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HomeMy WebLinkAboutMINUTES - 04152008 - C.32 C,74;L Contra TO: BOARD OF SUPERVISORS •, ', ' = :__- FROM: JOHN CULLEN, Costa- �-����� °5 County Administrator ti4 DATE: April 15, 2008 County i SUBJECT: SUPPORT POSITION on H.R. 5613 (Dingell and Murphy): The Medicaid Safety Net Act of 2008 SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATION SUPPORT H.R. 5613 (Representatives Dingell and Murphy), the Protecting the Medicaid Safety Net Act of 2008, a bill that would place a moratorium. until March 2009 on seven Medicaid regulations issued by the Department of Health and Human Services, as recommended by the Director of Health Services and the County Administrator. FISCAL IMPACT: If implemented, the regulations will result;in a $50 billion reduction in public hospital funding nationwide, a $550 million reduction to public hospitals in California, and $8 million reduction to Contra Costa Regional Medical Center. BACKGROUND: Counties deliver and finance health care for America's most vulnerable people. For decades, Medicaid has provided the flexible financial framework around which states and counties have built their own unique health care safety net; systems to support these populations. Over the past year, however, the U.S. Department of Health and Humans Services Center for Medicare and Medicaid Services (CMS) has issued a number of;regulations which would fundamentally alter Medicaid policy. These rules will either shift the cost of Medicaid programs to states and counties on a massive scale, or, what is more likely given the current economic downturn, require states and counties to slash services to Medicaid beneficiaries. The federal Department of Health and ;Human Services has imposed seven regulations that would make significant cuts to the Medicaid program over the next five years. According to the Congressional Budget Office (CBO), nearly $20 billion in funding is at stake during this five-year period. If implemented, the regulations;will result in a $50 billion reduction in public hospital funding nationwide, a $550 million reduction to public hospitals in California, and $8 million reduction to Contra Costa Regional Medical Center: This cut to CCRMC would come on top of an anticipated $9 million to $10 million cut to County hospital and clinics due to proposed County budget cuts for FY 2008-09. A cut of this magnitude would seriously harm the f nancial feasibility of our health system. CONTINUED ON ATTACHMENT: x YES SIGNATURE RECOMMENDATION OF COUNTY ADMINISTRATOR • OMMENDATION OF BOARD COUAITTEE —�— APPROVE OTHER SIGNATURE(S): ACTION OF BO ON / �'� D APPROVED AS RECOMMENDED V_ OT/II:R bb i i VOTE OF SUPERVISORS I I IFREBY CERTIFY T IAT TI IIS IS A TRUE AND CORRECT COPY OF AN ACTION TAKEN AND ENTERED ON MINUTES OF THE 1/ UNANIMOUS(ABSENT BOARD OF SUPERVISORS ON THE DATE SHOWN. y � i ) AYES: NOES: ABSENT: A13STAIN: Contact: L.DcLancy 5-1097 Cc: � ATrrsTr.•.n 15� �LWD L.DcLancy,CAO's Office JOHM CULLEN,CLERK OF THE BOARD OFSUPERVISORS Dr.Walker—FISD Dorothy Sansoe,CAO's Ofticc i BY: DEPUTY I . H.R. 5613-p. 2 ' April 15, 2008 I I I The regulations would reverse long-standing Medicaid policies and eliminate federal payments for a variety of critical Medicaid functions. The rules in question would affect payments to: public safety net institutions; coverage of rehabilitation services for people with disabilities; outreach and enrollment in schools as well as specialized medical transportation to school for children covered by Medicaid; graduate medical education payments; ;coverage of hospital clinic services; case management services that allow people with disabilities to remain in the community; state provider tax laws; and appeals filed through HHS. These regulations go into effect on May 25 unless they are overturned through new legislation or a lawsuit, both of which are in the works. In December 2007, Congress enacted temporary moratoria on some, but not all, of these regulations. However, all moratoria would expire before July 2008. The proposed legislation, HR 5613 (see below), would prevent the implementation of these regulations for one year to give Congress time to better evaluate and assess their effects. I Potential impact if regulations are enacted: o Quote from Rep. Dingell (sponsor of bill): "If the Administration's proposed cuts move forward, those most in need will pay the highest price. The restrictions the Administration is imposing on Medicaid are harmful and will undoubtedly put the health of thousands of our most vulnerable children at unnecessary, indefensible risk." o Quote from Rep. Tim Murphy: "The cuts to Medicaid target those who need help the most: children, and the mentally and physically disabled. By eliminating preventative healthcare programs and assistance, there could be a devastating effect on the long-term healthcare of Medicaid patients. This would only lead to higher costs in the future, and put the health of millions at risk." o A recent U.S. House of Representatives' Committee on Oversight & Government Reform report, The Administration's Medicaid Regulations: State-by-State Impacts shows that the seven regulations targeted by the Dingell-Murphy bill would add to states' existing burden by reducing federal Medicaid funding by nearly $50 billion over the next five years—more than three times the $15 billion estimated by the Bush Administration. Solution: