Several Important Gains for Health Consumers in the 2012 Budget -Medicaid and other Health Matters

This year’s New York State 2012 Medicaid and health budget included a number of important advances for low-income consumers, and two notable disappointments. The following list summarizes the issues of particular import to the Empire Justice Center.

First, the disappointments in the health budget (S. 6256–D /A. 9056–D) (Bill posted at this link)

1. No agreement on a bill to authorize a State Health Insurance Exchange. The Senate refused to agree to the language proposed by the Governor and the Assembly to create an independent State Health Insurance Exchange. The Governor has indicated he will provide authority for an Exchange at an existing state agency through an Executive Order. This action would at least allow the design process to move forward. Empire Justice pushed hard for inclusion of the authorization language and will work with other consumer groups to urge the Governor to move quickly with an Executive Order.

2. No Charity care reform. Negotiations on language to reform charity care distributions were not successful. In the end, the only change made in the budget was an adjustment to Mental Health services distributions to hospitals as required by the Centers for Medicare and Medicaid Services. This is a very disappointing outcome. Empire Justice will be pushing the legislature to revisit the issue once the budget dust settles. For our recommendations on reform and a recent report on barriers to accessing care for uninsured family members on Long Island, visit http://www.empirejustice.org/assets/pdf/publications/reports/holes-in-the-safety-net.pdf.

Measures supported by Empire Justice that were included in the health budget include:

1. State Takeover of Local Medicaid Costs and Responsibilities. The proposal for state takeover of local administrative costs and responsibilities as recommended by the Medicaid Redesign Team (MRT) Work Group on Streamlining and State and Local Responsibilities was included in the final budget, with some adjustments to the timing and fiscal formulas. Empire Justice supported this language, which will help New York achieve streamlining reforms proposed at the State and Federal levels.

State takeover of administrative cost is phased in by gradually reducing local responsibility for the increases in Medicaid costs. In 2013-14, local responsibility for Medicaid growth is reduced to two percent, and then by an additional one percent annually over the subsequent two years. By 2015, counties and New York City will no longer have to contribute toward the growth of Medicaid expenses. This takeover of the three percent Medicaid growth factor is projected to save counties and New York City $1.2 billion over five state fiscal years.

The budget is much less specific about the timeline for state assumption of local administrative functions. SDOH is required to produce a report by December 31, 2012, and annually thereafter, which is to include a plan and time line for the following activities:

• State assumption of specific administrative functions in the Medicaid program;

• Coordination of the Exchange and other activities required by Federal Health Care Reform with the Medicaid program;

• Cost relief and other financing changes impacting local districts;

• Functions that will be handled under contract with SDOH by either public or private entities.

The budget specifically targets Medicaid recovery actions as an administrative function SDOH is authorized to assume immediately, signaling that centralization of this function is a high priority. The budget language also provides flexibility for the state to amend current contracts to provide for enhanced eligibility automation, increased efficiency within the Enrollment Center (which process renewals currently), verification of third party insurance and asset verification. Thus, some of these functions may be targeted for state attention earlier rather than later.

Counties are provided the opportunity to contract with SDOH to continue to process applications and employees are made eligible for voluntary transfers to state positions without testing or probation. The phased takeover of local government administrative of Medicaid should increase accountability and consistency in Medicaid and help New York maximize gains for the program within the mandates of federal health care reform.

2. Monitoring Managed Long Term Care Implementation.  (section 24-a, 56-a, 56-b) The final budget amends the Public Health Law section dealing with Managed Long Term Care (MLTC) to make some additional requirements of the State Health Department during implementation of MLTC. Specifically:

• SDOH is required to report biannually on implementation, with the first report due on September 1, 2012, and formatted to allow comparisons between plans. The reports are to include:

  • Enrollee satisfaction with care coordination/case management and timeliness of care;
  • Service utilization, including changes in levels, hours, frequency and types of services and providers;
  • Enrollment data, including auto-assignment rates, by plan;
  • Continuity of care for enrollees moving between home care and institutional care.

• SDOH is required to work with affected stakeholders to develop policies for enrollee transition and continuity of care when moving from community based care (including Lombardi waiver services) into MLTC. These policies must include:

  • A timetable and plan for transitioning members, plans and providers;
  • Information on participants’ options, including the right to continue with a previously established program until the next comprehensive assessment;
  • An opportunity for plans and providers to pursue contracts;
  • Delineation of responsibilities for providers and plans.

The budget did not remove the requirement that an applicant to operate a MLTC be a hospital, LHCSA or CHHA, HMO or a not-for-profit organization with a history of providing or coordinating services. As mentioned in the bullets above, it appears that SDOH will facilitate contracting opportunities for providers however, presumably including Lombardi waiver providers.

3. Retention of Spousal/Parental Refusal. The proposal to eliminate spousal/parental refusal was not included in the three way agreement. Empire Justice opposed elimination and is pleased with this outcome!

