States Seek Clarity on Next Steps in PPACA Implementation

State governors and directors of Medicaid programs are seeking clarity on a number of issues from the Department of Health and Human Services (HHS) regarding the implementation of the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148). Although the U.S. Supreme Court in National Federation of Businesses, et al v. Sebelius upheld most of the health reform law, the states have numerous questions about the expansion of Medicaid, timelines for compliance, funding, and other issues.

As part of her response to the governors, HHS Secretary Kathleen Sibelius announced four “regional implementation forums” that will be held around the country in July and August.

Governors’ Concerns

In a July 2, 2012, letter to Sibelius, the National Governors Association noted that in the wake of the Supreme Court’s decision, states now have the option–not the requirement–to expand their Medicaid programs to anyone with an annual income of up to 133 percent of the federal poverty level (FPL), without the possibility of losing all federal Medicaid funding if the state did not expand Medicaid eligibility.

The NGA sought clarity on these topics:

(1) Will states that expand Medicaid coverage to a level less than 133 percent of FPL still receive the enhanced federal medical assistance percentage (FMAP) available for the newly covered population?

(2) Will states be allowed to phase in Medicaid coverage up to 133 percent of FPL in years after 2014 and still receive the enhanced FMAP?

(3) If a state opts not to pursue Medicaid expansion, what other Medicaid provisions in PPACA would apply to that state’s program?

(4) What options and federal assistance are available for states that decide not to expand Medicaid coverage?

(5) If a state had already expanded Medicaid coverage through a waiver prior to the enactment of PPACA, but at a level less than 133 percent of FPL, are they still eligible for the enhanced FMAP?

Medicaid Directors

The National Association of Medicaid Directors had about 30 questions to ask Sibelius, including:

(1) Will individuals with income between 100 and 133 percent of FPL be eligible for cost sharing subsidies and tax credits to purchase coverage through the state-based insurance Exchanges?

(2) How will CMS define “newly eligible” individuals for states that have already expanded Medicaid coverage to the optional adult population?

(3) Must states submit a state plan amendment (SPA) for approval of the Medicaid expansion and, if so, will there be  flexible deadlines for states that need legislative approval for an SPA?

(4) How will a state’s decision to expand or not expand Medicaid affect the separate PPACA provision that reduces funding for disproportionate share hospital programs in the states?

(5) What is CMS’ timeline for issuing guidance on alternative benefit packages for the optional adult category under Medicaid; on how states notify individuals about the penalty for not getting health insurance coverage; and on the Basic Health Plan program?

HHS Forums 

HHS will hold four PPACA implementation forums in July and August, focusing in part in topics relating to coverage provisions that become effective in 2014. The details of the four forums are:

July 31: Washington, DC

Hubert H. Humphrey Building, Great Hall

200 Independence Ave., SW

Washington, DC 20201

August 2: Chicago

Social Security Administration, Center Auditorium

600 West Madison St.

Chicago, IL 60661

August 10: Denver

David Auditorium in Sturm Hall, University of Denver

2000 E. Asbury Ave.

Denver, CO 80208

August 15: Atlanta

National Archives at Atlanta

5780 Jonesboro Rd.

Morrow, GA 30260