Medicaid

How will CMS’s proposed rule shift standards for Medicaid enrollee access to services?

This week’s In Focus is the second in a two-part look at the Centers for Medicare & Medicaid Services’ (CMS’s) recently proposed changes to the Medicaid program. Last week we covered CMS’s proposed changes to the federal Medicaid managed care regulations (CMS-2439-P). This week we review the Medicaid Access to Care proposed rule (CMS-2442-P).

As we discussed last week, the managed care and access to care rules include significant changes to core structural and financing aspects of the Medicaid program. Though state agencies, providers, health plans, consumer groups, and other stakeholders will want to understand the distinct requirements and expectations in each rule that apply to them, the proposed changes cannot be viewed in isolation.

The Access to Care rule addresses a range of challenges that shape the experience of Medicaid enrollees, regardless of whether they are in managed care programs or traditional fee-for-service (FFS). The proposed policy changes also are designed to create an updated federal framework for Medicaid’s home and community-based services (HCBS) programs. These proposals come at a pivotal time, as states are facing workforce shortages, particularly among HCBS direct care workers (DCWs).

The remainder of this In Focus delves into notable components of the proposed changes and includes analysis of the implications of these policies for stakeholders. CMS will benefit from stakeholder input; the deadline for submitting comments is July 3, 2023.

Table 1. Access to Care Regulations: Overview of Proposed Changes

Key Themes and Considerations

Ensuring Payment Adequacy for Key HCBS Services Experiencing Workforce Shortages. One of the most notable proposed changes that would directly impact DCWs is a requirement that at least 80 percent of Medicaid payments be spent on compensation. The proposed rule would apply to homemaker, home health aide, and personal care services, as they represent a large portion of HCBS services that DCWs provide. The proposal is based on feedback from states that have implemented similar provisions, which have ranged from 75 to 90 percent compensation requirements.

CMS specifically seeks stakeholder feedback on the percentage that should be adopted. This policy provision also is important from an equity perspective, given that 90 percent of DCWs are women and 60 percent are members of racial or ethnic minority populations. However, increased or mandated DCW rates may make it difficult for HCBS providers to sustain their businesses as they manage the increased administrative pressures of electronic visit verification, the complexity of filing claims for managed long-term services and supports (MLTSS), and the additional work that HCBS quality measurement may create. Smaller HCBS providers, some of which may have deep cultural expertise, may struggle to sustain themselves and meet these requirements.

Table 2. Access to Care Regulations: Snapshot of Proposed Rate, Access, and Payment Changes

Payment Alignment. CMS is seeking to align access to care strategies and payment rate transparency more closely across the FFS and managed care delivery systems. The proposed rule includes several changes that CMS has developed achieve this goal. For example:

  • CMS plans to require that states publish more detailed rate information in a consistent format. States, health plans, providers, and other interested stakeholders will want to consider the implications by delivery system. Additional transparency requirements could create a new opportunity to understand rates across payers and states and use this information in addressing access challenges for services.
  • The proposed rule also would require extensive comparative analysis of Medicaid FFS rates and Medicare rates. CMS proposes to use Medicare non-facility payment rates as a benchmark to determine if states are meeting federal Medicaid access State analyses will be vital to CMS oversight as well as advocacy efforts within states to monitor and update FFS rates as needed.

Strengthening the Focus on Quality in State HCBS Programs. Over the last several decades, states and Medicaid stakeholders have made significant progress toward increasing participation in HCBS programs and community integration initiatives to counter Medicaid’s institutional bias. CMS is proposing more consistency in the expectations and reporting for HCBS quality measures to further the impact and create a consistent foundation for the recently mandated HCBS quality initiatives starting to take root.

In the short-term, the proposed changes will require states, and likely downstream providers and Medicaid agencies, to immediately change their quality reporting policies and systems. States and their stakeholders will want to map out processes for cyclical updates to HCBS quality measures, including cross-walking the future measures with existing ones, making systems changes, and updating dashboards. Targeted attention and focus will be needed to identify realistic HCBS performance targets that yield successful improvement strategies in the midst of a workforce crisis. Longer term, it will be necessary to map out when updates and reporting will be required to strengthen the rigor and accountability for state performance in the HCBS quality measure set, as well as reinforce the information available to make policy, clinical, and operational improvements to Medicaid programs.

HCBS Access Measurement. CMS is proposing new FFS HCBS payment and access transparency requirements to ensure compliance with Medicaid provider payment rules that require payments to be adequate to enlist at least the same number of providers that the overall geographic population can access. Because the targeted HCBS services do not have a comparable Medicare rate, CMS proposes implementation of a payment rate disclosure approach that would standardize data and monitoring across service delivery systems, with the goal of improving access. In addition to proposed payment transparency changes, CMS proposed new reporting on HCBS waiver waiting lists and timelines for the start of related services once authorized.

These new reporting requirements will provide stakeholders with more information to benchmark their state’s experience with other providers across the nation. This information could be influential to policymakers and legislators and help uncover some of the core contributors to our nation’s HCBS workforce shortage.

Improving Health Equity with Medicaid Beneficiary Input. CMS proposes overhauling the scope and membership of the state Medical Care Advisory Committee. The new Medicaid Advisory Committee (MAC) would continue to advise the state on health and medical matters and play an expanded advisory role on matters of policy development and effective administration of the program. CMS also plans to require that states establish a Beneficiary Advisory Group (BAG) composed of current or past Medicaid beneficiaries. A subset of BAG members would serve on the MAC to ensure their perspectives are integrated into the committee’s recommendations to states.

Under the new federal requirements, MAC representatives could have greater relative input and influence on policies and actions each state Medicaid agency advances. Medicaid stakeholders will want to ensure the MAC’s minimum federal requirements support effective structures and processes in states.

What’s Next

CMS plans to reframe Medicaid access as one of three parts of the continuum of care, along with enrollment and maintenance of coverage. The proposals in the Access to Care rule would have a meaningful impact on the volume and type of data available to evaluate the relationship between Medicaid payment rates and access across all delivery systems.

States, managed care organizations, providers, Medicaid enrollee advocacy organizations, and other interested stakeholders should analyze the proposals and consider submitting comments to CMS on the feasibility, potential impact, and, where applicable, alternatives to the proposed changes. They also can use this time to begin planning and determine which resources and tools they may need to prepare for implementation of changes across delivery systems in the Medicaid program.

HMA’s experts are taking a wholistic approach to reviewing the Access to Care and Managed Care proposed rules in tandem and identifying key points of intersection.

For more information on the access to care proposed rule, contact HMA’s team of experts, Susan McGeehan and Andrea Maresca.

The end of the Public Health Emergency: imminent changes to the coverage of virtual care services

Policy crossroads and the end of the public health emergency due to COVID-19

This is part of a three-part series on significant implications of the end of the Public Health Emergency (PHE). 

The end of the Public Health Emergency on May 11, 2023 is likely to mark a transitional point in the rapidly evolving arena of virtual care services and not a dramatic end of coverage. Coverage of virtual care services will continue to evolve significantly over the next five years given the exponential growth in the public’s awareness of, and comfort with, these services — all hastened by the COVID-19 Federal Public Health Emergency.

The U.S. Congress and the Centers for Medicare and Medicaid Services (CMS) used its authority during the PHE to significantly expand Medicare coverage for virtual care services, covering telehealth visits in urban areas and from patient’s homes. In addition, Medicare began covering a wide range of clinical services virtually such as behavioral health and physical therapy; it also expanded coverage for different service delivery modalities to include audio-only visits. As a result of the changes, Medicare became a leading payer for virtual care nationally between 2020 and 2022. Over this same period, private insurers and state Medicaid programs largely followed Medicare’s lead by expanding their own virtual care coverage. 

One of the consequences of the PHE is that most payers have embraced Medicare’s basic definitional structure for types of virtual care services. As a part of this typology, virtual care services are divided into two general buckets of services: telehealth visits (physician office visits conducted via audio and video technology), which are typically prohibited by statute in urban areas or a patient’s home; and Communication Technology-Based Services (CTBS) which can be conducted anywhere. CTBSs include: remote patient monitoring (RPM); virtual check-ins (brief patient-to-clinician exchanges); e-visits (online portal or email visits); and e-consults (clinician to clinician interaction).

With the end of the PHE on May 11, Medicare coverage of virtual care services and coverage offered by other payers will change. The details and scope of this change have many stakeholders concerned and confused. HMA has a keen sense for which virtual care services may get a new lease on life in the coming months and which are likely to be hotly debated in the years ahead. The one certainty is that the last 3 years have altered the landscape for virtual care services for years to come.

Shift in Virtual Care Landscape

As a result of the statutory geographic limitations and restrictions placed on traditional fee-for-service (FFS) Medicare coverage, use of telehealth services was minimal most of the last decade, with only one-quarter of 1 percent (0.25%) of beneficiaries in FFS Medicare using virtual care services.[1] Even among Medicare Advantage plans and Medicare Accountable Care Organizations (ACOs), neither of which which face the same restrictions, virtual care was utilized very rarely before 2019.

This sluggish use of telehealth was radically altered when HHS used its PHE authority to relax constraints on the use of use virtual care services by Medicare beneficiaries and providers.[2],[3] Among the most consequential changes made by policymakers at the outset of the PHE were:

  • Enabling telehealth services to be provided anywhere (e.g., urban areas and patients’ homes);
  • Allowing Federally Qualified Health Centers (FQHC) and Rural Health Clinics (RHC) to conduct virtual care services;
  • Granting various types of clinicians permission to deliver virtual care services;
  • Enabling new patients to receive virtual care services;
  • Authorizing audio-only services;
  • Permitting telehealth services for more than 200 different types of clinical services (e.g., mental health, emergency department, physical and occupational therapy, critical care, inpatient care);
  • Relaxing HIPPA rules to enable the broad use of smartphones for virtual care.

