Category Archives: Medicaid Recipients

Broken Promises and the NC Waiver: You Do NOT Get Your Choice of Provider!!

“One can talk good and shower down roses, but it’s the receiver that
has to walk through the thorns, and all its false expectations.” –Anthony Liccione

In the 1968 Presidential campaign, Richard Nixon stated that “new leadership will end the war” in Vietnam. Also, in a 1968 interview, Nixon said he had “no magic formula” or “gimmick” for ending the Vietnam War. Then, in his memoirs, Nixon stated he never claimed to have such a plan. This is called a broken election promise.

Sadly, Richard Nixon’s broken election promise was not the first, nor would it be the last. We have become used to politicians making election promises and breaking those same promises which got them elected once they are in office.

“If you like your doctor, you can keep your doctor. If you like your health care plan, you can keep your health care plan.”

“Read my lips: no new taxes.”

Over the last few years, I have written ad nausem about accountability and proper supervision when it comes to the Managed Care Organizations (MCOs) in North Carolina. The other day, I was reviewing some pertinent federal regulations and came across this:

§ 438.52 Choice of MCOs, PIHPs, PAHPs, and PCCMs.

• General rule. Except as specified in paragraphs (b) and (c) of this section, a State that requires Medicaid beneficiaries to enroll in an MCO, PIHP, PAHP, or PCCM must give those beneficiaries a choice of at least two entities.

Obviously, North Carolina is not adhering to the above-referenced requirement.

Pull up the Waiver. In order to offer Medicaid enrollees only one MCO or other such entity, North Carolina would have had to request a waiver of 42 CFR § 438.52.If you rely on Medicaid for behavioral health care and live in Wake County, you have no choice but to rely on the provider network of only entity, Alliance Behavioral Health (Alliance), to receive services. For example, you do not get to choose between Alliance’s provider network and Eastpointe Behavioral Healthcare’s (Eastpointe) provider network. Staying with the same theoretical hypothesis, if your provider was not anointed with the gift of being in Alliance’s network, then you do not get to stay with your provider.

“If you like your doctor, you can keep your doctor. If you like your health care plan, you can keep your health care plan.”

Similar to President Barack Obama’s contention quoted above, we made similar promises to the Center for Medicare and Medicaid Services (CMS). Our promises are found within our Waivers. We have two Waivers, one for the developmentally disabled population and one for the mentally ill/substance abuse population. Each Waiver waives certain federal exceptions. However, in lieu of the federal requirements, we make certain promises to CMS. In order to waive 42 CFR § 438.52, we made certain promises to CMS in order to circumvent the necessary provisions of 42 CFR § 438.52.

The State sought a waiver of section 1902(a)(4) of the Act:

“The State seeks a waiver of section 1902(a)(4) of the Act, which requires States to offer a choice of more than one PIHP or PAHP per 42 CFR 438.52. Please describe how the State will ensure this lack of choice of PIHP or PAHP is not detrimental to beneficiaries’ ability to access services.”

Here are our promises:

“Under these circumstances, the State does not believe that making only one plan available in each geographic area of the State will negatively impact recipients’ access to care.”

“The LMEs have decades of experience locating and developing services for consumers with MH/IDD/SAS needs, and over the years, have built strong and collaborative working relationships with the providers of these services.”

“These providers support this initiative and consumers have at least as much choice in individual providers as they had in the non-managed care environment.

“Enrollees will have free choice of providers within the PIHP serving their respective geographic area and may change providers as often as desired. If an individual joins the PIHP and is already established with a provider who is not a member of the network, the PIHP will make every effort to arrange for the consumer to continue with the same provider if the consumer so desires.

“If you like your doctor, you can keep your doctor. If you like your health care plan, you can keep your health care plan.”

My two personal favorites among the State’s promises to CMS are: (1) “consumers have at least as much choice in individual providers as they had in the non-managed care environment;” and (2) the PIHP will make every effort to arrange for the consumer to continue with the same provider if the consumer so desires.”

These promises, in reality, are utter horsefeathers.

Over and over my provider clients come to me because one of the MCOs has terminated their Medicaid contract, usually for absolutely no valid reason. Over and over my provider clients tell me that their consumers are devastated by the news that they may lose their provider. I have had consumers contact me to beg me to help the provider. I have had consumers appear in court stating how much they want that particular provider. I have had provider clients cry in my office because their consumers are so upset and regressing because of the news that they may have to find another provider.

Yet, we have promised CMS that consumers have just as much choice in providers than when there was no managed care.

In the words of Dorothy from the Wizard of OZ, “You ought to be ashamed of yourself. Frightening him like that when he came to you for help.”

