Healthcare Payment Systems & Policy: Medicaid & CHIP Kimberly Davis Policy Advisor for Policy Development Medicaid/CHIP Division

Healthcare Payment Systems & Policy:Medicaid & CHIP

Kimberly Davis

Policy Advisor for Policy Development

Medicaid/CHIP Division

2

Overview

Medicaid & CHIP Background• Benefits• Eligibility & Enrollment• Costs & Financing• Delivery Models

Texas Specifics

Current HHSC Initiatives

Medicaid & CHIP: Overview

4

Medicaid: What is it?

Provides medical coverage to eligible individuals primarily:

• Low-income families• Non-disabled children• Related caretakers of dependent children• Pregnant women• People age 65 and older• People with disabilities

Entitlement program = no enrollment limitation

5

Medicaid: What is it?

Federal / State Program

• Funded jointly by state and federal governments

• Administered by states

• Subject to federal law and regulation:

–Requires coverage of certain populations and services

–Allows states to cover additional populations and services

6

Federal level

• Centers for Medicare & Medicaid Services (CMS) • Within the U.S. Department of Health and Human Services:

Kathleen Sebelius – Secretary of Health and Human Services

Cindy Mann – Director, Center for Medicaid and State Operations

Texas level

• Administered by single state agency – HHSC • Billy Millwee – Texas State Medicaid Director

Single point of contact with federal government Establishes Medicaid Policy Administers state plan or agreement with the federal government Administers Medical Care Advisory Committee (MCAC) mandated by

federal Medicaid law

Medicaid: Who runs it?

7

Medicaid in the Federal Budget, Federal Fiscal Year 2009

8

Medicaid State Plans: State & Federal Program

State Plans = agreements with federal government on:

• Eligibility• Services• Program administration• Financial administration• Other program requirements

State Plan Amendments (SPA) = requests to CMS to change:

• Optional services provided, or • Manner benefits are offered.

9

Medicaid 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 Waivers• 1115 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.

10

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 program

– Separate program

• Federal funding– Limited 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).

11

Medicaid Benefits: Acute and Long-Term Care

Acute Care• Physician, inpatient, outpatient, pharmacy, behavioral health, lab, X-ray

services• Health care for children and pregnant women for episodic health care

needs.Long-Term Services and Supports

• Chronic health conditions requiring ongoing medical care & often social support.

• Includes care: In facilities, e.g. nursing homes For behavioral health conditions

Distinction based on:• Cognitive and medical condition• Need for assistance with activities of daily living• Degree to which a disability is chronic• Nature of services provided• Setting in which services are provided

12

Medicaid Benefits: Mandatory vs. Optional

Mandatory• Inpatient hospital services • Outpatient hospital services • Early and Periodic Screening,

Diagnostic, and Treatment (EPSDT) services

• Nursing facility services • Home health services • Physician services • Rural health clinic services • Federally qualified health

center services• Laboratory and X-ray services

• Family planning services • Nurse midwife services • Certified pediatric and family

nurse practitioner services • Freestanding birth center

services (when licensed or otherwise recognized by the state)

• Transportation to medical care

• Smoking cessation for pregnant women

13

Medicaid Benefits: Mandatory vs. Optional

Optional• Prescription drugs • Clinic services • Physical therapy • Occupational therapy • Speech, hearing and language

disorder services • Respiratory care services • Other diagnostic, screening,

preventive and rehabilitative services

• Podiatry services

• Optometry services • Dental services • Dentures • Prosthetics • Eyeglasses • Chiropractic services • Other practitioner

services • Private duty nursing

services • Other services approved

by HHS Secretary

14

CHIP: Benefits

• Inpatient hospital services• Outpatient hospital &

ambulatory services• Lab & X-ray• Surgical & medical physician /

physician extender services (including immunizations & well-baby / well-child exams)

• Emergency services• Prescription drugs• Behavioral health & substance

abuse benefits

• Physical / speech / occupational therapy

• Home health• Transplants• Durable medical equipment• Dental services• Hospice care services• Skilled nursing facilities• Vision (eye exams / eyeglasses)• Chiropractic services • Tobacco cessation

15

CHIP: Benefits

Perinatal 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 week

• DeliveryHospital facility chargesProfessional services charges

• OtherPharmacy (based on CHIP formulary)Prenatal vitaminsLimited laboratory testing

• No cost-sharing requirements

2 postpartum visits Additional visits if medically

necessary

– Assessments

– Planning services

– Education and counseling

16

Income 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.

