DHS Submits Waiver for Medicaid Childless Adults

June 09, 2017

The Department of Health Services (DHS) submitted their proposed waiver request June 7 to the Centers for Medicare and Medicaid Services for changes impacting childless adults enrolled in the state’s Medicaid program. If approved, the waiver would allow Wisconsin to impose premiums, copayments for emergency services, drug screening and drug testing, and work requirements on those enrolled in Medicaid as "childless adults." The proposal would also expand opportunities for treatment for substance use disorder and seek relief from Medicaid’s current policy to limit reimbursement to institutes for mental disease (IMD). (See related article on page 1.)

WHA had submitted its comments on the proposal May 19, (See previous story  and comment letter.) WHA expressed support for the state’s commitment to increasing treatment options for individuals with substance use disorder and for the intention of the overall proposal to engage participants in maintaining and improving their overall health and incenting the efficient use of health care resources.

WHA also made several recommendations to ease the administrative burden as well as the financial burden on hospitals. Further, WHA had encouraged DHS to seek enhanced federal funding for the waiver population. The original waiver was considered a partial expansion under the previous administration and was not eligible for the enhanced funds that other states received for full expansions. WHA describes Wisconsin as a model for avoiding gaps in coverage and notes other states are now considering changes to their programs that align with Wisconsin. In Arkansas, for example, recently passed legislation requires the state to modify its current Medicaid waiver to reduce the income threshold for coverage from 133 percent FPL to 100 percent FPL, like Wisconsin’s program. Arkansas is an expansion state and has asked the federal government to maintain the higher match it currently receives.

In the end, DHS did not include the funding issue in its final proposal, but did make some modifications to the proposal in alignment with WHA’s comments.

With respect to premiums, the final proposal applies premiums only to those with income above 50 percent of the Federal Poverty Level (FPL), with one premium amount of $8. The previous proposal would have applied premiums to anyone with income above 20 percent FPL, and there were four different levels and premium amounts. Further, in the final submission, DHS said it agrees with commenters that a grace period is necessary, and the agency is considering a grace period of 12 months for members who miss a payment. Both of these changes align with WHA comments on the draft proposal.

Of particular note for hospitals is the application of an emergency room copayment. Under the original proposal, DHS would have imposed an emergency room copayment of $8 for a first visit and $25 for each subsequent visit to the emergency room. The final proposal decreases the higher copay for the subsequent visits, which is a positive step. However, the copay would still apply to all emergency room visits and providers would be required to collect the copayment. WHA continues to encourage DHS to narrow the scope to non-emergent use only and to collect the copayment directly.

The waiver proposal now moves to CMS, where there is a 30-day review period. Waivers submitted to CMS typically can still take months to receive approval, although the Trump administration has stated its intention to move more quickly than past administrations on state proposals.

The waiver has also been the subject of review during the state Legislature’s Joint Finance Committee (JFC) deliberations on the state budget. The JFC approved a change to the state budget that would require the waiver amendment to get approval by the JFC after it is approved by CMS and before it is implemented. Once approved, DHS has indicated it would take at least a year to make all of the changes necessary to implement the provisions.

This story originally appeared in the June 09, 2017 edition of WHA Newsletter