Medicaid Block Grant Act

Medicaid Block Grant Act

Summary

This Act relates to reforms designed to support state Medicaid programs, including requesting federal authorization to fund the state Medicaid program through a block grant or similar funding; establishes eligibility requirements, sliding scale subsidies, provisions for HSAs, a Medicaid reform task force, and provisions for the delivery of long term care.

Model Policy

Chapter 1. Title and Definitions.

Section 1. Title. This Act shall be known as the “Medicaid Block Grant Act.”

Section 2. Definitions.

In this Act:

(1) “Commission” means {insert applicable state health and human services agency or commission}.

(2) “Health benefit exchange” means an American Health Benefit Exchange administered by the federal government or an exchange created under Section 1311(b) of the Patient Protection and Affordable Care Act (42 U.S.C. § 18031(b)).

(3) “Long-term care services” means the provision of personal care and assistance related to health and social services given episodically or over a sustained period to assist individuals of all ages and their families to achieve the highest level of functioning possible, regardless of the setting in which the assistance is given.

(4) “Medicaid program” means the medical assistance program established and operated under Title XIX, Social Security Act (42 U.S.C. § 1396 et seq.).

(5) “Nursing facility” means a convalescent or nursing home or related institution licensed under {insert state nursing home licensing provision}, that provides long-term care services to medical assistance recipients.

(6) “Patient Protection and Affordable Care Act” means the federal Patient Protection and Affordable Care Act (Pub. L. No. 111-148) as amended by the Health Care and Education Reconciliation Act of 2010 (Pub. L. No. 111-152).

(7) “State Medicaid program” means the medical assistance program provided by this state under the Medicaid program.

(8) “State supported living center” means a state-supported and structured residential facility operated by the {insert state Department of Aging and Disability Services or comparable department} to provide to clients with mental retardation a variety of services, including medical treatment, specialized therapy, and training in the acquisition of personal, social, and vocational skills.

(9) “Task force” means the Medicaid Reform Task Force established under Chapter 6 of this Act.

Chapter 2. Federal Authorization to Reform State Medicaid Program; General Provisions.

Section 1. Federal Authorization to Reform Medicaid Required.

If the federal government establishes, through conversion or otherwise, a block grant funding system for the Medicaid program or otherwise authorizes the state Medicaid program to operate under a block grant funding system, including under a Medicaid program waiver, the commission, in cooperation with applicable health and human services agencies, shall, subject to Section 3 of this Chapter, administer and operate the state Medicaid program in accordance with Chapters 2-4 of this Act.

Section 2. Conflict With Other Law.

To the extent of a conflict between a provision of Chapters 2-4 and:

(1) another provision of state law, the provision of Chapters 2-4 controls; and

(2) a provision of federal law or any authorization described under Section (1) of this chapter, the federal law or authorization controls.

Section 3. Establishment of Reformed State Medicaid Program.

The commission shall establish a state Medicaid program that provides benefits under a risk-based Medicaid managed care model.

Section 4. Rules.

The executive commissioner shall adopt rules necessary to implement Chapters 2-4.

Chapter 3. Acute Care.

Section 1. Eligibility for Medicaid Acute Care.

(A) An individual is eligible to receive acute care benefits under the state Medicaid program if the individual:

(1) meets the eligibility requirements that were in effect immediately before implementation of the block grant funding system described by Chapter 2, Section 1; or

(2) is under 19 years of age and:

(a) is receiving Supplemental Security Income (SSI) under 42 U.S.C. § 1381 et seq.; or

(b) is in foster care or resides in another residential care setting under the conservatorship of {insert applicable state protective services agency}.

(B) The commission shall provide acute care benefits under the state Medicaid program to each individual eligible under this section through the most cost-effective means, as determined by the commission.

(C) If an individual is not eligible for the state Medicaid program under Subsection (A) and the individual’s household income exceeds 100 percent of the federal poverty level, the commission shall refer the individual to a health benefit exchange.

Section 2. Medicaid Sliding Scale Subsidies.

(A) An individual who is eligible for the state Medicaid program under Section 1 of this Chapter may receive a Medicaid sliding scale subsidy to purchase a health benefit plan from an authorized health benefit plan issuer.