17

Federal Poverty Income Levels, 2011

U.S. Department of Health and Human Services poverty guidelines based on annual income

SOURCE: Federal Register, Vol. 76, No. 13, January 20, 2011, pp. 3637-3638

At 100% of poverty, for families larger than 8, add $3,820 for each additional person.

Family Size 100% FPL

1 10,890

2 14,710

3 18,530

4 22,350

5 26,170

6 29,990

7 33,810

8 37,630

18

Medicare and Medicaid Eligibility

Medicare• Federally funded

• Federally administered

• Eligibility • People age 65+

• People with disabilities

• People with end stage renal disease

Medicaid • Jointly funded by federal

and state government• Administered by state

• Eligibility

• Low-income individuals

• Pays for most long-term care services & supports

19

Medicaid & Medicare: Dual Eligibles

Dual eligibles• Individuals who are aged or disabled (Medicare eligible) AND• Limited income (eligible for some Medicaid coverage)

Full Dual Eligibles• Entitled 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 Eligibles • Eligible 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.

20

CHIP 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)

Medicaid & CHIP: Texas Specifics

22

Texas Medicaid: Organization

23

Texas 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 drugs• Physical therapy• Occupational therapy• Targeted case management• Some rehabilitation services• Certified Registered Nurse Anesthesiologists• Eyeglasses/contact lenses• Hearing aids• Services provided by podiatrists• Certain mental health provider types

24

Texas 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 processing

• Prior authorization services

• Administration of drug rebate program

Texas 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

25

Texas Medicaid Women’s Health Program (WHP): Benefits

• Annual family planning exam & Pap smear

• Follow-up visit, if related to contraceptive method

• Counseling on specific methods & use of contraception

• Female sterilization • Follow-up visits related to

sterilization• Sexually Transmitted

Infection (STI) Screenings

• Certain screenings related to family planning: – Pregnancy test

– Rubella antibody test

– Routine urinalysis

– Urine culture

– Complete blood count (CBC)

– Hemoglobin and hematocrit tests

– Blood typing

– Blood glucose screening

– Lipid panel

– Thyroid stimulating hormone test

26

Texas 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.

27

Texas CHIP: Benefits

• Inpatient general acute & rehabilitation hospital services

• Surgical services• Transplants• Skilled nursing facilities • Outpatient hospital, comprehensive

outpatient rehabilitation hospital, clinic & ambulatory health care center services

• Physician/physician extender professional services (including well-child exams & preventive health services)

• Laboratory & radiological services• Durable medical equipment, prosthetic

devices, & disposable medical supplies• Home & community-based health

services• Nursing care services

• Inpatient mental health services• Tobacco cessation• Outpatient mental health services• Inpatient & residential substance use

treatment• Outpatient substance use treatment • Rehabilitation and habilitation

services • Hospice care services• Emergency services • Emergency medical transportation • Care coordination• Case management• Prescription drugs• Dental services• Vision• Chiropractic services

28

Texas CHIP Perinatal Program

Provides prenatal & post-partum care to pregnant women ineligible for Medicaid due to:

• income (whose income 186%-200% FPL), or • immigration status (with income below 200% FPL).

Upon delivery, CHIP Perinatal newborns in families:• With incomes at or below 185% FPL:

– are deemed to Medicaid – receive 12 months of continuous Medicaid coverage

• With incomes above 185% FPL up to 200% FPL:– remain in CHIP Perinatal Program – receive CHIP benefits for the remainder of the 12-month coverage

period

Members receiving CHIP Perinatal benefits are exempt from:• 90-day waiting period, asset test & all cost-sharing, including

enrollment fees & co-pays

29

Medicaid Benefits: Compared to Private Employer-Sponsored Coverage

30

Texas Medicaid: Eligibility

Medicaid serves:• Low-income families• Non-disabled children• Related caretakers of dependent children• Pregnant women• People age 65 and older• People with disabilities

Texas Medicaid does not currently serve:• Non-disabled, childless adults

31

Texas Medicaid Eligibility: Percent of FPL June 2010

32

Texas 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.

33

Texas CHIP: Eligibility

General eligibility• Uninsured 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 above

• CHIP Perinatal eligibility is determined for a 12-month period

34

Texas 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 both

• Acute care (e.g. hospitalization, outpatient services, and laboratory), and

• Long term services and supports (LTSS) provided in the home or community (e.g. assistance with daily living, skilled nursing, and therapy services).

