Posted May 22, 2003
Reform 2003 - Update
The National Governors Association did
not meet its May 14 deadline to come to a consensus on an alternative to
the Administration’s Medicaid reform plan introduced in January.
In a speech May 21, CMS Administrator Tom
Scully said he and HHS Secretary Tommy Thompson told the governors at their
meeting that they have a “small window” (no later than July) to get Medicaid
reform in Congress this year.
NGA rejected the Administration plan, which
would provide what Scully calls “forward funding” to states that elected
The plan (similar to getting your
paycheck in advance) would give states more federal funds over the first
seven years than they would get under current law – with no state match
required – but in the following three years, sharp reductions in federal
funding would amount to a “payback” of the funds to the government. Participating
states would assume the risk that their economies would support their Medicaid
programs in the later years.
NGA sources admit that a few vocal opponents
among the 50 governors could derail the effort. (Some advocacy groups have
hoped for just that, encouraging advocates to contact their governors to
urge them not to support “reforms” that could eliminate hard-won consumer
protections and benefit guarantees in the current law.)
One lobbyist suggested that some relief
for state costs for “dual eligibles” (people who qualify for both Medicare
and Medicaid) would be considered an accomplishment this year – particularly
having Medicare assume prescription drug coverage for Medicaid beneficiaries.
The NGA would also like Medicare to relieve states of the cost of Medicaid
recipients’ Medicare co-pays and deductibles.
What NGA Supports
NGA officials are unwilling to discuss
how they would finance their plan (other than to indicate that they don’t
like the risk in the Administration proposal), but they freely discuss
the long-term care principles the governors have agreed to, which are:
While on their face these options might appeal
to some consumer advocates, it is clear that Medicaid long-term care beneficiaries
could lose protections and guarantees they have in current law. So could
their families. NGA wants to require families to assume more of the
day-to-day responsibility for the long-term care of their relatives and
to pay more of the cost.
Shifting all – or even some – of the $90 billion
a year cost of services for “dual eligibles” to Medicare.
Creating tax incentives for long-term care
insurance and family caregiving.
Ending the institutional bias in Medicaid
funding. This includes providing Medicaid reimbursement for “consumer-directed
care,” home modification, and respite programs, and allowing states to
cover home and community-based services without obtaining waivers from
Giving states flexibility in what beneficiary
needs they meet and allowing them to provide services in only one part
of the state.
What the Administration Wants
The Administration has never produced
a public document detailing its Medicaid reform proposal. However, a
“Medicaid modernization model” developed by CMS for its discussions with
NGA has been going around Washington.
The Administration’s long-term care proposal
While many of the provisions appear to give
Medicaid beneficiaries more options, states would have greater flexibility
than they have now to determine what those options would be and who would
be eligible for them. Moreover, Administration officials continue to send
mixed signals as to whether the Nursing Home Reform Act and spousal impoverishment
protections would continue for optional beneficiaries, who are currently
at least 85 percent of nursing home residents who receive Medicaid.
(Both of these issues could be very scary.)
Give states broad flexibility to develop financial
resource tests for eligibility.
Allow people who do not meet the state resource
test to “buy in” to the program.
Require mandatory coverage only for those
who meet the state resource test and who require a nursing home level of
After a three-year transition period, require
states to “level the playing field” between support for institutional care
and a wide range of home and community-based services. States could make
eligibility for institutional care more restrictive than for home and community-based
End the ban on using Medicaid funds for state
Require states to individually tailor services
to beneficiaries based on an annual assessment.
Allow states to implement a voluntary system
of “self-directed services,” including counseling and other assistance
in obtaining appropriate long-term care services.
Allow states to impose higher cost-sharing
requirements on residents of institutions.
The Administration plan does not address
regulation of the newly Medicaid-funded home and community based services
that would be supported. (Also scary.)
An NGA official stressed that
states do not want federally imposed standards and regulations. This
could mean that where you live may make a very big difference in how you
are treated. Each state would basically make its own rules.
State Fiscal Relief
Newspapers reported May 22 that the House
and Senate had reached a deal on a tax cut bill with $20 billion for state
fiscal relief. Half of that amount had been reserved for relief for
state Medicaid programs, including nursing homes.
The House has passed a tort reform bill,
H.R. 5, but the Senate version, S. 607, was believed dead on arrival because
of its severe $250,000 cap on non-economic damages. Efforts to introduce
a bipartisan alternative have so far failed. House Republicans considered
attaching H.R. 5 to their version of the Medicare prescription drug bill,
apparently in an effort to force the Senate to act on tort reform, but
a House committee staff director says that the idea no longer seems to
be under consideration.
Reinstatement of Nurse Aide Training
On a party line vote (Republicans for,
Democrats against), the House Ways and Means Committee recently passed
an amendment that would give HHS the authority to develop guidelines to
reinstate nursing homes’ right to provide nurse aide training after a fine
of $5,000 or more.
There has been strong opposition to adoption
of the amendment without greater consideration and understanding of the
impact. Opposition was entered into the committee record.
The Medicare contracting reform bill
to which the amendment is attached must be reconciled with the House Energy
and Commerce Committee’s version, which does not include the amendment.
This amendment is one of the highest legislative priorities of the nursing
home industry, which maintains that the automatic two-year denial of nurse
aide training privileges for serious penalties is hurting facilities’ ability
to fill vacancies.
Elder Justice Act
The Elder Justice Act is expected to be
introduced in the House shortly by Rep. Emanuel (D-IL). By May 19, the
bill had more than 30 House sponsors. Some ombudsmen and state and local
citizen advocacy groups have joined the Elder Justice Coalition, a coalition
of organizations supporting passage of the bill. For information, further
information on this bill you can contact Amy Hooper at email@example.com.
Staffing Accountability Act
The National Citizens Coalition for Nursing
Home Reform has proposed a series of changes to this bill, which Senators
Grassley, Rockefeller and Breaux introduced last year as S. 2879.
The proposal is designed to ensure that
CMS implements plans to institute a new nurse staffing data collection
system based on payroll and contract data, and that it implements quality
measures based on staffing and turnover levels.
Feeding Assistant Regulation
CMS officials say the final regulations
allowing states to adopt “feeding assistant” programs will be published
in mid-summer. The industry has urged CMS to move the publication
date forward as much as possible (this says something!).
It appears that the final rules will
not be substantially different from the proposed regulations, which were
published last year with minimal federal guidance on how states run the