4. Medicaid Services Added/ Expanded. The budget makes several significant additions and/or expansions to Medicaid services, all of which are contingent upon federal approval, as follows:

a) Podiatry services for adults with diabetes are restored (Medicaid coverage of podiatry was limited to children under age 21 by previous budget cuts)(section 6) 

b) Lactation counseling for pregnant and postpartum women is added as a new Medicaid service;

c) Harm reduction counseling for drug users is added as a new service; and

d) Hepatitis C related services are added as new services, to include outreach, recruitment, education and counseling to promote adherence to treatment and coordination with other health care services.

e) An exception is created to the limit on enteral nutritional supplements (commonly known as "ensure") put in place by last year’s budget.  Last year, Medicaid would pay for these supplements only for people who were tube-fed.  The new exception to the limit on enteral therapy specifically includes persons diagnosed with an HIV related condition and also authorizes the service for other illness and conditions, subject to standards to be developed by the State Department of Health. (section 7) 

Empire Justice supported these service additions and expansions. Empire Justice also pushed unsuccessfully, for a broader, standards-based exception that would apply to all of the service limits enacted in last year’s budget. For information about a class action lawsuit filed on behalf of Medicaid recipients unable to access orthotics and compression stockings as a result of the limits enacted in last year’s budget, contact Geoffrey Hale in our Rochester office, ghale@empirejustice.org.

5. New Facilitated Enrollment Services for the Elderly and Disabled. The budget includes $3 million in state funding for an expansion of facilitated enrollment services to include elderly and disabled Medicaid applicants. This money should be subject to a federal match for a total budget of $6 million in new services. Empire Justice initiated the proposal through the MRT process and has been a strong supporter.

6. Medicaid Managed Care access issues --

• Ensuring access to atypical antipsychotics in Medicaid managed care. Last session, the budget removed what is known as “prescriber prevails” in the managed care context (the protection still applies for those beneficiaries utilizing fee for service Medicaid). Thus the prescriber does not have the final word in a dispute with a managed care plan about the medical necessity of a drug. This session, “prescriber prevails” was reinstated but only with regard to atypical antipsychotics. (section 55) 

• Requiring managed care plans to offer Consumer Directed Personal Assistance Program (CDPAP) services -- In August 2011, as required by last year's state budget, mainstream Medicaid managed care plans began including personal care services in their plans -- services previously "carved out" of the benefit package and obtained separately from the local Medicaid program.  This change will ensure that these consumers have the option of CDPAP services.  

7. EPIC Restoration -- The budget agreement restores Part D co-pay wrap-around assistance before and after the coverage gap (also known as the "doughnut hole"), as of January 2013. This assistance had been eliminated in last year’s budget and left many seniors – those unable to access the Part D Extra Help subsidy -- unable to afford their prescriptions for much of 2012. Empire Justice had worked alongside other advocates to publicize how these seniors had been falling through the cracks, and we are grateful that the Legislature and the Governor reached agreement to restore this critical assistance.

Beginning January 1, 2013:

• EPIC reverts back to the “fee” and “deductible” financial eligibility structure that had been in existence until December 31, 2011:

  • FEE -- Members will be charged a quarterly fee if they have incomes below $20,000 (single) or $26,000 (married couple).
    • Fee is waived for members receiving the full Extra Help subsidy.

  • DEDUCTIBLE --Members with incomes between $20,001-35,000 (single) or $26,001-50,000 (couple) will meet an annual deductible before EPIC coverage kicks in.

• EPIC members must pay for drugs during their Part D plan's deductible period, but members can avoid this by choosing a Part D plan in 2013 with no deductible.

• Part D enrollment is mandatory.

• EPIC will act as secondary payor for Part D drugs. Member’s actual co-pay amount, after Part D and EPIC have paid, will range from $3 to $20 per drug. EPIC co-pay assistance will exist during initial coverage limit, coverage gap (“donut hole”) and catastrophic coverage.  EPIC will NOT pay during the Part D plan's deductible period.

• EPIC will also pay for Part D excluded drugs year-round except in the Part D deductible period (such as benzodiazapenes like valium, ativan, and barbiturates).

• It appears that EPIC premium assistance will continue unchanged from this year - EPIC will pay the Part D premium for singles under .$23,000/year income and couples under $29,000/year.   

8.   Bed-hold for Nursing Home Residents --  Last year's drastic limitation on the right of nursing home residents, in some situations, to have Medicaid pay to hold their bed during a temporary hospital stay or other therapeutic leave was lifted.  Medicaid will still provide for a total of 14 bed hold days/year for hospital stays or other therapeutic leave, and 10 days/year for other reasons.  However, if $40 million is not saved on bedhold this year, the State will withhold Medicaid payment to nursing homes to achieve these savings.   

9.    Safe-RX -- Finally, one very important health access initiative from the Education Budget (S. 6257-E/A. 9057-D):

Translation Services for Pharmacy Prescriptions --The budget includes language proposed by the Governor that requires chain pharmacies operating in upstate New York to provide oral and written translations services for customers with limited English proficiency who are filling prescriptions. Such critical services will ensure that these customers fully understand the nature of the medication they’re receiving and the instructions for its use so that a language barrier does not become a threat to successful treatment. Empire Justice strongly supported this initiative, which was developed by the New York Lawyers for the Public Interest in order to expand a similar New York City directive statewide.

Under this new initiative, known as Safe Rx, the State Health Department is to develop regulations which shall set forth the core consumer-centered data elements for explaining prescriptions. The Department is to develop these elements in consultation with consumer advocates and other stakeholders, with attention to literacy level, font size and other factors viewed as relevant to special populations. Chain pharmacies will then be required to provide oral and written translations upon request in languages spoken by one percent or more of those residing in the region.

The final budget narrowed the applicability of the new requirements, however, amending the definition of chain pharmacies from those owning five or more stores to those owning eight or more stores – applicability to grocery store pharmacies is unclear. In addition, the regulations must include a mechanism allowing pharmacies to waive compliance when “implementation would be unnecessarily burdensome when compared to the need for such services.”

This article prepared by the Empire Justice Center.