35

Texas Medicaid: Historical Enrollment

History of Medicaid Eligibility: Caseload September 1977- August 2010

36

Texas Medicaid: Enrollment by Age, State Fiscal Year 2009

37

Texas 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 2009

38

Texas Medicaid: State Budget

Medicaid spending FY 2010-2011

• $44.9 billion from all fund sources

• $18.8 billion from General Revenue (GR), GR-Dedicated, and Tobacco Settlement Receipts

• 75% of all appropriations for HHS

39

$0.0

$4,000.0

$8,000.0

$12,000.0

$16,000.0

$20,000.0

1981 1991 2001 2011

(mil

lio

ns)

Federal Spending

State Spending

$16.1 B

$8.6B

1981 1991 2001 2011

Federal Client Services Payments ($Millions)

$688.6 $2,350.2 $6,234.1 $16,146.3

State Client Services Payments ($Millions)

$493.5 $1,333.6 $4,024.4 $8,550.1

Total Spending ($Millions) $1,182.0 $3,683.7 $10,258.5 $24,696.4

Total Federal and State Medicaid Client Services Spending (millions)

Texas Medicaid: Historical Spending

40

Texas CHIP: Enrollment & Spending

How many children in Texas are enrolled CHIP?

• Caseload for June 2011: 539,137 children

How 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.

41

Texas CHIP: Average Monthly Enrollment, State Fiscal Year 2000-2010

42

Texas CHIP: Enrollment by Age, State Fiscal Year 2010

43

Texas CHIP Perinatal Program: Enrollment, State Fiscal Year 2007-2010

44

Texas Medicaid: FMAP

Federal Medical Assistance Percentages (FMAP)• Portion of total Medicaid costs paid by the

federal government.• Texas FMAP for federal fiscal year 2012: 58.42–Of 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.

45

Texas Medicaid: DSH Payment

Medicaid Disproportionate Share Hospital (DSH) Program

• Source 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 billion

• State DSH Hospitals: $339 million• Non-state DSH Hospitals: $1.276 billion

46

Texas 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 hospitals• 11 non-state large urban public hospitals• 100 non-state owned rural public hospitals• 7 children’s hospitals• 11 state university physician group practices• unknown number of privately-owned hospitals in Private Hospital UPL

program

47

Texas CHIP: EFMAP

Enhanced Federal Medical Assistance Percentages (EFMAP)

• Portion of total CHIP costs paid by the federal government.

• Generally higher than Medicaid In 2012, the federal government pays 70.89% of

CHIP medical care expenditures Compared to 58.42% of Medicaid medical care

expenditures.

48

Texas CHIP: Historical Spending, State Fiscal Year 2000-2010

49

Texas CHIP: Cost Sharing

CHIP annual enrollment fee:• $0 for families with net income less than 150% FPL

• $35 for families between 151-185% FPL

• $50 for families between 186-200% FPL

Families are required to pay the enrollment fee upon enrollment or renewal of CHIP.

50

Texas CHIP: Cost Sharing

Families enrolled in CHIP are responsible for co-payments for certain plan benefits.

At or below 100% FPL

101% to

150% FPL

151% to 185% FPL

186% to 200% FPL

Preventative Health Care and Shots

Office Visit

Non-Emergency Room Use

Generic Prescription

Name-brand Prescription

Inpatient Hospital Care

Outpatient Hospital Care

$0

$3

$3

$0

$3

$10

$0

$0

$5

$5

$0

$5

$25

$0

$0

$7

$50

$5

$20

$50

$0

$0

$10

$50

$5

$20

$100

$0

51

Texas 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)

52

Medicaid Delivery Models:Managed Care vs. FFS

Managed Care Programs in Texas• STAR – 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 Medicaid• A 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.

53

Provider Reimbursement: Managed Care vs. FFS

Payment and processes vary by delivery model • Managed 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.

54

Texas CHIP: Delivery Systems

CHIP Service Delivery Models include:• MCO: A type of health care plan that arranges for or

provides benefits to covered clients– The 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 network– Providers are paid reimbursement rates established by the MCO

• Exclusive Provider Organization: A health plan that arranges for or provides benefits to covered persons through a network of exclusive providers– Limited to services provided to client in network, except for

emergencies.• Dental Maintenance Organization for dental services

Medicaid & CHIP: New Initiatives

56

Budget-Related Outcomes of the 82nd Texas Legislature

Summary of Medicaid Funding for FY 2012-13• $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 2010-2011 biennium, including an 8% hospital rate reduction.

• Cost containment initiatives totaling $1.8 billion in GR funds, including $450 million assumed in Rider 61.

57


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.