Similarly, our Medicaid recipients go to their providers for help. They create relationships…trust…bonds. And the MCOs are terminating these very providers, most for invalid and erroneous reasons, and, certainly, without the consideration of our promise to CMS.

But, remember, we are told the PIHPs will make every effort to keep the consumer with the chosen provider…

It would be interesting to do a public records request as to how many providers have been terminated by the MCOs in the last 2 years. Because, even if only 1 provider were terminated in the past 2 years and its consumers still wanted to go to that particular provider, then our State has broken its promise.

Apparently, due to my outspoken positions, DHHS will no longer honor my public records requests, which I think is absolutely preposterous. I am, still, a paying taxpayer last time I checked, which is every pay-day when I only get 60% of my wages. If any of you would submit this public records request, please forward it to me. I would be grateful for the information.

Williams Mullen Hosts “The State of the State of Health Care” Panel Discussion

Williams Mullen is hosting a free panel discussion on “The State of the State of Health Care.”  Please see below!

The panelists will be Rep. Nelson Dollar, Steven Keene, General Counsel to the NC Medical Society, Barbara Burke, from BCBS, and me.  The panel discussion will begin at 4:00.  Then from 5:00-6:30 we will have free drinks and appetizers.

Please feel free to come and bring others.  But we do request that you register here by October 10th in order for us to have a correct head count.

panel

 

 

DHHS reviews options for Medicaid expansion

From the News & Observer:

RALEIGH, N.C. — North Carolina’s health secretary said Wednesday her agency is collecting information for Gov. Pat McCrory to offer him possible ways to expand Medicaid coverage to more people under the federal health care overhaul.

The Republican-led General Assembly and McCrory declined to accept expansion last year because they said the state Medicaid office consistently faced shortfalls in the hundreds of millions of dollars. A state audit and other troubled operations led McCrory to call the $13 billion program “broken.”

But Health and Human Services Secretary Dr. Aldona Wos told a legislative committee the agency’s financial and structural improvements make offering credible options doable.

“We are at a point …. where we have an ability to evaluate options for the state and will be presenting those options to the governor,” Wos told the Joint Legislative Program Evaluation Oversight Committee. Last week, Wos trumpeted to another General Assembly panel how the Division of Medical Assistance held a $64 million cash balance at the end of the last fiscal year.

Wos stressed it would be up to others to decide on expansion, most of which would be paid by the federal government for the near future. Expansion is designed for hundreds of thousands of uninsured North Carolina residents who make too much for traditional Medicaid but not enough for subsidized insurance exchange plans. Medicaid currently enrolls more than 1.8 million state residents — mostly poor children, older adults and the disabled.

Wos gave no timetable for offering McCrory those options but said it would be more than just determining whether it would make financial sense. For example, she said, there needs to be enough health care providers to oversee any wave of new enrollees.

McCrory said in July he would be willing to revisit Medicaid expansion if cost overruns were repaired and provided the federal government in part gave the state flexibility to target any coverage increase based on North Carolina’s needs.

Earlier Wednesday, DHHS also announced plans for a retooled organizational structure for the division, the first of its kind in 36 years. It shifts from two division sections to what the agency calls five clearly defined functions. An outside consultant has been helping with organizational, finance and budget forecasting within Medicaid.

Again Wednesday, Wos rejected arguments from the legislature, particularly the Senate, to remove Medicaid from DHHS, saying it would undo recent progress.

Haven’t Fixed Medicaid Yet…But I Haven’t Gotten Bucked Off Yet

There are a number of federal regulations that, if I were in charge, would be immediately amended. Obviously, I am not in charge, so despite my best blogging efforts, my blogs do not change federal law. Today, however, I had the honor and privilege to speak to someone who may have the clout and political pull to fix some of the calamities found in the Code of Federal Regulations (CFRs) that are so detrimental to health care providers who accept Medicare and Medicaid across the country.

My husband, daughter, and I ride horses nearly every weekend. We ride Western and on trails all over North Carolina and Virginia, mostly on charity rides. And over the past few years, I have, sadly, gone through over 5 horses. Not because the horses have passed. But because each horse had an oddity or behavior issue that either (a) I didn’t want to deal with; or (2) terrified me.

For example, Twist of Luck (Twist) is a gorgeous pure, white horse with a yellow tail and mane and brilliant, blue eyes. But he was what you call, “proud cut.” Meaning that because he sired so many foals, even after he became a gelding he thought like a stallion. One weekend we were at Uwharrie National Park and when I saddled up Twist and mounted him, he decided that he did not want me on his back. My husband said Twist looked like a “poster horse” for a rodeo with his back completely rounded like an angry cat and all four of his hooves in the air. Needless to say, I found myself quite quickly on the ground with a sore tooshie, and Twist found himself sold.

