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November 8, 2017

Verma signals openness to Medicaid work requirements, accusing Obama administration of 'soft bigotry'

Daily Briefing

    Read Advisory Board's take on this story.

    CMS Administrator Seema Verma on Tuesday discussed the future of Medicaid and unveiled new policies that aim to give states greater flexibility to shape their Medicaid programs.

    Details of the new policies, initiatives

    In a shift from former President Barack Obama's administration, Verma signaled CMS going forward would approve Medicaid waiver requests to add work requirements for working-age, able-bodied Medicaid beneficiaries. According to Kaiser Health News, several states—including Arizona, Arkansas, Indiana, Kentucky, Maine, New Hampshire, Utah, and Wisconsin—have requested such changes to their Medicaid programs.

    In a state of reform: Profiles of innovative state-level Medicaid transformation

    "Believing that community engagement requirements"—which Axios reports Verma defined as having a job, receiving job training, going to school, or volunteering—"do not support or promote the objectives of Medicaid is a tragic example of the soft bigotry of low expectations consistently espoused by the prior administration," Verma said, adding, "Those days are over."

    As part of that effort, CMS revised's content on Medicaid waivers to provide states with further details on how Medicaid waiver requests might align with Medicaid's core objective of serving the health and wellness needs of the United States' vulnerable and low-income individuals and families.

    In addition, Verma said CMS released new policies to streamline its Medicaid waiver approval process. For instance, CMS said states will be able to:

    • Obtain expedited approval for waivers similar to those that have previously been approved; and
    • Submit Medicaid demonstrations that could run up to 10 years.

    The agency also said it will reduce Medicaid demonstration waiver reporting requirements. Further, Verma said CMS is in the process of developing scorecards for Medicaid and CHIP programs that will track and publish federal and state data on Medicaid beneficiaries' health outcomes. Verma said the scorecards will provide a "historic opportunity" for CMS to demonstrate how tax dollars are spent to produce improved health outcomes.  


    Robin Rudowitz, a health care policy and Medicaid expert at the Kaiser Family Foundation, said while the guidelines focus on making the Medicaid waiver approval process easier for states, it is unclear how CMS will define requirements for the states to have a waiver review expedited.

    Sara Rosenbaum, a health policy and law professor at George Washington University, said the new policies and initiatives indicate CMS "is preparing to disavow a central objective of federal law and instead will attempt to accomplish exactly what the law does not countenance, namely, a reduction in the level of assistance available to the poorest and most medically vulnerable Americans."

    Jane Perkins, legal director of the National Health Law Program, said CMS' decision to support work requirements could spur legal challenges. Perkins explained that CMS has the authority to allow states to use waivers to innovate Medicaid, but not restrict eligibility. Perkins said, "This is really a change in the complexion of the Medicaid program, where CMS is saying to states, 'Come tell us what you want to do and if you want to cut back the program, we will give you the go ahead,'" which she said "is inconsistent with congressional intent" of Medicaid waivers (Galewitz, Kaiser Health News, 11/7; Williams, CQ News, 11/6 [subscription required]; CMS release, 11/7; Baker, Axios, 11/7; Winfield Cunningham, "PowerPost," Washington Post, 11/7).

    Advisory Board's take

    by Rob Lazerow and Gillian Michaelson

    Administrator Verma's comments in support of increasing state control and flexibility, improving transparency, and transforming the Medicaid program align closely with the GOP's recent health reform proposals. These new CMS initiatives provide additional indication that even in the absence of sweeping health care reform legislation, the Trump administration will use executive actions to implement conservative policies in the health care economy—and now in the Medicaid program specifically.

    Now more than ever, providers need to craft an intentional Medicaid strategy, particularly given the existing unfavorable reimbursement rates and the prospect of additional reforms on the horizon. In the near term, organizations need to stabilize performance under current economics by curbing avoidable Medicaid costs. In the longer term, providers should evaluate the potential of embracing population health—and even the possibility of risk contracts—for their Medicaid beneficiaries.

    Join us for the Health Care Advisory Board National Meeting to learn our most up-to-date guidance on the state of the Medicaid program today, where it is headed next, and what concrete steps your organization can take to successfully maintain access to care while at the same time protect your margin.

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