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States Adopt New Tools to Control Rising Medicaid Drug Costs

Faced with continued increases in the cost of prescription drugs in their Medicaid programs, states are pursuing new approaches in attempts to control those rising costs.

In the past states have employed approaches such as beneficiary prescription limits, negotiating supplemental rebates from manufacturers, requiring prior authorization, implementing state maximum allowable cost programs, and operating preferred drug lists.

Recently, however, states are turning to a number of new mechanisms to limit the growth of Medicaid prescription drug costs, including:

  • introducing spending growth caps for Medicaid prescription drug costs, with unplanned increases in spending triggering a closer look at overall drug spending and a focus on specific drugs for utilization review;
  • closed formularies;
  • doing more to promote the use of generic drugs;
  • limiting generic drug price increases;
  • increasing prescription drug price transparency;
  • enacting manufacturer transparency laws;
  • adopting pharmacy benefit manager transparency laws;
  • aligning prices to federally negotiated drug prices.

Learn more about how state Medicaid prescription drug spending has grown and the steps states are taking to control that growth in the Kaiser Family Foundation report “Snapshots of Recent State Initiatives in Medicaid Prescription Drug Cost Control,” which can be found here.

Filed under: Uncategorized

Community Health Center Patients Often Have Housing Problems

Nearly half of the patients served by community health centers have housing problems, according to a new report published by the Journal of the American Medical Association.

Among those problems:  two or more homes in the past year alone, difficulty paying their rent or mortgage, and homelessness.  Some have homes that are not their own.

Practitioners need to understand this and help patients address their housing challenges, the study suggests, because housing concerns often prevent such patients from complying with medical instructions.

Learn more about how housing challenges affect health and health care in the JAMA report “Prevalence of Housing Problems Among Community Health Center Patients,” which can be found

Nearly half of the patients served by community health centers have housing problems, according to a new report published by the Journal of the American Medical Association.

Among those problems:  two or more homes in the past year alone, difficulty paying their rent or mortgage, and homelessness.  Some have homes that are not their own.

Practitioners need to understand this and help patients address their housing challenges, the study suggests, because housing concerns often prevent such patients from complying with medical instructions.

Housing issues are especially challenging for the patients served by Pennsylvania safety-net hospitals because those hospitals serve communities with especially large numbers of low-income residents.

Learn more about how housing challenges affect health and health care in the JAMA report “Prevalence of Housing Problems Among Community Health Center Patients,” which can be found here.

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Filed under: Pennsylvania safety-net hospitals

Medicaid Changes: More Than Just Work Requirements Coming?

While the green light for state applications to impose work requirements on their Medicaid recipients is receiving all of the attention, the Trump administration has issued guidance that appears to pave the way for other major changes in the Medicaid program as well.

Specifically, the Centers for Medicare & Medicaid Services has issued guidance that will enable states to pursue section 1115 waivers to test different ways of serving Medicaid patients that are otherwise not permitted under federal Medicaid law, including:

  • establishing time limits on how many months or years individuals may be enrolled in Medicaid;
  • locking out for a specified period of time Medicaid recipients who have not gone through annual eligibility redetermination or have failed to pay Medicaid premiums;
  • prohibiting hospitals from making presumptive eligibility determinations when they encounter new, low-income patients who are not enrolled in Medicaid at the time;
  • tightening their eligibility requirements;
  • excluding family planning providers like Planned Parenthood; and
  • establishing closed drug formularies for their Medicaid population.

Learn more about how the foundation has been laid for such changes if states are so inclined to pursue them and the implications of such changes if they are implemented in the article “State Waivers as a National Policy Lever:  The Trump Administration, Work Requirements, and Other Potential Reforms in Medicaid, which can be found here, on the Health Affairs Blog.

Filed under: Federal Medicaid issues

Pennsylvania Health Law Project Newsletter

The Pennsylvania Health Law Project has just published the latest edition of its Health Law News newsletter.

Included in this edition are articles about the elimination of Medicaid restrictions on prescription drugs for hepatitis C, the launch of the Community HealthChoices program of managed long-term services and supports in the southwestern part of the state, and more.

Find these stories and others here, in the latest edition of Health Law News.

