Hot Topic - Medicaid Funding Crisis
Guest Speaker – Representative Greg Wren, Chair of the Joint Legislative Committee on Medicaid
Representative Wren took the opportunity to share some of the background on the Medicaid program, current challenges and some of the plans as the State moves forward. He began talking about how despite efforts, Alabama is still lagging behind in many health indicators including, obesity, diabetes and hypertension. He noted that with life expectancies dramatically increasing, there are concerns that Medicaid, as it is currently constructed, is not fiscally sustainable.
Several factors are impacting the Medicaid budget and the State budget as a whole:
1. States are mandated to meet budgets without deficit spending.
2. Medicaid funding represents 36% of the overall State General Fund Budget.
3. States are not allowed input into the design of the Medicaid program from the Federal Government.
As Alabama moves forward, Representative Wren noted that several issues need to be addressed and announced that the Governor would be forming the Governor’s Medicaid Commission. This Commission is intended to be short-lived and focused on financing of the program, not benefits. He also discussed some of the financial issues with the program. Three taxes alone make up 37% - 38% of Medicaid revenue and all three are due to expire in 2013.
- Hospital Bed Tax
- Nursing Home Bed Tax
- Retail Pharmacy Tax
The Medicaid system needs major repair and to move forward providers must be included in any changes. Representative Wren stated that there will be a comprehensive legislative agenda to deal with Medicaid during the next legislative session. These bills, at least 10 of them, will seek to move the system to one that is more accountable, more nimble and more transparent.
Representative Wren then encouraged the group to send him their suggestions and concerns about Medicaid as the Legislative session moves forward.
Affordable Care Act (ACA) Updates
It was noted that many specifics regarding the Affordable Care Act and possible expansion of Medicaid are still undecided and will be until after the general election. For the January 24th meeting, we will attempt to have Alabama State Health Officer, Dr. Williamson, come and speak to the Coalition.
Health Insurance Exchange
Shannon Byrd reported that they are continuing to prepare Phase II of the HIX plan which would include $60 million to build the HIX infrastructure. It is believed that the state may have waited too late to be able to develop its own State run HIX by January, 2014. Therefore, it is possible that initially, the Federal Government will be running the Exchange. However, the State will have the ability to develop its own HIX and take control of that at a later date. Jim noted that Kathleen Sibelius, Secretary of Health and Human Services, has indicated that they would prefer that the States run their own HIX.
Because we will likely default to a Federally run program; we would default to the Federal Government’s baseline health benefits plan as well. This would likely model the Blue Cross Blue Shield 310 plan. There is a summary of this information on the Alabama Insurance Program website.
The Children’s Health Insurance Program and Medicaid are working on building a new Eligibility system that should be compliant with ACA by January, 2014. This system is being built by the ADPH IT Department. There are several changes that must be addressed in the new system. The first and most pressing issue is the change to using the Modified Adjusted Gross Income (MAGI) rules to determine eligibility. Medicaid will have to develop new eligibility limits. However, it is very important to Medicaid that Express Lane Eligibility (ELE) processes still be used to determine eligibility.
January 24th, 2013, RSA Tower, 15th floor Board Room
10:00 a.m. – 12:00 noon
Insuring Partner Reports
(As of October 25, 2012)
- Cases: 274,169
- Recipients: 592,931
- Enrollment: 85,526
- Enrollment continues to increase.
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