Florida's Medicaid Program: Looking Ahead to 2012

1. Florida's Medicaid Program: Looking Ahead to 2012 Joan Alkerand Jack Hoadley Georgetown University Health Policy Institute Webinar, December 7th, 2011

2. Looking Ahead to 2012, What Changes Are In Store for Florida's Medicaid Program?

3. What is an 1115 waiver? • A provision in the Social Security Act which allows the Secretary discretion to waive certain federal rules • The proposal must assist in promoting the objectives of the Act • Must be experimental, pilot or demonstration – can’t just be designed to save $.

4. Medicaid Enrollment 66.7% 33.3%

5. Cost of Florida’s Medicaid Program • Total annual costs slightly less than $20.3 billion • FMAP= 55.94% in SFY 11-12 • FMAP is projected to rise to 59.14% in SFY 14-15

6. Medicaid’s Budget: Putting Costs in Context, SFY 2008- SFY 2009 Source: Kaiser Commission on Medicaid and the Uninsured, "Policy Brief Update: State Budgets in Recession and Recovery," October 2011

7. Florida’s Budget, SFY 2008- SFY 2009 Source: 2008 and 2009 Annual Survey of State Government Finances. U.S. Census Bureau and 2009 NASBO State Expenditure Report

8. Florida’s Medicaid Spending Source: Georgetown University Center for Children and Families calculations based on National Association of State Budget Officers, "2009 State Expenditure Report" (December 2010).

9. Growth in Florida Medicaid Enrollment and Spending, 2006-2011 Source: Georgetown University calculations of “Social Services Estimating Conference - Medicaid Services Expenditures" (March 1 and October 17, 2011); and "Social Services Estimating Conference - Basic Medicaid Caseloads, Historical and Forecasted” (September 9, 2011).

10. Per-Person Five Year Growth in Health Care Costs, 2006-2011 Source: Georgetown University calculations of Kaiser Family Foundation & Health Research & Educational Trust, "Employer Health Benefits 2011 Annual Survey" (September 2011); 2006-2009 and Projected 2010-2011 National Health Expenditure Data; "Social Services Estimating Conference - Medicaid Services Expenditures" (March 1, 2011); and "Social Services Estimating Conference - Basic Medicaid Caseloads, Historical and Forecasted" (January 24, 2011).

11. What’s in the 2011 Legislation? • Required enrollment in managed care for most Medicaid beneficiaries • Managed long-term care program • $10 monthly premium requirement • $100 copay for non-emergency use of ER • Enhanced benefits program: credits for healthy behaviors • Opt-out to purchase private, employer-sponsored insurance

12. Mandatory Managed Care Populations • Children and parents who are eligible because of their incomes • Aged and Disabled persons receiving SSI disability (except those with developmental disabilities) • Children eligible because they are disabled (SSI) • Pregnant women • Children with chronic conditions who participate in Children’s Medical Services Network • Children in foster care and/or receiving adoption subsidies • Individuals eligible for hospice-related services • Individuals eligible for both Medicaid and Medicare (“dual eligibles”) • “Medically Needy”

13. Voluntary Managed Care Populations • Individuals residing in an institution, such as a nursing home, sub-acute inpatient psychiatric facility for those under the age of 21, or an Intermediate Care Facility for the Developmentally Disabled • Individuals with developmental disabilities • Individuals that have other creditable health care coverage, excluding Medicare • Individuals residing in residential commitment facilities, operated through the Department of Juvenile Justice or mental health treatment facilities • Refugees • Individuals with developmental disabilities enrolled in the home and community based services waiver program, those on the waiting list for this program, or those who are residents of developmental disabilities centers

14. Exempt Managed Care Populations • Women who are eligible for family planning services • Women who are eligible through the breast and cervical cancer program • Persons who are eligible for emergency Medicaid only • Children receiving services in a pediatric extended care facility

15. What Will the Federal Government Do? • Negotiations have been underway all year on extension of five-pilot county waiver • Some of those issues will carry over • CMS could act on some parts of the waiver and not others (1915 (b) and (c), SPA) • A lot of negotiations!!