Since I do not have the time to actually train my horse, I need a trained horse.

With my hobby of horseback riding, a well-trained horse is imperative…not only for safety, but for my enjoyment as well.

In the area of Medicare and Medicaid, it is imperative for enough physicians, dentists, and other health care providers to accept Medicare and Medicaid. You see, health care providers choose to accept Medicare and Medicaid. And not all health care providers agree to accept Medicare or Medicaid. But it is important for enough health care providers to accept Medicare and Medicaid patients otherwise the Medicare or Medicaid card in a person’s hand is worthless. Same as Twist was worthless to me that day in Uwharrie. If you can’t ride a horse, what is the point of owning it? If you can’t find a health care provider, what is the use of having coverage?

Here in North Carolina, we decided to not expand Medicaid. This blog is not going to address the ever-growing discontent in the media as to the decision, although you can see my blog: “Medicaid Expansion: Bad for the Poor.”

Instead, this blog will address my idea that I pitched to Congresswoman Renee Ellmers over lunch last week and discussed today with her legislative counsel today as to how it can be implemented.

Here’s my idea:

According to most data, not expanding Medicaid in North Carolina is affecting approximately 1.6 million uninsured North Carolinians. But to my point of the shortage of health care providers accepting Medicaid, what is the point of having an insurance card that no health care provider accepts? Therefore, I propose a pilot program here in NC…a pilot program to help the approximate 1.6 million uninsured in NC. Besides the moral issue that everyone deserves quality health care, fiscally, it is sound to provide the uninsured with quality health care (notice that I did not say to provide the uninsured with Medicaid). When the uninsured go to emergency rooms it costs the taxpayers more than if the uninsured had an insurance policy that would allow primary care and specialty doctor appointments. But with Medicaid…you can count out most specialty care, even some basic necessary care like dental care.

Most of the uninsured in NC are non-disabled men. I say this because it is usually easier to get a child on Medicaid with the Early, Periodic, Screening, Diagnostic, Testing (EPSDT) laws. See my blog: “How EPSDT Allows Medicaid Recipients Under the Age of 21 To Receive More Services Than Covered by the State Plan” for an explanation of EPSDT. Many women receive Medicaid based on having dependent children. “In most states, adults without dependent children are ineligible for Medicaid, regardless of their income, and income limits for parents were very low—often below half the poverty level.” See Kaiser Foundation. Which means, generally, many of our uninsured are men without dependents. However, that does not mean they are not fathers. Many of the uninsured are fathers.

Two-thirds of the uninsured live in families where there is at least one full-time worker. However, the percentage of uninsured who live in families with no workers, part-time workers and only one full-time worker has increased 12 percentage points over 5 years. See Demographics.

So how do we help the uninsured without merely handing all uninsured a Medicaid card that will not give them quality health care because not enough trained health care providers accept Medicaid patients?

By giving the uninsured health care insurance, of course! But not Medicaid coverage…oh, no! By giving the uninsured private insurance that will be accepted by all health care providers, all specialists, all durable medical equipment companies, all dentists…

We could partner up with a larger insurer like Blue Cross Blue Shield (BCBS) and create a premium health care insurance on which the insured would pay no premiums or co-pays. Instead, federal grant money would cover the premiums. All that money that NC did not receive based on our decision to not expand Medicaid…can go toward this pilot program to purchase the private insurance for the uninsured.

In order to qualify for this premium, free, private insurance the person must:

1. Be a legal resident;
2. NOT qualify for Medicaid; and
3. Maintain a part time job.

The reasoning behind the criterion of maintaining a part-time job is simple.

It is indisputable that the Affordable Care Act (ACA) has motivated employers across America to decrease the number of full-time jobs due to the mandatory expense of employers providing health care to full-time employees.

Obviously, part-time work does not pay well. It is difficult to even maintain a living on part-time work’s low hourly wages. Many people are forced to hold down two-part time jobs in order to survive. If you can not work and receive more government hand outs, what is the incentive to work?

If my idea comes to fruition and many of our uninsured carry a private insurance card and receive quality health care from the providers of their choice, we could create a whole new group of North Carolinians not only contributing to the community by working, but also contributing to their own homes, and improving themselves and those around them.

I don’t want to provide anyone a useless piece of paper that does not provide quality health care. We may as well give everyone a “proud cut” horse that no one could ride.

Thank you, Congresswoman Renee Ellmers, for being willing to listen to me regarding the uninsured and actually follow-up with the intent to implement.

