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Figure 1 The Short Term Outlook for Long- Term Services and Supports Jeffrey S. Crowley, M.P.H. Senior Research Scholar Health Policy Institute, Georgetown.

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Presentation on theme: "Figure 1 The Short Term Outlook for Long- Term Services and Supports Jeffrey S. Crowley, M.P.H. Senior Research Scholar Health Policy Institute, Georgetown."— Presentation transcript:

1 Figure 1 The Short Term Outlook for Long- Term Services and Supports Jeffrey S. Crowley, M.P.H. Senior Research Scholar Health Policy Institute, Georgetown University / (202) Health Action 2007 January 26, 2007

2 Figure 2 State of Health Policy Debate in 2007 Broad split among political parties and stakeholders on goals and approaches: Is universal coverage a goal?; Should we focus on public or private initiatives?; Should increased revenues be raised to pay for new initiatives? Should families have less comprehensive coverage (i.e. HSAs and high deductible plans)? Concern over the cost of future obligations: Promises have been made through the entitlements to Medicare, Medicaid, Social Security, etc. Are the programs on a sustainable footing? Significant increases in numbers of uninsured Americans and increasing poverty: 6.8 million more uninsured since 2000 and 5.4 million more people living in poverty since 2000 Increasing wealth disparities: In 2005, for every wealthy family that received a tax cut due to 2001 and 2003 tax cuts, there are 160 uninsured Americans

3 Figure 3 Broader Issues May Limit Focus on Medicaid Paygo: The Congress has reinstated budget rules that require any tax cut or increase in spending be offset by an increase in other taxes or reduction in other spending, rather than being deficit financed. SCHIP Reauthorization: Program covered 6.2 million children at a cost of $4.6 billion in 2004; concern that reauthorization may not even provide inflationary increase in funding; while disability community supports reauthorization, some proposals raise concerns for the disability community Medicare Price Negotiation and Stem Cells: Whether and how to authorize federal government to negotiate Medicare drug prices is 1st priority for Congress, followed by new efforts to expand federal funding for stem cell research

4 Figure 4 Most Current Challenges are Bigger than Medicaid The major financing issues facing Medicaid programs stem from problems that are bigger than Medicaid and call for broader national solutions. Unresolved issues include: Controlling health costs (across all payers) that consistently rise faster than inflation Financing access to new medical technology Establishing a national system for financing long-term services (to take pressure off Medicaid) Adapting to demographic changes

5 Figure 5 Significant Changes to Medicaid Just Enacted Deficit Reduction Act of 2005 (DRA): Budget bill signed by President Bush in February 2006 (Public Law ) enacting significant changes to Medicaid Makes changes in many other programs in addition to Medicaid including Medicare, child welfare, student loans, etc. Congressional Budget Office (CBO) estimates that the Medicaid provisions of the DRA will result in a net savings of $4.7 billion over 5 years

6 Figure 6 Major Areas of Long-Term Services Reform Asset Transfers: New prohibitions before qualifying for Medicaid Long-Term Care Partnership Program: New opportunities for states Family Opportunity Act: New state option to permit families of children with disabilities to purchase Medicaid Alternatives to Psychiatric Residential Treatment for Children: Competitive grant program for up to 10 states Money Follows the Person Demonstration: Competitive grant program to transition people from institutions to the community New State Option to Provide HCBS Services Cash and Counseling: New option to permit consumer direction without a waiver

7 Figure 7 Consumer Reactions to the Deficit Reduction Act (DRA) Increases Deficit: Net impact of DRA and accompanying tax cuts leads to an increased, not decreased, deficit Non-Solutions: Did not resolve any of the health policy challenges facing the nation Unnecessary Harm: Senate bill would have achieved comparable savings without harmful benefits changes Powerful Interests Win Consumer Advocacy Effective: Could have been much worse

8 Figure 8 A Tense Federal-State Partnership Ongoing Tension: Federal oversight versus state flexibility and experimentation Increasing Federal Responsibility: Over time, federal government has assumed greater responsibility for costs that were previously seen as a state responsibility Increased Emphasis on Evidence-Based Medicine and Pay for Performance: Questions have arisen whether new efforts are sensitive to needs of people with disabilities Overwhelming Burden of Medicare: Medicares benefits package is inadequate and Medicaid supplements coverage for low-income Medicare beneficiaries40% of Medicaid spending is for services for Medicare beneficiaries Tax Cuts Create Fiscal Pressure: Late 90s federal and state tax cuts have been major factors in recent budget crises

9 Figure 9 Two Approaches to State Medicaid Policy Change State Plan Amendments (SPAs) and Waivers offer states different ways to make changes to their Medicaid programs DRA gave states new flexibility so that many changes that previously required a waiver can now be done with a SPA Going forward, will we see most state policy change through SPAs or waivers? What are the implications for advocates for people with disabilities?

