifications and experience. Organizations that have yet to participate in at least one of these programs should consider the effect on their total score.  

Table 1 

Current Market 

Five MCOs—CVS/Aetna, CareSource, Centene/Buckeye, Molina, and United—participate in the current MCOP, with two or three of them participating in each of the seven regions. 

Timeline 

MCOs should submit a notice of intent to apply by June 21. Proposals are due August 2, and awards will be issued October 8. Implementation is scheduled for January 1, 2026.  

Link to RFP 

Connect With Us  

Ohio is one of several states transitioning from a FAI demonstration at the end of December 2025. Additionally, the 2025 Medicare Advantage Final Rule includes new policies affecting D-SNPs that could reshape the integrated care plan landscape in many states.  

Health Management Associates (HMA) will host a webinar June 20, 2024, to review the current landscape and federal changes that will affect D-SNPs in 2025 and beyond. The session will feature an analysis of the new regulations and a discussion of the critical strategic and product impacts on Medicare organizations that offer D-SNPs or are considering offering D-SNPs. Attendees also will have the opportunity to engage with the panelists during a Q&A session.  

More information on the webinar is available here. Contact HMA expert Sukey Barnum to learn more about the Ohio RFA and Holly Michaels Fischer, Greg Gierer, Dara Smith, and Tim Murray for details about the nationwide D-SNP rules and landscape.  

Federal healthcare quality initiatives: recent developments reshaping the landscape

This week, our In Focus section considers the increasing emphasis on quality at all levels of our healthcare system, especially for work that affects federally funded health insurance programs.  

The Universal Foundation Measure Set  

The 2024 Centers for Medicare & Medicaid Services (CMS) Quality Conference, April 8−10, in Baltimore, MD, continued to highlight the harmonizing of quality measures across CMS programs and promotion of CMS’s universal foundation measures. These metrics capture quality across six domains for adults and four domains for children. By promoting and integrating these well-established measures across all CMS programs, end users can align priorities across programs and help to reduce burden on providers and health plans being assessed.   

Medicaid has long been a leader in incorporating the universal foundation measures, having used many of them in managed care contracts, health homes, and other arrangements that include a quality assessment component for the past 20 years. Earlier this year, many universal foundation measures, including those pertaining to behavioral health, became part of the mandatory core measure set that all states must report to CMS as required in the SUPPORT for Patients and Communities Act—comprehensive federal legislation that addresses the opioid epidemic. Mandatory reporting will allow Congress, the Medicaid and CHIP Payment and Access Commission (MACPAC), and other stakeholders to better understand the impact of federal investments on quality of care for Medicaid and CHIP enrollees. 

New Developments in Medicaid’s Approach to Quality  

Forward momentum is evident in other areas of healthcare quality as well. A significant federal milestone in quality of care was included in the Medicaid Managed Care Rule released in April 2024, which required states to design a quality rating system (QRS) and submit their methodology to CMS for approval. The QRS is intended to be user-friendly and help Medicaid members to pick a plan and monitor its quality performance. States will be able to use the QRS as a monitoring and oversight tool to compare plan performance. Not only will a QRS help improve Medicaid’s accountability to states, enrollees, and policymakers, but it also promotes transparency for all end users and the public. At present, Medicaid quality measures are reported by state rather than by plan. Plan performance in Medicaid is typically captured in a state’s external quality review organization (EQRO) annual report, which may impede the ability of most users to extract, compare, and digest information.   

Another federal initiative is the Medicaid Access Rule, also released in April 2024, to help state Medicaid programs move toward public reporting of quality and compliance measures in home and community-based services (HCBS). In 2022, CMS released more than 90 measures that could be used to assess quality of care in Medicaid HCBS waiver populations. Under the rule, CMS will identify a subset of HCBS quality measures in 2026 and the technical specifications for these measures will be made available publicly and updated as needed. Similar to the CMS Child and Adult Core Sets, states will have an opportunity to implement these measures and CMS can use those outcomes to create HCBS scorecards by state. 

Medicare Advantage Star Ratings Program 

Finally, CMS is incorporating the health equity index (HEI) into the Medicare Advantage Star Rating system. The HEI contributes to a plan’s potential bonus and helps level the playing field for plans that enroll and provide services to underrepresented or at-risk populations. The HEI will account for enrollees who are dually eligible for Medicare and Medicaid, individuals with disabilities, or members with a low-income subsidy (LIS). The HEI also assesses plan-level performance for these specialized populations. Allowing plans to earn a better bonus for delivering high-quality services to these populations helps to mitigate adverse selection and reward plans for care that may be resource intensive. 

