4Provides medical coverage to eligible individuals primarily: Medicaid: What is it?Provides medical coverage to eligible individuals primarily:Low-income familiesNon-disabled childrenRelated caretakers of dependent childrenPregnant womenPeople age 65 and olderPeople with disabilitiesEntitlement program = no enrollment limitation
5Federal / State Program Medicaid: What is it?Federal / State ProgramFunded jointly by state and federal governmentsAdministered by statesSubject to federal law and regulation:Requires coverage of certain populations and servicesAllows states to cover additional populations and services
6Medicaid: Who runs it? Federal level Texas level Centers for Medicare & Medicaid Services (CMS)Within the U.S. Department of Health and Human Services:Kathleen Sebelius – Secretary of Health and Human ServicesCindy Mann – Director, Center for Medicaid and State OperationsTexas levelAdministered by single state agency – HHSCBilly Millwee – Texas State Medicaid DirectorSingle point of contact with federal governmentEstablishes Medicaid PolicyAdministers state plan or agreement with the federal governmentAdministers Medical Care Advisory Committee (MCAC) mandated by federal Medicaid law
7Medicaid in the Federal Budget, Federal Fiscal Year 2009
8Medicaid State Plans: State & Federal Program State Plans = agreements with federal government on:EligibilityServicesProgram administrationFinancial administrationOther program requirementsState Plan Amendments (SPA) = requests to CMS to change:Optional services provided, orManner benefits are offered.
9Medicaid Waivers: State & Federal Program Waivers = state request to CMS for permission to deviate from certain requirements, often to:Provide services beyond those in state plan.Limit geographical areas.Limit free choice of providers.Implement innovative new service delivery and management models.Common Types of Medicaid Waivers1115 Waiver – Research and Demonstration – Test policy innovations likely to further Medicaid program objectives.1915(b) Waiver – Freedom of Choice – Allow states to implement managed care delivery systems or otherwise limit individuals' choice of provider under Medicaid (i.e. STAR+PLUS).1915(c) Waiver – Home and Community-Based Services – Waive Medicaid provisions to deliver long-term care services and supports in community settings as an alternative to institutional settings.Scarves & Umbrellas Analogy –Waivers are intended to provide certain benefits to certain populations in certain areas. For instance, a SPA would be used to provide scarves to all Medicaid recipients in the state to keep them warm in the winter and help combat seasonal medical conditions. This proposition would be well suited for Amarillo, but the people in Corpus Christi don’t need scarves—the temperature does not get that cold down in South Texas. Instead, South Texans need umbrellas because they have wet winters. A Waiver (i.e. demonstration project) would be used to target the specific populations (Amarillo vs. Corpus Christi) and specific expansion of benefits (scarves vs. Umbrellas).
10Children’s Health Insurance Program (CHIP) CHIP: What is It?Children’s Health Insurance Program (CHIP)Medical coverage for uninsured children up to age 19.Joint state-federal program, either:Extension of state Medicaid programSeparate programFederal fundingLimited to block grant amounts allocated to each state.Not entitlement program, so states can:Determine age and income eligibility.Cap enrollment.Limit service benefits (as approved by HHS).
11Medicaid Benefits: Acute and Long-Term Care Acute CarePhysician, inpatient, outpatient, pharmacy, behavioral health, lab, X-ray servicesHealth care for children and pregnant women for episodic health care needs.Long-Term Services and SupportsChronic health conditions requiring ongoing medical care & often social support.Includes care:In facilities, e.g. nursing homesFor behavioral health conditionsDistinction based on:Cognitive and medical conditionNeed for assistance with activities of daily livingDegree to which a disability is chronicNature of services providedSetting in which services are provided
12Medicaid Benefits: Mandatory vs. Optional Inpatient hospital servicesOutpatient hospital servicesEarly and Periodic Screening, Diagnostic, and Treatment (EPSDT) servicesNursing facility servicesHome health servicesPhysician servicesRural health clinic servicesFederally qualified health center servicesLaboratory and X-ray servicesFamily planning servicesNurse midwife servicesCertified pediatric and family nurse practitioner servicesFreestanding birth center services (when licensed or otherwise recognized by the state)Transportation to medical careSmoking cessation for pregnant women(1) Medically-necessary HIV testing covered through laboratory benefit. (2) Children can be tested for HIV through EPSDT.**This and the following slide provided by CMS February 3, 2011:
13Medicaid Benefits: Mandatory vs. Optional Prescription drugsClinic servicesPhysical therapyOccupational therapySpeech, hearing and language disorder servicesRespiratory care servicesOther diagnostic, screening, preventive and rehabilitative servicesPodiatry servicesOptometry servicesDental servicesDenturesProstheticsEyeglassesChiropractic servicesOther practitioner servicesPrivate duty nursing servicesOther services approved by HHS Secretary(1) HIV testing is an optional benefit under preventive/screening services.(2) HIV testing is optional under CHIP depending on well-baby / well-child services & state’s elected benefit package.
