March 9, 2018: Reinsurance, Global Budgeting, Medicaid MCO Management, Pay for Success, Depression

Weekly updates on the latest state-level health care news from Heather Howard, program director of State Health and Value Strategies.

This week State Health and Value Strategies published a new issue brief, State Reinsurance Programs: Design, Funding, and 1332 Waiver Considerations for States by Manatt Health that provides a roadmap for states contemplating development of a state-based reinsurance program under 1332 waiver authority. And for those states ready to get to work on a 1332 waiver application to implement a state reinsurance program, SHVS has created a template to streamline the application process. As new states pursue section 1332 waivers, we continue to update our map with the latest activity.

Also this week, SHVS hosted, in partnership with Johns Hopkins University and the Milbank Memorial Fund, a webinar on global budgeting for rural hospitals that announced an upcoming policy academy for states on the topic. If you missed the webinar, you can check out the slide deck and a recording. Updates follow.

  • Arizona – This week the Arizona Health Care Cost Containment System (AHCCCS) announced contract awards to seven integrated managed care organizations that will coordinate the provision of physical and behavioral health care services to 1.5 million Medicaid members. Called AHCCCS Complete Care, the contracts begin on October 1, 2018.
  • Arkansas – The Centers for Medicare & Medicaid Services (CMS) approved Arkansas requested amendment to its section 1115 demonstration “Arkansas Works.” Under the amendment, Arkansas will require all Arkansas Works beneficiaries ages 19 through 49, with certain exceptions, to participate in and report 80 hours per month of activities, such as employment, education, job skills training, or community service, as a condition of continued Medicaid eligibility.
  • California — Covered California released a national economic analysis of potential premium increases in the individual market from 2019 to 2021 due to continued policy changes and uncertainty at the federal level. The analysis assesses which states are more or less likely to be at-risk of experiencing rate changes and identifies federal and state policies which could help mitigate premium increases.
  • Idaho – CMS Administrator Seema Verma sent a letter notifying state officials that a bulletin issued by the DOI in January 2018 provides “reason to believe that Idaho may not be substantially enforcing” parts of the Affordable Care Act. The letter affirms that CMS has a responsibility to uphold federal law and that it will enforce provisions of the ACA in Idaho if the state fails to do so. Idaho has 30 days to respond to CMS and put out a news release this afternoon responding to the CMS letter.
  • New York – The Office for People with Developmental Disabilities announced that it is implementing a new service coordination program for people with developmental disabilities, Health Home Care Management. Health Home Care Management will continue to provide the service coordination that people with developmental disabilities currently receive, but will also integrate coordination of other services, such as health care, wellness, behavioral, and mental health services through a single individualized Life Plan for each member.

New State Health and Value Strategies Affinity Group: Medicaid MCO Management and Oversight Work Group

We are pleased to announce a new work group that will bring together officials from state Medicaid agencies that manage the contracts and relationships with managed care organizations to discuss issues, challenges and solutions that states are working on. The group will be facilitated by experts at Bailit Health and will feature state-led discussions and opportunities to ask questions of your colleagues in an off-the-record environment. For the first call we will build on two recent SHVS webinars and issue briefs that address the categorization of APMs and how states define and track MCO adoption of APMs and we will dig into goal setting for MCO APM adoption, including considerations when crafting MCO contract language and defining measures to support state objectives for plan and provider APM adoption. This call is only for state officials and will provide program directors and managers with an opportunity to share their questions with our TA experts and other states. The first call will be Monday, March 12 at 2:00 PM ET. Please RSVP to Leah Holt at if you are interested in joining the call.

Pay for Success and Medicaid

Our friends at the Center for Health Care Strategies have a series of two blog posts up on Pay for Success (PFS). In the first post, Using Pay for Success in Medicaid Managed Care and Value-Based Purchasing Initiatives, explores what PFS can bring to Medicaid. It also discusses how PFS can be integrated into Medicaid managed care programs and value-based purchasing initiatives, including Medicaid accountable care organization programs, and support partnerships with community-based organizations. The second blog post in the series, Outcomes Rate Cards: A Scalable Pay for Success Approach, looks at a new adaptation of the PFS model: outcomes rate cards. In an outcomes rate card, a state agency, local government, or other organization identifies a problem, a target population, and a set of outcomes for which the entity wishes to contract. The set of outcomes may include ultimate goals, as well as progress-oriented steps toward those goals. This approach offers the potential to bring the benefits of PFS to state government, while mitigating limitations.

 The Effect of Medicaid on Management of Depression

An article in the Milbank Quarterly published this month relies on evidence from the Oregon Health Insurance Experiment to assess the relationship between Medicaid coverage and mental health care and how effectively Medicaid addresses unmet needs for mental health care. The article finds that Medicaid coverage reduced the prevalence of undiagnosed depression by almost 50 percent and untreated depression by more than 60 percent. It increased use of medications and reduced the share of respondents reporting unmet mental health care needs by almost 40 percent. The authors conclude that Medicaid coverage had significant effects on the diagnosis, treatment, and outcomes of a population with substantial unmet mental health needs. Coverage increased access to care, reduced the prevalence of untreated and undiagnosed depression, and substantially improved the symptoms of depression.