What’s Next 

Accountability for quality is beginning to emerge in the form of value-based contracting, incentive payments, and other forms of reimbursement focused on reducing disparities and improving outcomes. Health plans, providers, state agencies, vendors and other interested stakeholders need to have a strategy for quality improvement that reflects evolving federal and state quality priorities, reporting systems, and improvement processes.  

HMA’s quality and accreditation team includes experts in the quality space from a variety of backgrounds, including National Committee for Quality Assurance (NCQA) surveyors, former HEDIS auditors, health plan and provider senior quality staff (vice presidents and chief quality officers), and former Medicare/Medicaid leaders. To learn more about implementing quality programs or to explore options for leveraging quality measures to maximize your organization’s value-based contracts, win requests for proposals, increase membership, and optimize member experience, contact Caprice Knapp, PhD, Managing Director, Quality Accreditation.  

Election-driven shifts in healthcare innovation 

Innovation is the source of progress, driving advancements across industries and shaping the way we live, work, and interact. However, the landscape of innovation is not static—it ebbs and flows, influenced by various factors including political leadership. This year’s presidential election may bring forth significant shifts in priorities, policies, and funding that directly impact innovation efforts like Center for Medicare & Medicaid Innovation (CMMI), state waivers and the Advanced Research Projects Agency for Health (ARPA-H). 

CMMI serves as a catalyst for testing innovative payment and service delivery models within Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP). With a new administration comes the potential for shifts in CMMI’s focus and funding priorities. For instance, a president (or his/her appointees) can direct CMMI to design payment models, reimbursement structures that can lead to higher quality outcomes and more cost-effective healthcare delivery. The policy priorities and values that undergird a president’s healthcare agenda can shape the kinds of innovation that CMMI drives. Current CMMI initiatives have prioritized value-based care approaches linking payment to outcomes, improving equity of care across race, gender, and geography, and patient-centered care models designed to support particularly high cost, complex conditions; the priorities of the previous administration included focus on substance abuse disorders, kidney disease, and diabetes.  

CMS also grants waivers to states, such as Section 1115 waivers for Medicaid or 1332 waivers for insurance marketplaces, that offer flexibility to experiment with innovative healthcare solutions. The values and policy approaches of a new president will influence the degree of regulatory flexibility and the types of experimentation that will be approved. For example, several states have recently received approval on Medicaid waivers that encourage community-based approaches to whole person care, wrapping together healthcare coverage, benefits, delivery, with new support services that address upstream barriers to health. 

ARPA-H, a new unit within the National Institutes of Health focuses on investments in “break-through technologies and broadly applicable platforms, capabilities, resources, and solutions that have the potential to transform important areas of medicine and health for the benefit of all patients,” holds immense potential for driving breakthroughs in healthcare by funding innovation that “cannot readily be accomplished through traditional research or commercial activity.” The types of projects funded by ARPA-H could be directly impacted by the policy and budget priorities of whomever is president in 2025 and their interest in promoting collaboration between government, academia, and industry to address complex health challenges. A prime example of a potentially impacted area is the emphasis on cancer research by the Biden Administration. This focus may shift drastically with a change in leadership.  

For healthcare innovators looking to stay informed and adaptable amidst these potential policy changes, HMA has two opportunities of interest: The HMA Fall conference, and a DC Direct subscription.  On October 7-9, healthcare leaders and HMA experts will gather for the 2024 Fall Conference: Unlocking Solutions in Medicaid, Medicare and Marketplace, focused on innovation in public programs. Our keynote speaker Darshak Sanghavi, MD is, a foundational leader at ARPA-H tasked with developing health programs that challenge how we think about healthcare innovation inside and outside government. Conference registration is open and can be found here

Leavitt Partners (LP), an HMA Company, guides clients who need to more closely track federal policy and regulatory activity and know when and how to influence the process. DC Direct, an exclusive offering from LP, provides timely information and insights to elevate your knowledge from simply scratching the surface of understanding to becoming part of the fabric of change. 

Texas releases STAR Kids RFP

This week’s second In Focus reviews the Texas STAR Kids request for proposals (RFP), which the Texas Health and Human Services Commission released on May 10, 2024. The STAR Kids Medicaid managed care program provides coverage to children and youth ages 20 and younger with disabilities. Nine plans currently participate in the program, with contracts worth approximately $4 billion annually.  

STAR Kids Overview  

The STAR Kids program operates under the Texas Healthcare Transformation and Quality Improvement Program 1115 demonstration project. To be eligible, individuals must receive Supplemental Security Income (SSI) and SSI-related Medicaid, participate in the Medically Dependent Children Program (MDCP) Section 1915(c) waiver, live in a community-based intermediate care facility, or participate in an intellectual or developmental disability (I/DD) waiver program.  

