With studies showing that the fees led to fewer low-income adults signing up for coverage and fewer reenrolling, the Biden administration is moving to eliminate them.

This article was published on Thursday, February 10, 2022 in Kaiser Health News.

By Phil Galewitz and Andy Miller

When Republican-led states balked at expanding Medicaid under the Affordable Care Act, President Barack Obama's administration tossed them a carrot — allowing several to charge monthly premiums to newly eligible enrollees.

Republicans pushed for the fees to give Medicaid recipients "skin in the game" — the idea they would value their coverage more — and to make the government program resemble employer-based insurance.

But with studies showing that the fees led to fewer low-income adults signing up for coverage and fewer reenrolling, the Biden administration is moving to eliminate them.

It will force Arkansas and Montana to phase out premiums by the end of 2022. Federal health officials have indicated they may do the same in six other states allowed to charge premiums — Arizona, Georgia, Indiana, Iowa, Michigan, and Wisconsin.

The policy flip is one of several moves the administration has made to change how states run their Medicaid programs, and it provides a stark example of how Medicaid changes depending on who has control of the White House and state capitols.

Medicaid, which has about 83 million enrollees, is a state-federal partnership that provides health coverage to people with low incomes. Washington is responsible for most of the funding and states handle operations. For decades, states have complained that the federal government sets too many rules and doesn't respond quickly enough when states want to make changes through a wide variety of waivers to improve care or control costs.

But in recent months, the power struggle has intensified around the waivers that states seek from those federal rules so they can test new approaches for delivering health services. Waivers have become an integral part of the Medicaid program, and some states have renewed theirs to last for decades.

With spending on Medicaid waivers now making up about a third of federal spending on the program, they've become a lightning rod for disputes between states and the federal government.

Such conflicts are not new, said Matthew Lawrence, an associate professor at Emory University's law school. But lately "the level of conflict is unprecedented."

"The conflicts are more consequential because there is so much more money on the table," said Josh Archambault, a senior fellow with the conservative Cicero Institute, a Texas-based think tank.

At stake for states is not merely retaining authority on how to run their Medicaid program, but often billions of dollars in federal funding. Because securing a waiver can often take years, states are dismayed the Biden administration is trying to withdraw previously approved ones before they are up for renewal, Archambault said.

Both Georgia and Texas have sued the Biden administration for revoking part of their waivers approved in the waning days of President Donald Trump's administration. The changes sought be each state varied widely.

Neither of these Republican-led states has expanded Medicaid to cover all adults with annual incomes under 138% of the federal poverty level, about $18,800, as 38 other states have done.

Georgia sued the Biden administration in January after the Centers for Medicare & Medicaid Services rejected key parts of its waiver — approved in October 2020 but never implemented by the state as it awaited a review by the Biden administration.

These provisions would have required newly eligible enrollees to pay a monthly premium and work or volunteer as part of a plan to modestly increase enrollment.

The lawsuit says the decision by CMS was an illegal and arbitrary "bait and switch of unprecedented magnitude."

The Texas lawsuit filed in May stems from the Biden administration's reversal of a 10-year waiver extension approved five days before Joe Biden was sworn in as president. That waiver allowed the Texas Medicaid program to reimburse hospitals for treating uninsured patients and included $30 billion in federal aid. The Biden administration said Texas did not appropriately seek public comments and the move was seen as a way to nudge Texas toward expanding Medicaid. A federal district judge in August sided with Texas and issued a temporary injunction.

In another example of reversing Trump's policies, CMS last year told Michigan, Wisconsin, Arkansas, and New Hampshire, which had previously received approval for work requirements for newly eligible adults, that the federal government was withdrawing that green light. The change, however, had little practical effect since the work requirements had been put on hold by federal courts.

Advocacy groups say Medicaid enrollees are caught in the middle of these political battles.

Laura Colbert, executive director of the consumer advocacy group Georgians for a Healthy Future, said the lawsuit brought by the governor and state attorney general is a waste of time and taxpayer dollars. "Federal courts have repeatedly struck down work requirements for Medicaid-eligible adults because work requirements ultimately act as a barrier to health coverage and care," she said.

Typically, CMS reserves the right to terminate or rescind a waiver as long as its decision is not considered "arbitrary or unreasonable," said MaryBeth Musumeci, associate director of KFF's Program on Medicaid and the Uninsured.