o HR 5613 has been introduced in the House by Reps. Dingell and Murphy. It would enact a one-year moratorium on the new;rules. According to their press release, bipartisan support is important. The best strategy to avoid veto is to attach this to a larger, veto-proof bill (such as Iraq funding authorization). The bill will most likely go through Energy & Commerce Committee and Appropriations Committee before reaching House floor. o A lawsuit has also been filed by the public hospital association. o If neither of the above tactics works by May 25, the new regulations will go into effect. Who else is supporting the bill: o The National Governors Association, the National Association of State Medicaid Directors, and the American Public Human Services Association have all written bipartisan letters to HHS in opposition to the regulations. In addition, numerous groups representing beneficiaries, particularly people with disabilities, have also publicly opposed these regulations. I I I I I I i I I . . I I I I SUMMARY H.R.5613,THE"PROTECT IIVG THE MEDICAID SAFETY NET ACT OF 2008" I . The"Protecting the Medicaid Safety Net Act of 2008"—H.R. 5613 —was introduced by Representatives John D. Dingell (D-Ml) and Tim Murphy(R-PA)on March 13,2008. This legislation would place a moratorium until March 2009 on seven Medicaid regulations issued by the Department of Health and Human Services. According to the Congressional Budget Office,these regulations would together reduce Federal Medicaid funding to States for vital programs and services by nearly$20 billion over the next five years. The"Protecting the Medicaid Safety Net Act of 2008"would delay the implementation of the following iegulations: I • Rehabilitation services(proposed rule issued August 13, 2007;current moratorium through June 30, 2008). This proposed rule limits rehabilitation services for Medicaid beneficiaries in a number of ways. It would severely curtail the ability of people with;chronic and temporary disabilities to receive rehabilitation services now, covered under Medicaid. It would eliminate payment for certain rehabilitation services for children in foster care or for people with mental illness. It would increase the administrative burden on States and providers by requiring additional paperwork to receive Medicaid reimbursement. The rule particularly hurts those with developmental disabilities,mental illness, and people who,without access to rehabilitation services, could see their health deteriorate. It would also jeopardize the ability of people with disabilities to live independently in the community because access to needed services would no longer be available. ♦ Targeted case management(TCM) (interim final rule issued December 4, 2007, effective March 3, 2009,no current moratorium). Medicaid's case management benefit is intended to help people with disabilities, chronic illnesses, or special needs to gain access to the full spectrum of health care and support services by arranging for and coordinating care. States may provide case management for adults,but must provide it for children. This rule would hurt efforts to integrate school-based medical services for children with disabilities,because States would no longer be able to receive funding for important care coordination activities. The rule would fragment services for children in foster care by prohibiting child welfare agencies from being paid for providing Medicaid services. The rule would also restrict Medicaid's ability to coordinate and manage the care of a child with the most appropriate team of professionals by placing an arbitrary limit of one case manager per child'Finally,this rule would roll back Federal efforts to transition people out of nursing homes by limiting the assistance available to people with disabilities to secure needed services in a community setting. I . I Prepared by the Committee on Energy and Commerce staff• March 19,2008 I I I I 2 I I • School-based transportation and outreach (final rule issued December 28, 2007; current moratorium through June 30, 2008). Under current practice, schools may be reimbursed for their administrative activities associated with the Medicaid program, including outreach, assistance with enrollment, and referring children to Medicaid providers and Medicaid services.Under current practice, schools also may be reimbursed for extremely limited, specialized medical transportation"for Medicaid children to get to and from school. This rule prohibits all Medicaid funding of specialized medical transportation for children with disabilities in school settings. The rule also prohibits Medicaid payment for administrative activities performed by an employee or contractor of a school in conjunction with Medicaid responsibilities, such as Medicaid outreach to children,helping with Medicaid eligibility determinations or enrollment,or referral, coordination, and monitoring of Medicaid services to children. • Provider taxes(final rule issued February 22, 2008, effective April 22,2008;no current moratorium). Under current law States are allowed to tax providers as a way to help pay for Medicaid expenses. These taxes are supported by providers because the taxes are used to improve provider payment rates and improve quality. This rule redefines what CMS would consider an"allowable"provider tax beyond what is in the law(P.L. 109-432). This dramatic change in the definition of a provider tax will