14CHIP: Benefits Inpatient hospital services Outpatient hospital & ambulatory servicesLab & X-raySurgical & medical physician / physician extender services (including immunizations & well-baby / well-child exams)Emergency servicesPrescription drugsBehavioral health & substance abuse benefitsPhysical / speech / occupational therapyHome healthTransplantsDurable medical equipmentDental servicesHospice care servicesSkilled nursing facilitiesVision (eye exams / eyeglasses)Chiropractic servicesTobacco cessation1. With an eye toward preventive care, CHIP currently provides the following benefits.
15CHIP: BenefitsPerinatal benefits = limited, basic prenatal care including:Prenatal & postpartum visitsFirst 28 weeks of pregnancy: 1 visit every 4 weeks28 to 36 weeks of pregnancy: 1 visit every 2-3 weeks36 weeks to delivery: 1 visit per weekDeliveryHospital facility chargesProfessional services chargesOtherPharmacy (based on CHIP formulary)Prenatal vitaminsLimited laboratory testingNo cost-sharing requirements2 postpartum visitsAdditional visits if medically necessaryPerinatal began accepting applications on Jan. 2, 2007– Assessments– Planning services– Education and counseling
16Income and Federal Poverty Levels Federal Poverty Level (FPL)Compared to family’s income level.Basis for Medicaid financial eligibility.Intended to identify the minimum amount of income a family would need to meet certain, very basic, family needs.Indicate annual income levels by family size and are updated each year by the U.S. Department of Health and Human Services.
17Federal Poverty Income Levels, 2011 U.S. Department of Health and Human Services poverty guidelines based on annual incomeFamily Size 100% FPL,890,710,530,350,170,990,810,630At 100% of poverty, for families larger than 8, add $3,820 for each additional person.SOURCE: Federal Register, Vol. 76, No. 13, January 20, 2011, pp
18Medicare and Medicaid Eligibility Federally fundedFederally administeredEligibilityPeople age 65+People with disabilitiesPeople with end stage renal diseaseMedicaidJointly funded by federal and state governmentAdministered by stateEligibilityLow-income individualsPays for most long-term care services & supportsReference 2-year waiting period fact sheet
19Medicaid & Medicare: Dual Eligibles Individuals who are aged or disabled (Medicare eligible) ANDLimited income (eligible for some Medicaid coverage)Full Dual EligiblesEntitled to Medicaid benefits that Medicare does not cover.Include low-income individuals who are aged or disabled in community, waiver programs, nursing homes, and state schools.Other Dual EligiblesEligible only for Medicaid payments for Medicare premiums, deductibles, and coinsurance for Medicare services.Not entitled to Medicaid services.Include several categories of eligibility; incomes generally up to 135% of FPL.