58


Medicare Equalization• Past Texas Medicare-Medicaid Policy

– Part 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 2012– The 2012-13 General Appropriations Act directs HHSC to

align payment policies for Medicare Part A and B cost sharing.

59

Initiatives from the82nd Texas Legislature

Managed Care Expansion• September 1, 2011

– Expanded existing STAR and STAR+PLUS service areas to contiguous counties.

• March 1, 2012– Expand 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.

60


Reduce inappropriate utilization of Emergency Departments (ED) by Medicaid recipients

• ED hospital rates– As 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 FFS

• Medicaid cost-sharing – Encourage 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, and – Educate recipients about appropriate Emergency Department

utilization.

61


Quality Initiatives• Shift to paying for outcomes and quality instead of

volume.– Quality-based payments for hospitals and managed care.

– Policy changes• Example: Ending Medicaid payments for elective deliveries

prior to 39 weeks.

• S.B. 7 established:– Quality-Based Payment Advisory Committee

– Texas Institute of Health Care Quality and Efficiency

62

Healthcare Transformation 1115 Waiver

Texas Health Care Transformation and Quality Improvement Program 1115 Waiver includes:

• Managed care expansion– Expands Medicaid managed care services statewide.

– Includes legislatively mandated pharmacy carve-in and dental managed care.

• Hospital financing component– Preserves hospital funding under a new methodology.

– Creates Regional Healthcare Partnerships (RHPs).

63


Under the waiver, trended historic UPL funds and additional new funds are distributed to hospitals through two pools:

• Uncompensated Care Pool–Costs 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 Payments– Support coordinated care and quality improvements

through RHPs to transform care delivery systems (beginning in later waiver years).

64

Healthcare Transformation 1115 Waiver Pool

65


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.

66

Chronic Conditions Waiver

S.B. 1, 82nd Legislature, First Called Session, 2011

• If 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.

67

Affordable Care Act:Medicaid Expansion

Medicaid eligibility expands to include individuals under age 65 with incomes up to 133% FPL

• Includes 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 14 - 133% of FPL• Childless adults up to 133% FPL• Emergency Medicaid in expansion populations• Children in foster care through age 25

Federal government bears full cost of coverage for new eligibles for first 3 years of mandatory expansion.

68

Current & Estimated Future Medicaid/CHIP Eligibility Levels

Current Medicaid185% FPL

0

25

50

75

100

125

150

175

200

225

Newborns (<1yr)

Children (Age 1-5)

Children (Age 6-18)

PregnantWomen

SSI, Aged,Disabled

Parents Childless Adults Long-Term Care

CHIP200% FPL

CHIP200% FPL

CHIP200% FPL

CHIP200% FPL





14% FPL

NEW Medicaid

(Currently CHIP)133% FPL

NEW Medicaid133% FPL




133%

69

Affordable 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.

70

Affordable 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.

71

Texas Health Care Coverage: Post ACA Implementation

0

50

100

150

200

250

300

350

400

450

Newborns (<1 yr) Children (Age 1-5) Children (Age 6-18)

Pregnant Women SSI, Aged,Disabled

Parents Childless Adults

CHIP CHIP200% FPL

CHIP200% FPL

CHIP


Current Medicaid133% FPL Current

Medicaid100% FPL



14% FPL


NEW

Medicaid133% FPL

NEW Medicaid

133%

Sliding Scale Health

Insurance Subsidies,

through Exchange400% FPL
















Unsubsidized –

In or Out of Exchange

Unsubsidized –


Unsubsidized –


Unsubsidized –


Unsubsidized –


Unsubsidized –


Estimated Medicaid/CHIP

5.6 million

Estimated Insured & Subsidized in

Exchange

1.9 million

Estimated Insured but not Subsidized

(In or Out of Exchange)

15.5 million

Estimate of Ongoing

Uninsured

2.3 million

% of F

ederal P

overty Level

72

Current State Challenges

Redesign of existing programs• Strengthening 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.

Uncertainties• Pending 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.

73

Additional Resources

Medicaid Managed Care Initiativeswww.hhsc.state.tx.us/medicaid/MMC.shtml

Approved Healthcare Transformation 1115 waiver www.hhsc.state.tx.us/1115-waiver.shtml

HHSC News Releases www.hhs.state.tx.us/news/release.shtml

Texas Medicaid Pink Bookwww.hhsc.state.tx.us/medicaid/reports/PB8/PinkBookTOC.html

Documents

Healthcare Payment Systems & Policy: Medicaid & CHIP Kimberly Davis Policy Advisor for Policy Development Medicaid/CHIP Division