put current, long-standing State programs in jeopardy and jeopardize State funding for Medicaid programs. This will result in States reducing services,(cutting provider payments, or eliminating coverage. • Hospital outpatient(OPD) (proposed rule issued September 28, 2007;no current moratorium). This rule would significantly restrict the types of hospital outpatient services Medicaid can cover.For example,Medicaid would be prohibited from covering certain services such as dental and vision services commonly provided to Medicaid patients through outpatient clinics. The rule would also restrict the ability of States to cover services in outpatient clinics that are separate from hospitals—a common way States have served people in communities and reduce emergency room use. The rule would also lower the amount Medicaid can pay for outpatient services. This could jeopardize patient access given Medicaid's already chronically low payment rates. • Graduate Medical Education (GME) (proposed rule issued May 23, 2007; current moratorium through May 25, 2008). This rule would prohibit Medicaid payment for graduate medical education programs that train providers so they have the experience and skills necessary to meet the unique needs of Medicaid beneficiaries,particularly individuals with disabilities. Eliminating Medicaid funding for graduate medical education will reduce the number of providers with the skills and training to care for the special needs of Medicaid beneficiaries.It will also exacerbate shortages of trained physicians in certain specialties as facilities would be forced to pare back their training programs. I I Prepared by the Committee on Energy and Commerce staff' March 19, 2008 I I I I I ' I I I 3 • Intergovernmental transfer(IGT) final rule issued May 29, 2007; current moratorium through May 25, 2008). This rule places strict limits on Medicaid payments to critical safety net institutions such as hospitals and nursing homes that serve Medicaid beneficiaries. If these payments are reduced or eliminated,the critical access to care and services provided by these institutions may be in jeopardy. In addition, such,cuts may undermine the strong community employment base these institutions provide. In 2008,the Committee ori Energy and Commerce held four hearings where concerns about the regulations were voiced by various stakeholders. In particular, stakeholders noted that many of the regulations were altering longstanding Medicaid policy without direct Congressional authorization.'Certain regulations, such as the targeted case management and provider tax regulations,were the subject of recent Congressional action,but CMS's;regulation went far beyond the scope of the legislative changes. The National Governors Association and the National Association of State Medicaid Directors have issued bipartisan letters decrying the effect these regulations would have on States and beneficiaries. The"Protecting the Medicaid Safety Net Act"would stop the implementation of these rules through March 2009 in order for Congress to more fully examine their merit. A number of the regulations covered by this legislation have been temporarily blocked by Congress due to bipartisan concern about their effect on providers and beneficiaries. I I I I i I I I i Prepared by the Committee on Energy and Commerce staff. March 19, 2008 i i i N A C O National Association of Counties The Voice of America's Counties March 26,2008 The Honorable John D. Dingell Chairman Committee on Energy and Commerce' United States House of Representatives Washington,DC 20515 The Honorable Timothy F. Murphy United States House of Representatives Washington, DC 20515 Dear Chairman Dingell and Mr. Murphy: On behalf of the National Association of Counties and America's 3,066 county governments, I commend you for introducing H.R. 5613, the Protecting the Medicaid Safety Net Act of 2008. i As you know, counties deliver and finance health care for America's most vulnerable people. For decades,Medicaid has provided the flexible financial framework around which states and counties have built their own unique health care safety net systems to support these populations. Over the past year,however, the U.S. Department of Health and Humans Services Center for Medicare and Medicaid Services(CMS)has issued a number of regulations which would fundamentally alter Medicaid policy. These rules will either shift the cost of Medicaid programs to states and counties on a massive scale, or,what is more likely given the current economic downturn,require states and counties to slash services to Medicaid beneficiaries. i NACo has attempted to convey the counties' concerns to CMS about the impacts of the proposed rules both formally and informally,;but to no avail. We have also, as you are no doubt aware, strongly supported the efforts of many Members of Congress to delay the implementation of individual rules by legislation. On March 3, 2008, the NACo Board of Directors unanimously approved an interim policy resolution (attached),calling on Congress to issue a blanket moratorium on all the pending Medicaid rules. H.R. 5613 answers that call in a meaningful and constructive way,and we stand ready to help you see it enacted without delay. Sincerely, Larry E.Naake Executive Director Attachment 25 Massachusetts Avenue, NW 1 Suite 5001 Washington, DC 20001 !202.393.62261 fax 202.393.2630 I www.naco.org I I i I I I I HEALTH STEERING COMMITTEE 2 3 RESOLUTION ON REGULATIONS ISSUED BY THE CENTERS FOR MEDICARE 4 AND MEDICAID SERVICES 5 6 Issue: Numerous proposed regulations issued by the Centers for Medicare and Medicaid 7 Services(CMS)will alter the administration and financing of the Medicaid program and reduce. 