Federal Perspective Changes in Medicaid

1
Federal Perspective Changes in Medicaid Alice
Burton, Director AcademyHealth June 2, 2005
2
Medicaid SCHIP Federal Changes

• Budget resolution calls for 10 billion in
  Medicaid reductions over 5 years
• Budget Resolution is broad budget framework
• Final Medicaid reductions might be more or less
  than 10 billion
• Medicaid Commission created
• SCHIP Reauthorization due by 2008, maybe sooner

3
Medicaid Commission

• To advise Secretary on ways to modernize
  Medicaid the Medicaid program so it can provide
  high quality health care to its beneficiaries in
  a financially sustainable way (CMS Charter,
  5/19/05)
• By Sept 1 2005 recommendations on 10 billion
  in savings over 5 years
• By Dec. 31 2006 Longer-term recommendations
  that ensure sustainability

4
Potential Sources of Medicaid Savings

• Presidents budget savings proposals totaled
  13.9 billion over 5 years (CBO scoring)
• Provider taxes 5.7 billion
• Rx pricing 5.2 billion (some Govs support)
• Asset transfer 1.4 billion (some Govs support)
• Targeted case management 1.5 billion
• Gov Warner letter with suggested savings Rx
  pricing, asset transfer and 2 billion by
  allowing states to charge higher co-pays

5
Next Steps in Federal Budget Process

• Commission report September 1, 2005
• House and Senate Committee action
• Response to reconciliation instructions expected
  by September 15, 2005
• Appropriations bills separate
• FY 2006 starts October 1st

6
States Propose Changes to Medicaid

• Reductions in Eligibility
• Tennessee Missouri
• Concept papers or waivers to redesign including
  individual accounts
• Florida, Georgia, Vermont, West Virginia, New
  Hampshire
• Changes to Disproportionate Share Funding and
  other financing issues