20CHIP Eligibility CHIP covers children in families who: Have too much income or too many assets to qualify for Medicaid.Cannot afford to buy private insurance.Generally are below 200% of the FPL.States can design their CHIP program as:Medicaid expansion (7 states, D.C. and 5 territories)Separate from Medicaid (17 states)Combination of the two approaches (26 states)
23Texas Medicaid: Optional Benefits The state may choose to provide some, all, or no optional services specified under federal law.Optional services provided in Texas include:Prescription drugsPhysical therapyOccupational therapyTargeted case managementSome rehabilitation servicesCertified Registered Nurse AnesthesiologistsEyeglasses/contact lensesHearing aidsServices provided by podiatristsCertain mental health provider types
24Texas Medicaid: Pharmacy Benefits HHSC Vendor Drug Program performs most pharmacy services functions, including policy and program oversight, formulary management, and pharmacy customer services.Texas contracts with private companies for:Pharmacy claims processingPrior authorization servicesAdministration of drug rebate programTexas contracts with pharmacies to provide Medicaid clients with pharmacy benefits.Over 4,200 licensed Texas pharmacies are under contract.Beginning March 2012, managed care organizations (MCOs) will be responsible for providing pharmacy benefits to their members
25Texas Medicaid Women’s Health Program (WHP): Benefits Certain screenings related to family planning:Pregnancy testRubella antibody testRoutine urinalysisUrine cultureComplete blood count (CBC)Hemoglobin and hematocrit testsBlood typingBlood glucose screeningLipid panelThyroid stimulating hormone testAnnual family planning exam & Pap smearFollow-up visit, if related to contraceptive methodCounseling on specific methods & use of contraceptionFemale sterilizationFollow-up visits related to sterilizationSexually Transmitted Infection (STI) Screenings
26Texas Medicaid Women’s Health Program (WHP): Benefits Services not covered through WHP:Mammography - screens for breast cancer are limited to a clinical breast exam.Treatment for any conditions diagnosed during a WHP visit.Visit for pregnancy test only.Visit for STI test or treatment only.Follow-up after an abnormal Pap test.Counseling on and provision of emergency contraceptives.Referrals made for medical problems to providers that perform elective abortions.Other visits that cannot be appropriately billed with one of WHP- allowable diagnosis codes.
27Texas CHIP: BenefitsInpatient general acute & rehabilitation hospital servicesSurgical servicesTransplantsSkilled nursing facilitiesOutpatient hospital, comprehensive outpatient rehabilitation hospital, clinic & ambulatory health care center servicesPhysician/physician extender professional services (including well-child exams & preventive health services)Laboratory & radiological servicesDurable medical equipment, prosthetic devices, & disposable medical suppliesHome & community-based health servicesNursing care servicesInpatient mental health servicesTobacco cessationOutpatient mental health servicesInpatient & residential substance use treatmentOutpatient substance use treatmentRehabilitation and habilitation servicesHospice care servicesEmergency servicesEmergency medical transportationCare coordinationCase managementPrescription drugsDental servicesVisionChiropractic services
28Texas CHIP Perinatal Program Provides prenatal & post-partum care to pregnant women ineligible for Medicaid due to:income (whose income 186%-200% FPL), orimmigration status (with income below 200% FPL).Upon delivery, CHIP Perinatal newborns in families:With incomes at or below 185% FPL:are deemed to Medicaidreceive 12 months of continuous Medicaid coverageWith incomes above 185% FPL up to 200% FPL:remain in CHIP Perinatal Programreceive CHIP benefits for the remainder of the 12-month coverage periodMembers receiving CHIP Perinatal benefits are exempt from:90-day waiting period, asset test & all cost-sharing, including enrollment fees & co-pays
29Medicaid Benefits: Compared to Private Employer-Sponsored Coverage
30Texas Medicaid: Eligibility Medicaid serves:Low-income familiesNon-disabled childrenRelated caretakers of dependent childrenPregnant womenPeople age 65 and olderPeople with disabilitiesTexas Medicaid does not currently serve:Non-disabled, childless adults
31Texas Medicaid Eligibility: Percent of FPL June 2010
32Texas Medicaid Women’s Health Program (WHP): Eligibility WHP Eligibility Criteria:Ages 18 – 44.U.S. citizens & qualified immigrants.Reside in Texas.Not eligible for full Medicaid benefits, CHIP, or Medicare.Not pregnant.Not sterilized, infertile, or unable to get pregnant due to medical reasons.No private health insurance coverage covering family planning services.Exception if filing a claim would cause physical, emotional, or other harm from a spouse, parent, or other person.Countable household income at or below 185% FPL.
