On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 (the ARP), a wide-ranging package of health care and economic measures responding to the coronavirus pandemic. The ARP includes a broad expansion of the Affordable Care Act’s (ACA) main health insurance subsidy, the premium tax credit (PTC), the first major expansion of the health care reform law since its passage. This piece highlights the policymaking considerations that states must account for in light of the PTC expansion and uncertainty about future federal action. A key theme that emerges is that states will benefit from approaches that give them the flexibility to adjust policies year by year as the federal landscape develops.
The Fiscal Impact of the Healthy Adult Opportunity Medicaid Demonstration Initiative
TO BE RESCHEDULED
State Health and Value Strategies was planning to host a webinar, The Fiscal Impact of the Healthy Adult Opportunity Medicaid Demonstration Initiative, on Thursday, March 19, to discuss findings from a new publication by our friends at the Commonwealth Fund and Manatt Health. In light of the rapidly evolving COVID-19 pandemic, this webinar will be rescheduled.
As you may know from our earlier webinar, Medicaid Capped Funding Demonstrations: Considerations for States, the Centers for Medicare & Medicaid Services (CMS) recently released guidance inviting states to apply for the Healthy Adult Opportunity Medicaid demonstration initiative, which allows states to opt into a block grant funding model. The issue brief finds that the initiative would result in substantially less federal funding for state Medicaid programs—including a 10.5 percent reduction in the median state between fiscal years 2021 and 2025—as well as greater financial risks for states that elect to pursue the demonstration. The estimates show even greater losses if costs or enrollment rise above current national projections. States opting to participate will likely have to make significant cuts in enrollees’ coverage, reduce benefits, impose higher cost sharing, and lower payment rates for providers who treat Medicaid patients. And the demonstration’s “shared savings” feature, which allows states to divert some of the capped federal dollars into other state priorities, would lead to additional Medicaid cuts. During the webinar, experts from Manatt Health will share their findings from the new publication, with an opportunity for states to ask questions of the report authors.