Medicaid managed care organizations (MCOs) provide acute, behavioral, and long-term services and supports (LTSS) to children in the MDCP program and acute services only to children covered under the other home and community-based services/IDD waivers. 

RFP 

Texas plans to award contracts to at least two MCOs for each of the 13 service areas (SAs). Each MCO can be awarded up to six SAs.  

MCOs will need to describe reimbursement strategies that incentivize high-quality and cost-effective healthcare while controlling spending and reducing ineffective service utilization in their proposals.  

MCOs must demonstrate progress toward advancing alternative payment model (APM) initiatives within an APM performance framework. MCOs will need to provide a proposed APM and a means of tracking its effectiveness, including implementation of processes that support and incentivize providers to apply value-based care models and reward high performers. 

Evaluation 

Technical questions in the proposals are divided into five broad categories, representing a total of 1,800 points. Plans can score up to 2,000 points, including oral presentations (see table below).  

Timeline 

Proposals are due July 11, with awards expected to be made between December 2025 and February 2026. The contract start date is anticipated to begin between December 2026 and February 2027. Contracts will run for six years with three two-year renewal options. 

Current Market

Incumbents CVS/Aetna, Elevance/WellPoint, Blue Cross Blue Shield of Texas, Centene/Superior Health Plan, Community First Health Plan, Cook Children’s Health Plan, Driscoll Children’s Health Plan, Texas Children’s Health Plan, and UnitedHealthcare served 150,000 beneficiaries as of November 2023.

Connect With Us  

Texas has an active Medicaid procurement schedule, with key deadlines and additional developments expected in the coming months. HMA experts in Texas are monitoring these activities as the state works to reprocure all its Medicaid managed care contracts. These programs include the State of Texas Access Reform (STAR) and CHIP for traditional Medicaid members, STAR+PLUS for members who are aged and disabled, and STAR Kids for individuals younger than 20 years old with disabilities. 

Through HMA’s Information Services, subscribers gain access to detailed information about the Texas and other state RFP landscapes and procurement documents, as well as historical data about plan contracts, enrollment, and financials.  

For more information about HMA’s work in Texas and our HMAIS resources contact Stephen Palmer, Alona Nenko, and Andrea Maresca. 

Takeaways from the ensuring access to Medicaid services final rule

This week’s second In Focus section delves into the Ensuring Access to Medicaid Services final rule. The Centers for Medicare & Medicaid Services (CMS) published the access rule May 10, 2024, alongside the similarly significant Medicaid managed care final rule. The two rules include new flexibilities and requirements aimed at enhancing accountability for improving access and quality in Medicaid and the Children’s Health Insurance Program (CHIP) across the fee-for-service (FFS) and managed care delivery systems and provide targeted regulatory flexibility in support of this goal.   

Five Takeaways from the CMS Medicaid Managed Care Final Rule, which Health Management Associates, Inc. (HMA), published April 24, 2024, outlined key issues and implications that CMS advanced in the Medicaid managed care program. The Ensuring Access to Medicaid Services final rule, meanwhile, focuses on the following:   

  • Payment adequacy for direct care workers (80/20 rule) 
  • The role of self-direction and the 80/20 rule 
  • Establishment of a pathway to national benchmarking of Medicaid rates   
  • Potential impacts of the rule on programs that serve individuals with dual eligibility 

Overview  

The Ensuring Access to Medicaid Services finalized policies are designed to create an updated federal framework for Medicaid’s home and community-based services (HCBS) programs. These changes come at a pivotal time, as states are facing workforce shortages, particularly among HCBS direct care workers (DCWs). Table 1 provides an overview of several significant final policies. 

Table 1. Ensuring Access to Medicaid Services: Overview of Final Rule Policies 

Below HMA reviews several key questions we are fielding regarding the impact of the rule.  

Ensuring Payment Adequacy: How will states demonstrate that 80 percent of Medicaid payments go to direct care workers?  

The final rule requires at least 80 percent of Medicaid payments be spent on compensation for DCWs workers, including homemaker, home health aide, and personal care services. In response to public comment, CMS adjusted the final rule to include some employer costs in the 80 percent calculation.  

Recognizing it will take substantial time for providers to establish the necessary systems, data collection tools, and processes to collect the required information to report to states, CMS is providing states six years to implement the HCBS Payment Adequacy policy, and four years for reporting requirements. States and providers must ensure that that they are prepared to meet the payment adequacy requirements in the final rule. Being successful will require collaboration between states and providers, investments in systems, and analysis of – and potentially changes to – reimbursement levels.  

How does the 80/20 rule apply to self-directed care?  