10 Figure 10 Key Themes in Recent Waivers and DRA Changes Personal Responsibility: Consumer choice of plans; increased premiums and/or cost sharing; and behavior modification through incentives Tailored benefits: Varied benefits by population Increased role of private marketplace: Increased control to private for-profit plans to determine benefit packages Increasing spending predictability: Defined contribution approaches; aggregate caps on federal funding; and increased ability to limit/reduce coverage More challenging advocacy environment: Confusion about the rules of the game; limited public information; substantial controversy; and loss of state legislative input

11 Figure 11 Issues and Threats in 2007 Leavitt Commission Report: Leavitt Commission released its final report in December; key Congressional leaders (Senator Baucus, incoming Chair of Senate Finance and Rep. Dingell, incoming Chair of House Energy and Commerce) criticize report; advocates call report dead on arrival –One voting member to represent disability community (Gwen Gillenwater) was sole vote in opposition, issued a strong dissent Potential for Entitlements Commission: Current proposals would address only Social Security and Medicare, but we need to be vigilant to monitor impacts on MedicaidSize of deficits and presidential politics may create pressure to establish an entitlements commission; Medicare and Social Security shortfalls higher profile issues, but cause for concern for Medicaid Rehab and TCM Changes: New proposed rules imminent New Efforts to Promote Managed Care and Integrated Care: Seen as latest quick fix to save money in Medicaid

12 Figure 12 Needed: A Good Defense Disability advocates and the broader consumer community cannot focus on just the federal or state levels; both environments important Disability community leadership is important, but working in broad-based coalitions essential To achieve our health coverage goals and protect access to comprehensive benefits, the disability community needs to become far more engaged on tax and revenue issues at both the state and federal levels Need to make the case that DRA flexibility doesnt solve the real problems the problems with our health care system will not be resolved by charging beneficiaries higher cost-sharing, denying needed services, or hassling citizens

13 Figure 13 Oppose Changes to Rehab Option and TCM 46 states plus DC use the rehab option to provide community developmental disability and mental health services; a related essential service is targeted case management (TCM) used by states to link people to medical and social services In the DRA, Congress rejected Bush Administration efforts to legislate changes to the rehab option; in his 2007 budget, the President indicated that he would use administrative measures to restrict the rehab option to achieve savings of $6.1 billion over the next 10 years New proposed rules (NPRM) expected soon; rumor has it that the feds will propose to decrease access to rehab through time limits and other changes Also need to monitor anticipated DRA regs; serious concern over changes to TCM and third party liability

14 Figure 14 Managed Long-Term Care is the Latest Hot Issue Managed long-term care and integrated care for dual eligibles present both risks and opportunities. Large-scale models for delivering long-term services and supports in a managed care environment do not exist. Arizona remains the only Medicaid managed long-term care program that operates both statewide and on a mandatory basis. A number of states have started managed long-term care programs, but the overall penetration rate is small. In 1996, the Robert Wood Johnson Foundation established the Medicare/Medicaid Integration Project funding 14 states to develop integrated care programs for dual eligibles. To date, only 3 of these states have been able to implement these programs.

15 Figure 15 Managed Care Recommendations If the feds or your state are considering expanding managed care for seniors and people with disabilities Go slowly in implementing managed care programs Ensure payments to MCOs and providers are adequate Ensure states maintain an adequate Medicaid administrative infrastructure Promote Disability Care Coordination Organizations as a way to use managed care to serve people with disabilities Consider strengthened critical consumer protections

16 Figure 16 Needed: A Good Offense The disability community needs to engage in efforts to push for universal coverage and long-term care reform We need to expand eligibility for more low-income people. My priorities: –Mandatory eligibility for all seniors and people with disabilities under poverty –Mandatory access to medically needy coverage, and spenddown to a reasonable income level We need to push for a federal minimum community living benefit

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