Quality health care is imperative. Necessary. Needed. We need to fix this system.

Obamacare, Health Care Exchanges, Subsidies, Typos, and Speak-o’s

Have you ever said something that you immediately wished you could put back in your mouth? I know I have! In fact, just recently, I was eating lunch with my husband and one of our closest friends Josh. Josh, his wife, Tracey, my husband Scott and I ride horses together almost every weekend. Our daughters come with us, and it’s a fun family event. So, I should have known that a manger is a tool used in barns to hold the hay for the horses to eat, not just baby Jesus’ bed.

Josh tells me that he is going to pick up a manger. To which I respond, “Josh, why do you need a baby manger?” If words came out of your mouth on a string, I would have grabbed that string and shoved it back into my mouth. Of course, my husband had no end to his ribbing. “Josh, why do they sell baby mangers in Tractor Supply?” And “Baby Jesus was so lucky that someone put a manger in that barn for when he was born.”

At that point, I would have liked to claim that I had a “speak-o.” You know, like a typo, but for speech.

At least this is what Jonathan Gruber has claimed…that he made a speak-o in 2012.

Jonathan Gruber is one of the architects of the Affordable Care Act (ACA). He drafted much of the language included in the ACA. After the ACA was passed, Gruber was interviewed by a number of journalists regarding specific sections of the ACA. One of the sections on which he spoke was the section that allowed for health care premium subsidies for people enrolled in the program who reside in states which created state-run health care exchanges as opposed to states that opted to use the federal exchange. For ease of this blog, I will call this ACA section the “Health Care Premium Subsidies Section.”

As I am sure you are aware if you follow my blog, two appellate court cases came out July 22, 2014, regarding the Health Care Premium Subsidies Section, with polar opposite holdings. In Halbig v. Burwell, the D.C. Circuit Court found that the clear language of the ACA only allows the health care premium subsidies in states that created their own state-run health care exchanges, i.e, residents in NC along with 35 other states would not be eligible for the subsidies. See my blog: “Halbig: Court Holds Clear Language of the ACA Prohibits Health Care Subsidies in Federally-Run Exchanges.”

Juxtapose the 4th Circuit Court’s decision in King v. Burwell, which held that “For reasons explained below, we find that the applicable statutory language is ambiguous and subject to multiple interpretations. Applying deference to the IRS’s determination, however, we uphold the rule as a permissible exercise of the agency’s discretion.”

The two cases were released within hours of each other and came to two entirely different conclusions. Halbig: ACA is clear; King: ACA is ambiguous.

Interesting to note is that D.C. is not a state, and the 4th Circuit clearly embraces five states.

In my Halbig blog, I explain the legal analysis of statutory interpretation. I also explain that based on my reading of the Health Care Premium Subsidies Section, I tend to side with the D.C. courts and opine that the Section is not ambiguous.

If, however, a court finds that the statutory language is ambiguous, the court defers to the agency’s interpretation “so long as it is based on a permissible construction of the statute,” which is clear case law found in the 4th Circuit.

Therefore, once the 4th Circuit determined that the statute is ambiguous, the court made the correct determination to defer to the IRS’ ruling that all states could benefit from the subsidies.

Yet another approach to statutory interpretation is considering the legislative intent. The courts may attempt to evaluate legislative intent when the statute is ambiguous. In order to discern legislative intent, courts may weigh proposed bills, records of hearing on the bill, amendments to the bill, speeches and floor debate, legislative subcommittee minutes, and/or published statements from the legislative body as to the intent of the statute.

Recently, some journalists have uncovered 2012 interviews with Gruber during which he states that the Health Care Premium Subsidies Section was drafted intentionally to induce the states to create their own health care subsidies and not rely on the federal exchange. How’s that for intent?

The exact language of that part of the 2012 interview is as follows:

Interviewer: “You mentioned the health information [sic] Exchanges for the states, and it is my understanding that if states don’t provide them, then the federal government will provide them for the states.”

Gruber: “I think what’s important to remember politically about this is if you’re a state and you don’t set up an Exchange, that means your citizens don’t get the tax credits… I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these Exchanges, and that they’ll do it.”

What do you think? You think Gruber is pretty explicit as to legislative intent? Well, at least in 2012….

In 2014, Gruber states, as to his 2012 comment, “I honestly don’t remember why I said that. I was speaking off-the-cuff. It was just a mistake. People make mistakes. Congress made a mistake drafting the law and I made a mistake talking about it.”

According to Gruber, Congress made a typo; Gruber made a speak-o.

“It’s unambiguous that it’s a typo,” Gruber tells reporter Chris Matthews from NBC and MSNBC.