33Texas CHIP: Eligibility General eligibilityUninsured children under age 19.CHIP Perinatal serves unborn children meeting eligibility requirements.Gross income up to 200% FPL.U.S. citizens or legal permanent residents.Not eligible for Medicaid.Families with net incomes above 150% FPL must meet assets criteria:Assets below $10,000.One vehicle is exempt up to $18,000; additional vehicles are exempt up to $7,500.Eligibility is determined for a 12-month period; income verification at 6th month for families at 185% FPL and aboveCHIP Perinatal eligibility is determined for a 12-month periodCHIP serves:To qualify for CHIP, a child must be under age 19, a Texas resident and a U.S. citizen or legal permanent resident.The citizenship or immigration status of the parents does not affect the children's eligibility and is not reported on the application form.An eligible child must live in a household with federal poverty income limits (FPL) at or below 200% and not be otherwise eligible for Children's MedicaidAny adult who lives with an uninsured child and provides care for that child can apply.A family's size, income and assets determine whether the children qualify for CHIP.If the family has a net income above 185% FPL, they must meet assets test.Finally, eligibility is determined for a 12-month period. If the family has a net income above 185% FPL, they have a six-month income verification.Facing a budget shortfall in 2003, the 78th Legislature passed major reforms to the Children’s Health Insurance Program.In the 80th Legislature, those major reforms were reversed with House Bill 109 by Rep. Sylvester Turner, including:Figuring eligibility on net income, rather than gross income to disregard certain expenses;Removing a 90-day waiting period for coverage designed to prevent “crowd out;”Increasing the liquid assets allowable to be eligible from $5,000 to $10,000 per household;Along with the exempt value of vehicles;And granting coverage for 12 months, rather than 6.In the bill eventually sent to the Governor, the Senate amended the period of eligibility to require an electronic check on families with the highest incomes at the six-month mark. Starting last month, families with incomes above the 185 FPL had their six-month review to see if the family’s income had changed.HB 109 also required outreach to increase awareness of CHIP, which included radio ads in both English and Spanish. The campaign also includes messages on buses, ads in publications that serve primarily African-American and Hispanic communities; ads for Spanish language TV, and brochures in English, Spanish, and Vietnamese. HHSC has also contracted with 28 community-based organizations to provide application assistance and conduct grassroots outreach efforts about CHIP or other HHSC programs.
34Texas Medicaid: Enrollment The Texas Medicaid program has grown considerably in recent years.Texas Medicaid now serves over 3.4 million people out of a total population of about 25 million (as compared to 2.8 million in 2006).Persons who are aged, blind or disabled represent:25% of Texas Medicaid recipients.58% of Texas Medicaid costs.They often have complex medical conditions, needing bothAcute care (e.g. hospitalization, outpatient services, and laboratory), andLong term services and supports (LTSS) provided in the home or community (e.g. assistance with daily living, skilled nursing, and therapy services).
35Texas Medicaid: Historical Enrollment History of Medicaid Eligibility: CaseloadSeptember August 2010
36Texas Medicaid: Enrollment by Age, State Fiscal Year 2009
37Texas Medicaid: Enrollment & Spending June 2011, 3.3 million people received Medicaid.Over 2.3 million are children.Over 700,000 are individuals who are aged, blind, or disabled.Texas Medicaid beneficiaries & expenditures, state fiscal year 2009If you ever see ABD in an or report, it refers to the Aged, Blind and Disabled population.
38Texas Medicaid: State Budget Medicaid spendingFY$44.9 billion from all fund sources$18.8 billion from General Revenue (GR), GR-Dedicated, and Tobacco Settlement Receipts75% of all appropriations for HHS
40Texas CHIP: Enrollment & Spending How many children in Texas are enrolled CHIP?Caseload for June 2011: 539,137 childrenHow much is spent on CHIP?Total state fiscal year 2010 budgeted* for CHIP$815.6 million from all fund sources$270.2 million from GR*Based on FY 2010 Operating Budget. Includes all traditional CHIP costs: client service costs for federally funded children, legal immigrants, school employee children, and vendor drugs; administrative and operating expenses.In FY 2007, the average number of children on CHIP per month was 312, 101 children. The average for 2006 was 308,762. As of January of 2008, enrollment in CHIP had increased to a total of 352, 981 children, and is expected to increase to over 450,000 by the end of the biennium based on the latest forecasts.Funding totals $2 billion in All Funds ($624 million in General Revenue Funds).Keep in mind that these figures do not include those in the CHIP Perinatal program.
41Texas CHIP: Average Monthly Enrollment, State Fiscal Year 2000-2010
42Texas CHIP: Enrollment by Age, State Fiscal Year 2010
43Texas CHIP Perinatal Program: Enrollment, State Fiscal Year 2007-2010
44Texas Medicaid: FMAP Federal Medical Assistance Percentages (FMAP) Portion of total Medicaid costs paid by the federal government.Texas FMAP for federal fiscal year 2012: 58.42Of each dollar spent on Medicaid services in Texas, the federal government pays approximately 58 cents.Based on average state per capita income compared to the U.S. average.Small changes in the FMAP could result in significant loss or gain of federal funds.