CMS finalized its proposal to require that at least 80 percent of all payments for homemaker, home health aide, and personal care services in HCBS programs, including managed care programs, be spent on compensation for DCWs. In a change from its proposed policy, CMS limits the 80/20 compensation mandate to certain types of self-directed models. Specifically, the 80/20 rule will apply to models in which the beneficiary directing services does not set the payment rate for the worker, such as Agency with Choice and other self-directed models that use a fiscal intermediary or fiscal employer agent, in both managed care and FFS delivery systems. The compensation rule does not apply to self-directed models in which the beneficiary sets the rates paid to workers.  

CMS will hold states accountable for compliance with the 80/20 rule, regardless of whether their HCBS are delivered through an FFS delivery system, managed care delivery system, or both. States will need to determine an approach to track compliance with the minimum performance requirement at the provider level, not the managed care plan level. States and managed care plans should collaborate to determine their respective roles in activities such as the data collection and mandatory reporting, and they should continue to seek and monitor clarifying guidance from CMS. 

How will the Ensuring Access final rule affect national benchmarks in Medicaid rates? State Medicaid programs have many nuances that make it difficult to obtain applicable comparison data and best practices. Beginning July 1, 2026, the final rule requires that states publish their payment rates, specifically the average hourly Medicaid FFS fee schedule payment rates, separately identified for payments made to individual providers and provider agencies, if the rates vary. States also must conduct a comparative analysis of their base Medicaid FFS fee schedule payment rates with the Medicare non-facility payment rate. CMS does not, however, require that states change their payment rates based on the comparative analysis.  

Payment rate transparency publications, comparative payment rate analyses, and payment rate disclosures present opportunities for states, MCOs, and providers to assess the adequacy of payment rates and their impact on access to services. The forthcoming data also will help federal and state level policymakers in their efforts to improve quality, access, and affordability. States will need to do baseline assessments comparing Medicaid and Medicare rates. States, managed care plans, and providers should monitor for CMS sub-regulatory guidance, including hypothetical examples of the service codes that would be subject to the comparative payment rate analysis.  

Does the final rule affect integrated models of care for people who are dually eligible for Medicaid and Medicare? CMS finalizes policies that will have a variable impact on states and individuals dually eligible for Medicare and Medicaid because of differences in state approaches to integrated care for this population. For example, the new grievance system policies apply differently depending on the level of integration the state requires of Medicare Advantage (MA) dual-eligible special needs plans (D-SNPs) programs. Like grievance systems, states, providers, and MCOs should monitor how states address the final rules for critical incidents for individuals with dual eligibility when a Medicaid managed care plan is unable to access Medicare data.  

CMS intends to provide additional sub-regulatory guidance and technical assistance to support implementation of policies that affect dually eligible individuals. States should verify their access to and readiness to use Medicare data related to the new requirements, and seek technical assistance to maximize use of these data for individuals enrolled in non-integrated D-SNPs. Commentors have also asked how the changes to the HCBS quality measure set may work in programs for dually eligible members.  

Connect with Us  

HMA is ready to support your efforts to understand and take action to account for the Ensuring Access to Medicaid Services final rule’s effects on your state’s or organization’s strategy and operations. Our experts are developing policies and procedures at the intersection of the access and managed care final rules. Please contact Susan McGeehan, Dari Pogach, and Patrick Tigue to connect with our expert team members on this vital set of issues.

HMA opens registration for fall conference: Unlocking Solutions in Medicaid, Medicare, and Marketplace

Unlock Solutions in Medicaid, Medicare, and the Marketplace at HMA’s Fall Conference, October 7−9 

This week, we preview what to expect at the 7th annual Health Management Associates, Inc. (HMA) Fall Conference “Unlocking Solutions in Medicaid, Medicare, and Marketplace,” October 7−9, 2024, at the Marriott Marquis Chicago, IL. Learn more about our Keynote Speaker and take advantage of our Early Bird Registration

Keynote Speaker Announced 

We are pleased to announce our Keynote Speaker will be Darshak Sanghavi, MD, program manager at the Advanced Research Projects Agency for Health (ARPA-H)—a newly created multibillion dollar federal agency tasked with developing health programs that are “so bold no one else, not even the private sector, is willing to give them a chance.” His talk, “Unlocking Health Solutions through Innovation,” will highlight the innovative collaborations and projects ARPA-H is advancing. A trained clinician who has served in high level public and private sector advisory roles, Dr. Sanghavi will discuss how this new wave of research and innovations is changing how we think about healthcare’s challenges and will address why the agency is so important at this time. He will highlight ARPA-H investments and commitments and the timeline for impact, including how healthcare systems and states should be thinking about ARPA-H funded innovations and preparing for scaling breakthroughs that improve outcomes.  