16. Proposed Medicaid Premiums Challenge Coverage for Florida’s Children and Parents

17. How is Florida doing in covering children? WA NH VT MT ME ND OR MN MA ID WI SD NY WY MI RI CT IA PA NV NE NJ OH IL UT IN DE CO CA WV KS VA MD MO KY NC DC TN AZ OK NM AR SC MS AL GA TX LA Florida=12.7% US=8% AK FL HI Uninsured rate higher than national rate (16 states) No statistically significant difference (5 states) Uninsured rate lower than national rate (30 states including DC)

18. Increase in Child Poverty Source: US Census Bureau, American Community Survey ACS

19. Florida Still Has Many Uninsured Children

20. Florida had largest decline in number of uninsured children in 2008-2010 Source: Georgetown University Center for Children and Families, “Despite Economic Challenges, Progress Continues: Children's Health Insurance Coverage in the United states fro m2008-2010”

21. Florida led nation in decline of uninsured rate Source: Georgetown University Center for Children and Families, “Despite Economic Challenges, Progress Continues: Children's Health Insurance Coverage in the United states fro m2008-2010”

22. Proposed New Premiums • $10 monthly premium on Medicaid beneficiaries, regardless of income • Primary exception: those living in nursing homes • Premium would be a condition of eligibility • $10 premium far exceeds allowable limits under federal law • Thus requires federal government waiver

23. Illustrative Premiums under Proposal 23

24. Premiums in Other States • States currently charging premiums • For children: 34 • For adults: 23 • Only 8 states have premiums that reach families with incomes as low as 101% of FPL • No other state currently charges premiums to children under the poverty line

25. Case Study in Oregon • Higher premiums for adults below poverty • $6 to $20 per month, based on income • Enrollment dropped from 104,000 in February 2003 to 24,000 in November 2005. • One-third cited premiums as key factor • Two-thirds became uninsured • Total state premium revenues declined

26. Other State Experiences • Missouri: 30% enrollment decline over two years • Maryland: 28% of children disenrolled • $37 monthly premium at higher income levels • Urban Institute study: even small premiums (as share of income) decrease enrollment 26

27. Expected Effect of Increasing Premiums on Participation Rates Source: Leighton Ku and Teresa Coughlin, “Sliding-Scale Premium Health Insurance Programs: Four States’ Experiences,” Inquiry 36(4): 471-480, Winter 1999-2000.

28. Applying the Model to Florida • Estimates made for different eligibility groups, based on income levels • Families with TANF-based eligibility ≤ 59% FPL • Families with unemployed parent ≤ 22% FPL • Children based, on age and income • Pregnant women, based on age and income • 807,000 children and parents projected to drop coverage 28

29. Over 80% of Those Expected to Lose Enrollment are Children Source: Georgetown Health Policy Institute Analysis

30. Most Beneficiaries Projected to Lose Enrollment are Below Poverty Source: Georgetown Health Policy Institute Analysis

31. What Happens to Children and Families Who Disenroll? • Many will have no other option for coverage • Those working at low-paid jobs often have no employer health insurance offered • When offered, insurance has much higher premiums than proposed in Medicaid • Those without jobs have few insurance options • The result: many likely to become uninsured

32. Reliance on the Safety Net • Without insurance, people turn to emergency rooms and safety net clinics and hospitals • Neglected preventive care • Added burden for safety net clinics, hospitals • Higher costs for state and localities • Increased cycling on/off coverage • Greater administrative costs • Adverse selection

33. For More Information • Visit the Jessie Ball duPont Fund website • www.dupontfund.org • Visit the Winter Park Health Foundation website • http://www.wphf.org/ • The Georgetown University project website • http://hpi.georgetown.edu/floridamedicaid