45Texas Medicaid: DSH Payment Medicaid Disproportionate Share Hospital (DSH) ProgramSource of reimbursement to state-operated and non-state (local) Texas hospitals that treat indigent patients.Federal law requires that state Medicaid programs make special payments to hospitals that serve a disproportionately large number of Medicaid and low-income patients.Not tied to specific services for Medicaid-eligible patients, unlike other Medicaid payments.Total funds to all DSH hospitals in state fiscal year 2009: $1.615 billionState DSH Hospitals: $339 millionNon-state DSH Hospitals: $1.276 billion
46Texas Medicaid: UPL Payment Upper Payment Limit (UPL)Financing mechanism used by states to provide supplemental payments to hospitals or other providers.Federal regulations allow states to pay providers up to what Medicare would have paid, or the amount the hospital charges for services.States may use local funds transferred to the state to fund the supplemental payments.HHSC currently makes UPL payments to:4 state-owned hospitals11 non-state large urban public hospitals100 non-state owned rural public hospitals7 children’s hospitals11 state university physician group practicesunknown number of privately-owned hospitals in Private Hospital UPL program
47Texas CHIP: EFMAPEnhanced Federal Medical Assistance Percentages (EFMAP)Portion of total CHIP costs paid by the federal government.Generally higher than MedicaidIn 2012, the federal government pays 70.89% of CHIP medical care expendituresCompared to 58.42% of Medicaid medical care expenditures.
48Texas CHIP: Historical Spending, State Fiscal Year 2000-2010
49Texas CHIP: Cost Sharing CHIP annual enrollment fee:$0 for families with net income less than 150% FPL$35 for families between % FPL$50 for families between % FPLFamilies are required to pay the enrollment fee upon enrollment or renewal of CHIP.There are two types of cost share obligations: enrollment fees and co-payments. Most CHIP eligible families are subject to cost share obligations.The CHIP annual enrollment fee varies based on the net income of the family. There is no annual fee for families less than or equal to 150% of the FPL.For families between 151 to 185% of the FPL, the annual fee is $35.For families between 186% to 200% FPL, the annual enrollment fee is $50.Eligible children cannot enroll and receive covered benefits before receipt of the enrollment fee. Families must pay the enrollment fee at renewal before continuing coverage.
50Texas CHIP: Cost Sharing Families enrolled in CHIP are responsible forco-payments for certain plan benefits.At or below 100% FPL101% to150% FPL151% to 185% FPL186% to 200% FPLPreventative Health Care and ShotsOffice VisitNon-Emergency Room UseGeneric PrescriptionName-brand PrescriptionInpatient Hospital CareOutpatient Hospital Care$0$3$10$5$25$7$50$20$100The other type of cost sharing obligation that most families are required to pay are co-payments, which again will vary on the families’ incomes.Something to note is that families have a cost-sharing cap which is the maximum amount of out-of-pocket expenses a family is required to pay during the enrollment segment.When a family reaches their cost sharing cap during the enrollment segment, the family is not required to make co-payments for the remainder of the enrollment segment.Families with gross income at or below 150% FPL has a cost-sharing cap during the 12-month coverage period of 1.25% of its annual gross income.Families with gross income greater than 150% FPL has a cost-sharing cap during the 12-month coverage period of 2.25% of its annual gross income.On cost sharing all together, CHIP perinatal recipients are not subject to cost share obligations. CHIP perinatal recipients do not pay enrollment fees or copayments.
51Texas Medicaid Women’s Health Program (WHP): Savings In 2008, WHP saved:$63 million (all funds) due to reduction in expected births.$42.4 million (all funds) after paying program costs.State share of reduced Medicaid costs totaled:approximately $23.5 million (GR)net state share of savings after paying WHP expenditures totaled approximately $21.4 million (GR)
52Medicaid Delivery Models: Managed Care vs. FFS Managed Care Programs in TexasSTAR – provides acute care services to children, pregnant women, and families.STAR+PLUS – provides acute and long-term services and supports to individuals with disabilities and elderly people.NorthSTAR – provides behavioral health services to individuals in a multi-county area in and around Dallas.STAR Health – provides a comprehensive managed care program for children in foster care.Fee-for-Service (FFS)/Traditional MedicaidA few eligibility categories remain in FFS.Individuals in FFS can choose any provider.FFS does not offer the management or utilization controls that managed care provides.