Before joining ARPA-H, Dr. Sanghavi was global chief medical and clinical operating officer for Babylon, the global end-to-end digital healthcare provider serving more than a dozen countries and 24 million-plus people, with the mission of bringing “affordable and accessible healthcare to everyone on earth.” He also has served in senior roles at UnitedHealthcare’s Medicare & Retirement, OptumLabs, the R&D hub of UnitedHealth Group, and in the Obama Administration as the Director of Preventive and Population Health at the Center for Medicare and Medicaid Innovation, where he directed the development of large pilot programs designed to improve the nation’s healthcare costs and quality. He is an award-winning medical educator, who has worked in medical settings around the world. He will draw on these diverse experiences to inspire and challenge attendees to unlock solutions to some of our healthcare system’s most complex issues. 

Network with Leaders in Healthcare 

This is an important moment for ever-changing publicly sponsored healthcare programs like Medicaid, Medicare, and the Marketplace, with greater focus on value and federal initiatives that encourage improved health equity, affordability, quality, and outcomes. Don’t miss out on this opportunity to form new partnerships as you dig into today’s urgent issues and immerse yourself in insightful discussions, networking opportunities, and engaging workshops on the new Medicaid managed care rule, applications for AI in healthcare, approaches to meet rural workforce needs, value-based care contracting, and insights from state Medicaid services.  

Preconference tactical workshops will focus on exclusive tools, insights, and strategies to guide program design, navigate new regulatory frameworks, and advance value-based care. HMA’s premier national conference plenary and breakout sessions will focus on the landscape for innovation in healthcare, emerging service delivery models, and growth strategies in pursuit of improved value, quality, and better outcomes. 

Who should attend? 

Executives and leaders from federal, state, and local government agencies, health plans, payers, managed care, hospitals and health systems, provider and provider enablement organizations, community-based organizations, IT companies, life sciences organizations, investment firms, foundations, and associations. 

CLICK HERE TO REGISTER

The 2024 Presidential Election and its long-term impact on Medicaid

The prospect of new leadership due to a presidential election brings with it the potential for significant shifts in priorities, policies, and programs within federal agencies. Medicaid now provides healthcare coverage for more than 84 million Americans. Since 2010, Medicaid has been subject to significant federal policy changes, starting with expansion as part of the Affordable Care Act, pandemic-related continuous eligibility provisions, expanded coverage for postpartum women, and just recently updated rules for managed care plans. The 2024 election will have a significant impact on Medicaid in the coming years, although you won’t hear much about it on the campaign trail (but our DC Direct subscribers get a steady stream of insight to stay on top of what’s coming next).

Medicaid’s political salience has been quiet but steadily increasing since 2010, with now 41 states (including DC) having expanded access, changing the political narrative about the program. Medicaid coverage churn due to the unwinding of the pandemic related continuing-coverage provisions has been politically fraught for governors and legislatures, even bringing some states like Mississippi to finally consider the expansion opportunity to improve stability of coverage.

States each have their own approach to designing Medicaid coverage, but federal rules set the parameters within which they choose how to maintain access and quality of healthcare for low-income individuals and families.  New CMS rules are requiring require more from managed care plans who contract to administer Medicaid in many states, increasing network adequacy, quality measurement standards, consumer protections and tailored approaches for long-term services and supports. These changes will shape the future of procurements for managed care services.

The election is very likely to touch on broad issues of affordability and equity, which are relevant to all healthcare programs but especially to Medicaid. Current policy priorities that center on equity have resulted in program design features that can impact the social determinants of health, including initiatives to address housing insecurity, food access, and mental health services. Increasingly these concerns have been bipartisan, although the proposed approaches will differ based on who is in charge.

Changes in national leadership – whether at CMS, HHS, or in the White House – will inevitably result in changes to the Medicaid program that impacts states and the agencies that serve the millions of Americans who rely on the program for essential healthcare services. Our Leavitt Partners colleagues provide regular intelligence on all the federal activity in D.C. that impacts Medicaid and other state health programs. Learn more about DC Direct and how this steady stream of insight can help inform your strategic decisions.

Medicaid Unwinding Check-in: Data Informed Observations to Guide Future Action

In this week’s In Focus section, HMA Managing Director Matt Powers and Associate Principal Lora Saunders discuss observations and perspectives as we approach completion of the Medicaid unwinding.   

Overview  

In response to the COVID-19 pandemic, CMS offered states an enhanced federal match in exchange for states pausing Medicaid disenrollments. As a result, Medicaid enrollment increased from around 71 million at the start of the pandemic to more than 92 million in December 2022, when Congress passed a bill to end the “continuous eligibility” provision. States began to resume normal (pre-pandemic) redetermination activities in early 2023—a massive undertaking of attempting to reach and verify eligibility for the then 94 million Medicaid enrollees known as “unwinding.”  

