Trends in State Medicaid Programs: Looking Back and Looking Ahead
For fifteen years, the Kaiser Commission on Medicaid and the Uninsured and Health Management Associates (in collaboration with the National Association of Medicaid Directors in recent years) have conducted annual in-depth surveys of changes taking place in Medicaid programs across the country. Each year, the survey is conducted from June through August; Medicaid directors and staff provided data for this report in response to a written survey and a follow-up telephone interview. They are asked about policy actions that have been taken in the past state fiscal year (SFY) and actions planned for the coming fiscal year. For most states, the fiscal year runs from July 1 through June 30. For example, SFY 2006 for most states ran from July 1, 2005 through June 30, 2006. Exceptions include AL, DC, and MI (October 1 through September 30), NY (April 1 through March 31) and TX (September 1 through August 31). All 50 states and DC completed surveys and participated in telephone interview discussions each year. Copies of these reports can be found on the KFF Medicaid Budget Survey Archives.
Data included in this issue brief and its related data collection reflect information collected for the each fiscal year. Adopted policies are sometimes delayed or not implemented due to complex administrative or computer system changes, advance notice requirements, lack of approval from CMS or other legal, fiscal, or political considerations. Therefore, adopted actions should not be taken as final until they are implemented.
These surveys seek to capture policy changes states elect to make; changes required under federal law are not counted (though may be noted in some tables as (nc) or “not counted”.)
Over time the survey has evolved, reflecting the ever-changing nature of Medicaid. For example, the first few years of this survey work coincided with an economic downturn, and therefore the report focused on cost containment. As economic conditions improved and states shifted their focus, the survey did so as well, dedicating more effort to capturing innovations and expansions. Questions are refined and reworked; some questions eliminated while others added. Certain questions have been asked consistently to allow for trending. For this report, data from prior surveys have been pulled together in one place. Because of changes in policy and refinement of questions, counts included here may not match the original report. Below are some further notes for each of the policy sections.
Spending and Enrollment
Total Medicaid spending includes all payments to Medicaid providers for Medicaid covered services provided to enrolled Medicaid beneficiaries. In addition, total Medicaid spending includes special payments to “disproportionate share hospitals” (“DSH payments”) that subsidize uncompensated care for persons who are uninsured and unreimbursed costs related to care for persons on Medicaid. Not included in total Medicaid spending are Medicaid administrative costs and federally mandated state “Clawback” payments to Medicare (Pursuant to federal law, state have paid Clawback payments since 2006 to help finance the Medicare Part D prescription drug benefit for beneficiaries who are dually enrolled in both Medicare and Medicaid.) States are asked to exclude costs for the Children’s Health Insurance Program (CHIP.) Total Medicaid spending includes payments financed from all sources, including state funds, local contributions and federal matching funds. Historical state Medicaid spending refers to all non-federal spending, which may include local funds and provider taxes and fees as well as state general fund dollars. State spending for FYs 2014-2016 collected as part of this survey reflect state spending, largely state general fund dollars.
Spending and enrollment data reported here are annual rates of growth for Medicaid enrollment. The growth rates were calculated as weighted averages across all states, and for states based on state decisions to implement the ACA Medicaid expansion in 2014, 2015 or 2016. For FYs 2014, 2015 and 2016, average annual Medicaid spending growth was calculated using weights derived from the most recent state Medicaid expenditure data for fiscal year 2014, based on estimates prepared for KCMU by the Urban Institute using CMS Form 64 reports, adjusted for state fiscal years. These data were also used for historic Medicaid spending. Medicaid enrollment average annual growth rates for SFYs 2015 and 2016 were calculated using weights based on Medicaid and CHIP monthly enrollment data for June 2014 published by CMS. Historical enrollment trend data reflects the annual change from June to June of monthly enrollment data for Medicaid beneficiaries collected from states.1 Medicaid enrollment average annual growth rates for SFY 2014 were calculated using the June 2013 enrollment data that is used for the historical trend.
Eligibility Standards and Application and Renewal.
Eligibility Standards – For the purposes of this survey, eligibility standards refer to changes to income standards, asset tests, retroactive eligibility, treatment of asset transfers or income, enrollment caps or buy-in options (including Ticket to Work and Work Incentive Improvement Act or the DRA Family Opportunity Act.) Policy changes are classified as expansions or restrictions based upon the beneficiary’s perspective. While the ACA Medicaid expansion was a mandatory change, it was made effectively optional by the June 2012 Supreme Court ruling; therefore adoption of the ACA Medicaid expansion was counted as an eligibility expansion. With the new options available starting in January 2014 (Medicaid expansion and Marketplace subsidies) states made changes to some existing Medicaid coverage pathways (waivers extending coverage over 138 % FPL, coverage for pregnant women over 138% FPL, Breast and Cervical Cancer Treatment Program, Family Planning and Medically Needy) that were included in reports, but not counted as restrictions.