In the Texas case, in fact, the federal court said CMS was arbitrary and unreasonable in revoking the state's Medicaid waiver.

Brian Blase, a former Trump health adviser and president of Paragon Health Institute, a research firm, said having so much of the Medicaid program run through waivers is problematic because states are seldom held accountable for how the waivers work and that the program changes depending on which party is in power in Washington.

"States get whipsawed back and forth under the current structure of Medicaid," he said.

Blase and other conservatives want Congress to give states a defined amount of money — a block grant — for Medicaid each year and let states manage it as they see fit. Democrats have fought such proposals, saying they would limit how much money states have to help the poor, especially during difficult economic times.

The proposal to fund Medicaid through block grants is at the center of another simmering waiver feud. The Trump administration in its final days approved a new financing plan for Tennessee that would convert the state's federal Medicaid funding into a type of block grant. The Biden administration reopened the public comment period last summer. Nearly all of the 3,000 letters submitted opposed the plan.

Blase said that some Republican states expanded Medicaid only because they were allowed to implement it with work requirements and premiums. Taking away those provisions, he said, "is an affront to those states and will discourage other states from adopting the expansion."

But it's unlikely Republican-led states would turn away from the expansions they've implemented because it's politically difficult to kick people off the program.

Democrats have long opposed Medicaid premiums, so it's no surprise the Biden administration is moving away from them now that it has data to show their negative impact.

A 2021 study in Michigan found that the number of adults dropping out of Medicaid increased by nearly 12% after the state began charging them a monthly premium, which now averages about $18 a month. Disenrollment rose by nearly 1 percentage point for every dollar charged monthly, the study found.

States needed waivers because federal law prohibits charging premiums to most Medicaid enrollees.

Katharine Bradley, a senior researcher at Mathematica who recently helped evaluate premium policies in several Medicaid programs for CMS, said premiums as low as $1 a month act as a deterrent to signing up, she said.

"All the evidence points in the same direction — that premiums inhibit overall enrollment," Bradley said.

Michigan — like other states with premiums — stopped enforcing the provision during the pandemic. But even before the national health emergency, Michigan enrollees faced few consequences for not paying. If people did not pay, the state would deduct the amount from their state tax refund or any lottery winnings.

By contrast, before the pandemic, states such as Indiana, Iowa, and Montana disenrolled thousands of Medicaid enrollees who did not pay.

When asked late last year if CMS would eliminate premiums in all Medicaid waivers, CMS Administrator Chiquita Brooks-LaSure said: "We want our programs to be consistent."

Phil Galewitz: pgalewitz@kff.org, @philgalewitz

Andy Miller: amiller@kff.org, @gahealthnews

The California Department of Healthcare Services, which administers Medi-Cal, calls the problems "unacceptable."

This article was published on Wednesday, February 9, 2022 in Kaiser Health News.

By Samantha Young

SACRAMENTO, Calif. — A month into its debut, California's new Medicaid prescription drug program is riddled with problems, leaving thousands of patients without medications — often after languishing on hold for up to eight hours on call center phone lines.

On Jan. 1, the state handed control of its Medicaid drug program, known as Medi-Cal Rx, to Magellan Health, which is administering prescription drug coverage for California's 14 million Medicaid patients, most of whom previously got their medications from about two dozen managed-care plans.

But Magellan has tripped up implementation. It didn't anticipate that calls to its help center would take so long, and a large number of its call center workers have been sickened during the omicron surge — with 100 of 220 absent during the first two weeks of January, state officials said. Magellan also didn't get some data it needed from managed-care plans.

This has left Californians from Redding to Oceanside without their medications for days, sometimes weeks.  

"We've had many, many patients who are sort of in this limbo," said Dr. James Schultz, chief medical officer of Neighborhood Healthcare, which operates 17 clinics in Riverside and San Diego counties. 

"Somebody is gonna die if they haven't already," added Schultz, who said some of his clinics' patients have experienced delays getting life-saving medications such as antibiotics or those used to prevent seizures and blood clots. "That's why we're fighting so hard."

Officials from the California Department of Healthcare Services, which administers Medi-Cal, California's Medicaid program for low-income people, called the problems "unacceptable." The department and Magellan Health are scrambling to find missing patient data, fix improper claim denials, add call center staffers, and provide pharmacists with codes to override prescription denials. 

