Remember the MassHealth waiver? Didn’t think so. After refreshing your knowledge with the superb Mass Medicaid Policy Institute summary, come back for a brief discussion of today’s news.
[short summary: waiver= permission by federal government allowing state to claim federal Medicaid reimbursement funds for health reform spending]
Today the state filed with the federal government a request to obtain additional federal funds to support safety net hospitals that treat large numbers of MassHealth patients. For detail, see the state’s press release, and a story in the online Boston Globe.
(UPDATE: the actual waiver submission is here (pdf))
The total requested comes to $480 million over two years. Of that, $216 million would go to Cambridge Health Alliance, for payments to support their extensive primary care and mental health programs for low income patients, and to facilitate the reorganization plan underway. The rest would assist other hospitals, with the almost all going to go to six hospitals which have the highest ratio of Medicaid care compared to commercial patients: Boston Medical Center, Brockton, Caritas Carney, Lawrence, Holyoke and Mercy Hospitals.
The Cambridge payments were previously approved by the legislature, but legislative action is needed to authorize the funds for other hospitals.
These funds are vital to reverse some of the growing disparities in MassHealth payment levels. The hospitals that depend on MassHealth for a significant proportion of their revenue have been disadvantaged because they have little ability to shift costs to private payers. These payments will facilitate the move to a more effective payment system under payment reform. We strongly urge the legislature to support the request.
In addition to the funds request, the administration is also seeking federal authority to increase copays for generic drugs from $2 to $3. While this request is driven by budget shortfalls, it may result in a real hardship for MassHealth recipients with very low incomes. In addition, this step reduces federal revenue to the state. Most of the revenue collected in extra copays will go to the federal government, rather than support the state’s budget. At time when the state is seeking to maximize federal funds, this proposal is counterproductive.