(B) A sliding scale subsidy provided to an individual under this section must:

(1) be based on:

(a) the average premium in the market; and

(b) a realistic assessment of the individual ’s ability to pay a portion of the premium; and

(2) include an enhancement for individuals who choose a high deductible health plan with a health savings account.

(C) The commission shall ensure that counselors are made available to individuals receiving a subsidy to advise the individuals on selecting a health benefit plan that meets the individuals’ needs.

(D) An individual receiving a subsidy under this section is responsible for paying:

(1) any difference between the premium costs associated with the purchase of a health benefit plan and the amount of the individual ’s subsidy under this section; and

(2) any copayments associated with the health benefit plan.

(E) If the amount of a subsidy received by an individual under this section exceeds the premium costs associated with the individual ’s purchase of a health benefit plan, the individual may deposit the excess amount in a health savings account that may be used only in the manner described by Section 3(C) of this Chapter.

Section 3. Delivery of Subsidies; Health Savings Accounts.

(A) The commission shall determine the most appropriate manner for delivering and administering subsidies provided under Section 2 of this Chapter or this section. In determining the most appropriate manner, the commission shall consider depositing subsidy amounts for an individual in a health savings account established for that individual.

(B) In addition to providing a subsidy to an individual under Section 2, the commission may provide additional subsidies for coinsurance payments, copayments, deductibles, and other cost-sharing requirements associated with the individual’s health benefit plan. The commission shall provide the additional subsidies on a sliding scale based on income.

(C) A health savings account established under this section may be used only to:

(1) pay health benefit plan premiums, copayments, and cost-sharing amounts;

(2) if appropriate, purchase health care-related goods and services; and

(3) pay administrative fees associated with providing the account.

(D) The restriction on health savings accounts established under this section shall remain in place after an individual no longer qualifies for a subsidy under Section 2.

(E) The commission shall draft rules for the creation and regulation of health savings accounts established under this section, including protections against fraud and abuse, and measures to prevent price discrimination against individual account holders.

Section 4. Medicaid Health Benefit Plan Issuers.

The commission shall allow any health benefit plan issuer authorized to write health benefit plans in this state to participate in the state Medicaid program.

Section 5. Maternity Benefits.

(A) To be eligible for purchase under the state Medicaid program, a health benefit plan must provide maternity benefits to state Medicaid program-eligible enrollees through an endorsement or rider adopted by the commissioner of insurance in consultation with the commission.

(B) Subject to Section 2 of this Chapter and other applicable requirements of Chapters 2-4, the state Medicaid program will pay to the health benefit plan issuer a premium in the amount fixed by the commissioner of insurance for the endorsement or rider. The commissioner of insurance shall set premium rates under this section in amounts that are based on sound actuarial principles and are not excessive, inadequate, unfairly discriminatory, or confiscatory as to the health benefit plan issuer.

(C) The commissioner of insurance by rule shall establish criteria for health benefit plans that provide maternity benefits under the state Medicaid program.

(D) The executive commissioner in consultation with the commissioner of insurance shall establish minimum criteria that a person must meet in order to be eligible to receive prenatal care under the state Medicaid program.

Section 6. Reinsurance for Participating Health Benefit Plan.

(A) The commission in consultation with the commissioner of insurance shall study a reinsurance program to reinsure participating health benefit plan issuers.

(B) In examining options for a reinsurance program, the commission and commissioner of insurance shall consider a plan design under which:

(1) a participating health benefit plan is not charged a premium for the reinsurance; and

(2) the health benefit plan issuer retains risk on a sliding scale.

Chapter 4. Long Term Care Services and Supports.

Section 1. Eligibility: Long Term Care Services and Supports.

(A) An individual is eligible to receive long-term care services and supports under the state Medicaid program if the individual:

(1) has a household income at or below {insert applicable state eligibility level}; or

(2) is under 19 years of age and:

(a) is receiving Supplemental Security Income (SSI) under 42 U.S.C. § 1381 et seq.; or

(b) is in foster care or resides in another residential care setting under the conservatorship of {insert applicable state protective services agency}.

(B) In determining eligibility, the commission may consider resources in the manner specified by Section 4 of this Chapter.

Section 2. Delivery of Medicaid Benefits; Sliding Scale Subsidies.