53Provider Reimbursement: Managed Care vs. FFS Payment and processes vary by delivery modelManaged Care:HHSC pays MCOs a capitated rate.MCOs pay providers reimbursement rates established by contracts with the providers.Providers send claims (bills for services) to the MCO for payment.FFS:HHSC establishes FFS methodologies to pay providers.Claims are sent to state for payment.
54Texas CHIP: Delivery Systems CHIP Service Delivery Models include:MCO: A type of health care plan that arranges for or provides benefits to covered clientsThe state pays the CHIP MCOs on a capitation basis: a set dollar amount PMPM to cover the health care costs of clients.Client selects an MCO and a Primary Care Provider (PCP)PCP authorizes services within the networkProviders are paid reimbursement rates established by the MCOExclusive Provider Organization: A health plan that arranges for or provides benefits to covered persons through a network of exclusive providersLimited to services provided to client in network, except for emergencies.Dental Maintenance Organization for dental servicesMaximus is responsible for the enrollment process for CHIP clients. Once determined eligible, families receive an enrollment packet and are asked to select a health plan and PCP (if in an MCO area).If a health plan or PCP is not selected, the client is defaulted into a plan and assigned a PCP (there is a formula for rotating the default plan so one is not favored over another).Superior is currently the sole Exclusive Provider Organization.
56Budget-Related Outcomes of the 82nd Texas Legislature Summary of Medicaid Funding for FY$40.6 billion in All Funds ($17.1 billion in GR).Assumes expansion of managed care, anticipated to result in a net savings of $385.7 million GR and increases in insurance premium tax revenue collections.Funding levels continue provider rate reductions implemented during the biennium, including an 8% hospital rate reduction.Cost containment initiatives totaling $1.8 billion in GR funds, including $450 million assumed in Rider 61.
57Budget-Related Outcomes of the 82nd Texas Legislature Statewide Standard Dollar Amount (SDA)Converted hospital reimbursement from a hospital-specific, cost-based reimbursement to a statewide base SDA effective September 1, 2011.HHSC worked closely with hospital industry to develop the statewide SDA.Add-on adjustments for hospital wages, medication education, and trauma centers to recognize high-cost services and geographic variations.Hold Harmless:HHSC authorized to use up to $20 million in GR ($48.1 million all funds) to mitigate losses to hospitals that are disproportionately impacted.Funding available up to September 1, 2012.
58Budget-Related Outcomes of the 82nd Texas Legislature Medicare EqualizationPast Texas Medicare-Medicaid PolicyPart A - State limits Medicare coinsurance and deductible payments to no more than the Medicaid rate for the same service.Part B - State makes Medicare coinsurance and deductible payments. Total payment for service may exceed Medicaid rate.As of January 2012The General Appropriations Act directs HHSC to align payment policies for Medicare Part A and B cost sharing.
59Initiatives from the 82nd Texas Legislature Managed Care ExpansionSeptember 1, 2011Expanded existing STAR and STAR+PLUS service areas to contiguous counties.March 1, 2012Expand STAR to new service areas.Expand STAR+PLUS to new service areas.Replace TX Primary Care Case Management Program (PCCM) with a capitated MCO program.Carve the pharmacy benefit into the services delivered by the Medicaid and CHIP MCOs.Develop statewide Medicaid dental MCOs.
60Initiatives from the 82nd Texas Legislature Reduce inappropriate utilization of Emergency Departments (ED) by Medicaid recipientsED hospital ratesAs of September 1, 2011, HHSC applied a 40% reduction to facility charges for non-emergent services delivered in an ED setting to recipients of Medicaid FFSMedicaid cost-sharingEncourage personal accountability and appropriate use of health care services.Cost-sharing includes non-emergency services through a hospital ED.HHSC is researching options for implementation.Target implementation date is December 2012.Develop incentives though MCOs for providers to:Offer evening and weekend hours, andEducate recipients about appropriate Emergency Department utilization.