More than 70 percent of the efforts that will precipitate the largest one-year drop in enrollments since the program’s inception in 1965 have been completed. The enrollment reductions to date have been virtually identical to HMA’s aggregate projections, and overall enrollment remains well above pre-pandemic levels. Perhaps most importantly, the Medicaid unwinding has put policymakers in a position to better evaluate how to improve enrollment and redetermination processes going forward.   

Figure 1 summarizes pre-pandemic enrollments, unwinding enrollments, and the projected end of 2024 enrollment. If the current trend holds, national Medicaid enrollment will be approximately 80 million enrollees—down from the 94 million pre-unwinding enrollment peak and nearly 10 million greater than the 71 million pre-pandemic enrollment. 

Our team’s assessment of the status of and data related to the Medicaid unwinding has led us to the following observations: 

  • Arkansas, Iowa, Nebraska, Utah, and West Virginia have completed the redetermination process. More than half of the states are within two months of finishing the process. 
  • The states that saw Medicaid enrollment grow the most under the continuous coverage policy are generally the same ones that are experiencing the greatest enrollment declines during the Medicaid unwinding. 
  • Some larger states—including California, New York, and Texas—have sizeable outstanding redeterminations.   
  • Nationally, more than 70 percent of all Medicaid enrollees have completed the redetermination process.  Figure 2 points out how far along states are with the redetermination process as of late April 2024. 

Medicaid Unwinding: The Road Ahead 

As the Medicaid unwinding process enters its final phase in most states, we are looking back at the experiences and lessons that can be applied to make impactful changes to Medicaid eligibility policies, systems, and procedures. 

Despite the challenges that the pandemic presented, the safety net was tested and responded well. In early 2020, the number of employed Americans decreased from 158 million to 133 million, and unemployment levels quickly reached 15 percent. Many new healthcare policies targeted direct access issues (e.g., financial supports to providers and telehealth regulatory relaxations), whereas the Medicaid continuous coverage requirement was intended to mitigate the effects of the abrupt spike in unemployment and potential effects on healthcare insurance. Table 1 shows how HMA projects national coverage patterns to change by type of coverage from before the pandemic through the end of the Medicaid unwinding. While the number of people with employer-sponsored insurance (ESI) or uninsured remains essentially flat, Medicaid enrollment grows significantly, and marketplace enrollment nearly doubles. Myriad federal and state policy changes contributed to a remarkably stable uninsurance rate during one of the most volatile economic periods in the past century. 

A next question for policymakers is whether, or to what extent, the rate of uninsured people can be sustained or reduced. The broad state adoption of policies to expand postpartum coverage to 12 months from two months and the nationwide January 2024 requirement for states to offer 12 months of continuous Medicaid coverage for children provide a coverage and continuity boost, especially given that nearly 40 million children will benefit from the new law. Other policy levers have the potential to be widely accepted and provide a further incentive to move people who are uninsured toward coverage, more stable insurance products, and more predictable outcomes and costs relative to the inefficiencies and ineffectiveness of non-coverage. 

Pivoting to best practices and making policy changes permanent. Just as the relaxation of relatively rigid telehealth policies has become more accepted, post-Medicaid unwinding will provide a natural opportunity to assess best practices and consider permanent policy changes.    

  • Making Ex Parte Durable Policy.  Evidence suggests that ex parte policies effectively reduce churn. Further refinement of longstanding ex parte policies is within reach. Ensuring ex parte appropriately manages both the complexities of household versus individual eligibility issues and addresses the weaknesses of unreliable member contact information can improve the likelihood that ex parte can effectively serve as durable policy.  
  • Pivoting from Paper to Electronic Communications.  The Medicaid unwinding has seen more partnerships and innovation with state and federal workers, providers, managed care organizations, and consumer advocates, and allowed the increased use of mobile devices for outreach and engagement. Making more deliberate strides to simplify eligibility and move the eligibility platform, patient engagement, and member outreach to more reliable communication methods (e.g., email, text, and member portals rather than paper communication) while adhering to privacy and security requirements is a logical next step.   
  • Continuing to Measure Better. Call abandonment rates, call center wait times, and application processing times—metrics that focused on some of the key challenges to a successful redetermination and timely access to care—received greater attention during the unwinding but were frequently overshadowed by other primary metrics like “disenrollments” and “procedural terminations.” Though disenrollment data and procedural terminations could be used to identify potential areas of concern, their emergence as primary metrics often diverted energy from innovative engagement and redetermination efforts. A focus on contextualized metrics that provide actionable information will support effective oversight and monitoring.

Marketplace growth may be the real story. Throughout the pandemic, marketplace enrollment has steadily increased, jumping nearly 90 percent from 2020 to 2024 and 30 percent from 2023 to 2024, to reach more than 21 million enrollees. Driving the growth in marketplace enrollment are temporarily increased marketplace subsidies and Medicaid unwinding public awareness campaigns.  

