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As Pa. waits for decision on Medicaid waiver, a look at other states

Written by Ben Allen, General Assignment Reporter | Mar 20, 2014 4:00 AM

(Harrisburg) -- The federal government is still considering Pennsylvania’s request for a Medicaid waiver. Under the proposal, Medicaid money would be used to offer private insurance to those who would otherwise be covered by a straightforward expansion of Medicaid. But what have other states done to get their plans approved?

Arkansas set the standard – launching what’s known as the private option in October. 

“We are starting to see some of our providers, our hospitals in particular, that are seeing a reduction in the uncompensated care January and February of this year compared to January and February a year ago. So I think we’re starting to see some of the financial impact," says Arkansas Surgeon General Dr. Joe Thompson, who helped craft the plan.

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It wasn’t easy for the state though. Every state has political hurdles, sure, but Arkansas was going first. At one point, the Washington Post referred to the plan as a "weird trick". So, it basically gave the Centers for Medicare and Medicaid Services what it was looking for – no premiums for anyone making under 138 percent of the poverty line (about $30,000 for a family of four). The state also included supplemental benefits like coverage for non-emergency medical transportation, access to at least one federal qualified health center, and more.

“We did approach the Secretary with this new approach," says Dr. Thompson.

"It did fall within the guidelines although I don’t know that the guidelines had necessarily been developed thinking this approach was even possible. And they did work closely with us through the approval process to make sure that what we were asking for they could both legally and from a policy perspective support.”

Iowa pushed the Centers for Medicare and Medicaid Services a little bit in nearly all areas. The most notable might be premiums. It wanted anyone making more than 50 percent of the federal poverty line to pay them. And initially, Pennsylvania had that on the table too. But when negotiations between Iowa and the federal government nudged that line up to 100 percent, Pennsylvania fell into line. 

“Um yes, certainly where the policy position was with Iowa, certainly something that we understood going in," says Lisa Allen, Executive Medicaid Director for the Pennsylvania Department of Public Welfare. "But we also held our public forums here in Pennsylvania, we received significant comments during that public forum process."

But on other issues, the commonwealth is standing its ground. Iowa got a one-year waiver for non-emergency medical transportation. Pennsylvania is asking for a five-year waiver. Robin Rudowitz, Associate Director for the Kaiser Commission on Medicaid and the Uninsured at the Kaiser Family Foundation, has studied Medicaid waivers since Arkansas first applied.

“Each time CMS approves or denies or does not approve a certain provision that’s in one state’s waiver request, they are in a way setting a precedent of what other waivers they will approve. So these decisions do apply more broadly than just one specific state.”

Perhaps the most noticeable difference among the states is Pennsylvania would not require health plans provide access to family planning centers out of their network. CMS has not approved such a requirement for any state so far. 

“We’re feeling pretty confident that we’ve addressed many of the major areas that would have problematic for them. I think we feel that we have a fairly strong proposal and that we should be ready to implement it," says Allen.

Put aside the application itself for a second. After all,  Allen says the commonwealth will not settle for a rejection. What are the keys to making sure implementation is as smooth as possible? Arkansas has enrolled about 110,000 people, about halfway to its goal of 220,000. Arkansas Surgeon General Dr. Joe Thompson says it’s about team work.

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“Your insurance commissioner and your Medicaid director have to be closely intertwined. At the federal level, you have Socio, and the Center for Medicaid and Medicare Services. At the state level, you have the Insurance Department and the Medicaid state program, and essentially, all four of those divisions have to work together for successful implementation of the private option.”

Arkansas also has to fight the political fight every year. 75 of 100 state House Representatives and 27 of its 35 state Senators need to approve the plan every year, and this year, that took a couple votes before getting the necessary "yes" votes. In addition, it has to meet a September 15th deadline to request federal approval for health savings accounts for those in the program, along with other provisions, including reduced non-emergency medical transportation for those getting coverage through the private option.

In both Iowa and Arkansas, about 10 percent of those whose income makes them eligible for health coverage end up in the regular Medicaid program because they are determined to be "medically frail." That program has more robust benefits (in Iowa, it is the same coverage that state employees get), and reduced costs.

Iowa is actually closing in on its enrollment goal of 90,000 this year, at about 80,000 so far. Amy Lorentzen McCoy, spokeswoman for the the Iowa Department of Human Services, says the state’s Iowa Care program gave them a head start.

“We were able to take more than 50,000 people from that program and automatically enroll them in the Iowa Health and Wellness Plan. Doing that streamlined process was really important for a lot of people to continue to get benefits, and we also had that groundwork already laid for the contacts with these folks.”

Pennsylvania isn’t there yet though. The state’s application needs to get the okay from the federal government. The Centers for Medicare and Medicaid Services is reviewing it, and a decision is expected soon. But negotiations could draw the process out, since Pennsylvania has asked for changes that CMS has never approved before.

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