61Initiatives from the 82nd Texas Legislature Quality InitiativesShift to paying for outcomes and quality instead of volume.Quality-based payments for hospitals and managed care.Policy changesExample: Ending Medicaid payments for elective deliveries prior to 39 weeks.S.B. 7 established:Quality-Based Payment Advisory CommitteeTexas Institute of Health Care Quality and Efficiency
62Healthcare Transformation 1115 Waiver Texas Health Care Transformation and Quality Improvement Program 1115 Waiver includes:Managed care expansionExpands Medicaid managed care services statewide.Includes legislatively mandated pharmacy carve-in and dental managed care.Hospital financing componentPreserves hospital funding under a new methodology.Creates Regional Healthcare Partnerships (RHPs).
63Healthcare Transformation 1115 Waiver Under the waiver, trended historic UPL funds and additional new funds are distributed to hospitals through two pools:Uncompensated Care PoolCosts of care provided to individuals who have no third party coverage for the services provided by hospitals or other providers (beginning in first year).Delivery System Reform Incentive PaymentsSupport coordinated care and quality improvements through RHPs to transform care delivery systems (beginning in later waiver years).
65Healthcare Transformation 1115 Waiver RHPs:Will form around hospitals currently receiving UPL payments.Will develop plans to address local delivery system concerns with a focus on improved access, quality, cost-effectiveness, and coordination.Must provide opportunities for public input in plan development and review.Should encourage broad engagement of local stakeholders in RHPs.
66Chronic Conditions Waiver S.B. 1, 82nd Legislature, First Called Session, 2011If feasible and cost-effective, HHSC may apply for a waiver to more efficiently leverage use of state and local funds.Would provide benefits to individuals eligible to receive services through the county for chronic health conditions.Requires broad-based input from interested persons.Must use intergovernmental transfers to maximize federal Medicaid matching funds.Text of SB 1:
67Affordable Care Act: Medicaid Expansion Medicaid eligibility expands to include individuals under age 65 with incomes up to 133% FPLIncludes income deduction of 5 percentage points, creating effective eligibility level of 138% FPL.In 2014, Texas will experience 1.8 million increase in caseload.New client populations in Texas include:Parents and caretakers at % of FPLChildless adults up to 133% FPLEmergency Medicaid in expansion populationsChildren in foster care through age 25Federal government bears full cost of coverage for new eligibles for first 3 years of mandatory expansion.
69Affordable Care Act: Eligibility Changes State Health Benefit Exchange (HBE)The law requires each state to have a HBE.If a state chooses not to operate a HBE, the federal government will operate an HBE for the state.Texas has not yet decided whether or not it will operate an HBE.Medicaid, CHIP, and the HBE must interface.Applications through the HBE must be “deemed” to Medicaid and CHIP with no additional required action by the applicant.
70Affordable Care Act: Medicaid Benchmark Benefit Federal law allows for a Medicaid benchmark benefit that:Will be provided to the new Medicaid adult expansion population in 2014,May be different from the regular Medicaid benefit package,Must include essential health benefits (EHB), as defined by federal Department of Health and Human Services (HHS).In December 2011, HHS released initial guidance on EHB.Additional guidance specific to Medicaid is forthcoming.HHSC is reviewing the guidance and researching options for Texas while awaiting additional guidance.Texas will seek stakeholder input while developing the benchmark benefit.
71Texas Health Care Coverage: Post ACA Implementation CHIP200% FPLCurrentMedicaid185% FPL133% FPL100% FPL74% FPL14% FPLNEWNEW Medicaid133%Sliding ScaleHealth Insurance Subsidies, through Exchange400% FPLUnsubsidized –In or Out of ExchangeEstimated Insured but not Subsidized(In or Out of Exchange)15.5 million% of Federal Poverty LevelEstimated Insured & Subsidized in Exchange1.9 millionEstimated Medicaid/CHIP5.6 millionThe estimated number of Medicaid/CHIP enrollees includes the number of current Medicaid/CHIP enrollees and the additional clients that will be served post ACA implementation.Estimate of Ongoing Uninsured2.3 million
72Current State Challenges Redesign of existing programsStrengthening and transforming the health care infrastructure.Streamlining Medicaid and CHIP eligibility determinations and coordinating with the HBE.Effectively redesigning existing state and local programs currently serving the population.Building adequate workforce to serve newly insured populations.UncertaintiesPending federal guidance for many provisions, which complicates states ability to implement.Long term fiscal planning as federal participation levels decrease over time.Estimating the ongoing needs of the undocumented and remaining uninsured populations.
73Additional Resources Medicaid Managed Care Initiatives Approved Healthcare Transformation 1115 waiverHHSC News ReleasesTexas Medicaid Pink Book