Medicaid solutions bring uncertainty

Medicaid has become a prevalent issue in health care discussions as federal and state lawmakers look at ways to reduce rising health care costs.

Proposed legislation in Missouri by state Sen. David Sater, R-Cassville, concerning the global waiver bill may have just the opposite effect.

President Donald Trump has stated mandating Americans to purchase health insurance was never the right solution. A federal bill intends to repeal the efforts of the Affordable Care Act, lowering health care costs across the board and could ultimately leave Missouri with a tab it can't repay.

A Missouri Hospital Association report released last week explains Congress' ACA repeal-and-replace legislation could cost Missouri $9 billion as a result of proposed cuts to both urban and rural Medicare and Medicaid communities.

Officials believe the proposed legislation may leave more than 250,000 Missourians uninsured and would reduce hospital funding that pays for indigent care, which is care for those who don't qualify for coverage under Medicaid, Medicare or private insurance.

At the state level, Sater has proposed legislation that would require the Department of Health and Senior Services to apply for a global waiver block grant from the federal government. The waiver would change the way the state receives federal funding for Medicaid users, capping the allocation to a figure currently unknown to the bill sponsor.

Sater told the News Tribune under the current federal-match model, the feds have tied the state's hands.

"If costs continue to rise, the state won't be able to keep up with the costs," Sater said. "We can't continue down the same road."

In fiscal year 2018, Missouri could be on the hook for $9 billion-10 billion in Medicaid costs.

Sater said this explosion in costs is making it impossible to fund other important projects like the foundation formula, transportation and dilapidated bridges, and it has resulted in a reduction of funds for higher education.

Currently, there are a lot of unknowns to the proposed legislation including uncertainty of how much control the state will have under a global waiver; whether federal reimbursement allowances, which are federal-match dollars, would be granted; and the number of people who could lose coverage.

The legislation was brought to the Senate floor March 7 for debate and tabled for future discussion. Nothing further is planned at this time.

Federal dollars' impact statewide

MHA President Dave Dillon told the News Tribune it is hard to discuss funding health care without talking about federal reimbursement allowances, also known as provider taxes. Under Sater's proposed bill, there is nothing outlining whether the state would still be able to access the federal-match dollars gained by utilizing FRAs. The funds are typically allocated to MO Healthnet, the state's Medicaid program.

The purpose of the FRA program is to allow Missouri and program participants to take full advantage of the government's Medicaid cost-sharing program. Each dollar of assessment Missouri collects and spends generates approximately an additional $1.73 billion in federal funds.

Dillon explained Missouri's health care agencies have depended on the provider taxes since the 1990s, and without them, the state would have a $1 billion gap to fill. Prior to the implementation of provider taxes in 1990, MO Healthnet was appropriated 39.5 percent of general revenue funds. By fiscal year 2015, that appropriation was reduced to 17.3 percent, according to MHA data.

"A question that has not been asked is whether hospitals will be expected to be the only real revenue generators for the next generation?" Dillon said.

Pharmacists have also been brought to the table to discuss how the state can get a better handle on rising health care costs, and they too question the prospects of the global waiver proposal.

Ron Fitzwater, chief executive officer of the Missouri Pharmacy Association, told the News Tribune they understand the state and federal government are frustrated with the dollars going into the Medicaid budget, but access to provider taxes under the proposed global waiver bill is a concern.

"Our concern is that Missouri is very heavily dependent on the provider taxes, and there's no indication from the federal government how those taxes are going to be impacted under a waiver program," Fitzwater said. "When the federal government says we will give X dollars to the state, we have a pie that is a certain size, and health care advocates are fighting amongst the state to decide how to divide it. I don't think there's a good enough model out there on how to distribute it."

Fitzwater and Dillon agree the state doesn't have enough information to accept or reject the proposed legislation.

Missourians' eligibility changes

In Missouri, there are 1.6 million Medicaid recipients. If the block grant was granted, there would be a cap on how many people would be eligible for these services, because the state could only afford what's provided under the terms of the federal grant.

Currently the mandatory populations covered under the state Medicaid program include nursing facility care; hospital inpatient and outpatient services; physicians services; home health services; lab and x-ray services; family planning services and treatments; transportation, including non-emergency transportation; and covered services provided by Federally Qualified Health Clinics, rural Health Clinics, and Early Periodic Screening, Diagnosis and Treatment, which includes all medically necessary treatments and care needed to correct and ameliorate a child's health conditions.

Jen Bernsdale, executive director for Missouri Care for All, was pleased to see the discussion for the waiver has been tabled. She explained under the global waiver, there is a level of uncertainty of how cuts would be made.

"It's important to remember who is eligible under the Medicaid program - children, pregnant women, seniors and people with disabilities," Bersdale said. "Under this proposal, we don't know who may be cut off from coverage, but what we do know is if the state's expenses exceed the revenue granted by the federal government, the state will be on the hook."

Sen. Rob Schaaf, R-St.Charles, said legislation like this could provide the state more flexibility to implement more incentives and disincentives, but the amount of control the state would have is still unknown.

Schaaf explained under the federal and state relationship, there should be some level of control granted to the state that would, for example, allow them to increase co-pays if a person is exhibiting irresponsible behavior. He believes emergency room visits should cost more than urgent care visits.

"The issue is that medical costs is exceeding the revenue, and we want control over that," Schaaf said. "The goal is not to knock people out of Medicaid, but we don't want to allow it to eat into other programs."

Bersdale disagrees.

"Saying we want to cut health care to make young children make better decisions doesn't make sense as a strategy," Bersdale said. "We want people to make smarter health care choices, but one way to do this is to increase access to different kinds of care."