Due to these policy changes, rates of virtual care skyrocketed during the PHE (Figure 1). In April of 2020 the number of Medicare claims for any type of virtual care service exceeded 9 million, while 2019 the number of these services provided monthly never exceeded 100,000 (Figure 1). On an annual basis, from 2019 to 2021 the number of virtual care visits jumped from roughly 1 million to 39 million and the number of unique beneficiaries receiving these services increased from 300,000 to nearly 12 million. 

Figure 1: Number of Virtual Care Service Visits, Number of Unique Medicare Fee-For-Service Beneficiaries, and Number of visits per Utilizer by Month, December 2019 to December 2021. 

Source: HMA analysis of CMS’s 100 percent Medicare Fee-For-Service Claims data for 2019, 2020, and 2021.

The growth of virtual care services has largely been driven by an increase in telehealth visits, but we observe important trends in the use of CTBSs, as well. In late 2021, more than 90 percent of visits were associated with telehealth, while 10 percent were associated with CTBSs. Early in the PHE, all of these service types experienced an initial, abrupt increase in use (Figure 2). By contrast, the growth in the use of remote patient monitoring (RPM) has been continuous since 2020. The growth in use of RPM reflects the general movement of services into patients’ homes and has been accelerated by specialist such as cardiologists and endocrinologists beginning to leverage the power of RPM. We expect greater diffusion and use of RPM and other CTBSs in the next five years.

Figure 2: Number of Virtual Care Service Visits for Remote Patient Monitoring, Virtual Check-ins, E-visits, and E-Consultations by Month, December 2019 to December 2021. 

Source: HMA analysis of CMS’s 100 percent Medicare Fee-For-Service Claims data for 2019, 2020, and 2021.

Policies temporarily in place until the end of 2024

During the PHE, Congress made critical long-term changes to Medicare’s coverage of virtual care services that continued to spur the use of these services and offer access to care for beneficiaries. In 2021, Congress changed the law to permanently allow Medicare beneficiaries to receive behavioral/mental telehealth services regardless of location (urban or rural) and for this care to be available to patients in their own homes.

In 2022, Congress severed the link between the PHE declaration and Medicare coverage policies for virtual care services, extending those benefits through the end of calendar year 2024. We expect that coverage for all telehealth services will receive considerable attention from federal policymakers and stakeholders towards the end of 2024.

Immediate impact of expiring policies

Certain aspects of Medicare’s virtual care policies will, however, terminate May 11, 2023, when the PHE declaration comes to an end. Several of the expiring policies have a broader impact beyond the Medicare program, affecting patients insured by private payers and State Medicaid programs.

Specifically, when the PHE ends, policymakers will need to address the following anticipated changes:

  • The Office for Civil Rights (OCR) will return to imposing penalties on providers who violate the provisions of the Health Insurance Portability and Accountability Act (HIPAA) by using public-facing remote communication technologies which are not HIPAA-compliant. This may prohibit the use of some of the most common smartphone-based video conferencing tools for health care visits.
  • Medicare beneficiaries without an existing relationship with a clinician will be unable to receive CTBSs such as RPM, virtual check-ins, and e-visits.
  • Providers will no longer be allowed to provide virtual care services across state lines, because most state medical licensure boards will return to pre-PHE policy.   
  • Federal rules from the Drug Enforcement Agency (DEA) may revert to the pre-PHE requirement that clinicians establish a patient-provider relationship in-person before being permitted to prescribe controlled substances for substance use disorder treatment.

Potential policy changes occurring before 2025 As explained earlier, Medicare coverage for many virtual care services will remain in place for the next 19 months. Before the end of 2024, Congress will need to address several policy questions, and among the most widely debated are whether to:

  • Restore Medicare’s statutory prohibition on telehealth services being delivered in urban areas or in home settings;
  • Allow Federally Qualified Health Centers and Rural Health Clinics to provide telehealth services to Medicare beneficiaries; or
  • Continue to cover audio-only telehealth visits under Medicare.

Lawmakers will look to payers, patients, and providers for feedback before making these policy decisions. Among the most critical pieces of information they will also consider will be the results of the  study Congress has required of HHS regarding trends in the use of virtual care. This study’s final report is due in 2026, which has led some to speculate that Congress will delay action on virtual care coverage policy until then. In the meanwhile, we expect HHS will be assessing the overall volume of virtual care use, who is using which types of services, and the levels of related fraud and abuse.

Looking Ahead

In the United States, our experience during the acute phase of the pandemic demonstrated that patients and providers are more receptive than previously thought to utilizing digital technologies for the delivery of care. This experience may also influence policymakers’ decisions about reimbursement and coverage of wearable devices, as well as other cutting-edge tools that rely on artificial intelligence or machine learning.  

HMA believes payers and providers alike can take steps now to strategically prepare for the still evolving and growing landscape of digital health care.

Based on the various changes that have occurred in the virtual care environment over the last 3 years, we are intently watching several areas of potential change in the practice of medicine and the ways payers set coverage policy. Below are some of the trends we anticipate in the years ahead:

  • Continued use of virtual care services at levels observed in 2021.
  • An expansion of CMS’s programs to protect against fraud and abuse related to virtual care.
  • Notable growth in the use of RPM, and related services for physical and occupational therapy services.
  • The proliferation of innovative home-based screening and testing technologies. We anticipate payers will encourage the use of these at-home tests for things like kidney function, liver function, and colorectal cancer screening in order to limit care delivery in higher cost settings.  
  • Growth in “virtual-first” insurance plans, where patients are encouraged to use virtual care first – prior to being seen in person. As these plan options expand, we anticipate virtual care use will rise, and reimbursement rates will begin to change. 

Virtual care services are primed for additional growth and HMA is working with a wide variety of payers, providers, and foundations to develop strategies for adapting to state and federal rules and regulations related to virtual care. Changes in this landscape will hinge on research CMS will complete by the end of 2026, and coverage decisions made by states and commercial payers. HMA is well positioned to assist stakeholders with work in this area and can leverage access to Medicare and Medicaid claims data to conduct health services research to illustrate geographic variations in the use of virtual care.

If you have questions on how HMA can support your agency before or after the end of the PHE, please contact [email protected] or [email protected]

Read other parts of this blog series:

Part 1:
Medicaid redeterminations and loss of coverage
Part 2:
Public health after the emergency ends

[1] (2016) https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/Information-on-Medicare-Telehealth-Report.pdf

[2] Centers for Medicare & Medicaid Services. Medicare telemedicine health care provider fact sheet. March 17, 2020. https://www.cms.gov/newsroom/fact-sheets/medicare-telemedicine-health-care-provider-fact-sheet

[3] HHS Administration for Strategic Preparedness & Response (ASPR). https://aspr.hhs.gov/legal/PHE/Pages/default.aspx

What you need to know about CMS’s proposed changes to Medicaid managed care rules

This week, our In Focus section reviews CMS’s proposed changes to the federal Medicaid managed care access, finance, and quality regulation (CMS-2439-P). A future In Focus will take a closer look at the proposed changes to the federal Medicaid access to care regulation (CMS-2442-P), which also has significant implications for state Medicaid programs.

On April 28, 2023, the Centers for Medicare & Medicaid Services (CMS) unveiled two significant and related proposed rules addressing Medicaid managed care access, finance, and quality requirements. Together these proposed rules signal a new era of accountability and transparency in the Medicaid program. They also strengthen beneficiaries’ role in influencing the policies and administration of state Medicaid programs.

Table 1 identifies a few of the key themes and issues addressed in the Medicaid managed care proposed rule. The deadline for submitting comments to CMS is July 3, 2023.

Table 1. Medicaid Managed Care Proposed Rule: Snapshot of Proposed Changes

Key Themes and Considerations

Payment Ceilings May Accelerate Value-Based Payment Arrangements. Current federal regulations allow states to direct managed care organizations (MCOs) to pay providers according to specific rates or methods. States have used these directed payment arrangements to set minimum payment rates for certain types of providers or to require participation in value-based payment (VBP) initiatives.

In the proposed rule, CMS calls for establishing an upper limit for these payments. Specifically, the agency plans to limit the projected total payment rates to the average commercial rate (ACR) for inpatient and outpatient hospital services, nursing facility services, and qualified practitioner services at academic medical centers that states include in state-directed payment (SDP) arrangements. The ACR limit, in concert with the proposed SDP documentation and reporting, is among the most significant and complex proposed changes in the rule.

Considerations: The proposed changes represent a strong federal regulatory push to accelerate movement to VBP in Medicaid, which provides states with new levers to drive value in their Medicaid delivery systems. It also means that MCOs, providers, and other stakeholders will need to navigate and help inform the policies and contractual arrangements that will flow from the pending changes. For example, states may need to reflect on the following considerations:

  • Whether the proposals will require them to reduce reimbursement
  • Whether they will need to develop new value-based arrangements through SDPs and how these policies will be structured
  • What outcomes they might need to prioritize
  • How transparency in reporting provider-level payments could affect non-federal funding and SDP initiatives

Updated Approach to in Lieu of Services (ILOS) Facilitates Whole-Person Care. In January 2023, CMS issued a State Medicaid Director Letter (SMDL#23-001) advising states of the option to use the ILOS authority in Medicaid managed care programs to reduce healthcare inequities and address unmet health-related social needs (HRSNs), such as housing, food insecurity, and intimate partner violence. The proposed Medicaid managed care rule would expand upon and codify in regulation that guidance.

Considerations: Although the ILOS proposal adds reporting requirements and guardrails to address fiscal accountability, overall, the updated policy signals CMS’s willingness to support innovative state approaches to meet a continuum of beneficiary needs, including HRSNs that affect the social drivers of health. Notably, CMS advises that the substitution of an ILOS for a state plan service or setting should be cost-effective but does not need to be budget-neutral. States also can specify that an ILOS can be an immediate or longer-term substitute for a state plan service or setting.

