Medicaid 1115 waivers provide states the opportunity to waive key provisions of federal law. The changes made possible by Section 1115 waivers are not as dramatic as those included in the failed bills-- for instance, states cannot use these waivers to fully restructure Medicaid under block grants or per capita caps, neither can the federal government use them to take away federal reimbursements for Medicaid expansion-- yet they are still significant.
In an attempt to "support states helping Medicaid beneficiaries improve well-being and achieve self-sufficiency", CMS released new guidance for waivers that imposed work requirements on January 11, 2018. Along with work requirements, states are also looking into provisions such as eligibility time limits, drug testing, and premiums. Because of this, these waivers are controversial and have brought up policy issues throughout the country.
At the moment, a number of states have submitted waivers for approval from the federal government. Here is some of the highlighting waiver activity within the states.
NEW HAMPSHIRE'S MEDICAID 1115 WAIVER FOR WORK REQUIREMENTS
New Hampshire was the fourth state to be permitted by the Trump administration for Medicaid work requirements. Under the state's Medicaid 1115 waiver, able-bodied adults will either need to work, develop job skills, or be involved in community service in order to receive premium assistance and program benefits from the state's Medicaid expansion.
Chief of CMS, Seema Verma congratulated the state and pointed out, "the Trump Administration has helped create one of the strongest job markets in our nation's history and we want to make sure able-bodied, working-age adults receive the necessary skills to join our growing workforce."
Governor Chris Sununu (R-- NH) said, "Work requirements help lift able-bodied individuals out of poverty by empowering them with the dignity of work and self-reliability while also allowing states to control the costs of their Medicaid programs."
Critics of the waiver are concerned that its ramifications will not support the original goals of the Medicaid program. A number of Democratic lawmakers are in opposition to the work requirements, strongly believing that they undermine access to the healthcare program. Supporters of the waiver see it as means of safeguarding the program's sustainability. They assert that Medicaid should be reserved for the country's most vulnerable and low-income individuals and families.
KANSAS IS DENIED 1115 WAIVER FOR LIFETIME LIMITS
Support for Medicaid expansion in Kansas came to a halt in February despite efforts from the Senate Public Health and Welfare Committee and House Democrats. Kansas Governor, Sam Brownback (R) vetoed the bill. Had it been approved, an estimated 150,000 residents would have been eligible.
While expansion failed, Kansas is one of five states, including Utah, Maine, Arizona, and Wisconsin, to ask for lifetime limits from CMS. This would have made it possible for the state to restrict coverage to three years/36 months for some of its recipients. CMS has declined the request making Kansas the first of the five states requesting lifetime limits to be denied.
Verma defended the decision saying, "we seek to create a pathway out of poverty, but we also understand that people's circumstances change, and we must ensure that our programs are sustainable and available to them when they need and qualify for them."
MEDICAID REFORM IN KENTUCKY
Kentucky was the very first state to get approval from CMS for an 1115 waiver (January 12, 2017). The waiver will implement work requirements, monthly premiums for low-income parents and expansion adults, dis-enrollment and coverage lockouts, the elimination of retroactive eligibility, the addition of deductible and incentive accounts, and waiving non-emergency medical transportation.
Kentucky's governor, Matt Bevin (R), plans to start the overhaul of the state's Medicaid program on July 1, 2018. It will begin in Campbell County and reach across the state over a period of six months. These changes will predominantly affect able-bodied beneficiaries with incomes up to 138% of the federal poverty level that obtained coverage during the program's expansion in 2014. Due to the overhaul, it's approximated that Kentucky and the federal government will save $2.2 billion over five years. Additionally, the Center On Budget and Policy Priorities expects that over the duration there will be a 15 percent drop in adult Medicaid enrollment.
On January 24, sixteen Kentucky Medicaid beneficiaries took legal action and sued the federal government over the waivers provisions. The group sees the Trump administration's approval as a violation of several federal laws and a threat to the lives of tens of thousands of low-income families.
HEALTHY INDIANA 2.0 CLAMPS DOWN ON ENROLLMENT AND ELIGIBILITY
CMS signed off on the amended extension of Healthy Indiana 2.0 on February 1. Initially, the state's waiver expanded the program under the Affordable Care Act (ACA) from February 2015 through January 2018 by changing the states pre-ACA limited coverage expansion waiver, Healthy Indiana Program 1.0. While other state's waivers focus on adults enrolled during expansion, Indiana's also includes changes to the terms of coverage for non-expansion adults. This encompasses low-income parents as well as those eligible for transitional medical assistance.
Healthy Indiana Program 2.0 features provisions such as: raising premiums by 50% for tobacco using members beginning the second year of enrollment, eligibility work requirements for most adults in 2019, dis-enrollment and coverage lockouts, introducing a tiered premium structure, and restricting transitional medical assistance eligibility to between 139% and 185% of the federal poverty level.
While there are a number of exemptions in place to help beneficiaries secure and keep coverage, the launch of these provisions will definitely alter program eligibility. Now that the state has received approval for their provisions, Indiana confronts the task of implementing them.
ARIZONA'S FOUR 1115 WAIVERS UNDER REVIEW
Arizona is looking to update and reform their Medicaid program, Arizona Health Care Cost Containment System (AHCCCS). Currently, the state has pending Medicaid 1115 waivers with CMS. The amendments include a retroactive eligibility request, an Institution for Mental Disease (IMD) waiver, work requirements, and an uncompensated care payment model.
Originally, Arizona also requested for approval of a 5-year lifetime time limit on Medicaid enrollment. However, this was recently taken out from the state's requests after CMS turned down Kansas's similar request for a 3-year time limit. No other state at this time has lifetime limits. In regards to the decision to delay the lifetime limit request, Deputy Director of AHCCCS, Jami Snyder said, "We have removed the lifetime limit from the waiver request, really for the purpose of expediting approval of the work requirements request." Right now, Arizona is still in discussions with CMS.
Regardless of the federal government's inability to reform Medicaid, states are now taking action to do it themselves through submitting 1115 waiver requests to CMS. Around the nation, local governments are now taking into consideration provisions such as work requirements, drug testing, lifetime limits, and premiums. A few states have received approval while others are encountering strong resistance. While reform through Medicaid 1115 waivers is supported by many state legislators, the way in which they are carried out will be vital to ensuring the future of the Medicaid program.
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