Arizona and Texas officials hope the Trump administration will be more receptive to Medicaid waivers that would fund care for the uninsured, impose work requirements and place a life cap on enrollment.
Texas state officials want a 21-month extension waiver that will help cover the unpaid bills of Medicaid-eligible and uninsured patients in the state.
The waiver provides $4 billion a year for the Texas Healthcare Transformation and Quality Improvement Program, which covers providers' uncompensated-care bills. It also includes a Delivery System Reform Incentive Payment, or DSRIP, which encourages providers to adopt innovative programs that raise the quality and cost-effectiveness of care.
Texas' waiver, which began in 2011 was originally set to expire Dec. 31, after the CMS granted a short-term extension last spring. The Obama administration had been against continued funding of an uncompensated-care pool for states as it felt Medicaid expansion and the coverage it provides the uninsured would make a need for the pool obsolete.
But leaders of conservative states such as Texas have rejected Medicaid expansion.
Now with Trump in charge and the possibility of repeal of the Affordable Care Act looming, Texas is hoping to continue to get funds at current levels through Sept. 30, 2019. By then, the state says it hopes to submit a new waiver or block grant proposal that will allow more flexibility in how the state oversees its Medicaid program and funds.
The Texas Hospital Association said losing the uncompensated-care funds would likely cause hospitals to scale back services and prevent low-income people from getting care. The CMS estimates that between 2011 and 2017, Texas received $21.5 billion in uncompensated-care funds.
Dr. Arlo Weltge, an ER physician in Houston and member of the Texas Medical Association, said the funds are critical especially for public hospitals that had been anticipating Medicaid coverage expansion before the Supreme Court made it optional. However, they have faced cuts in Medicare funding that were baked into the ACA under the assumption that coverage expansion would reduce the need for uncompensated-care funds.
Texas may incorrectly believe the Trump administration would be receptive to the waiver. The nominee for HHS Secretary, U.S. Rep. Tom Price (R-Ga.) ,wants to reduce Medicaid spending. However, Texas' Republican Gov. Greg Abbott has been a strong supporter of Trump.
Arizona, meanwhile, is again asking the CMS to approve a waiver that would lock consumers out of Medicaid coverage after five years if they were considered "able-bodied,” and require beneficiaries to search for jobs while on the program.
The state is now accepting comments on the draft waiver before formally submitting it.
The Obama administration said no to the requests in October over concerns that the proposals would undermine access to care in Arizona. Medicaid covers 1.7 million people in the state. Since expanding Medicaid, 315,000 people have gained coverage.
However, state law mandated that the federal government approve the requests every two years.
Given that Trump's pick to run the CMS, consultant Seema Verma, has drafted similar requests for other states, it's more likely that the requests will be granted this time. Verma has not yet been confirmed to his position.
Hospitals have expressed concern over the proposals as they feel it will divert people back to overusing emergency department services.
The state also plans to submit a brand-new request to allow fee-for-service Medicaid beneficiaries to have access to inpatient psychiatric services.
Medicaid has never paid institutions of mental disease for beneficiaries age 21 and over. Most residential treatment facilities for mental health and substance-use disorders with more than 16 beds did not qualify for Medicaid reimbursement.
However, a mega managed-care rule finalized last year allowed states to reimburse managed-care plans if patients with behavioral issues stayed in an institution for no more than 15 days. Arizona wants that same permission extended to fee-for service beneficiaries.
