Friday, September 9, 2011

Jon Peacock: Keeping Them Honest For Our Sake!

FYI – today’s Wisconsin Health News has an interview w. Sec. Smith.  I highlighted in yellow the portion about the waiver request: 
On the Record with Department of Health Services Secretary Dennis Smith

Governor Scott Walker's administration is "working hard" to lift the cap on Family Care enrollment, Department of Health Services Secretary Dennis Smith told Wisconsin Health News in a recent, exclusive interview.

"The governor is deeply committed to Family Care," he said. "We are working really hard on what reforms we can bring to the program to be able to lift caps, as we all want to do."

In a wide-ranging interview, Smith also defended the rollout of a recent state report on the federal health reform law, discussed when the administration plans to submit a waiver from maintenance of effort requirements, and talked about why states deserve more flexibility in their Medicaid programs.

Excerpts are below.

WHN: Last month, the Office of Free Market Health Care released a report examining the impact the federal health reform law will have on Wisconsin. Advocates, Democratic lawmakers, and even one of the economists who worked on the report, criticized Governor Scott Walker's administration for only highlighting its negative aspects. How do you respond to that?

DS: Originally, people were quite excited when we were told that reform meant the cost of health care was going to go down. That is what people were sold on in terms of why we were going to pursue what became the Patient Protection and Affordable Care Act. Obviously, people are frustrated with the report we released that said that won't be the case. Now people are trying to move the goal posts on us, that it was supposed to be these other things. Why didn't we emphasize the reduction in the uninsured, for example? Why didn't we emphasize other things? To a large extent, (with the report), we went back to the original promise that got everyone so excited. Showing people a picture of that is what we should really concentrate on. We now know that premiums for young people will go up significantly. We know that there will be disruption in the market. We should focus on what we should be doing between now and 2014 to mitigate those negative aspects in the market?

WHN: So you disagree with the claims that the Office spun the report's findings?

DS: If I was really putting a spin on it, I would have done much more to highlight those areas where I disagree with the authors. They have a relatively modest erosion in employer-sponsored health insurance. I believe, and many other people believe, that it will be much more significant than that. The reason I believe that is from prior history. If you go back to look at what happened when the State Children's Health Insurance Program was created in 1997, you see a migration out of private insurance into public insurance. Once those new public benefits were offered, that erosion of private coverage was much more substantial than the authors were saying it would be. I didn't highlight my disagreements where I thought the report was wrong. I said these are what the facts are. This is what the report said.

WHN: According to the report, 340,000 more Wisconsin residents will have insurance coverage under the federal health reform law. That seems like a significant finding. Why has that not been highlighted by the Office?

DS: Most of those people who are currently uninsured, most of them will come into Medicaid. The majority of those people are already eligible. People are giving too much credit to PPACA, when you realize where the reduction in uninsured is coming from.

WHN: Last month the Republican Governors Association published a report outlining its recommendations for reforming Medicaid. Among other things, it says that states should have flexibility to make the program work best for their taxpayers. Why is that important?

DS: The federal government has now increasingly limited states' ability to manage their program because the rules coming out of Washington are more and more restrictive. Wisconsin has been a managed care state for many years. It's accepted into the provider culture. It's accepted into our general population culture. And yet, CMS says we have to follow rules that the federal government comes up with that may not reflect our markets, either geographically, or the population that's used to being in managed care. When you go back and look at Medicaid, the majority of Medicaid spending occurs because states are the ones that decided in the first place to expand beyond the minimum federal requirements. States like Wisconsin, that have been very generous, have expanded eligibility far above what the federal mandates are. It's fundamentally wrong for federal officials to say, well, we have to impose these federal requirements, because without them state Medicaid programs won't be of high quality. They won't meet the needs of the population. That is fundamentally offensive to states. States are the ones that expanded the programs. We ought to as well have the latitude to manage the program in a way that is in line with state cultures and markets.

WHN: In a press briefing announcing the governors' Medicaid report, you said "We get good sound bites from the top leadership (at HHS), but when we get to the regulations it's quite a different story." Could you explain what you mean by that?

DS: If you go back to January of this past year, right before the National Governors Association's winter meeting, Secretary (Kathleen) Sebelius was saying we are all for flexibility. That was music to our ears. But it is inconsistent with what we have been experiencing in the regulations themselves in what has been coming out of CMS. When you look at the maintenance of effort requirement, for example, if you look at the statute, when it originally came out in the stimulus bill it referred to eligibility levels. Which is fine. We all understand what that means. And then CMS, not through regulation, but through a state Medicaid director letter, went on to say that that also means cost sharing. Cost sharing has never been considered an issue of eligibility. So they went far beyond what the statute says. That takes away state flexibility. We are getting mixed messages out of Washington, and that is very frustrating.

WHN: You mentioned maintenance of effort requirements. Governor Walker's budget bill says that if the state does not receive a waiver from MOE requirements by December 31, 2011, DHS must reduce eligibility to 133 percent of the poverty level starting July 1, 2012. Has DHS requested a waiver yet?

DS: We have not. It is still under development. We have assured everyone that we will release it publicly here first before we send anything to CMS. Frankly, we have been through different versions or different parts because of what we hear CMS talking to different states about, and now the latest notice for proposed rulemaking on eligibility under PPACA. This is sort of the irony and the mixed message you get out of Washington. Washington is not willing to give flexibility on how you determine eligibility, even when the alternative is states can simply drop tens of thousands of people off the program. That's a very confusing message.

WHN: When will the waiver request be presented to the public?

DS: Within the next four to six weeks. You will see it in early fall.

WHN: In an interview with the Milwaukee Journal Sentinel this summer, Governor Walker said the cap on Family Care enrollment could be modified or dropped later this year. Where does that stand now? Will the cap be lifted or modified?

DS: The governor is deeply committed to Family Care. We are working really hard on what reforms we can bring to the program to be able to lift caps, as we all want to do.

WHN: Is there a realistic possibility that the cap will be lifted this year?

DS: We are trying to find ways to bring reform into the program so it is sustainable so we can lift the caps. We are still working through those ideas and suggestions, including those from industry and from advocates. I have been very pleased with the very positive response people have had to making this workable. Everyone knows we have a great deal at stake here, and we all share the same goal, which is to ultimately be able to lift the cap. But everyone understands the challenge. We have to make the program sustainable.

WHN: If the administration does decide to continue the cap - which started June 30 - what type of federal approval is needed?

DS: That's an issue we are in discussion with CMS on. We have provided them with some information. They have followed up, and asked us some additional questions.
Many thanks to all of you for signing onto the attached letter.  We hand-delivered it late Thurs. afternoon to the Secretary’s office, and we just sent it to Wheeler,  WisPolitics and some health care reporters.  
I’ll be surprised if it actually gets any press, but that isn’t the primary objective.   I think it’s important for groups to start making noise about the importance of public participation, and to begin to draw attention to the fact that the department’s foot dragging puts CMS in an almost impossible position. 
Incidentally, there was an interesting article in “Healthwatch “ (The HILL’s health care coverage) on Wed. regarding the opposition of GOP officials, including Smith, to federal transparency requirements:
Jon Peacock, research director
Wisconsin Council on Children and Families
(608) 284-0580 x 307

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