  • The marketplaces are proving to be a reliable source of coverage for consumers without health insurance access through ESI or other public programs, particularly in times of significant change such as the Medicaid unwind. With more marketplace enrollees and, therefore, broader risk pools, more health insurers are considering offering marketplace plans and are assessing competitive advantages like lower costs, broader provider networks, and more robust drug formularies. 
  • Figure 3 shows that marketplace growth in non-expansion states is far outpacing marketplace growth in Medicaid expansion states, suggesting that the key elements of the Affordable Care Act have developed deep roots.  

HMA’s experts continue to monitor Medicaid unwinding developments. We are taking a comprehensive approach to assessing lessons learned and opportunities to improve Medicaid as state and stakeholder experiences and data continue to become available over the next two quarters. 

For more information or questions about Medicaid unwinding developments, contact Matt Powers and Lora Saunders. 

Five takeaways from the CMS Medicaid managed care final rule

This week, our In Focus section reviews significant Medicaid policy announcements from the Centers for Medicare & Medicaid Services (CMS). For example, both the Medicaid and Children’s Health Insurance Program Managed Care Access, Finance, and Quality Final Rule (CMS-2439-F) (CMS fact sheet available here) and the separate Ensuring Access to Medicaid Services Final Rule (CMS-2442-F) (CMS fact sheet available here) were released April 22, 2024. 

Taken together, these two final rules create new flexibilities and requirements aimed at enhancing accountability for improving access and quality in Medicaid and the Children’s Health Insurance Program (CHIP) across the fee-for-service and managed care delivery systems and provide targeted regulatory flexibility in support of this goal.  

HMA’s April 11, 2024, “What to Watch For” article outlined several proposed changes that CMS was poised to advance in the Medicaid managed care program. We focus today on the approved changes, including:  

  • In lieu of services and settings (ILOSs)  
  • The Medicaid and CHIP quality rating system (MAC QRS)  
  • Medical loss ratios (MLRs)  
  • Network adequacy 
  • State directed payments (SDPs) 

Following are HMA’s insights on the key takeaways in each of these major areas for states, managed care organizations (MCOs), providers, and other stakeholders. In addition, HMA experts will discuss the final rule during a LinkedIn Live on event at 2:00 pm (EDT) April 25, 2024. Go to the HMA LinkedIn feed to watch. 

In future weeks, HMA will review the Ensuring Access to Care final rule. 

ILOSs 

The final rule makes clear that CMS remains committed to the conviction that ILOSs can play an important role in supporting state and MCO efforts to address many of the unmet physical, behavioral, developmental, long-term care, and other enrollee needs. At the same time, CMS continues to put forward requirements in this area to ensure adequate assessment of these substitute services and settings in advance of approval, ongoing monitoring for sufficient beneficiary protections, and financial accountability for related expenditures. 

The final rule presents an opportunity to leverage ILOSs to improve population health, reduce health inequities, and lower total healthcare costs in Medicaid and CHIP, including by addressing unmet health-related social needs as well as through other avenues. To take full advantage of this opportunity, states and MCOs must ensure that that they are prepared to meet the accountability measures outlined in the final rule and partner with existing providers and community-based organizations that already provide such services and settings. 

Medicaid and CHIP Quality Rating System  

CMS finalized most proposed provisions related to mandatory quality measures, the process used to update these measures, the ability of states to include additional measures, and the ability of states to apply an alternative QRS if desired. On this last point, CMS is making several modifications to its MAC QRS proposal to clarify the scope of and to reduce the implementation resources needed for an alternative MAC QRS if a state elects to implement one. 

States will be required to collect from MCOs the data necessary to calculate ratings for each measure and ensure that all data collected are validated. This will require MCOs to assess their capability to produce the mandated data upon request by states and, to the extent possible, to assess baseline performance on measures and proactively operationalize strategies to improve performance where necessary. 

Medical Loss Ratios 

The final rule aligns Medicaid and CHIP MLR QIA reporting requirements with the private market to ensure that only those expenses that are directly related to healthcare QIAs are included in the MLR numerator. CMS notes that this provision will allow for better MLR data comparisons between the private market and Medicaid and CHIP markets as well as reduce administrative burden for MCOs participating across these markets.  

MCOs will need to model the impact of QIA expenditures that are no longer available for inclusion in the MLR numerator to ensure that a resulting failure to meet any minimum MLR requirements can be avoided, and, if it is projected to occur, a strategy can be developed and executed to avert the problem. CMS made this requirement effective as of the effective date of the final rule with no delay because it believes it is critical to the fiscal integrity of Medicaid and CHIP, adding urgency to MCO compliance action here. 