(A) Except as provided by Section 6 of this Chapter, an individual who is eligible for long-term care benefits under the state Medicaid program shall receive a sliding scale subsidy in a predetermined amount to be used to purchase long-term care services and supports from authorized Medicaid providers.

(B) A sliding scale subsidy provided to an individual under this section must:

(1) be based on:

(a) a single estimate of the average cost per person of long-term care services and supports needed under the state Medicaid program; or

(b) multiple estimates of the average cost per person of long-term care services and supports needed under the state Medicaid program based on the populations to be served;

(2) increase or decrease, as appropriate, given budgetary considerations in accordance with Section 7 of this Chapter; and

(3) vary in amount granted to each individual based on the results of assessments required in accordance with Section 4 of this Chapter.

(C) An individual receiving a subsidy under this section is responsible for paying any difference between the cost of benefits and the amount of the individual’s subsidy under this section.

(D) If the amount of a subsidy received by an individual under this section exceeds the amount needed to purchase long-term care services and supports benefits, the individual receiving the subsidy may deposit the excess amount in a health savings account that may be used only in the manner described by Section 3(B) of this Chapter.

Section 3. Delivery of Subsidies; Health Savings Accounts.

(A) The commission shall determine the most appropriate manner for delivering and administering subsidies provided under this Chapter. In determining the most appropriate manner, the commission shall consider depositing subsidy amounts for an individual in a health savings account established for that individual.

(B) A health savings account established under this section may be used only to:

(1) pay the cost of long-term care services and supports under the state Medicaid program; and

(2) if appropriate, purchase health care-related goods and services.

(C) The restrictions on health savings accounts established under this section shall remain in place after an individual no longer qualifies for a subsidy under section 2.

Section 4. Required Assessments.

(A) The commission shall establish a process for determining the amount of an eligible individual’s subsidy under Section 2 of this Chapter that requires each individual eligible for benefits under the state Medicaid program to undergo:

(1) a disability and functional acuity assessment; and

(2) a financial assessment.

(B) The commission shall contract with an independent medical evaluator to perform the disability and functional acuity assessment required under Subsection (A)(1).

(C) In conducting the financial assessment required under Subsection (A)(2), the commission shall consider the resources available to the individual and the individual’s family. The executive commissioner shall define “family” for purposes of this section.

(D) The commission shall use the results of both assessments required under this section to determine the amount of an eligible individual’s subsidy.

Section 5. Authorized Providers.

The commission shall:

(1) establish standards for providers authorized to provide long-term care services and supports under the state Medicaid program; and

(2) make a list of authorized providers available to recipients under the program.

Section 6. Exemptions.

This Chapter does not apply to:

(1) an individual receiving medical assistance under the program of all-inclusive care for the elderly (PACE) established under {insert state code provision establishing (PACE), if applicable}.

(2) an individual who is eligible for benefits under the state Medicaid program and who requires placement in a nursing facility or {insert applicable state institution for IDD population}.

Section 7. Budgetary Considerations.

(A) To ensure that the state does not exceed the state’s budget for the provision of the state Medicaid program, the commission shall:

(1) set maximum subsidy amounts allowed under this Chapter to increase or decrease at the same rate as federal and state funding; and

(2) implement measures to adjust spending as necessary to stay within budgeted amounts.

(B) Measures implemented under Subsection (A)(2) may include implementing uniform benefit reductions applied to all subsidy payments that are automatically triggered and enforced by the commission based on actual expenditures.

Chapter 5. Medicaid: Incremental Reform.

Section 1. Customized Benefits Package.

The commission shall, for individuals receiving home and community-based services instead of institutional long-term care services, develop and implement customized benefits packages that are designed to prevent the overutilization of services. Customized benefits packages under this section must be based on an individualized needs assessment administered at a single point of entry.

Section 2. Cost Effective Medicaid Managed Care Model.

Except as otherwise provided by this section and notwithstanding any other law, the commission shall provide medical assistance for acute care through the most cost-effective model of Medicaid managed care as determined by the commission. If the commission determines that it is more cost-effective, the commission may provide medical assistance for acute care in a certain part of this state or to a certain population of recipients using:

(1) a health maintenance organization model; or

(2) a primary care case management model;

Section 3. Dual Eligible Integrated Care Demonstration Project.