Um…a typo when the statement is spoken? Hence, the new word “speak-o” blowing up Twitter.

If Gruber’s statement was truly a speak-o, it was a re-occurring speak-o. Gruber also made two speeches in which he listed three possible threats to the implementation of Obamacare. In both cases the third “threat” was that states would not set up exchanges and, instead, would rely on the federal government.

I anticipate that Gruber’s 2012 and contrary 2014 statements will be at issue as these cases, Halbig and King, move forward.

As for me, I would like to invoke my own speak-o’s. I can only imagine how I will be received when I appear before a court and say, “Your Honor, I apologize. That was a speak-o.”

Halbig: Court Holds Clear Language of the ACA Prohibits Health Care Subsidies in Federally-Run Exchanges

Remember my post, “The Great and Powerful ACA: Are High, Inflated Premiums Hiding Behind the Curtain?” I warned of the possible consequences of Halbig v. Burwell…and it happened.

Halbig v. Burwell was decided earlier today.

The Halbig court held that the Internal Revenue Service (IRS) went too far in extending subsidies to those who buy insurance through the federally run, Healthcare.gov website.

The Halbig court ruled that the subsection of the ACA that allows high insurance premium tax credits, according to the plain language of the statute, only applies to those individuals enrolled “through an exchange established by the state.” (emphasis added). Therefore, if Halbig is upheld on en banc review by the D. C. Circuit (see below) or on appeal to the U. S. Supreme Court, residents who reside in two-thirds (or 36) of the states that did not establish state-run health care exchanges (including NC), will not benefit from the health care subsidies.

Looking at the decision through a purely objective, legal lens, I believe the federal court of appeals is correct in its ruling. I also agree that the ruling will have drastic and devastating consequences for the ACA and the people who would have benefited from the health care subsidies.

However, the law governing statutory construction and interpretation is clear. Statutory interpretation is the process by which courts interpret legislation.

For years, the U.S. Supreme Court has been explicit on statutory interpretation. “We begin with the familiar canon of statutory construction that the starting point for interpreting a statute is the language of the statute itself. Absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive.” Consumer Product Safety Commission et al. v. GTE Sylvania, Inc. et al., 447 U.S. 102 (1980).

In other words, if the words of a statute are unambiguous, then the statutory interpretation ends. The clear words of the statute must be followed.

Let me give an example of ambiguous language:

A magazine printed the following: “Rachel Ray enjoys cooking her family and her dogs.” If that were true, Rachel Ray’s family and dogs would be very upset. I am sure what the editor meant to write was “Rachel Ray enjoys cooking, her family, and her dogs.”

It is amazing how important a comma is.

The Halbig court held that the section of the ACA allowing health care subsidies only apply to those enrolled in an exchange established by the state is not ambivalent. Thus, according to statutory interpretation rules, the judicial inquiry ends.

So what happens now?

A request for an en banc ruling by the D. C. Circuit is the next step for Department of Justice. An en banc ruling is a decision made by all the justices, or the entire bench, of an appeals court, instead of a panel selected by the bench. In this case, three federal judges sat on the panel and the case was decided 2-1. An appeals court can only overrule a decision made by one of its panels if the court is sitting en banc.

Looking beyond any en banc ruling, the case could, potentially, be heard by the U.S. Supreme Court, especially in light of the importance of the decision and the fact that a 4th Circuit Court of Appeals ruled the opposite way literally hours after Halbig was announced. See David King, et al. v. Burwell, et al.

The Fourth Circuit found the ACA ambiguous, and it states, “For reasons explained below, we find that the applicable statutory language is ambiguous and subject to multiple interpretations. Applying deference to the IRS’s determination, however, we uphold the rule as a permissible exercise of the agency’s discretion. We thus affirm the judgment of the district court.”

Bizarre that two courts hold opposing positions on the same issue and publish both decisions on the same day.  It reminds of the old Sam the Sheepdog cartoon, “Duh! Which way did he go? Which way did he go, George?”

Finally, in closing, and on a personal note, I would like to dedicate this blog to my lab-doberman mix, Booker T, who, sadly, passed Sunday.  He was my best friend for over 14 years.  You will be greatly missed, Booker T.  Rest in peace.

Booker T

The Great and Powerful Affordable Care Act: Are High, Inflated Premiums Hiding Behind the Curtain?

A lawsuit that could come out as early as tomorrow could be catastrophic for the Affordable Care Act (ACA) in as many as 36 states and impact approximately 5.4 million Americans.

