The federal government would reduce its financial commitment to state Medicaid programs under the FY 2021 budget the Trump administration proposed earlier this month.

While testifying before the Senate Appropriations Committee’s Subcommittee on Labor, Health and Human Services and Education, Health and Human Services Secretary Alex Azar acknowledged that the administration’s proposed FY 2021 would eliminate the enhanced rate at which the federal government matches state funds used to serve individuals who enrolled in Medicaid through the Affordable Care Act’s Medicaid expansion provision.  That enhanced rate calls for the federal government to pay 100 percent of the costs associated with the Medicaid population during the first year of Medicaid expansion, eventually scaling down to 90 percent after 2020.  Nationally, the federal government’s matching rate for the pre-expansion population is 57 percent; that matching rate would not be affected by this proposal.

This aspect of the administration’s proposed FY 2021 budget has mostly flown under the radar since the budget’s release and has received little public attention.

In explaining the proposal, Azar said that enhanced funding for the Affordable Care Act’s Medicaid expansion population was biased against the disabled, women, and children.

Learn more about what Secretary Azar said about federal …

Health care accrediting organizations will be the subject of scrutiny and possible action by the federal government in the coming months.

At a recent conference, Centers for Medicare & Medicaid Services administrator Seem Verma said that

Receiving CMS’s authorization to inspect and deem healthcare providers compliant with Medicare’s quality standards is nothing short of assuming a sacred public trust…But an increasing amount of evidence indicates that accrediting organizations are not living up to that high bar.

According to Verma, CMS’s interest is motivated by a number of recent incidents of “serious deficiencies” among hospitals that had been found compliant with Medicare’s care standards.  She also is concerned that the same organizations that perform accreditations also provide consulting services, raising the possibility of conflicts of interest.

Learn more about CMS’s interest in looking into the work of accrediting companies and possibly introducing changes in accreditation processes in the HealthLeaders Media article “Verma Raps Accrediting Agencies ‘Glaring Conflict of Interest.’”

 …

Businesses with more than 50 employees enrolled in Medicaid would pay a fee, or tax, under a proposal by New Jersey Governor Phil Murphy.

Murphy’s “corporate responsibility fee” would levy a tax of $325 per employee on companies with between 50 and 500 employees on Medicaid.  The companies would pay the same fee for the members of their employees’ families who are enrolled in Medicaid as well.  Companies with more than 500 workers on Medicaid would pay a higher fee and the tax would rise to $725 per employee for businesses with more than 1000 employees on Medicaid.

The proposal will be part of Murphy’s upcoming budget proposal and would generate an estimated $180 million.  New Jersey’s Medicaid budget for next year is expected to be approximately $4.7 billion.

Learn more about New Jersey’s proposed tax on businesses with large number of employees on Medicaid in the Philadelphia Inquirer article “N.J. governor to propose new fees for companies whose workers rely on Medicaid.”…

The revised public charge regulation that will make it more difficult for some immigrants to come to the U.S. will be implemented after the Supreme Court lifted preliminary injunctions issued by lower courts that delayed the regulation’s implementation.

Under revisions of the public charge regulation introduced last year, individuals seeking entry into the U.S. and green cards who do not appear to be financially independent or have employment commitments can be denied entry if they will be dependent on means-tested public aid programs such as Medicaid or food stamps or even if they, or members of their family, appear likely to become dependent on such aid in the near future.

A number of judges throughout the country blocked the administration’s implementation of revisions of the public charge rule.  The Supreme Court’s action only lifts those injunction; it does not address the constitutionality of the regulation, leaving that matter to continue to be addressed by lower courts for now.

The challenge posed to health care providers by the updated public charge regulation is as much a matter of perception as reality:  individuals already legally in the U.S. who are not subject to the regulation have withdrawn from Medicaid out of fear …

Medicaid block grants and the proposed Medicaid fiscal accountability regulation (MFAR) pose new financial threats to providers and states, according to Fitch Ratings, the financial rating company.

MFAR poses the greater threat, Fitch believes, noting in a new analysis that it could

…reduce total Medicaid spending nationally by $37 billion and $44 billion annually…and by $23 billion to $30 billion for hospitals alone.  States, and to some extent providers, would respond to MFAR’s implementation with measures to mitigate the negative fiscal implications.

Block grants, through what has been named the Healthy Adult Opportunity program, also pose a threat, with Fitch explaining that

Capping federal Medicaid contributions, even for a subset of beneficiaries, poses risks to state budgets and those entities reliant on state funding, including local governments and providers.  States would need to find revenue or cost savings, either in Medicaid or elsewhere, to offset reduced federal contributions.

Learn more about the potential impact of the proposed Medicaid fiscal accountability regulation and Medicaid block grants in the Fitch Ratings analysis “Fitch Rtgs: Medicaid Changes Will Affect States, NFP Healthcare Providers.”…