States could pursue a variety of options under CMS’s revised ILOS framework. State Medicaid agencies and their partners can collaborate on ILOS strategies that will allow them to make further progress toward reducing healthcare inequities, as well as fulfill their quality strategy goals and objectives.

New Standards for Medical Loss Ratio Strengthen Link to Performance Improvement. Existing federal regulations require Medicaid managed care plans to report their medical loss ratio (MLR) to states annually, and, in turn, states must submit a summary of those reports to CMS. Many state MCO contracts require plans to comply with provider incentive and bonus policies; however, MCOs infrequently make incentive payments contingent on the provider meeting quantitative clinical or quality improvement standards.

Consistent with the healthcare sector’s transition toward value-based care, CMS proposes to strengthen the link between an MCOs incentive payment to a provider and the provider meeting defined quality improvement or performance metrics. Additionally, contractual language between MCOs and providers will need to more explicitly identify the dollar amounts tied to successful completion of these metrics. Only incentive payments based on quality improvement will be considered incurred claims when plans calculate their MLR; administrative costs cannot be included in quality improvement activity reporting.

Considerations. The proposed requirements are expected to add more transparency to negotiations between Medicaid MCOs and providers. MCOs will retain flexibility to determine the quality improvement or quantitative performance metrics, which carry more weight and accountability in CMS’s revised regulatory framework.

Network Adequacy Requirements Strengthen Link to Access and Rates. CMS also proposes policies that the agency believes will help strengthen Medicaid enrollees’ access to services. For example, the rule would require states to develop wait-time standards for adult and pediatric primary care and outpatient mental health, substance use disorder (SUD), and OB/GYN services, with CMS establishing federal minimum appointment wait times. States also will need to develop a quantitative network adequacy standard, beyond wait times, for certain providers.

Notably, CMS also plans to require states to submit an MCO-level analysis of MCO-to-provider payments. This analysis may provide more insights about the relationship between rates and access to certain types of providers and services. It may also improve alignment in access policies across delivery systems.

ConsiderationsStates and MCOs should expect to need more sophisticated analysis of provider capacity at state and local market levels. This information will be critical in developing network adequacy standards and determining where additional provider support may be necessary. Expanded and new strategies may be needed to ensure compliance with the federal rules and resulting changes to state policies.

What’s Next

Many of CMS’s proposals track closely with many recent recommendations from federal commissions and oversight entities, including the Medicaid and CHIP Payment and Access Commission (MACPAC) and Government Accountability Office (GAO), which may indicate a greater likelihood that CMS will finalize those policies. If they are finalized largely as proposed, the rule will further the Biden Administration’s directional imprint on the Medicaid program.

Within the proposed rules described above, CMS identifies numerous areas where stakeholder input would be beneficial. States, MCOs, providers, and other interested stakeholders should analyze the proposals and consider submitting comments to CMS on the feasibility, potential impact, and, where applicable, alternatives to the proposed changes. Stakeholders also may use this time to begin planning for 2024 and determining what resources and tools they may need to prepare for implementation of the final regulations, as well as how their approach may vary based on state-specific factors.

For questions about the rule and how HMA’s team of experts can support your organization’s response, please contact Andrea Maresca, Joe Moser, and Patrick Tigue.

Biden administration encourages states to apply for Medicaid Reentry 1115 Demonstration for individuals in carceral settings

This week our In Focus section reviews guidance from the Centers for Medicare & Medicaid Services (CMS), released on April 17, 2023, encouraging states to apply for the new Medicaid Reentry Section 1115 Demonstration Opportunity. The demonstration is aimed at helping improve care for individuals in carceral settings prior to their release.

Background

The United States has approximately 1.9 million individuals incarcerated nationwide. Studies have shown higher rates of mental illness and physical health care needs in incarcerated populations compared to the general population, as well as associations between jail incarceration and increases in premature death rates from infectious diseases, chronic lower respiratory disease, drug use, and suicide.

CMS states that formerly incarcerated individuals with physical and mental health conditions and substance-use disorders (SUDs) typically have difficulty succeeding upon reentry due to obstacles present immediately at release, such as high rates of poverty and high risk of poor health outcomes. These individuals tend to face barriers in obtaining housing, education, employment, and health care access upon release. They often do not seek outpatient medical care and are at significantly increased risk for emergency department (ED) use and hospitalization.

Purpose and Goals

After collecting feedback from stakeholders, including managed care organizations, Medicaid beneficiaries, health care providers, the National Association of Medicaid Directors, and other representatives from local, state, and federal jail and prison systems, CMS designed the Reentry Section 1115 Demonstration Opportunity. The services covered under this demonstration opportunity should aim to improve access to community resources that address the health care and health-related social needs of the carceral population, with the aims of improving health outcomes, reducing emergency department visits, and inpatient hospital admissions for both physical and behavioral health issues once they are released and return to the community.

The purpose of this demonstration opportunity is to provide short-term Medicaid enrollment assistance and pre-release coverage for certain services to facilitate successful care transitions. The full goals, as quoted from CMS, are as follows:

  • “Increase coverage, continuity of coverage, and appropriate service uptake through assessment of eligibility and availability of coverage for benefits in carceral settings just prior to release
  • Improve access to services prior to release and improve transitions and continuity of care into the community upon release and during reentry
  • Improve coordination and communication between correctional systems, Medicaid systems, managed care plans, and community-based providers
  • Increase additional investments in health care and related services, aimed at improving the quality of care for beneficiaries in carceral settings and in the community to maximize successful reentry post-release
  • Improve connections between carceral settings and community services upon release to address physical health, behavioral health, and health-related social needs
  • Reduce all-cause deaths in the near-term post-release
  • Reduce number of ED visits and inpatient hospitalizations among recently incarcerated Medicaid beneficiaries through increased receipt of preventive and routine physical and behavioral health care”

CMS encourages states to engage with individuals who were formerly incarcerated when contemplating the design and implementation of their proposal. CMS also encourages states to design a broadly defined demonstration population that includes otherwise eligible, soon-to-be former incarcerated individuals. States have the flexibility to target population, such as individuals with specific conditions, but are encouraged to be mindful of undiagnosed conditions. States should have a plan to ensure incarcerated individuals will be enrolled in Medicaid upon their release, applying for Medicaid no later than 45 days before the day of release.

Reentry Section 1115 Demonstration Opportunity

To receive approval for the demonstration, the state proposal must include in the pre-release benefit backage:

  1. Case management to assess and address physical and behavioral health needs and health-related social needs;
  2. Medication-assisted treatment (MAT) services for all types of SUD as clinically appropriate, with accompanying counseling; and
  3. A 30-day supply of all prescription medications that have been prescribed for the beneficiary at the time of release, provided to the beneficiary immediately upon release from the correctional facility.

In addition to these three services states may include other important physical and behavioral health services to cover on a pre-release basis, such as family planning services and supplies, behavioral health or preventive services, including those provided by peer supporters/community health workers, or treatment for Hepatitis C. CMS is also open to states requesting Section 1115 expenditure authority to provide medical supplies, equipment, and appliances.

The Reentry Section 1115 Demonstration opportunity is not intended to shift current carceral health care costs to the Medicaid program. CMS will not approve state proposals to receive federal Medicaid matching funds for any existing carceral health care services funded with state or local dollars unless the state agrees to reinvest the total amount of new federal matching funds received into activities or initiatives that increase access to or improve the quality of health care services for individuals who are incarcerated.

CMS also expects states to refrain from including federal prisons as a setting in which demonstration-covered prerelease services are provided under the opportunity.

States with approved demonstrations will need to submit an implementation plan, a monitoring protocol, quarterly/annual monitoring reports, a mid-point assessment report, an evaluation design, and interim/summative evaluation reports.

California

California became the first state to receive approval for a Section 1115 waiver amendment earlier this year to provide limited Medicaid services to incarcerated individuals for up to 90 days immediately prior to release. The approval period runs through December 31, 2026, timed with the expiration of the CalAIM Medi-Cal waiver demonstration. California’s reentry demonstration initiative aims to provide health care interventions at earlier opportunities for incarcerated individuals to reduce acute services utilization and adverse health outcomes. The state anticipates it will increase coverage and continuity of coverage for eligible beneficiaries, improve care transitions for beneficiaries as they reenter the community, and reduce morbidity and mortality in the near-term post-release.

Pre-release services include comprehensive care management, physical and behavioral clinical consultation, lab and radiology, MAT, community health worker services, and medications and durable medical equipment. A care manager will be assigned to eligible individuals to establish a relationship, understand their health needs, coordinate vital services, and make a plan for community transition, including connecting the individual to a community-based care manager they can work with upon their release. Additionally, all counties implementing Medi-Cal application processes in jails and youth correctional facilities will “suspend” the Medicaid status while an individual is in jail or prison, so that it can be easily “turned on” when they enter the community.

On April 6, 2023, HMA held a webinar titled, “Medicaid authority and opportunity to build new programs for justice-involved individuals.” A replay can be watched here. HMA will announce additional webinars on the topic.

Link to Press Release and Letter

CMS’s 2024 hospital inpatient regulation proposes to increase payments to hospitals, support safety net hospitals, and modify the NTAP program

This week, our In Focus section reviews the policy changes proposed by the Centers for Medicare & Medicaid Services’ (CMS) on April 10, 2023, for the Fiscal Year (FY) 2024 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Acute Care Hospital (LTCH) Proposed Rule (CMS-1785-P). This year’s IPPS Proposed Rule includes several important policy changes that will alter hospital margins and change administrative procedures, beginning as soon as October 1, 2023.