In so many ways, in the last year or so, the all-changing, great and powerful ACA that promised affordable health care for all and “if you like your health care coverage, you can keep it,” has fallen monumentally short of its original, lofty promises.

In a way, we all wanted to believe in the promises of the ACA, like Dorothy in “The Wizard of Oz.” Who can forget the disappointed sigh Dorothy expels when Toto pulls back the curtain of the Great and Powerful Oz only to see a mundane, elderly man with absolutely no super powers or means to grant her wishes. Dorothy wanted Oz to be real. She wanted desperately for Oz to be as Great and Powerful as he proclaimed. However, in reality, he was not.

Like Dorothy wanted Oz to be real, we all wanted the ACA to create an affordable, nationwide health care system…this health care utopia.

So many lofty promises of the ACA have already been crushed, either by the Supreme Court’s decision that allows states to opt-out of Medicaid expansion, or by President Obama himself in executive actions, including an action delaying the employee mandate.

The courts may deflate the illusions of grandeur of the ACA even more with an upcoming and anxiously awaited decision. The case of Halbig v. Burwell, a D.C. Court of Appeals case, has concerned citizens everywhere, who wait on bated breath for a ruling. Halbig could have a huge (negative) impact on health care premiums. Halbig could be the Toto that pulled back the curtain on the ACA.

Let me explain:

There is a subsection of the ACA that allows high insurance premium tax credits, in an effort to make premiums more affordable for low-income families. The subsection applies to individuals who make less than $46,075. In implementing the ACA, it was contemplated that those individuals who make under $46,075 will have difficulty affording the insurance premiums; therefore, the ACA gives nice, large tax credits to offset the costs of premiums.

However, according to the plain language of the statute, these tax credits only apply to those individuals enrolled “through an exchange established by the state.” (emphasis added). Yet two-thirds (or 36) of the states did not establish state-run health care exchanges (including NC). Instead, these states relied on the federal exchange, in part, to avoid additional cost expenditures.

Here is a map of states according to whether it is expanding Medicaid:

current-status-of-the-medicaid-expansion-decisions-healthreform1

The Halbig case asks the question: Can people living in states run by a federal health exchange reap the benefit of tax credits intended for those people participating in an exchange run by the state?

If the Halbig Court takes that stance that the statute is not ambivalent and must be followed exactly as it is written, then millions of Americans will become ineligible for the tax credits for health care premiums, because they will not be enrolled in a state-run exchange. Premiums would sky-rocket and many Americans would be unable to afford health care…again. It is estimated that without the tax credits, the health care premiums will cost 4x as much.

Interestingly, the Internal Revenue Service (IRS) weighed in and issued a highly-contested rule authorizing the federal exchange to issue tax credits. Amidst all the tomfoolery about the IRS targeting 501(c) charities owned by the Tea Party, it is surprising, at least to me, that the IRS would issue such a contentious ruling in favor of the ACA and anti-conservatives.

Hence, the Halbig case, in which Plaintiffs argue that the IRS has exceeded its statutory authority in issuing tax credits to those residing in states with federal exchanges, when the ACA clearly states that the tax credits only apply to state-run exchanges.

If the D.C. Court of Appeals sides in favor of the Plaintiffs, the following could occur:

• Residents of 36 states could pay health care premiums 4x more than promised;
• The ACA would fall short of promises…again;
• The IRS will have exceeded its authority to benefit Democrats…again;
• People may not be able to afford the health care premiums;
• The ACA could risk the downfall of many more promises.

We all wanted the ACA to create health care utopia. We all wanted the Great and Powerful Oz to be Great and Powerful.

But the courts may tell us we just can’t say, “Pay no attention to the man behind the curtain!!”

“The Times They Are a-Changin’”: A Look at Possible Ramifications on Medicaid by Senate Bill 744

I think of Bob Dylan’s raspy voice singing:

Then you better start swimmin’
Or you’ll sink like a stone
For the times they are a-changin’.

In 1933, Franklin D. Roosevelt took the presidency during a time of severe poverty. The Great Depression, which would last until the late 1930s or early 1940s, cast shadows and doubt over the future of America. People were starving. Unemployment and homelessness were at an all-time high.

FDR’s first 100 days in office were monumental. In fact, FDR’s first 100 days in office changed America forever. With bold legislation and a myriad of executive orders, he instituted the New Deal. The New Deal created government jobs for the homeless, banking reform, and emergency relief to states and cities. During those 100 days of lawmaking, Congress granted every major request Roosevelt asked. This is an example of what I call blending of the separation of powers. In a time of great national need, Congress took an expansive view of the president’s constitutional powers and cooperated with him to effect major change.

