The Landscape of Medicaid Demonstration Waivers Ahead of the 2020 Election
|How Have States Used Section 1115 Demonstration Waivers in the Past?|
|From Medicaid’s beginning in 1965 through the early 1990s, waivers were small in scope. Beginning in the 1990s, there was an increase in waiver activity, and waivers became broader in scope. General periods of waiver activity prior to the Trump administration are discussed below:
Broad Expansion Waivers (Mid-1990s-2001). In the pre-ACA mid-90s through the early part of the 2000s (before statutory authority/federal funds were directly authorized for coverage expansion to childless adults under the ACA), most waivers focused on expanding coverage. Many began as state efforts to implement broader managed care delivery systems than were then permitted under federal law. States used savings from mandatory managed care or redirected disproportionate share hospital funds to offset expansion costs, and flush economic times during the mid- to late-90s helped support expansion efforts. Two of the largest waivers approved during this time (OregonHealth Plan and TennCare) also restructured coverage for existing beneficiaries in ways that were considered very controversial at the time.
HIFA and Other Waivers (2001 Forward). In August 2001, under President Bush, the administration announced the Health Insurance Flexibility and Accountability (HIFA) waiver initiative, which promoted the use of waivers to expand coverage within “current-level” resources and offered states increased flexibility to reduce benefits and charge cost-sharing to offset expansion costs. However, states had limited interest and success in expanding coverage under HIFA, and waivers instead began to increasingly focus on cost control as the nation moved into an economic downturn. Expansions that did move forward under HIFA waivers were generally limited, particularly when compared to the larger expansions of the 1990s. Beginning in 2005, waivers were approved in Rhode Island and Vermont set global caps on federal funds. Also during this same period, Massachusetts obtained a waiver that provided support for its efforts to provide universal coverage without significantly restructuring its Medicaid program.
Pre-ACA Expansion Waivers (2010-2013). Six states (CA, CO, DC, MN, NJ, and WA) used waivers to expand Medicaid coverage to adults after the enactment of the ACA to prepare for 2014.
Emergency Waivers (periodic over time in response to emergencies). Beyond these themes, waivers have also helped states quickly provide Medicaid support during emergencies, for example, by enabling a vastly streamlined enrollment process in New York in the wake of the September 11th attacks, and by assisting states in providing temporary Medicaid coverage to certain groups of Hurricane Katrina survivors and those affected by lead contaminated water in Flint, Michigan.
|What are the CMS Criteria for Approving Section 1115 Medicaid Demonstration Waivers?|
|In response to criticism from the General Accounting Office (GAO) about the lack of standards used to determine whether proposed Section 1115 demonstrations further Medicaid program objectives, CMS under the Obama administration posted a set of criteria to use when considering waiver requests in 2015. The Trump administration revised these criteria in November 2017. For comparison, both sets of criteria are listed below.
2015 CMS Waiver Approval Criteria
November 2017 Revised CMS Waiver Approval Criteria