Key provisions of the FY 2024 Hospital IPPS and LTCH Proposed Rule

For FY 2024, CMS proposes to make modifications to several hospital inpatient payment policies. We highlight six proposed policies that are among the most impactful for Medicare beneficiaries, hospitals and health systems, payors, and manufacturers:

  1. the annual inpatient market basket update,
  2. hospital wage index adjustments,
  3. New Technology Add-on Payment (NTAP) program policy changes,
  4. the agency’s call for input on how to best support Safety Net Hospitals,
  5. graduate medical education payments at rural emergency hospitals, and
  6. changes to many cardiovascular-related MS-DRGs.

Stakeholders will have until June 9, 2023, to submit comments to CMS on the contents of this regulation and request for information

1. Market basket update

Proposed Rule: Overall CMS’s Medicare 2024 Hospital Inpatient Proposed Rule will increase payments to acute care hospitals by an estimated $3.3 billion from 2023 to 2024; however, recent trends in economy-wide inflation may alter this estimate by the time the agency releases the Final Rule version of this regulation in August 2023. The primary driver of the estimated $3.3 billion increase in inpatient payments to hospitals is CMS’s proposed 2.8 percent increase in the annual update to inpatient operating payment rates.

HMA/Moran analysis: CMS’s 2.8 percent increase is largely based on an estimate of the rate of increase in the cost of a standard basket of hospital goods, the hospital market basket. For beneficiaries, increasing payment rates will eventually lead to a higher standard Medicare inpatient deductible and increased beneficiary out-of-pocket costs for many other services. For hospitals and health systems, payors, and manufacturers the proposed payment increase (2.8 percent) falls below economy-wide inflation (5-6 percent in recent months) and hospitals are already saying it is insufficient.[1] For this Proposed Rule, data from the third quarter of 2022 was used to calculate the 2.8 percent increase. Importantly, for the FY 2024 Final Rule, CMS will use data through the first quarter of 2023, which we know to include additional growth in economy-wide inflation. As a result, we anticipate the proposed 2.8 percent increase in payment rates may increase slightly by the time rates are finalized later in the year.

2. Hospital Wage Index Adjustments:

Proposed Rule: CMS proposes two wage index policies for FY 2024. First, CMS proposes to continue temporary policies finalized in the FY 2020 IPPS/LTCH PPS final rule to address wage index disparities affecting low-wage index hospitals, which includes many rural hospitals. Second, CMS proposes to include geographically urban hospitals that choose to reclassify into rural wage index areas in the calculation of state-level rural wage index and the calculation of the state-level wage index floor for urban hospitals (referred to as the rural floor policy).

HMA/Moran analysis: The two wage index policies proposed by CMS for FY 2024 will support rural hospitals. The first policy, to continue the low-wage index policy for an additional year beyond the original 4-year plan will allow hospitals with low wage indexes to boost their wage index and their payment rates across all MS-DRGs. Specifically, hospitals with wage indexes below 0.8615 (the 25th percentile across all hospitals) will automatically receive an increase in their wage index by CMS. This policy will bring additional millions of dollars to individual rural hospitals in FY 2024. The second policy, to include the labor data of geographically urban hospitals that choose to reclassify into rural wage index areas within the calculation of the state-level rural wage index and the state-level rural floor will largely benefit rural hospitals. In recent years several large geographically urban hospitals in several markets have chosen to reclassify into rural wage index areas to benefit their Medicare payments. In the past, CMS has not included the labor costs of these hospitals, which tend to have higher than average labor costs in their calculation of the state rural wage index or the rural floor wage index. In making this change, to include the labor costs of the geographically urban hospitals in these calculations, CMS will very likely increase the state-wide rural wage index. This will have the effect of increasing the wage index of many rural hospitals around the country. The overall impact of both proposed wage index policy changes for FY 2024 will be to increase inpatient payment rates to rural hospitals.

3. New technology add-on payments (NTAP):

Proposed Rule: Citing the increased number of applications over the past several years and noting the need for CMS staff to have time to fully review and analyze the applications, CMS proposes two changes to the NTAP application requirements.  First, CMS proposes to require all applicants to have a complete and active FDA market authorization request in place at the time of NTAP application submission (if not already FDA approved).  In addition, CMS proposes to move the FDA approval deadline from July 1 to May 1, beginning with applications for FY 2025.

HMA/Moran Analysis: CMS’ proposals to change the NTAP application process aim to ameliorate the problem of manufacturers withdrawing applications because they miss the FDA approval deadline. These withdrawals increase CMS’ workload, as the agency reviews some applications multiple times. However, while these proposals provide CMS with more time to review applications, they increase the amount of time some applicants will not receive NTAP payments, depending on the timing of the FDA approval process. The annual NTAP approval cycle and FDA approval deadline create difficulties for manufacturers with products that miss the deadline, which many stakeholders argue creates barriers to access for new technologies. Stakeholders have proposed a variety of potential solutions to these barriers, such as biannual or quarterly NTAP decisions, or extending the conditional approval pathway currently used for certain antibiotic products to all NTAP applications.

 4. Safety Net Hospital Request for Information:

Proposed Rule: CMS is seeking public input on the unique challenges faced by safety-net hospitals and the patients they serve, and potential approaches to help safety-net hospitals meet those challenges.

HMA/Moran Analysis: In the 2024 Proposed Rule CMS poses a variety of questions to the public about how safety net hospitals and their patients can be better supported by the Medicare program, both in terms of payment and infrastructure investment. The agency specifically asks stakeholders their opinion on measures that could be used to define safety net hospitals and potentially make differential or additional payments to safety net hospitals. CMS names the safety net index (SNI) developed by the Medicare Payment Advisory Commission (MedPAC) in recent years and the Area Deprivation Index (ADI) developed by the National Institutes for Health (NIH) as the two leading options for defining and potentially reimbursing safety net hospitals. These two methods have several significant differences, including that the SNI is a hospital-level measure based in-part on the volume of cases at a given hospital associated with Medicare beneficiaries that are fully or partially eligible for Medicaid and the ADI is a geographic measure that correlates local socioeconomic factors with medical disparities. HMA has modeled the SNI for hospital stakeholders in the last year and has identified hospitals that would be potential winners and losers if an SNI approach were implemented by CMS.

5. Graduate Medicare Education Training in Rural Emergency Hospitals:

Proposed Rule: CMS proposed to allow Graduate Medical Education (GME) payments for training Rural Emergency Hospitals. Rural Emergency Hospitals are a new provider type established by the Consolidated Appropriations Act, 2021, to address the growing concern over closures of rural hospitals. If finalized, this proposal would allow hospitals converting to REH status and other hospitals newly designated as REHs to receive Medicare GME payments even though they do not have an inpatient facility.

HMA/Moran analysis: If finalized, the proposed policy to allow REHs to offer GME training and to be paid for GME training will enhance access to care in rural areas and will enable hospitals that convert to REHs to expand their capabilities. CMS’s proposal to allow REHs to receive payment based on 100 percent of the reasonable costs for GME training costs allows REHs to operate training programs and to focus new training programs on rural care and outpatient care. This policy, if finalized, will bring additional revenues to hospitals that decide to convert to REHs (thereby relinquishing their inpatient capacity) and will improve access to care for beneficiaries living in rural areas.

6. MS-DRG weights:

Proposed Rule: To set MS-DRG weights for FY 2024 inpatient cases, CMS proposed to use FY 2022 data, which is consistent with pre-pandemic CMS methods. In previous years, CMS had modified its MS-DRG weight calculation to account for high volumes of COVID cases. However, for FY 2024, CMS has returned to its longstanding method of using a single year of data to set MS-DRG weights. In addition, among the various changes CMS has proposed as a part of the 2024 MS-DRG weight setting process CMS has proposed significant changes to many MS-DRGs in the category for diseases and disorders of the circulatory system (Major Diagnostic Category 5).

HMA/Moran analysis: CMS’s return to using a single year of data without COVID modification will be welcomed by many stakeholders, but particularly for those with an interest in short-stay surgical cases. The modifications CMS proposes to make to the MS-DRGs within Major Diagnostic Category 5, which includes numerous cardiovascular MS-DRGs, are likely to be disruptive for many stakeholders initially but over the long term are likely to make CMS coding more consistent with standard clinical practice and per case resource use. For example, CMS is proposing to consolidate five cardiac defibrillator MS-DRGs into three, consolidate three Thrombolysis MS-DRGs into two, and overhaul the family of stenting MS-DRGs. We anticipate that these changes and other proposed by CMS may result in initial coding confusion for hospitals, but that they will slowly adapt throughout 2024.

HMA and The Moran Company work collaboratively to monitor legislative and regulatory developments in the inpatient hospital space and assess the impact of inpatient policy changes on the hospital sector. HMA’s Medicare experts interpret and model inpatient policy proposals and use these analyses to assist clients in developing their strategic plans and comment on proposed regulations. Moran annually replicates the methodologies CMS uses in setting hospital payments and models alternative payment policies to help support its clients’ comments to the rule. Moran also assists clients with modeling for DRG reassignment requests and to support NTAP applications. Typically, these projects run through the summer, to ensure readiness for October deadlines. Finally, many clients find it useful to model payments for different types of cases under different payment scenarios. For example, a client may be interested in how payments for COVID-19 cases may change after the expiration of the Public Health Emergency, and which hospitals will face the biggest payment cuts. Moran is available to help with these and other payment modeling questions—and works on many of these issues in tandem with HMA’s Medicare experts.

For more information or questions about the policies described below, please contact Zach GaumerAmy BassanoKevin Kirby or Clare Mamerow.