I am in no way comparing our General Assembly to Congress back in the 1930s nor am I comparing FDR to Gov. McCrory. In fact, there are vast differences. I am only making the point that rarely does the legislative body create such change.

But North Carolina’s current Senate Bill 744 may create this change. For example, if Senate Bill 744 passes the House, the Department of Health and Human Services (DHHS), Division of Medical Assistance (DMA) may no longer manage Medicaid. That’s right. A whole new state agency may manage Medicaid.

This past Friday, May 30, 2014, the state Senate passed a $21.2 billion budget, which is known as Senate Bill 744. On May 31, 2014, Senate Bill 744 passed its 3rd reading and will now go on to the House. So far, it has been revised 3 times, so we do not know whether the House will make substantial changes. But, as it stands today, it is shocking. Is it good? Bad? I don’t think we can know whether the changes are good or bad yet, and, quite honestly, I have not had time to digest all of the possible implications of Senate Bill 744. But, regardless, the changes are shocking.

Of the most shocking changes (should SB 744 get passed), consider the following:

1. DHHS must immediately cease all efforts to transition Medicaid to the affordable care organizations (ACOs) system that DHHS had touted would be in effect by July 2015;

2. DHHS’s DMA will no longer manage Medicaid. Instead, a new state entity will be formed to manage Medicaid. (A kind of…”scratch it all and start over” method);

3. All funds previously appropriated to DMA will be transferred to the Office of State Budget and Management (OSBM) and will be used for Medicaid reform and may not be used for any other purpose such as funding any shortfalls in the Medicaid program.

4. Categorical coverage for recipients of the optional state supplemental program State County Special Assistance is eliminated.

5. Coverage for the medically needy is eliminated, except those categories that the State is prohibited from eliminating by the “maintenance of effort” requirement of the Patient Protection and Affordable Care Act. Effective October 1, 2019, coverage for all medically needy categories is eliminated.

6. It is the intent of the General Assembly to reduce optional coverage for certain aged, blind, and disabled persons effective July 1, 2015, while meeting the State’s obligation under the Americans with Disabilities Act and the United States Supreme Court decision in Olmstead v. L.C. ex rel. Zimring, 527 U.S. 581 (1999).

7. Repeal the shared savings program and just reduce the reimbursement rates by 3%.

8. DHHS shall implement a Medicaid assessment program for local management entities/managed care organizations (LME/MCOs) at a rate of three and one-half percent (3.5%).

9. For additional notices as to State Plan Amendments (SPAs), DHHS must post the proposed SPAs on its website at least 10 days prior to submitting the SPAs to the federal Center for Medicare and Medicaid Services (CMS).

10. Reimbursement rate changes become effective when CMS approves the reimbursement rate changes.

11. The Department of Health and Human Services shall not enter into any contract involving the program integrity functions listed in subsection (a) of this section of SB 774 that would have a termination date after September 1, 2015.

12. The Medicaid PROVIDER will have the burden of proof in contested case actions against the Department.

13. The Department shall withhold payment to any Medicaid provider for whom the DMA, or its vendor, has identified an overpayment in a written notice to the provider. Withholding shall begin on the 75th day after the day the notice of overpayment is mailed and shall continue during the pendency of any appeal until the overpayment becomes a final overpayment (can we say injunction?).

Senate Bill 744 purports to make immense modifications to our Medicaid system. I wonder what Gov. McCrory and Secretary Wos think about Senate Bill 744. If SB 744 passes, McCrory and Wos can no longer continue down the ACO path. Does the General Assembly even have the authority to bind their hands from creating ACOs? It seems so.

As for the “new state agency” that will manage Medicaid, maybe the General Assembly is right and we do need to scratch out the current Medicaid management and start over…I doubt anyone would disagree that DHHS has had some “oops” moments in the past year or so. But (a) is this the way to start all over; and (b) does the General Assembly have the legal power to remove the management of Medicaid from Secretary Wos?

Going to the reduction of optional services for the “medically needy,” what services are considered optional? Here is a list of optional services, as defined by the Center of Medicare and Medicaid Services (CMS):

• Case Management
• Mental Health
• Podiatry
• Intermediate Care Facilities (ICF-MR)
• Personal Care Services
• Prosthetics
• Respiratory Therapy
• Hospice
• Adult Dentures
• Prescription Drugs
• Community Alternative Programs (CAP)
• Private Duty Nursing
• Chiropractor
• Home Infusion Therapy
• Physical Therapy/Speech Therapy
• Transportation

I cannot comment on all the changes proposed by Senate Bill 744; I simply have not had enough time to review them in detail, because there are so many changes. I do not purport to know whether these modifications are ultimately for the good or for the bad.

