South Dakota Medicaid Program

1. South Dakota Medicaid Program April 23, 2013

2. What is Medicaid? • Medicaid is one of the largest healthcare insurers in South Dakota • Federal-State partnership governed by Medicaid state plan- agreement with federal government on who is served and what services are covered • Each state’s plan is different • Makes comparisons between states difficult • Different than Medicare - 100% federal coverage for older and some disabled adults

3. Who Uses Medicaid Now? • Medicaid covered 144,373unduplicated individuals during FY12 • Nearly 1 of every 7 persons in any given month will have health coverage through Medicaid or CHIP. • 1 of every 3 persons under the age of 19 in South Dakota has health coverage through Medicaid or CHIP. • 50 percent of the children born in South Dakota will be on Medicaid or CHIP during the first year of their life.

4. Who Uses Medicaid Now? • Medicaid eligibility depends on: • 1. Whether a person meets a specific eligibility category; • 2. Resources; and • Examples: bank accounts, bonds, stocks, certificates of deposit, real property and other things of value that are owned • 3. Income

5. Who is covered by Medicaid? • States required to cover some “mandatory” groups • Children under age 6 below 133% FPL • Children age 6-18 under 100% FPL • Pregnant women under 133% FPL • Elderly and disabled on SSI- also called Aged, Blind and Disabled • Parents below cash assistance eligibility levels- 49% FPL • 2013 FPL Chart:

6. Who is covered by Medicaid? • States have option to increase eligibility levels, with approval from CMS • SD covers children through CHIP up to 200% FPL • 69 percent are children and 31 percent are adults • Adults who are not disabled or parents with very low incomes are not covered by Medicaid

7. Who is covered by Medicaid? SFY12 Actual Average Monthly Eligibles – 115,731

8. Who is covered by Medicaid?

9. What services are covered by Medicaid? • Medicaid Mandatory Services (examples) • Inpatient hospital services • Outpatient hospital services • Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) services • Nursing facility services • Home health services • Physician services • Rural health clinic services • Federally qualified health center services • Laboratory and X-ray services • Nurse Midwife services • Certified Pediatric and Family Nurse Practitioner services • Transportation to medical care • Tobacco cessation counseling for pregnant women • All medically necessary care for eligibles under age 21

10. What services are covered by Medicaid? • South Dakota Optional Services (examples) • Physician assistants • Psychologists and independent mental health practitioners • Intermediate Care Facilities for the Mentally Retarded (ICF/MR) • Podiatry • Prescription Drugs • Optometry • Chiropractic services • Durable medical equipment • Dental services • Physical, occupational, speech therapy, audiology • Prosthetic devices and eyeglasses • Hospice care, nursing services • Personal care services and home health aides

11. Majority of expenses by provider type

12. Recipient Cost Sharing • Federal guidelines for imposing co-pays • Limits on emergency services, maximums for services • Non-generic prescription drugs: $3.30 • Generic prescription drugs: $1.00 • Durable Medical Equipment: 5% • Non-emergency dental services: $3 co-pay, $1,000 annual limit for adults • Inpatient Hospital: $50 per admission • Non-emergency outpatient hospital services, which includes emergency room use for non-emergent care: 5% of billed charges, maximum of $50

13. Third Party Liability and Premium Assistance • When people have other insurance, Medicaid becomes a secondary payer • Cost avoid whenever possible, otherwise recover • Recovered more than $7.7 million in FY12 • When it is cost effective and the recipient is eligible for other insurance, Medicaid will pay the private insurance premiums, deductibles and co-pays • FY12- 80 cases • Saved $8.9 million total- net • $3.6 million general funds • Providers received $5.2 million more with private insurance

14. How is Medicaid funded? • FMAP- Federal Medical Assistance Percentage • Determines how much the federal government pays for Medicaid services • Most administrative services are paid at 50% state match • FMAP based on last three years of personal income, compared to other states • When SD’s income goes up compared to other states, the state pays more and the federal government pays less • Highest match rate for services is 50% • Every 1% change in FMAP equals about $7 million general funds

15. How is Medicaid funded? • Services provided by Indian Health Services are reimbursed by Medicaid when the recipient is Medicaid eligible • 100% federal funds when the service is provided directly by IHS • $63 million in FY12 • State pays the regular general fund match rate when IHS does not provide the service directly or through IHS contract funds

16. How is Medicaid Funded? • SFY14 blended FMAP is 54.20% federal/ 45.80% general • The State will pay 45.80% of the cost of Medicaid services * * * * Impacted by American Recovery and Reinvestment Act (ARRA)

17. How is Medicaid Funded? • Total Medicaid expenditures were $799.6 million in FY12 • Medicaid budget is a large part of state government spending • Medicaid part of budgets for several state agencies • Department of Social Services-State Medicaid Agency • Department of Human Services • Department of Health • Department of Corrections • Department of Military and Veterans Affairs • Department of Education

18. How is Medicaid Funded?

19. How is Medicaid Administered? • Eligibility for Medicaid determined by DSS- Division of Economic Assistance Staff • 63 offices throughout SD • Other aspects of Medicaid administered through DSS- Division of Medical Services • Provider enrollment • State Plan management • Rate setting • Claims payment • Utilization review

20. How is Medicaid Administered? • Program Integrity • Fraud and Abuse Prevention and Detection • Surveillance and Utilization Review Unit • Quality Improvement Organization • Recoveries and Fraud Investigations • Drug Utilization Review • Medicaid Integrity Contractors • Medicaid Fraud Control Unit • Federal Reviews- payment error rates

21. Thank You!