Handing over Medi-Cal's drug program to a single pharmacy benefit manager is one of Gov. Gavin Newsom's big healthcare initiatives. His administration estimates it will save the state $414 million in the 2022-23 budget year alone, in part by getting bigger discounts on drugs than the managed-care insurance plans did.

But the massive transfer has been rocky for many providers, pharmacists, and patients, especially patients who use medications their doctors consider medically necessary but require prior authorizations from Medi-Cal Rx and are generally not on the state's approved drug list. Magellan has received more than 95,000 prior authorization requests since it took over, state officials said. 

In the months leading up to the switch, patients and doctors were told all their medications would be grandfathered into the new system for 180 days, but that hasn't always been the case.  

Marilyn Bloomer of Oceanside had gone nearly a week without a specialty histamine prescription that she takes to regulate an overactive allergic response in her body, a condition known as mast cell activation syndrome, because her pharmacist and Magellan said it was no longer covered. When she finally reached someone at the Magellan call center last week — six hours after she placed the call — a supervisor gave her a code the pharmacist could use to override the denial. 

But the pharmacy wouldn't accept it. 

On Monday, Bloomer's health plan secured an emergency five-day supply for her, but she doesn't know what will happen when it runs out. Without the medication, called ketotifen, Bloomer gets bright red, patchy hives all over her face. 

"I'm getting the runaround, and I'm getting confused," said Bloomer, 57, who said her face had been beginning to swell. "It's beyond frustrating."

State officials said Magellan representatives had answered more than 81,000 calls at the 24-hour, 7-day-a-week call center as of Feb. 1 and paid 11 million prescription claims totaling approximately $1.3 billion as of Feb. 4.

"As we sit here, clearly five weeks into operations, Magellan, our contractor, has really struggled with some service operations," Jacey Cooper, the state's Medicaid director, told lawmakers at an Assembly budget subcommittee hearing Monday.

She said that the Department of Healthcare Services is holding daily meetings with Magellan to discuss its management of the program and that the state has provided staffers to help answer calls at the Medi-Cal Rx call center. The immediate goal, Cooper added, is to ensure medications that require prior authorization are approved within 24 hours. In the meantime, she said, the state has given pharmacies the go-ahead to fill emergency prescriptions for up to two weeks. It also has removed prior authorization requirements for some medications.

Magellan referred media questions to the Department of Healthcare Services.

After the hearing, Assembly member Joaquin Arambula (D-Fresno), who chairs the Assembly budget subcommittee that oversees Medi-Cal, said he is satisfied with the administration's plan. "I believe there's a real path forward to implementing the system successfully," he told KHN.

Sharon Ng, pharmacy director at the Venice Family Clinic, isn't as optimistic. Even though state officials say they have given pharmacies authorization to use override codes and fill temporary emergency prescriptions, prescriptions continue to be denied. 

"It's just chaos," Ng said. "We just kept getting rejections. It's been so frustrating because the rejection doesn't tell you what's wrong. And then if you finally go through their lines, they don't help you either. They're just guessing."

What Magellan needs, she added, is a dedicated hotline for pharmacists — like the managed-care plans had — so they don't have to compete with Medi-Cal patients.

Patients and legal advocates say they are confounded by the chaos because both the state and Magellan had plenty of time to prepare for the rollout, since the program was delayed by nearly a year after the healthcare company Centene announced plans to acquire Magellan.

Medi-Cal Rx finally launched Jan. 1 after state officials ruled in December that Magellan could independently administer the Medi-Cal drug benefit without any conflict of interest with its new owner. 

"Magellan should have come into this understanding fully what the volume and the needs were going to be," said Jack Dailey, an attorney with the Legal Aid Society of San Diego, which is representing some Medi-Cal enrollees unable to get their medication. "I did not think this is where we would be a month into this process."

Shah'ada, a mother in Redding, has spent the past two weeks desperately trying to get her 16-year-old son's birth control medication approved. He is transgender and hadn't had a period in five years until last week, she said. Without the birth control, he bled for 11 days. 

"Things in our household have started dissolving," said Shah'ada, who asked that her last name not be published to protect her son's privacy. "He's been depressed, unable to go to school for several days, really high anxiety. It's just very emotional and frustrating."