[1] https://www.aha.org/news/headline/2023-04-10-cms-issues-hospital-ipps-proposed-rule-fy-2024

Florida releases Medicaid Managed Care ITN

This week our In Focus section reviews the Florida Statewide Medicaid Managed Care Program (SMMC) Invitation to Negotiate (ITN), released on April 11, 2023, by the Florida Agency for Health Care Administration (AHCA). SMMC consists of three programs: Managed Medical Assistance (MMA), Long-term Care (LTC), and dental, covering 4.4 million individuals. This ITN is for contracts to provide MMA and LTC.

Under the SMMC program, all enrollees receive their services from a single plan providing managed medical assistance, long-term care, and specialty benefits. (Dental benefits are provided separately.)

AHCA will select plans that will achieve the agency’s goals, including providing healthy birth outcomes for mothers and their infants, improving childhood and adolescent mental health, maximizing home and community-based placement and services, and supporting the HOPE Florida program. HOPE Florida utilizes ‘Hope Navigators’ to help individuals achieve economic self-sufficiency, develop long term-goals, and map out a strategic plan by focusing on community collaboration between the private sector, faith-based community, nonprofits and government entities.

Additionally, with the new contracts, AHCA will implement the following changes:

  • Specialty plans will no longer be awarded separately but must be awarded to a comprehensive or MMA plan.
  • Enrolling voluntary recipients (such as individuals with intellectual or developmental disabilities) into the SMMC program and providing the opportunity for them to opt out
  • AHCA may mandatorily enroll into the MMA program full benefit dual-eligibles who are also in a Medicare Dual Eligible Special Needs Plan (DSNP).

AHCA will invite 10 plans to negotiate for awards as shown below:

Timeline

Proposals are due August 15, 2023, with an anticipated award date of December 11. Contract will run from October 1, 2024, through December 31, 2030. Contracts may not be renewed, but AHCA may extend the term to cover any delays during the transition to a new plan.

Evaluation

Plans can receive a total maximum number of points of 5,950. AHCA will invite top-ranking plans to negotiations to ensure that AHCA can enter into contracts with the minimum required number of plans per region.

Current Market

As of December 2022, Florida served 4.3 million MMA and LTC enrollees, excluding an additional 97,000 Children’s Medical Services enrollees in the Children’s Medical Services Network plan. Centene had the highest market share based on enrollment, at over 40 percent.

Link to ITN

Medicaid redeterminations and loss of coverage

Policy crossroads and the end of the public health emergency due to COVID-19

This is part of a three-part series on significant implications of the end of the Public Health Emergency (PHE). 

What does your organization need to know?

March 31st marked the end of the COVID-19 Medicaid continuous coverage condition. Most forecasts project between 10-15 million enrollees will lose Medicaid coverage. State Medicaid programs will lose supplemental funding provided for the continuous coverage requirement and begin to transition to normal eligibility operations. Health Management Associates (HMA) and HMA companies can help the full spectrum of stakeholders plan for, adjust to, and administer the changes up to and beyond the 12-month continuous coverage “unwinding” period. The immediate work can serve as a springboard for future improvement initiatives and to respond to federal guidance that is under development to strengthen and streamline eligibility and enrollment processes and improve the experience for consumers.

Who is affected by this change?

  • Payers including Medicaid managed care organizations and Qualified Health Plans
  • Provider organizations
  • Trade associations of Medicaid managed care or provider organizations
  • State and local community-based organizations
  • State and local governments responsible for administering and overseeing the eligibility processes for Medicaid and other public programs
  • Advocacy groups
  • Foundations
  • Vendors supporting state agencies, health plans and providers

Watch a video presentation about the HMA Coverage Model

What is in the HMA model?

HMA has developed an insurance mix model that projects how the resumption of Medicaid eligibility redeterminations beginning in April 2023 will affect Medicaid enrollment, employer sponsored insurance (ESI), Marketplace coverage, and the uninsured. The model includes enrollment projections for all 50 states and considers the enhanced Marketplace subsidies included in the Inflation Reduction Act (IRA). Approximately 20 million individuals gained coverage during the redetermination freeze and well over 10 million of the approximately 90 million current Medicaid enrollees are at risk for disenrollment.  HMA’s model contemplates the variety in state approaches to managing the resumption of eligibility redeterminations as well as key insights related to the differential impact by Medicaid eligibility categories. 

HMA can help with immediate needs to help you plan:

  • HMA has detailed state-specific unwinding policy insights for each state including observations regarding which states are taking more aggressive and less aggressive approaches. 
  • We can provide technical assistance and strategic planning services to help states and organizations manage the necessary changes.
  • Actuarial experts can assist with acuity changes caused by the change in enrollment.
  • Our colleagues are available for a discussion of the product and the key policies influencing the projections.
  • HMA can also help with post PHE support.

For more information, please contact:

Matt Powers, Managing Director, [email protected]

Chris Dickerson, Consulting Actuary, [email protected]

Read part 2 in this blog series

Medicaid authority and opportunity to build new programs for justice-involved individuals

On January 26, the Centers for Medicare & Medicaid Services (CMS) approved California’s (CA) section 1115 request to cover targeted healthcare services for incarcerated individuals 90 days before release. This historical partial rollback of the Medicaid Inmate Exclusion Policy empowers the CA Department of Health Care Services (DHCS) to collaborate with state agencies, counties, health plans and community-based organizations to create coordinated community reentry services focused on persons transitioning from incarceration to community that provide physical and behavioral healthcare services.

Fourteen states have pending section 1115 demonstration requests to provide specific healthcare services for justice-involved individuals. CMS has indicated it will be issuing guidance on the coverage parameters for healthcare services for individuals transitioning from carceral settings.  These efforts allow states, counties, and cities to build coordinated systems of healthcare care to support reentry.  Building such systems requires infrastructure development and enhancement, stakeholder engagement, strategic planning, and project and change management across justice partners, health plans, and community-based organizations. 

Implementing the services will involve an in-depth understanding of the fundamental healthcare needs of justice-involved individuals, carceral setting healthcare delivery and reentry (transition to the community), and how to operationalize necessary changes to meet program requirements.  Additionally, change management, critical stakeholder coordination, infrastructure, and technology development, enhancement, guidance on data-sharing agreements, and health plan involvement will need to be created or adapted to meet the CMS 1115 requirements.  Administrators of carceral settings and correctional healthcare providers must coordinate services with community-based organizations and health plans to implement timely, cost-effective, and quality healthcare services to individuals leaving carceral facilities.

States, payors, correctional administrators, and healthcare providers will benefit from understanding the 1115 requirements to stand up this initiative, recommendations to facilitate the 1115 application process, how it intersects with healthcare delivery within a carceral setting and during reentry, and practical strategies for planning and operationalizing the effective delivery and coordination of healthcare services that meet program requirements. 

On Thursday, April 6, 2023, HMA held a webinar to help states and other stakeholders understand the section 1115 parameters and provide insight to states, local government, correctional health settings, and providers on how to best plan for implementing such services.

Key experts covered the following topics:

  • Deep Dive into California’s section 1115 approval and lessons learned from the California application process?
  • Operationalizing In Reach and Re-entry Programming for Justice-Involved Individuals
    • Understanding the complex needs of justice-involved individuals.
    • What investments must states make to implement Medicaid-eligible services for justice-involved individuals?
    • What role can technology and digital health play in supplementing direct care?
  • The Role of Payers in new Services for Justice-Involved Individuals

Speakers:

Linda Follenweider, Managing Director, Justice Involved Services
Tonya Moore, Senior Consultant
Margaret Tatar, Managing Principal
John Volpe, Principal
Julie White, Principal 

HMA consultants bring unparalleled expertise in Medicaid policy, correctional health and a deep understanding of the unique needs of this population. We have the operational knowledge and experience with technology and digital health solutions, as well as the needed data and analytic capacity to collect the correct data to drive improvements in equity and access to care.

Medicaid managed care enrollment update – Q4 2022

This week, our In Focus section reviews recent Medicaid enrollment trends in capitated, risk-based managed care in 32 states.[1] Many state Medicaid agencies post monthly enrollment figures by health plan for their Medicaid managed care population to their websites. This data allows for the timeliest analysis of enrollment trends across states and managed care organizations. All 32 states highlighted in this review have released monthly Medicaid managed care enrollment data into the fourth quarter (Q4) of 2022. This report reflects the most recent data posted. HMA will continue tracking enrollment throughout the eligibility redetermination period. HMA has made the following observations related to the enrollment data shown on Table 1 (below):

  • The 32 states in this report account for an estimated 71 million Medicaid managed care enrollees as of December 2022. Based on HMA estimates of MCO enrollment in states not covered in this report, we believe that nationwide Medicaid MCO enrollment was likely about 75 million in December 2022. As such, the enrollment data across these 32 states represents approximately 95 percent of all Medicaid MCO enrollment.
  • Across the 32 states tracked in this report, Medicaid managed care enrollment is up 7.5 percent year-over-year as of December 2022.
  • All states, besides Mississippi, saw increases in enrollment in December 2022, compared to the previous year, due to the gains from the COVID-19 pandemic. Mississippi Medicaid managed care enrollment fell because the state shifted members to FFS during the public health emergency.
  • Twenty-three of the 32 states – Arizona, California, District of Columbia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Missouri, Nebraska, Nevada, New Jersey, New Mexico, New York, Ohio, Oregon, Pennsylvania, Virginia, Washington, and West Virginia – expanded Medicaid under the Affordable Care Act and have seen increased Medicaid managed care enrollment since expansion.
  • The 23 expansion states listed above have seen net Medicaid managed care enrollment increase by 3.5 million members, or 7.2 percent, in the past year, to 52.2 million members at the end of 2022.
  • The nine states that have not yet expanded Medicaid as of December 2022 – Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, Tennessee, Texas, and Wisconsin – have seen Medicaid managed care enrollment increase 8.3 percent to 19 million members at the end of 2022.

