Looking Back & Looking Ahead for State Medicaid Programs
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2015 was another interesting year for Medicaid programs. There were many of the same issues at play as in 2014, most notably the Affordable Care Act (ACA)’s effect on Medicaid enrollment. More states decided to expand their programs, talked about delivery and payment reforms extensively, and took big strides with their long-term care and dual eligible coordination of care initiatives. Through this range of issues that played out, we identified these notable trends
- Budget constraints plagued nearly every program, with a sharp focus on finding savings and meeting budgets. Medicaid now provides coverage to more than one in five Americans, and with these new beneficiaries, come new costs.
- The Centers for Medicare & Medicaid Services (CMS) issued a Notice of Proposed Rulemaking (NPRM) driving new mandates for Medicaid Programs. This was the first time in more than ten years that the federal government looked at Medicaid managed care regulations
- The “woodwork effect” of the ACA continued to impact program growth, particularly the need to do redeterminations on a significantly larger scale, regardless of whether or not a state expanded its Medicaid program.
- High-cost, chronic care beneficiaries continued to be a large portion of spend and states began to look at the Financial Alignment Demonstrations, which have been running for more than two years now, to coordinate the care that helps dually eligible beneficiaries access the care they need.
- The debate of whether or not to expand Medicaid continued on. To-date, 31 states and the District of Columbia have adopted Medicaid Expansion, which means Medicaid now covers nearly 70 million Americans nationwide.
Many of these trends will continue in 2016, with new technology and innovative ideas beginning to gain ground in solving the problems faced by Medicaid Directors this past year. Another interesting facet of 2016 is that in addition to electing a new president and vice president, we will have elections for all 435 voting-member seats in the House of Representatives, 34 of the 100 seats in the Senate, 12 state governorships and 2 territorial governorships. The politicians up for election will be looking closely at their agendas for the year, and those elected will have the power to facilitate significant change in their upcoming tenures – and Medicaid will most likely be high on their list of activities. Some trends we expects see in 2016 are:
- Continued budget constraints, compiled with added stress to find innovative solutions that solve age-old problems.
- The final rule from CMS, which could include key principles that states need to implement such as: delivery system reform, payment and accountability improvements, and beneficiary protections like conflict-free choice counseling and continuity of care.
- The rising cost of prescription drugs is increasing exponentially. According to Medicaid drug spending and utilization data, 2 percent of the specialty drugs account for 32 percent of spend.
- Medicaid programs are starting to modernize their systems and leaving antiquated, bundled MMIS systems behind with new modular approaches.
Medicaid programs will see a combination of issues in 2016 — many unresolved from 2015 — and new ones surrounding innovation and comprehensive program changes to better solve the needs of an expanding group of beneficiaries. However, as we know, managing Medicaid programs can be unpredictable, and during an election year there is always a heightened level of scrutiny on state Medicaid programs.