When Shah'ada tried to fill the prescription, the pharmacist told her that it was denied because of her son's gender. 

She dialed the prescription call center every chance she got. Her managed-care plan suggested there was a glitch in the system but didn't know how to help since it no longer controls prescription drugs for its members. Her son's doctor tried to submit more paperwork to no avail, and she submitted a grievance to Medi-Cal Rx. 

Over the weekend, she finally got approval for her son's birth control, but she's worried about refilling the prescription in three months.

Schultz, the San Diego County physician, said his staff is also directed to the call center to ask questions when patients are denied medications. But the appeal form they are asked to fill out is incomplete, he said, lacking a section for the previous medications a patient has tried, for instance, information Medi-Cal Rx requires for approval.

"We've got people out with COVID. We really don't have time to sit on hold for eight hours. We have dozens of patients in the same boat," Schultz said. "Theoretically, all of our staff could be tied up on hold with Magellan. We can't do it."

This story was produced by KHN, which publishes California Healthline, an editorially independent service of the California Healthcare Foundation.

Samantha Young: syoung@kff.org, @youngsamantha

Not everyone agrees that vaccine mandates for children are the way forward.

This article was published on Wednesday, February 9, 2022 in Kaiser Health News.

By Elisabeth Rosenthal

The rapid spread of omicron across the nation — and the finding that vaccines continue to provide strong protection against severe disease — brings COVID-19 one step closer, perhaps, to truly earning its place on the list of diseases that have been tamed by vaccines. These include polio, measles, mumps, rubella, and chickenpox, all of which most kids must generally be vaccinated against before they enter school or day care. Some states have announced COVID vaccine requirements for certain students.  

But not everyone agrees that vaccine mandates for children are the way forward. Sen. Rand Paul, who has opposed vaccine mandates, called omicron "nature's vaccine." Seventeen mostly Republican-led states have proactively banned, in some form, COVID vaccine requirements for students. Resistance to adopt mandates has profound repercussions, especially as vaccination rates among kids ages 5 to 11 remain alarmingly low — under 15% in some states — even though children 5 and over have been eligible for shots since last fall.

History holds lessons for why low vaccination rates for children are so risky and why officials should strongly consider school mandates for the COVID vaccine.

In the United States, children generally must get a number of vaccines before they enter school. Such requirements help ensure an entire generation gets their shots against diseases that were feared for decades — sometimes centuries — before vaccines did their work. Such diseases proved even more terrifying in places that were immunologically "naïve," showing up in bodies that hadn't seen them before. That's the devastating place we were with COVID-19 in early 2020.

When explorers brought diseases like measles, which had long circulated on the European continent, to Native populations of the New World, they killed up to an estimated 80% to 95% of the Indigenous population in repeated outbreaks over the ensuing 100 to 150 years. When global travel become more available, the king and queen of Hawaii arrived in England in 1824 and both died there of measles. The virus came back to Hawaii in 1848 and started an epidemic that killed one-quarter of the Native population, by one estimate, then flared to create additional waves that killed more people in the following decades.

Even after vaccines were invented and diseases like measles and chickenpox were no longer common (and not medically dangerous for the average child), the United States continued to mandate school vaccination for different but important reasons.

We vaccinate against chickenpox and measles in part because those diseases can be more deadly for adults, for the immunocompromised, and for babies, whose immune systems are still developing. Like COVID.

We vaccinate against mumps, in itself usually a mild disease, because some who get it will suffer serious lasting effects, such as hearing loss or infertility in males who've passed puberty. You can draw parallels here with "long COVID," and we still don't know about the long-term effects of the coronavirus, which can inflame organs.

Also, kids with chickenpox must endure a prolonged, miserable isolation at home. And we vaccinate against the chickenpox virus — and measles — because an outbreak at a school can cause significant disruption if vaccination rates are low, triggering actions like contact tracing and other public health measures.

Just as with the coronavirus today.

We could get lucky and achieve more widespread immunity for COVID relatively quickly, after new waves become less and less overwhelming. But even if that happens, many unvaccinated people will die or get seriously ill and some kids will miss school when they didn't need to. New, potentially more dangerous strains have a better chance to emerge. Do we really want to roll the dice and not take full advantage of this very effective tool at our disposal?