All I know is that we better start swimming or we will sink like a stone, because the times they are a-changin’.

Medicaid Expansion, Polarization, and Diving Head-First Into the Unknown

I have always believed in the concept to think first, act second. I rarely react; I try to act. In politics, generally, this mantra is not followed. If a public poll states that the public is in favor of X, then the leaders need to consider X. If it is an election year, then the politicians will do X.

I’m reminded of an awful book I read a couple of years ago. I can’t remember the name of it, but it began with a young teen-age couple at a lake. The boyfriend dives off of a dock into the lake and dies because his head hit a rock underneath the water. (I do not suggest reading the book). But I remember thinking… “How tragic,” then… “Why in the world would this guy dive head-first into a lake without knowing the depth or pitfalls? This was a preventable death.”

This is a perfect example of why we should think first, act second.

However, in politics, the polarization of the two parties, Republican and Democrat, sometimes causes politicians to RE-act according to the party lines. Nowhere is this polarization more prevalent than the concept of Medicaid expansion. See my blog: “To Expand, Or Not To Expand, A Nationwide Draw?” It seems that if a state has a Republican governor, without question, that state will refuse to expand (I know there are few exceptions, but there are few). If a state elected a Democratic governor, then the state has elected to expand Medicaid.

Are these issues so black and white? Or have we become so politically polarized that true intellect and research no longer matters? Doesn’t that actual state of the state matter in deciding to expand?

For example, according to a 50-state survey by USA Today, North Dakota is the best run state. North Dakota has zero budget deficit, and an unemployment rate of 3.1%, the lowest of all 50 states. North Dakota has opted to expand Medicaid.

On the other hand, according to the same study, North Carolina has an unemployment rate of 9.5%, which is the 4th highest in the nation. What does high unemployment mean? A large number of Medicaid recipients.

North Dakota has approximately 82,762 Medicaid recipients, according to the Kaiser Foundation for FYE 2010. Conversely, North Carolina, for the same year, had 1,813,298 Medicaid recipients.

So my question is: Can, or should, a state with 1.8 million Medicaid recipients adopt the same Medicaid eligibility rules as a state with 82,000 Medicaid recipients?

And how can we know the consequences of expansion prior to deciding to expand? Because, after all, shouldn’t we think first, act second? Who wants to dive into an unknown lake?

But issues that apparently no one had contemplated are cropping up…

States across America are seeing unexpected Medicaid costs increase. According to the Associated Press, prior to Medicaid expansion there were millions of Americans who were eligible for Medicaid but who, for whatever reason, had never signed up. Now that there has been so much publicity about health care, those former un-insured but Medicaid-eligible people are signing up in droves.

In California, State officials say about 300,000 more already-eligible Californians are expected to enroll than was estimated last fall.  See article.

Rhode Island has enrolled 5000-6000 more than its officials expected. In Washington State, people who were previously eligible represent about one-third of new Medicaid enrollments, roughly 165,000 out of a total of nearly 483,000.

While the Feds are picking up the costs for Medicaid recipients now eligible because of the expansion (at least for a few years), state budgets have to cover these new Medicaid recipients signing up who had been eligible in the past.

For states blue or red, the burden of these unanticipated increased costs will be on the shoulders of the states (with federal contribution).

Going back to the extremely polarized view of Medicaid expansion (Democrats expanding and Republicans not expanding)…maybe it’s not all black and white. Maybe we should shed our elephant or donkey skins and actually research our own states. How many Medicaid recipients do we have? What does our budget cover now?

Maybe we should research the consequences before diving in the lake.

Knicole Emanuel to Appear on UNC-TV Tonight! Tune In at 7:30pm!

Heather Burgiss, a UNC-TV journalist, created a 3-part television series called, “Mental Health Services in NC.” Part 1 will air tonight on UNC-TC at 7:30, and I will be discussing the important topic of the current status of our mental health system in NC.  So tune in to watch!!!!

The three-part series is intended to educate North Carolinians on the current state of mental health in NC, as well as discuss the upcoming Medicaid reform consisting of the Accountable Care Organizations (ACOs) for physical health services.

P.S. It is intimidating how UNC-TV interviews you, so forgive any bad grammar, etc. :)  During the interview, they cut off all the lights and shine a bright light on you.  It creates a strange environment in which you can hear the person asking you questions, but you cannot see him or her.  Plus, the light is super hot.

But, we will see, Heather was very nice in dealing with my novice handling of the interview.

And, BTW, when you see the scene during which I am walking down the hall of my law firm, I had a strange sensation to start doing the MC Hammer.  But I did not succumb.

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