Table 1 – Monthly MCO Enrollment by State – July 2022 through December 2022

 Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Arizona2,069,0482,079,3602,095,1012,106,8002,116,4442,127,666
+/- m/m8,52710,31215,74111,6999,64411,222
% y/y7.6%0.0%7.5%7.4%7.2%7.1%
California12,929,50013,013,32413,073,42713,132,61613,231,99313,204,398
+/- m/m215,50683,82460,10359,18999,377(27,595)
% y/y9.8%9.9%9.9%9.9%10.2%9.5%
D.C.246,957247,704248,577249,617250,676 
+/- m/m3,2237478731,0401,059N/A
% y/y6.7%6.7%6.5%6.5%6.4%
Florida4,385,9654,432,2334,465,6704,502,2974,537,1214,581,266
+/- m/m41,44146,26833,43736,62734,82444,145
% y/y10.9%10.9%10.7%10.7%10.7%11.0%
Georgia1,975,2771,988,727 2,016,4622,027,2752,035,673
+/- m/m13,11713,450N/AN/A10,8138,398
% y/y9.8%9.5%9.0%8.7%8.3%
Illinois2,890,3322,884,0292,900,2322,929,5842,965,0073,000,717
+/- m/m(8,672)(6,303)16,20329,35235,42335,710
% y/y5.1%4.5%4.1%4.4%5.1%5.5%
Indiana1,742,7621,761,6921,769,4001,781,4641,797,4511,813,044
+/- m/m6,90618,9307,70812,06415,98715,593
% y/y11.6%11.3%11.0%10.5%10.2%10.3%
Iowa795,534799,748807,296 812,481814,490
+/- m/m2,6424,2147,548N/AN/A2,009
% y/y5.9%5.8%6.4%6.0%6.1%
Kansas489,309490,911492,640497,257499,143500,814
+/- m/m2,6911,6021,7294,6171,8861,671
% y/yN/AN/AN/AN/A8.3%6.3%
Kentucky1,494,0681,487,3871,509,2741,518,9061,528,4841,534,657
+/- m/m6,069(6,681)21,8879,6329,5786,173
% y/y5.5%5.3%5.6%5.8%6.7%6.1%
Louisiana1,821,6441,828,0151,833,4571,841,6931,858,0921,860,170
+/- m/m7,2136,3715,4428,23616,3992,078
% y/y4.6%4.5%4.4%4.7%5.2%5.8%
Maryland1,496,6771,502,2711,508,4691,514,3811,521,1711,529,308
+/- m/m8,2055,5946,1985,9126,7908,137
% y/y6.5%6.2%6.1%5.8%5.8%5.7%
Michigan2,280,2432,294,4322,299,9132,309,9132,319,9512,324,046
+/- m/m2,92314,1895,48110,00010,0384,095
% y/y3.8%3.6%3.5%3.7%4.5%4.3%
Minnesota1,261,1121,262,0731,278,9541,286,8901,293,8581,299,194
+/- m/m1,89396116,8817,9366,9685,336
% y/y7.3%6.7%7.4%7.5%7.5%7.5%
Mississippi367,137363,387364,612355,694367,902396,880
+/- m/m(452)(3,750)1,225(8,918)12,20828,978
% y/y-22.7%-19.9%-17.4%-17.3%-12.5%-3.9%
Missouri1,038,2391,065,2171,099,7071,118,3731,136,5891,157,005
+/- m/m26,52026,97834,49018,66618,21620,416
% y/y27.0%29.1%32.6%31.7%31.8%29.0%
Nebraska363,328366,202369,770372,613374,857378,237
+/- m/m2,7402,8743,5682,8432,2443,380
% y/y12.4%11.9%11.7%11.2%10.8%10.6%
Nevada687,362689,139697,752675,465685,736692,890
+/- m/m9,4641,7778,613(22,287)10,2717,154
% y/y9.3%9.0%9.3%4.2%5.2%5.7%
New Jersey2,100,9472,113,9302,125,1812,130,8682,144,5142,158,966
+/- m/m10,89712,98311,2515,68713,64614,452
% y/y7.4%7.4%7.2%7.0%7.1%7.0%
New Mexico809,991811,732812,995813,630814,466815,798
+/- m/m2,4911,7411,2636358361,332
% y/y4.2%3.7%3.4%3.0%2.6%2.3%
New York5,855,6155,853,1085,878,5195,906,2645,929,2885,961,782
+/- m/m39,970(2,507)25,41127,74523,02432,494
% y/y4.5%4.3%4.2%4.3%4.5%4.6%
North Carolina1,738,5451,746,9481,757,5031,768,9741,778,1991,837,423
+/- m/m9,0478,40310,55511,4719,22559,224
% y/y8.0%6.8%6.7%6.6%6.6%9.5%
Ohio2,964,7312,963,6162,960,9222,958,6662,961,9832,973,763
+/- m/m(1,340)(1,115)(2,694)(2,256)3,31711,780
% y/y3.4%2.6%1.9%1.4%1.0%0.9%
Oregon1,193,3581,202,1981,206,5201,211,0991,221,4351,228,054
+/- m/m3,9208,8404,3224,57910,3366,619
% y/y8.3%8.4%7.7%7.6%7.4%7.2%
Pennsylvania2,895,8372,909,9852,920,5842,937,0492,950,6132,966,207
+/- m/m13,97314,14810,59916,46513,56415,594
% y/y7.4%7.3%6.9%6.8%6.6%6.5%
South Carolina1,055,7851,063,4451,069,5691,078,0941,084,5291,089,577
+/- m/m5,2267,6606,1248,5256,4355,048
% y/y7.6%7.5%7.4%7.9%7.6%7.5%
Tennessee1,692,3951,704,3981,710,1251,718,5391,726,6031,734,108
+/- m/m6,73712,0035,7278,4148,0647,505
% y/y6.0%6.1%6.1%6.0%5.9%5.8%
Texas 5,466,045  5,653,169 
+/- m/mN/AN/AN/AN/AN/AN/A
% y/y8.6%10.6%
Virginia1,572,9231,582,9731,589,7221,598,8751,608,8401,619,311
+/- m/m11,82910,0506,7499,1539,96510,471
% y/y11.3%11.0%10.0%9.6%10.1%9.8%
Washington1,884,7341,898,9831,904,1271,913,2301,927,6901,959,278
+/- m/m8,86714,2495,1449,10314,46031,588
% y/y#DIV/0!#DIV/0!5.8%5.9%6.0%7.2%
West Virginia519,992524,042524,922527,226530,494533,194
+/- m/m2,8714,0508802,3043,2682,700
% y/y6.5%6.8%6.4%5.9%5.9%5.7%
Wisconsin1,161,2021,166,2081,172,7191,179,2041,184,8991,190,673
+/- m/m5,2635,0066,5116,4855,6955,774
% y/y7.5%7.2%7.1%7.1%6.9%6.6%

Note: In Table 1 above and the state tables below, “+/- 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.

Below, we provide a state-specific analysis of recent enrollment trends in the states where HMA tracks data.

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, while others reflect an end-of-the-month snapshot. Second, in some cases the data is comprehensive in that it covers all state-sponsored health programs for which the state offers managed care; in other cases, the data reflects only a subset of the broader Medicaid managed care population. This is the key limiting factor in comparing the data described below and figures reported by publicly traded Medicaid MCOs. Consequently, the data we review in Table 1 and throughout the In Focus section 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 data.

State-Specific Analysis

Arizona

Medicaid Expansion Status: Expanded January 1, 2014

Enrollment in Arizona’s two Medicaid managed care programs grew to 2.1 million in December 2022, up 7.1 percent from December 2021.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Acute Care2,002,5842,012,8022,028,3352,039,8802,049,3112,060,376
ALTCS66,46466,55866,76666,92067,13367,290
Total Arizona2,069,0482,079,3602,095,1012,106,8002,116,4442,127,666
+/- m/m8,52710,31215,74111,6999,64411,222
% y/y7.6%7.5%7.4%7.2%7.1%

California

Medicaid Expansion Status: Expanded January 1, 2014

Medi-Cal managed care enrollment was up 9.5 percent year-over-year to 13.2 million, as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Two-Plan Counties8,356,1378,409,8178,446,5148,481,8858,548,0968,588,418
Imperial/San Benito100,384101,117101,633102,064102,881103,437
Regional Model364,066366,437368,624370,361373,402375,473
GMC Counties1,435,2501,445,5321,452,1271,458,1491,470,1221,391,421
COHS Counties2,561,8312,578,7472,593,0032,608,7312,625,7952,634,112
Duals Demonstration111,832111,674111,526111,426111,697111,537
Total California12,929,50013,013,32413,073,42713,132,61613,231,99313,204,398
+/- m/m215,50683,82460,10359,18999,377(27,595)
% y/y9.8%9.9%9.9%9.9%10.2%9.5%

District of Columbia

Medicaid Expansion Status: Expanded January 1, 2014

Medicaid managed care enrollment in the District of Columbia was up 6.4 percent to almost 251,000 in November 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22
Total District of Columbia246,957247,704248,577249,617250,676
+/- m/m3,2237478731,0401,059
% y/y6.7%6.7%6.5%6.5%6.4%

Florida

Medicaid Expansion Status: Not Expanded

Florida’s statewide Medicaid managed care program had seen an 11 percent rise in total covered lives over the last year to nearly 4.6 million beneficiaries as of December 2022. (Note that the managed LTC enrollment figures listed below are a subset of the Managed Medical Assistance (MMA) enrollments and are included in the MMA number; they are not separately added to the total to avoid double counting).