Which path do we want to take to put the pandemic behind us: the quicker, more certain one of mandatory vaccination or a stuttering, drawn-out affair?

Unfortunately, the COVID vaccines landed at a time of deep national divides, when science had become politicized and mistrust of government was high. Even parents who get their children the school-required shots have balked at COVID vaccines. States and school districts that have announced plans for school vaccination requirements already face backlash.

This is a far cry from the way the public reacted to the introduction of childhood vaccines in the 20th century. People reacted enthusiastically to the availability in 1955 of the vaccine against polio, a disease that could have disastrous health consequences, but — like COVID — was asymptomatic or mild in most people who were infected, particularly children. The hesitancy that existed then was not driven by intense partisanship or political division.

One explanation for that era's enthusiasm for a new shot was that Americans' memories were long, having lived through fearsome polio outbreaks and the attendant quarantines through much of the mid-20th century. By 1955, many Americans knew someone who had perished from polio or was left partly paralyzed. People have lived with COVID for a relatively short amount of time.

Resistance to the COVID vaccine will perhaps dissipate once the FDA moves the shot for children from emergency use authorization to full approval and as waves of COVID affect more Americans.

Here's how my thinking about another vaccine was affected a generation ago: My older child got chickenpox before the shot was available and spent hours in oatmeal baths covered with hundreds of itchy blisters. She couldn't return to preschool (nor I to work) for 10 days, until her blisters scabbed over; some scars took years to fade.

So when the chickenpox vaccine came to market in 1995, I raced to get my 2-year-old the shot. He still got chickenpox, but a mild case, just like most breakthrough COVID cases: One evening while he was playing, I noticed two telltale blisters on his upper arm that disappeared within 24 hours. He didn't miss a single play date.

Like many childhood vaccines, that shot protected him, our family, my work, our caregiver, his toddler classes, his grandmother, and all the vulnerable people we had come in contact with at the market or on the subway. If we want to bring this pandemic to a rapid denouement, vaccinating schoolchildren can have the same ripple effect and may well be the best way to go.

Elisabeth Rosenthal: erosenthal@kff.org, @rosenthalhealth

Eight years into the Hospital-Acquired Condition Reduction Program, 2,046 hospitals have been penalized at least once.

This article was published on Tuesday, February 8, 2022 in Kaiser Health News.

By Jordan Rau

The federal government has penalized 764 hospitals — including more than three dozen it simultaneously rates as among the best in the country — for having the highest numbers of patient infections and potentially avoidable complications.

The penalties — a 1% reduction in Medicare payments over 12 months — are based on the experiences of Medicare patients discharged from the hospital between July 2018 and the end of 2019, before the pandemic began in earnest. The punishments, which the Affordable Care Act requires be assessed on the worst-performing 25% of general hospitals each year, are intended to make hospitals focus on reducing bedsores, hip fractures, blood clots, and the cohort of infections that before COVID-19 were the biggest scourges in hospitals. Those include surgical infections, urinary tract infections from catheters, and antibiotic-resistant germs like MRSA.

This year's list of penalized hospitals includes Cedars-Sinai Medical Center in Los Angeles; Northwestern Memorial Hospital in Chicago; a Cleveland Clinic hospital in Avon, Ohio; a Mayo Clinic hospital in Red Wing, Minnesota; and a Mayo hospital in Phoenix. Paradoxically, all those hospitals have five stars, the best rating, on Medicare's Care Compare website.

Eight years into the Hospital-Acquired Condition Reduction Program, 2,046 hospitals have been penalized at least once, a KHN analysis shows. But researchers have found little evidence that the penalties are getting hospitals to improve their efforts to avert bedsores, falls, infections, and other accidents.  

"Unfortunately, pretty much in every regard, the program has been a failure," said Andrew Ryan, a professor of healthcare management at the University of Michigan's School of Public Health, who has published extensively on the program.  

"It's very hard to capture patient safety with the surveillance methods we currently have," he said. One problem, he added, is "you're kind of asking hospitals to call out events that are going to have them lose money, so the incentives are really messed up for hospitals to fully disclose" patient injuries. Academic medical centers say the reason nearly half of them are penalized each year is that they are more diligent in finding and reporting infections.