Network Adequacy 

The final rule makes clear that CMS has been persuaded that it needs to increase oversight of network adequacy and overall access to care through a new quantitative network adequacy standard. To measure network adequacy, the agency intends to implement wait time standards, complemented by secret shopper surveys to support enforcement. 

Wait time standards and secret shopper surveys present opportunities for states, MCOs, and providers to collaborate to enhance access where needed and ensure compliance with the final rule. Undertaking secret shopper surveys ahead of implementation of the wait time standards (effective the first rating period beginning on or after three years after the effective date of the final rule) to determine the current performance relative to maximum wait times is a proactive step that is worth consideration by states and MCOs and can also be employed to foster dialogue with providers to address any areas of concern identified. 

State Directed Payments 

CMS is adopting its proposal in the final rule to use the average commercial rate as a limit for SDPs for inpatient and outpatient hospital services, nursing facility services, and professional services at academic medical centers. CMS believes that this approach represents a reasonable limit that is supportive of appropriate fiscal guardrails, while still affording states the flexibility to achieve SDP policy goals. States and providers will need to account for this requirement, along with others, as SDPs are developed going forward.  

Connect with Us 

HMA is ready to support your efforts to understand and take action to account for the managed care final rule’s effects on your state or organization’s strategy and operations. Please reach out to [email protected] to connect with our expert team members on this vital set of issues. 

Medicaid managed care enrollment update—Q4 2023

This week, our In Focus section reviews recent Medicaid enrollment trends in capitated, risk-based managed care in 30 states.1 Many state Medicaid agencies post monthly enrollment figures by health plan for their Medicaid managed care population on their websites. These data allow for timely analysis of enrollment trends across states and managed care organizations. All 30 states highlighted in this review have released monthly Medicaid managed care enrollment data into quarter four (Q4) of 2023. The analysis that follows reflects the most recent data posted. HMA continues tracking enrollment as states work towards concluding their Public Health Emergency (PHE) unwinding-related redeterminations and resuming normal eligibility operations. 

Health Management Associates, Inc., (HMA) has reviewed the Q4 enrollment data (see Table 1) and offers the following observations:  

  • Across the 30 states tracked in this report, Medicaid managed care enrollment declined by 7.3 percent year-over-year as of December 2023. 
  • Of the 30 states, 26 experienced decreased enrollment in December 2023, compared with the previous year, as the result of Medicaid redeterminations. 
  • A total of 23 of the states—Arizona, California, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Missouri, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, Virginia, Washington, and West Virginia—saw net Medicaid managed care enrollment decrease by 469,000 (0.9%) to 51.5 million members at the end of Q4 2023. (Note: North Carolina expanded Medicaid in December 2023 and was added to the expansion group, in part inflating the change). 
  • The seven states that had yet to expand Medicaid as of December 2022—Florida, Georgia, Mississippi, South Carolina, Tennessee, Texas, and Wisconsin—have seen Medicaid managed care enrollment decrease 25.2 percent to 13.9 million members at the end of Q4 2023.  

Table 1. Monthly MCO Enrollment by State, October 2023−December 2023 

Note: In Table 1, “+/- m/m” refers to the enrollment change from the previous month. “% y/y” refers to the percentage change in enrollment from the same month in the previous year.

It is important to note the limitations of the data presented. First, not all states report the data at the same time during the month. Some of these figures reflect beginning of the month totals, whereas others provide an end of the month snapshot. Second, in some cases the data are comprehensive in that they cover all state-sponsored health programs offering managed care; in other cases, the data reflect only a subset of the broader managed Medicaid population, making it the key limitation to comparing the data described below and figures that publicly traded Medicaid MCOs report. Consequently, the data in Table 1 should be viewed as a sampling of enrollment trends across these states rather than a comprehensive comparison, which cannot be developed based on publicly available monthly enrollment information. 

Expand Your Awareness about Medicaid and Medicare Advantage via HMAIS 

If you are interested in gaining access to detailed information on the Medicaid managed care landscape, an HMAIS subscription is the key to unlock important data. The HMA Information Services (HMAIS) collects Medicaid and Medicare Advantage Special Needs Plan (SNP) enrollment data, health plan financials, as well as developments on expansions, waivers, and demonstrations. Your HMAIS login also provides access to a library of public documents all in one place, including Medicaid RFPs, responses, model contracts, scoring sheets and other procurement related materials. HMAIS combines this publicly available information along with HMA expert insights on the structure of Medicaid in each state, as well as a proprietary HMA Medicaid Managed Care Opportunity Assessment. 

For information on how to subscribe to HMA Information Services, contact Andrea Maresca.