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
MMA3,908,5393,948,9293,978,0984,010,5344,041,8164,080,381
LTC (Subset of MMA)124,107124,691125,397126,144126,720126,621
SMMC Specialty Plan332,179338,057342,325346,516350,058355,638
FL Healthy Kids145,247145,247145,247145,247145,247145,247
Total Florida4,385,9654,432,2334,465,6704,502,2974,537,1214,581,266
+/- m/m41,44146,26833,43736,62734,82444,145
% y/y10.9%10.9%10.7%10.7%10.7%11.0%

Georgia

Medicaid Expansion Status: Not Expanded

As of December 2022, Georgia’s Medicaid managed care program covered more than 2 million members, up 8.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Georgia1,975,2771,988,7272,016,4622,027,2752,035,673
+/- m/m13,11713,45010,8138,398
% y/y9.8%9.5%9.0%8.7%8.3%

Illinois

Medicaid Expansion Status: Expanded January 1, 2014

Illinois enrollment across the state’s managed care programs was up 5.5 percent to 3 million as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
HealthChoice2,800,4202,793,1242,809,6892,839,3422,874,7002,909,303
Duals Demonstration89,91290,90590,54390,24290,30791,414
Total Illinois2,890,3322,884,0292,900,2322,929,5842,965,0073,000,717
+/- m/m(8,672)(6,303)16,20329,35235,42335,710
% y/y5.1%4.5%4.1%4.4%5.1%5.5%

Indiana

Medicaid Expansion Status: Expanded in 2015 through HIP 2.0

As of December 2022, enrollment in Indiana’s managed care programs—Hoosier Healthwise, Hoosier Care Connect, and Healthy Indiana Program (HIP)—was more than 1.8 million, up 10.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Hoosier Healthwise845,910852,904857,952863,973869,613876,606
Hoosier Care Connect102,805102,819102,537102,253102,200102,150
HIP794,047805,969808,911815,238825,638834,288
Indiana Total1,742,7621,761,6921,769,4001,781,4641,797,4511,813,044
+/- m/m6,90618,9307,70812,06415,98715,593
% y/y11.6%11.3%11.0%10.5%10.2%10.3%

Iowa

Medicaid Expansion Status: Expanded January 1, 2014

Iowa launched its statewide Medicaid managed care program in April of 2016. Enrollment across all populations was nearly 814,500, as of December 2022. Enrollment was up 6.1 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Traditional Medicaid507,266510,618516,556520,234521,118
Iowa Wellness Plan237,910239,261242,555244,724246,385
hawk-i50,35849,86948,18547,52346,987
Total Iowa795,534799,748807,296812,481814,490
+/- m/m2,6424,2147,5482,009
% y/y5.9%5.8%6.4%6.0%6.1%

Kansas

Medicaid Expansion Status: Not Expanded

Kansas Medicaid managed care enrollment was nearly 501,000 as of December 2022, up 6.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Kansas489,309490,911492,640497,257499,143500,814
+/- m/m2,6911,6021,7294,6171,8861,671
% y/y8.3%6.3%

Kentucky

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, Kentucky covered more than 1.5 million beneficiaries in risk-based managed care. Total enrollment was up 6.1 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Kentucky1,494,0681,487,3871,509,2741,518,9061,528,4841,534,657
+/- m/m6,069(6,681)21,8879,6329,5786,173
% y/y5.5%5.3%5.6%5.8%6.7%6.1%

Louisiana

Medicaid Expansion Status: Expanded July 1, 2016

Medicaid managed care enrollment in Louisiana was more than 1.86 million as of December 2022, up 5.8 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Louisiana1,821,6441,828,0151,833,4571,841,6931,858,0921,860,170
+/- m/m7,2136,3715,4428,23616,3992,078
% y/y4.6%4.5%4.4%4.7%5.2%5.8%

Maryland

Medicaid Expansion Status: Expanded January 1, 2014

Maryland’s Medicaid managed care program covered more than 1.5 million lives as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Maryland1,496,6771,502,2711,508,4691,514,3811,521,1711,529,308
+/- m/m8,2055,5946,1985,9126,7908,137
% y/y6.5%6.2%6.1%5.8%5.8%5.7%

Michigan

Medicaid Expansion Status: Expanded April 1, 2014

As of December 2022, Michigan’s Medicaid managed care was up 4.3 percent to 2.3 million.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Medicaid2,239,9372,251,8102,256,8002,265,2192,274,7632,279,473
MI Health Link (Duals)40,30642,62243,11344,69445,18844,573
Total Michigan2,280,2432,294,4322,299,9132,309,9132,319,9512,324,046
+/- m/m2,92314,1895,48110,00010,0384,095
% y/y3.8%3.6%3.5%3.7%4.5%4.3%

Minnesota

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, enrollment across Minnesota’s multiple managed Medicaid programs was nearly 1.3 million, up 7.5 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Parents/Kids748,197748,513758,100763,044767,798770,918
Expansion Adults272,666273,387278,421281,284284,073288,680
Senior Care Plus24,19024,25225,34425,91426,41526,740
Senior Health Options43,42943,68643,92044,16244,24844,324
Special Needs BasicCare64,65664,48465,56265,76365,98766,171
Moving Home Minnesota11111010911
Minnesota Care107,963107,740107,597106,713105,328102,350
Total Minnesota1,261,1121,262,0731,278,9541,286,8901,293,8581,299,194
+/- m/m1,89396116,8817,9366,9685,336
% y/y7.3%6.7%7.4%7.5%7.5%7.5%

Mississippi

Medicaid Expansion Status: Not Expanded

MississippiCAN, the state’s Medicaid managed care program, had membership down 3.9 percent to nearly 397,000 as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Mississippi367,137363,387364,612355,694367,902396,880
+/- m/m(452)(3,750)1,225(8,918)12,20828,978
% y/y-22.7%-19.9%-17.4%-17.3%-12.5%-3.9%

Missouri

Medicaid Expansion Status: Expansion Enrollment began in October 2021

Missouri managed care enrollment in the Medicaid and CHIP programs was nearly 1.2 million in December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Medicaid758,928757,312769,419775,076782,863787,611
Total CHIP28,94928,93729,02629,12129,23129,402
Total AEG199,963228,361250,131262,612272,574287,692
Total SHK50,39950,60751,13151,56451,92152,300
Total Missouri1,038,2391,065,2171,099,7071,118,3731,136,5891,157,005
+/- m/m26,52026,97834,49018,66618,21620,416
% y/y27.0%29.1%32.6%31.7%31.8%29.0%

Nebraska

Medicaid Expansion Status: Expanded October 1, 2020

As of December 2022, Nebraska’s Medicaid managed care program enrolled 378,000 members, up 10.6 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Nebraska363,328366,202369,770372,613374,857378,237
+/- m/m2,7402,8743,5682,8432,2443,380
% y/y12.4%11.9%11.7%11.2%10.8%10.6%

Nevada

Medicaid Expansion Status: Expanded January 1, 2014

Nevada’s Medicaid managed care enrollment was up 5.7 percent to nearly 693,000 as of December 2022.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Nevada687,362689,139697,752675,465685,736692,890
+/- m/m9,4641,7778,613(22,287)10,2717,154
% y/y9.3%9.0%9.3%4.2%5.2%5.7%

New Jersey

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, New Jersey Medicaid managed care enrollment was up 7 percent to nearly 2.2 million.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total New Jersey2,100,9472,113,9302,125,1812,130,8682,144,5142,158,966
+/- m/m10,89712,98311,2515,68713,64614,452
% y/y7.4%7.4%7.2%7.0%7.1%7.0%

New Mexico

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, New Mexico’s Centennial Care program covered nearly 816,000 members, up 2.3 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total New Mexico809,991811,732812,995813,630814,466815,798
+/- m/m2,4911,7411,2636358361,332
% y/y4.2%3.7%3.4%3.0%2.6%2.3%

New York

Medicaid Expansion Status: Expanded January 1, 2014

New York’s Medicaid managed care programs collectively covered nearly 6 million beneficiaries as of December 2022, a 4.6 percent increase from the previous year. The Medicaid Advantage program ended in December 2021.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Mainstream MCOs5,399,0895,395,4895,418,9155,446,4095,467,4675,494,358
Managed LTC255,999256,538258,236257,360260,087264,965
Medicaid Advantage000000
Medicaid Advantage Plus34,35734,35534,68934,76434,71735,061
HARP164,514165,067165,024166,063165,340165,713
FIDA-IDD (Duals)1,6561,6591,6551,6681,6771,685
Total New York5,855,6155,853,1085,878,5195,906,2645,929,2885,961,782
+/- m/m39,970(2,507)25,41127,74523,02432,494
% y/y4.5%4.3%4.2%4.3%4.5%4.6%

North Carolina

Medicaid Expansion Status: Not Expanded

As of December 2022, enrollment in North Carolina’s Medicaid managed care program was 1.8 million, up 9.5 percent from the prior year. North Carolina implemented Medicaid managed care on July 1, 2021.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total North Carolina1,738,5451,746,9481,757,5031,768,9741,778,1991,837,423
+/- m/m9,0478,40310,55511,4719,22559,224
% y/y8.0%6.8%6.7%6.6%6.6%9.5%

Ohio

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, enrollment across all four Ohio Medicaid managed care programs was nearly 3 million, up 0.9 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
CFC Program1,800,7811,800,0381,798,1351,796,3271,798,8731,804,860
ABD/Duals348,071348,176347,461347,371347,473347,839
Group 8 (Expansion)815,879815,402815,326814,968815,637821,064
Total Ohio2,964,7312,963,6162,960,9222,958,6662,961,9832,973,763
+/- m/m(1,340)(1,115)(2,694)(2,256)3,31711,780
% y/y3.4%2.6%1.9%1.4%1.0%0.9%

Oregon

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, enrollment in the Oregon Coordinated Care Organization (CCO) Medicaid managed care program was more than 1.2 million, up 7.2 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Oregon1,193,3581,202,1981,206,5201,211,0991,221,4351,228,054
+/- m/m3,9208,8404,3224,57910,3366,619
% y/y8.3%8.4%7.7%7.6%7.4%7.2%