Another issue raised by researchers and the hospital industry is that under the law, the Centers for Medicare & Medicaid Services each year must punish the quarter of general care hospitals with the highest rates of patient safety issues even if they have improved and even if their infection and complication rates are only infinitesimally different from those of some non-penalized hospitals.

In a statement, CMS noted it had limited ability to alter the program. "CMS is committed to ensuring safety and quality of care for hospital patients through a variety of initiatives," CMS said. "Much of how the Hospital-Acquired Condition (HAC) Reduction Program is structured, including penalty amounts, is determined by law."

In allotting the penalties, CMS evaluated 3,124 general acute hospitals. Exempted from the evaluation are around 2,000 hospitals. Many of those are critical access hospitals, which are the only hospitals serving a geographic — often rural — area. The law also excuses hospitals that focus on rehabilitation, long-term care, children, psychiatry, or veterans. And Maryland hospitals are excluded because the state has a different method for paying its hospitals for Medicare patients.

For the penalized hospitals, Medicare payments are reduced by 1% for each bill from October 2021 through September 2022. The total amount of the penalties is determined by how much each hospital bills Medicare.

A third of the hospitals penalized in the list released this year had not been punished in the previous year. Some, like UC Davis Medical Center in California, have gone in and out of the penalty box over the program's eight years. Davis has been penalized four years and not punished four years.

"UC Davis Medical Center is usually within a few points of the [Hospital-Acquired Condition Reduction Program] threshold, so it's not unusual to move in and out of the program year to year," UC Davis Health said in an email. It said Davis ranked 38th out of 101 academic medical centers that use a private quality measurement system.

The Cleveland Clinic said that its satellite hospital in Avon has received awards from private groups, such as an "A" grade for patient safety from the nonprofit Leapfrog Group. Both it and Cedars-Sinai touted their five-star ratings. In addition, Cedars said that overall assessment comes even though the hospital deals with large numbers of very sick patients. "This rating is particularly meaningful because of the complexity of the care that many of our patients require," Cedars said in a statement.

Other hospitals declined to comment or did not respond to emails.

The KHN analysis found that the government penalized 38 of the 404 hospitals that were both included in the hospital-acquired conditions evaluation and had received five stars for "overall quality," which CMS calculates using dozens of metrics. Those include not just infection and complication rates but also death rates, readmission frequencies, ratings that patients give the hospital after discharge, and hospitals' consistency in following basic protocols in a timely manner, such as giving patients medicine to break up blood clots in the 30 minutes after they display symptoms of potential heart attacks.

In addition, 138 of 814 hospitals with the next-highest rating of four stars were docked by the program, KHN found.

Lower-rated hospitals were penalized with a higher frequency: Although just 9% of five-star hospitals were punished, 67% of one-star hospitals were.

KHN's analysis found major discrepancies between the list of penalized hospitals and how Medicare's Care Compare rated them for virtually the same patient safety infection rates and conditions. On the Medicare site, two-thirds of the penalized hospitals are rated as "no different than average" or "better than average" for the public safety measures CMS uses in assigning star ratings. The major differences center on the time frames for those measures and the structure of the penalty program. The Medicare website, for instance, evaluated only one year of infection rates, rather than the 18 months' worth that the penalty program examined. And the public ratings are more forgiving than the penalties: Care Compare rates each hospital's patient safety metric as average unless it's significantly higher or lower than the scores of most hospitals, while the penalty program always punishes the lowest quartile.

Nancy Foster, the vice president for quality and patient safety at the American Hospital Association, said the penalties would cause more stress to hospitals already struggling to handle the influx of COVID patients, staffing shortages, and the extra costs of personal protective equipment. "It is demoralizing to the staff when they see their hospital is deemed unsafe or less safe than other hospitals," she said.

Dr. Karen Joynt Maddox, co-director of the Center for Health Economics and Policy at Washington University in St. Louis, said it was time for Congress and CMS to reevaluate the penalty program. "When this program had started, the thought was that we would get to zero" avoidable complications, she said, "and that hasn't proven to be the case despite a really good effort on the part of some of these hospitals."

She said the hospital-acquired conditions penalty program, along with other quality-improvement programs created by the ACA, feels "very ready for a refresh."

Jordan Rau: jrau@kff.org, @JordanRau