 

Filed under: Pennsylvania Medicaid, Pennsylvania Medicaid laws and regulations, Pennsylvania Medicaid policy

340B on the Move?

Consider moving the section 340B prescription drug discount program from the Health Resources and Services Administration to the Centers for Medicare & Medicaid Services.

That was the message in a recent letter from Senate Finance Committee chairman Orrin Hatch to new Secretary of Health and Human Services Alex Azar.

In his letter, Senate Hatch observes that

HRSA lacks the necessary regulatory authority to oversee the 340B program. The agency only has the authority to regulate in three areas, which include establishing an alternative dispute resolution process, imposing civil monetary penalties against manufacturers who knowingly overcharge covered entities, and calculating the 340B ceiling price. Even so, it has not fully implemented these regulations. HRSA audits covered entities for program eligibility, duplicate discounts, and diversion. However, HRSA rarely audits manufacturers to ensure compliance with the ceiling price and conducts fewer than 200 audits of covered entities each year. The limited audits HRSA did conduct reveal high-levels of non-compliance by covered entities. This is disconcerting, given that, with relatively few dedicated staff, by 2021 HRSA will be responsible for providing oversight for over $20 billion in drug sales.

To address this challenge, Senator Hatch suggests that

With the limited statutory authority and concern that HRSA lacks adequate resources, HHS should consider whether CMS is better suited for 340B program administration, all or in part. Many determinants of 340B eligibility and other operational program details are linked to Medicare and Medicaid program components. CMS has extensive experience directly interacting with hospitals and drug manufacturers, including ensuring they meet participation requirements and conduct audits. Additionally, HHS already works with the Internal Revenue Service (IRS) to report charity care to Congress. This makes HHS more capable of tracking how covered entities use 340B savings.

In his letter, Senator Hatch also posed a number of 340B-related questions to Secretary Azar and requested a response to the Senate Finance Committee by February 26.

The 340B program has become controversial in recent years and has been the subject of considerable congressional scrutiny.  Currently, Congress is considering several bills to alter the program in different ways.

Virtually all Pennsylvania safety-net hospitals participate in the 340B program and consider it an essential tool in their efforts to serve their predominantly low-income communities.

Read Senator Hatch’s entire 340B letter to HHS Secretary Azar here.

Filed under: Medicare

NQF to Medicaid: Do a Better Job of Addressing Social Determinants of Health

State Medicaid programs need to do a better job of measuring and addressing the social risks their patients face, the National Quality Forum has asserted in a new report.

To do so, NQF concluded, state Medicaid programs should “…work more with healthcare organizations and communities to better manage social disparities.”

How?

According to the NQF, state Medicaid programs should:

  • Acknowledge that Medicaid has a role in addressing social needs that impact health.
  • Create a comprehensive, accessible, routinely updated list of local community resources for healthcare organizations.
  • Harmonize tools that assess social needs that impact health to ensure that they collect and document the same type of information.
  • Create standards for inputting and extracting social needs data from electronic health records to strengthen information sharing between health and non-health providers and programs
  • Increase information sharing between government agencies.
  • Expand the use of waivers and demonstration projects to begin to learn what works best for screening and addressing social needs that impact health.

Learn more about how the NQF wants state Medicaid programs to address the social determinants of health in the new report Food Insecurity and Housing Instability Final Report, a link to which can be found here.

Filed under: Uncategorized

MACPAC Meets

The Medicaid and CHIP Payment and Access Commission met last week in Washington, D.C. to discuss a variety of Medicaid and Children’s Health Insurance Program issues.

MACPAC, the non-partisan legislative branch agency that performs policy and data analysis and makes recommendations to Congress, the administration, and the states, addressed a number of issues during the meeting.  Among them it discussed Medicaid managed long-term services and supports (MLTSS) and voted to recommend that states be given the opportunity to seek permission to make Medicaid beneficiary enrollment in managed care plans mandatory through revisions of their state plan amendment rather than by seeking Medicaid waivers.

