Medicaid and CHIP: On the Road to Reform

Cindy Mann, JDCMS Deputy Administrator

DirectorCenter for Medicaid, CHIP and Survey & Certification

Centers for Medicare & Medicaid Services

Alliance for Health Reform/Kaiser Family FoundationAlliance for Health Reform/Kaiser Family FoundationMarch 4, 2011March 4, 2011

Implementing the Affordable Care Act

Working with States (Governor’s offices, Medicaid, CHIP, Insurance Commissioners)

Coordinating with the Center for Consumer Information and Insurance Oversight (CCIIO), IRS/Treasury, other federal agencies

Listening to what reform means to a broad array of stakeholders

Promulgating regulations and guidance; providing technical assistance

2

Source: Congressional Budget Office, March 2010Source: Congressional Budget Office, March 2010Source: Congressional Budget Office, March 2010Source: Congressional Budget Office, March 2010

Sources of Coverage by 2019 for Individuals Under 65

25m23m

24m 51m

159m

Not a safety net but a full partner in assuring coverage, quality and cost containment

Simplified rules and process (eligible = enrolled)

A system of coverage and care

New Paradigm

ExchangeExchangeEmployer Coverag

e

Medicaid/CHIP

Medicaid/CHIP

Percentage of Population Under 133% of the FPL

Uninsured vs. Medicaid Covered

66%

17%

35%

42%

23%

43%

Source: HHS ASPE analysis of the 2010 Annual Social and Economic Supplement to the Current Population Survey

Minimum Medicaid Eligibility Levels

Now and 2014Population Current Minimum

Eligibility Levels(average)

2014 MinimumEligibility Levels

Children 100%/133%(241%)

241%

Parents 41%(64%)

133%

Disabled Adults 74%(SSI-related)

133%

Other Adults 0%* 133%* 5 States provide Medicaid or Medicaid look-alike coverage to certain childless adults; 15 States provide a limited benefit package to certain childless adults.

Average - Will vary by State

2014 Health Insurance Subsidies

Medicaid/CHIP Children

0

133% FPL

241%FPL

400%FPL

Exchange Subsidies

Adults Children

Medicaid Adults

Varies by State

First Steps:Modernized, Efficient Systems

IT Guidance 1.0 for Medicaid and the ExchangeNPRM on Medicaid Eligibility Systems

90% FFP for eligibility and enrollment system design and development until 12/31/15

75% FFP for system maintenance

Established 7 Conditions & Standards

7 Exchange Innovator Grants and Collaborative8

Estimated Distribution of Costs for Medicaid Coverage Changes: 2014-2019

(in billions)

Total $464.7 billion

Who Pays?

Source: Congressional Budget Office and Medicaid Coverage and Spending in Health Reform, John Holahan and Irene Headen/Kaiser Commission, May 26, 2010

Current Fiscal Pressures

Enrollment among families and children has grown sharply due to the recession Medicaid is intended to be a countercyclical program

Despite enrollment growth, state Medicaid spending declined during the recession The Recovery countercyclical FMAP increase resulted in a 10% drop in

state spending on Medicaid in 2009

While enrollment growth explains recent growth in costs, the real cost drivers lie elsewhere

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Concentration of Medicaid Spending

Source: Medicaid Statistical Information System Claims Data for FY 2008

1%

5 %54%

10%

95%

50%5%

Percentile of Medicaid Population (Ranked by Spending)

Percent of Total Medicaid Spending

0% 20% 40% 60% 80% 100%

Coverage: Pathway to Better Care, Better Health, Lower Costs

Per CapitaCost

ExperienceOf Care

PopulationHealth

Focus on Medicaid Cost DriversExisting Authority & New Initiatives

Benefits & Cost-Sharing

Integrated Care for High-Cost Beneficiaries; improving care transitions; reducing unnecessary hospitalizations

Purchasing Drugs More Efficiently

Assuring Program Integrity

Working individually with States (“MSTAT”)

What CMS is Doing to Help States Reduce Costs Now

Health Care Expenditures

$2,541

$7,464

Average Cost of One Hospital Admission for a Non-Dual Disabled

Medicaid Enrollee

Annual Cost of Providing Health Coverage to One Parent under

Medicaid

Source: CMS data analysis and Urban Institute analysis of data from MSIS and CMS Form 64, prepared for Kaiser Commission on Medicaid and the Uninsured, 2010. Kaiser Family Foundation-State Health Facts, FY 2007.

Source: CMS data analysis and Urban Institute analysis of data from MSIS and CMS Form 64, prepared for Kaiser Commission on Medicaid and the Uninsured, 2010. Kaiser Family Foundation-State Health Facts, FY 2007.

Focus on Dual Eligibles

Source: CMS data and Urban Institute analysis of data from MSIS and CMS Form 64, prepared for Kaiser Commission on Medicaid and the Uninsured, 2010. Kaiser Family Foundation-State Health Facts, FY 2007.

Source: CMS data and Urban Institute analysis of data from MSIS and CMS Form 64, prepared for Kaiser Commission on Medicaid and the Uninsured, 2010. Kaiser Family Foundation-State Health Facts, FY 2007.

Total Spending = $311 billion

Duals as Share of Medicaid Spending

Dual EligiblesNon-Duals39%

61%

Children Adults Duals

Medicaid Spending by Population Group

$2,541$2,135

$14,972

Non-Disabled Adults

Children Duals

Achieving a High Performing Medicaid Program

States and the Federal Government working together to achieve:Simplified, accurate, customer-friendly, data driven

eligibility/renewal processes that are fully coordinated with the Exchange

Eligible = Enrolled

Access to person-centered, high quality, integrated care with options for continuity of coverage with plans on the Exchange

Continuing quality and cost improvement in our health care system, based on consumer and other stakeholder input, data, and collaboration.

High Performing Medicaid Program