8 access to services by the neediest beneficiaries. 9 10 Adopted policy:NACo opposes CMS' proposed rules which would place severe restrictions on 11 the ability of state and county governments to finance the Medicaid program and provide 12 Medicaid services.NACo further opposes any additional regulations which will reduce federal 13 payments and/or shift costs to local safety net providers. NACo urges Congress stop the rules' 14 implementation by extending and/or creating moratoriums through April 2009 for CMS 15 regulations, including,but not limited;to: Rehabilitation Services Option, Graduate Medical 16 Education, Public Provider Cost Limit,School Based Administration and Transportation, 17 Outpatient Clinic and Hospital Facility Services,and Targeted Case Management. Congress 18 should tell CMS that any similar proposals also will be blocked. 19 20 Background: Since March 2007, CMS has issued 10 proposed rules that would fundamentally 21 alter the financing and administration of the Medicaid program. The proposed rules would 22 undermine the federal-state Medicaid partnership by significantly reducing federal payments and 23 shifting the cost of maintaining services to state and local governments. By redefining key 24 elements of the Medicaid program CMS seeks to save federal dollars,but these changes will 25 place further stress on local systems of care and create barriers to needed services for 26 beneficiaries. 27 28 Counties have been providing Medicaid services for years, in some cases, decades. Limiting 29 eligible services and the funding available to support them would have profoundly detrimental 30 effects on the access, quality, and delivery of necessary services for Medicaid beneficiaries 31 including those with complex mental and behavioral health needs. Adults and children 32 experiencing severe and disabling mental illness or developmental disabilities, for example, are 33 currently able to live outside institutional or hospital settings because critically needed, 34 community-based services are available. Proposed changes in the definition of allowable 35 services under the"Rehabilitation Option Services"plan would place these services and the 36 people who rely on them in jeopardy. 37 38 The current state of the American economy adds to the imperative to prevent the proposed rules 39 from going into effect. With unemployment rising,home foreclosures at a record high and real 40 wages declining, local public health and behavioral health systems are seeing increased demand 41 for services from economically vulnerable families and individuals. A growing need for services 42 requires increased financial resources. If the 10 proposed regulations were to go into effect, the 43 federal financial contribution to Medicaid would be reduced by more than $15 billion over five 44 years. States and local authorities will have to cut services, increase revenues or reprogram 45 dollars from other critical services'to keep pace. 46 I I I I i I I I I I I I I I Counties and other service providers already provide billions of dollars to support local safety 2 net systems. One proposed rule would even create a barrier to utilizing these local funds to 3 support Medicaid programs. CMS has redefined a"unit of government"in the Public Provider 4 Cost Limit proposed regulation and would only allow those entities with"generally applicable 5 taxing authority"to contribute to the non-federal share of Medicaid through IGT's and CPE's. 6 Many counties, local authorities and service providers currently contributing to their state's 7 match would no longer be permitted to l do so. The loss of these revenues,which enable states to .8 maximize Medicaid services,would devastate local systems of care and reduce access to services 9 for beneficiaries. 10 11 NACo urges Congress to be diligent in its oversight of CMS and the Medicaid program and to 12 prevent the Congressional intent of the statutes to be diverted or reinterpreted by CMS' 13 regulations or directives. Enacting moratoriums on the implementation of the proposed 14 regulations is the quickest way to prevent CMS from usurping Congressional authority and 15 causing potentially irreparable harm to the Medicaid program and the people it is intended to 16 serve. 17 18 FiscalfUrban/Rural Impact: Every county,whether urban, suburban or rural,will be affected if 19 the proposed regulations go into effect. In many rural communities,the county's health and 20 mental health services are the only services available to the most vulnerable populations 21 including people with serious mental illness. Even in large urban communities with multiple 22 providers,Medicaid beneficiaries often rely on public health and mental health services to deal 23 with complex physical and behavioral health care needs. Reducing eligible services,curtailing 24 federal support and limiting other fiscal resources available to maintain safety net systems will 25 profoundly damage the integrity of the Medicaid program and severely harm the beneficiaries it 26 was created to help. 27 28 Adopted by the NACo Board of Directors 29 March 3, 2008 30 I 31 I I I I I I I I I