The commission also heard presentations on and discussed:

  • the integration of substance use disorder treatment with other Medicaid-covered services
  • residential substance abuse treatment and the exclusion of institutions for mental disease from treatment options
  • stakeholder experiences with MLTSS
  • Medicaid hospital payments
  • Medicaid managed care
  • the “Money Follows the Person” demonstration program
  • appeals for the dually eligible

MACPAC’s deliberations are important to Pennsylvania safety-net hospitals because those hospitals serve so many Medicaid patients.  While MACPAC’s recommendations are binding on neither the administration nor Congress, it is a respected source of insight and ideas and its recommendations often find their way into future regulations, legislation, and policy.

Go here for a summary of the meeting and links to the presentations used for these subjects.

Filed under: Federal Medicaid issues, Pennsylvania safety-net hospitals

ACA Improves Access to Surgical Services

The Affordable Care Act’s Medicaid expansion has improved access to surgical services for Medicaid patients.

Or so says a new study published in JAMA Surgery, which reports that

In this study of patients with 1 of 5 common surgical conditions, Medicaid expansion was associated with a 7.5–percentage point increase in insurance coverage at the time of hospital admission. The policy was also associated with patients obtaining care earlier in their disease course and with an increased probability of receiving optimal care for those conditions.

As a result, the study found,

The ACA’s Medicaid expansion was associated with increased insurance coverage and improved receipt of timely care for 5 common surgical conditions.

This development is especially relevant to Pennsylvania safety-net hospitals because they serve so many more Medicaid patients in the predominantly low-income communities in which they are located.

Learn more about the study, its findings, and the implications in the JAMA Surgery report “Association of the Affordable Care Act Medicaid Expansion With Access to and Quality of Care for Surgical Conditions,” which can be found here.

Filed under: Affordable Care Act, Pennsylvania safety-net hospitals

Medicaid in the Spotlight

State-option work requirements.

A cap on federal spending.

New flexibility for states to address eligibility, benefits, and provider payments.

Rolling back the Affordable Care Act’s eligibility expansion.

Medicaid is under the policy microscope in Washington these days in ways it has not been for many years as the new administration continues to work to put its stamp on the federal government’s major program to provide health care to low-income Americans.

These and other possible changes are of great interest to Pennsylvania’s safety-net hospitals because these hospitals care for so many more Medicaid and low-income patients than the typical community hospital.

What are policy-makers considering and what are the potential implications of their efforts?  Learn more in the new Health Affairs blog article “Medicaid Program Under Siege,” which can be found here.

Filed under: Federal Medicaid issues, Pennsylvania safety-net hospitals

A New Use for Section 1115 Medicaid Waivers?

Historically, states have pursued section 1115 Medicaid waivers as a means of expanding Medicaid eligibility.

But the Centers for Medicare & Medicaid Services now appears to be looking at granting 1115 waivers to help states reduce their Medicaid populations.

According to a new report published by the Commonwealth Fund, CMS is encouraging states – both Medicaid expansion and non-expansion states – to launch demonstration programs designed to reduce enrollment in “means-tested public assistance” programs such as Medicaid.  In their efforts to cut spending and reduce Medicaid enrollment, states are expected to seek section 1115 waivers to experiment with means of doing so such as:

  • establishing monthly premiums for Medicaid recipients
  • eliminating retroactive eligibility
  • imposing lifetime limits on how long individuals may participate in Medicaid
  • excluding people with substance abuse problems
  • shifting Medicaid enrollment to a single annual open-enrollment period
  • implementing more frequent eligibility determinations

And just last week CMS signaled states that it was now welcoming waiver applications to impose work requirements on some Medicaid recipients.

In a recent section 1115 waiver application, the state of Kentucky, for example, projects that the combination of establishing premiums for Medicaid participation and locking out those who do not make their payments, eliminating retroactive eligibility, and imposing a work requirement would reduce its Medicaid population 14.8 percent in the sixth year such changes were implemented.  That waiver was granted last week.

Learn more about how CMS is preparing to use section 1115 Medicaid waivers to enable states to reduce their Medicaid enrollment in the Commonwealth Fund report “State 1115 Proposals to Reduce Medicaid Eligibility: Assessing Their Scope and Projected Impact,” which can be found here.

Filed under: Federal Medicaid issues

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2012 Safety-Net Association of Pennsylvania