Application and Renewal – For the purposes of this survey, application and renewal refer to changes in forms, verification or face to face interview requirements, frequency of redeterminations or renewals, new online enrollment systems among other changes. Policy changes are counted as simplifications or restrictions based upon the beneficiary’s perspective. All states were required to implement a number of enrollment simplifications in January 2014 under the ACA. Given the number and scope of these changes, surveys conducted in 2014 onward no longer asked states to report changes in application and renewal policy.
States are only asked to report the direction of provider rate changes for select provider types; they do not reflect the magnitude of the changes nor levels. Restrictions refer to provider rates that are reduced compared to the previous year for all providers except inpatient hospitals and nursing facilities. These two provider types are more likely than other provider types asked about in the survey to have inflationary adjustment built into their rates. Therefore, for these two provider types, freezes as well as cuts are counted as restrictions. Increases refer to rates being higher than the year before. Because all states were required to increase payment rates for primary care physicians in calendar year 2013 and 2014 (the difference being funded with federal dollars) this survey did not capture primary care rate changes for affected periods; rates for specialists were still captured during this period.
Each year, states are asked to report provider taxes that are in place, new or being eliminated. The way this question has been asked ask changed over time; states were originally asked to list provider taxes in their state. In later years, states were asked about common provider tax types (Nursing Facilities, Inpatient Hospitals and Intermediate Care Facilities for those with Intellectual Disabilites (ICF-IDs). Because of this, there may appear to be breaks in trend data in the early years that may not reflect changes in policy but incomplete data.
In July 2009, CMS changed policy regarding the use of provider taxes on MCOs that restricted their use. A number of states either eliminated such taxes, sometimes replacing them with premium taxes that were not Medicaid provider taxes. This survey relies on state reporting to differentiate between Medicaid provider taxes on MCOs and other taxes; however, it is possible that some states misreported such taxes. In this survey, MCO taxes reported by states for all periods were moved into “other” counts.
Policy changes are counted as expansions/enhancements or restrictions/eliminations based upon the beneficiary’s perspective. Changes that were required under federal policy (e.g. covering tobacco cessation services for pregnant women, free-standing birth centers, coverage of the essential health benefits for the ACA Medicaid expansion population) were not counted as changes but may have been reported in tables as (nc).
Two types of benefits – pharmacy and HCBS services – are not included in benefit counts in this report as they are counted in other sections. Pharmacy has long been treated this way in final reports. However, this is a change for HCBS services. Up through SFY 2012, changes to LTSS benefits were often counted as long-term care actions. Starting in 2013, such actions were counted as benefit changes. For this report and in future reports, HCBS benefit changes (which include 1915i, 1915k, HCBS waiver services, state plan home health, personal care and private duty nursing) are counted as long term care actions. Additionally, changes to pharmacy benefits are not included in the benefit counts, but reported as pharmacy actions.
Guidance issued in 2013 clarified that autism-related benefits were required coverage under EPSDT. Such actions reported in that year and years earlier were not counted as benefit changes in this report or its related data collection.
Pharmacy – Pharmacy cost containment actions can include any cost-containment action; only certain ones (changes to the state Preferred Drug List, Changes to Supplemental Rebates and Script Limits) were asked consistently over time. Starting in SFY 2007, states were asked about these same select pharmacy tools being in place; this was not asked in previous years.
Long Term Care – The surveys have asked about expansions and restrictions on both community and institutional benefits. However, in recent years, the survey has moved away from counting restrictions on institutional benefits as these were often completed as part of actions to shift more people into the community. Therefore, expansions on the number of people served in the community can be trended but not restrictions. Up through SFY 2012, changes to LTSS benefits were often counted as long-term care actions. Starting in 2013, such actions were counted as benefit changes. For this report and in future reports, HCBS benefit changes (which include 1915i, 1915k, HCBS waiver services, state plan home health, personal care and private duty nursing) are counted as long term care actions.
Managed Care and Delivery System Reform
This section of the survey has undergone considerable refinement. In the early years of the survey, changes to managed care (such as adding new groups, expanding to new regions, etc.) included changes to both PCCM and MCOs; such changes were not differentiated between the two systems. Therefore, these changes cannot be trended over all surveys. Medicaid managed care trend data is available in the Medicaid and CHIP section of State Health Facts.