Pennsylvania

Medicaid Expansion Status: Expanded January 1, 2015

As of December 2022, Pennsylvania’s Medicaid managed care enrollment was nearly 3 million, up 6.5 percent in the past year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Pennsylvania2,895,8372,909,9852,920,5842,937,0492,950,6132,966,207
+/- m/m13,97314,14810,59916,46513,56415,594
% y/y7.4%7.3%6.9%6.8%6.6%6.5%

South Carolina

Medicaid Expansion Status: Not Expanded

South Carolina’s Medicaid managed care programs collectively enrolled nearly 1.1 million members as of December 2022, which represents an increase of 7.5 percent in the past year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Medicaid1,041,9091,049,7061,056,0261,064,5481,071,0161,076,146
Total Duals Demo13,87613,73913,54313,54613,51313,431
Total South Carolina1,055,7851,063,4451,069,5691,078,0941,084,5291,089,577
+/- m/m5,2267,6606,1248,5256,4355,048
% y/y7.6%7.5%7.4%7.9%7.6%7.5%

Tennessee

Medicaid Expansion Status: Not Expanded

As of December 2022, TennCare managed care enrollment totaled 1.7 million, up 5.8 percent from the prior year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Tennessee1,692,3951,704,3981,710,1251,718,5391,726,6031,734,108
+/- m/m6,73712,0035,7278,4148,0647,505
% y/y6.0%6.1%6.1%6.0%5.9%5.8%

Texas

Medicaid Expansion Status: Not Expanded

Texas’ state fiscal year begins in September and program-specific enrollment is only reported at the end of each state fiscal quarter. As of November 2022, Texas Medicaid managed care enrollment was nearly 5.7 million across the state’s six managed care programs, up 10.6 percent from the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
STAR4,559,2934,748,820
STAR+PLUS559,746568,456
STAR HEALTH45,76046,228
Duals Demo34,33633,673
CHIP97,15385,773
STAR KIDS169,757170,219
Total Texas5,466,0455,653,169
+/- m/m
% y/y8.6%10.6%

Virginia

Medicaid Expansion Status: January 1, 2019

Virginia Medicaid managed care enrollment was up 9.8 percent in December 2022 to 1.6 million members.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Virginia1,572,9231,582,9731,589,7221,598,8751,608,8401,619,311
+/- m/m11,82910,0506,7499,1539,96510,471
% y/y11.3%11.0%10.0%9.6%10.1%9.8%

Washington

Medicaid Expansion Status: Expanded January 1, 2014

Washington’s Medicaid managed care enrollment increased 7.2 percent to nearly 2 million as of December 2022, compared to the previous year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total Washington1,884,7341,898,9831,904,1271,913,2301,927,6901,959,278
+/- m/m8,86714,2495,1449,10314,46031,588
% y/y#DIV/0!#DIV/0!5.8%5.9%6.0%7.2%

West Virginia

Medicaid Expansion Status: Expanded January 1, 2014

As of December 2022, West Virginia’s Medicaid managed care program covered 533,000 members, up 5.7 percent year-over-year.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
Total West Virginia519,992524,042524,922527,226530,494533,194
+/- m/m2,8714,0508802,3043,2682,700
% y/y6.5%6.8%6.4%5.9%5.9%5.7%

Wisconsin

Medicaid Expansion Status: Not Expanded

Across Wisconsin’s three Medicaid managed care programs, December 2022 enrollment totaled nearly 1.2 million, up 6.6 percent from the year before.

Jul-22Aug-22Sep-22Oct-22Nov-22Dec-22
BadgerCare+1,042,4561,047,2171,053,3611,059,5871,065,1821,070,788
SSI61,84161,91662,06562,12962,16562,293
LTC56,90557,07557,29357,48857,55257,592
Total Wisconsin1,161,2021,166,2081,172,7191,179,2041,184,8991,190,673
+/- m/m5,2635,0066,5116,4855,6955,774
% y/y7.5%7.2%7.1%7.1%6.9%6.6%

More Information Available from HMA Information Services

More detailed information on the Medicaid managed care landscape is available from HMA Information Services (HMAIS), which collects Medicaid enrollment data, health plan financials, and the latest on expansions, waivers, duals, ABD populations, long-term care, accountable care organizations, and patient-centered medical homes. HMAIS also includes a public documents library with copies of Medicaid RFPs, responses, model contracts, and scoring sheets.

HMAIS enhances this publicly available information with an overview of the structure of Medicaid in each state, as well as proprietary Medicaid Managed Care RFP calendars.

For additional information on how to subscribe to HMA Information Services, contact Carl Mercurio at 212-575-5929.

[1] Arizona, California, District of Columbia, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Washington, West Virginia, Wisconsin.

CMS announces plans to pursue new Medicare and Medicaid drug payment models

This week our In Focus section reviews the Centers for Medicare and Medicaid Services’ (CMS) announcement that the agency will explore three new prescription drug payment models in the Medicare and Medicaid programs:

  • Medicare High-Value Drug List Model
  • Cell and Gene Therapy (CGT) Access Model
  • Accelerating Clinical Evidence Model

The announcement – and accompanying report – responds to President Biden’s October 2022 Executive Order directing CMS’ Center for Medicare and Medicaid Innovation (the Innovation Center) to identify models that could lower cost sharing for commonly used drugs and include value-based payment for drugs.

Notably, the Innovation Center offered varying levels of specificity about the models, leaving unanswered many questions about the structures and timelines for the potential models. The Innovation Center will need to conduct more robust analysis to determine the design specifications for each model, stakeholder interest, and practical and political feasibility for each. In addition, each model will need to have its own application or rulemaking process to identify participants and other key model parameters. While this makes it difficult for the Innovation Center to specify timelines, it provides stakeholders some flexibility to analyze and develop recommendations for the potential models over the next several months.

HMA’s experts are also closely tracking CMS’ work on additional areas identified for the agency to research. For example, CMS could consider other regulatory pathways, partnerships, or campaigns to promote the following changes:

  • Opportunities to encourage price transparency for prescription drugs
  • Options to improve biosimilar adoption
  • Medicare fee-for-service options to support CGT access and affordability

The drug payment models build on other federal and state-level efforts to address prescription drug costs and total cost of care initiatives. For example, CMS’ drug payment model announcement comes just a week after the agency released its implementation approach for the drug payment policies approved as part of the inflation Reduction Act of 2022 (IRA) (P.L. 117-169). CMS is balancing the extensive implementation needs for the IRA while also acknowledging the new law may not directly address other value-based considerations impacting cost and access for certain prescription medications.

Below are some of the highlights of the Innovation Center’s drug payment models.

Medicare High Value Drug List Model

The Medicare High Value Drug List model would provide standardized approach to cost sharing for specified Part D medications. CMS suggests a standardized list with consistent cost-sharing to allow providers to easily identify and prescribe appropriate medications. Part D Sponsors could offer a Medicare-defined standard set of approximately 150 high-value generic drugs with a maximum co-payment of $2 for a month’s supply. Under this model, generic drugs included in the standardized list would not be subject to step therapy, prior authorization, quantity limits, or pharmacy network restrictions.

According to the report, CMS could explore leveraging existing systems, which would allow for a streamlined implementation. CMS also plans to seek input from beneficiaries, Part D Sponsors, manufacturers, and providers, but the agency did not provide a more specific timeline for announcing the Model specifications and start date.

Cell and Gene Therapy (CGT) Access

The Cell and Gene Therapy (CGT) Access model would be a voluntary opportunity for states and manufacturers. The model builds on existing state Medicaid initiatives to develop outcomes-based agreements (OBAs) with certain manufacturers of high-cost and breakthrough medications. CMS suggests the multistate test could inform a more permanent framework for evaluating, financing, and delivering CGTs on a broader scale. This model may also help address complexities with the federal drug rebate requirements in states that wish to pursue value-based contracting arrangements. Under this model a state Medicaid agency could choose to adopt the CMS structure for multi-state OBAs with participating manufacturers. CMS would be responsible for implementing, monitoring, reconciling, and evaluating financial and clinical outcomes. Initially the model would focus on CGTs for illnesses like sickle cell disease and cancer.  This approach could remove some of the barriers that have slowed state uptake of OBAs.

CMS plans to begin model development in 2023, announce the model sometime in 2024-25, and test it as early as 2026.

Accelerating Clinical Evidence Model

The Innovation Center is considering mandatory participation for Medicare Part B providers in the Accelerating Clinical Evidence Model. Under this potential model, the agency would adjust Medicare Part B payment amounts for Accelerated Approval Program (AAP) drugs to determine if adjustments incentivize manufacturers to timely complete trials, which in turn may facilitate earlier availability of clinical evidence.

The Innovation Center identified some challenging aspects for this model and stated the agency will need to consult with the U.S. Food and Drug Administration (FDA) in 2023 to consider approaches for this model. Statements from agency officials about the model also indicate the need for consultation with the Medicare Payment Advisory Commission (MedPAC) and other stakeholders, including through an Advance Notice of Proposed Rulemaking.

If the Innovation Center determines this model is feasible, the agency will provide more details about a targeted launch. The Innovation Center has previously attempted to implement mandatory Part B drug payment models but never implemented them due to legal challenges and stakeholder opposition.

HMA and HMA companies will continue to analyze these potential models and initiatives developing in parallel with the Innovation Center’s work. We have the depth and breadth of expertise to assist with tailored analysis, to model policy impacts of the potential models, and to support the drafting of feedback to CMS as it considers these options.

If you have questions about the Innovation Center’s proposed models and how it will affect manufacturers, Medicare providers, Medicaid programs and patients, contact Amy Bassano ([email protected]), Kevin Kirby ([email protected]) or Andrea Maresca ([email protected]).