(A) Subject to Subsection (B), the department shall establish a dual eligible integrated care demonstration project that would allow appropriate individuals described by {insert state code provisions pertaining to dual Medicaid and Medicare coverage}, as determined by the department, to receive long-term care services and supports under both the medical assistance program and the Medicare program through a single managed care plan.

(B) An individual who is a resident of a state supported living center is exempt from participation in the demonstration project established under this section.

Section 4. Parental Fee Program.

(A) To the extent allowed by federal law, the department shall establish a parental fee program that requires the parent or legal guardian of a child receiving institutional long-term care services or home and community-based services under the medical assistance program established under this Chapter to pay a fee for those services. The fee imposed under this section must be greater for a parent or legal guardian of a child who receives institutional long-term care services.

(B) Failure to pay a fee under this section may not affect a child’s eligibility for benefits under the medical assistance program, but the parent or legal guardian may be subjected to attempts by the department to collect the fee.

(C) The executive commissioner of the Health and Human Services Commission shall adopt rules necessary to implement this section.

Section 5. Filial Responsibility Requirement.

(A) To the extent allowed by federal law, the department shall require that each adult child of a recipient receiving institutional long-term care services or home and community-based services under the medical assistance program established under this Chapter assumes some financial responsibility for the care the adult child’s parent receives by:

(1) assessing a fee against the adult child, imposed on a sliding scale based on the household income of the adult child; or

(2) imposing an assessment on any transfer made to the adult child in the five years preceding the date the parent-recipient was determined eligible for benefits.

(B) Failure by an adult child to pay a fee or assessment under this section may not affect the parent-recipient’s eligibility for benefits under the medical assistance program, but the adult child may be subjected to attempts by the department to collect the fee.

(C) The executive commissioner of the Health and Human Services Commission shall adopt rules necessary to implement this section.

Section 6. Study and Report on Estate Recovery Program.

(A) {Insert applicable state health and human services agency} shall conduct a study to examine the estate recovery program implemented by this state under 42 U.S.C. § 1396p(b)(1) and determine options the state has to improve recovery under and increase the efficacy of the program.

(B) Not later than {insert date}, the commission shall submit a written report containing the findings of the study conducted under this section together with the commission’s recommendations to the governor, the lieutenant governor, and the standing committees of the senate and house of representatives having primary jurisdiction over the Medicaid program.

Section 7. Study and Report on Alternative Income and Asset Limits.

(A) {Insert applicable state health and human services agency} shall conduct a study imposing alternative income and asset limits for purposes of determining eligibility for long-term care services and supports under the medical assistance program under {insert state code provisions for obtaining benefits for eligible citizens as authorized under the Social Security Act  or any other federal act}. The commission shall consider:

(1) imposing greater restrictions on exempt assets;

(2) limiting the amount of income that an individual may transfer into a qualified trust under 42 U.S.C. § 1396p(d)(4)(B) to an amount equal to the average cost of nursing home care; and

(3) reducing the income eligibility limit to qualify for Medicaid institutional long-term care or home and community-based waiver services under the medical assistance program under {insert state code provisions for obtaining benefits for eligible citizens as authorized under the Social Security Act  or any other federal act}.

(B) Not later than {insert date}, the commission shall submit a written report containing the findings of the study conducted under this section together with the commission’s recommendations to the governor, the lieutenant governor, and the standing committees of the senate and house of representatives having primary jurisdiction over the Medicaid program.

Section 8. Study and Report on Nursing Home Providers.

(A) {Insert applicable state health and human services agency} shall conduct a study on the feasibility of selecting and reimbursing nursing home providers under the medical assistance program under {insert state code provisions for obtaining benefits for eligible citizens as authorized under the Social Security Act  or any other federal act}, using a competitive bidding process.

(B) Not later than {insert date}, the commission shall submit a written report containing the findings of the study conducted under this section together with the commission’s recommendations to the governor, the lieutenant governor, and the standing committees of the senate and house of representatives having primary jurisdiction over the Medicaid program.

Chapter 6. Medicaid Reform Task Force.

Section 1. Task Force.

(A) The Medicaid Reform Task Force is established for purposes of advising the commission in designing a state Medicaid plan and program that are:

(1) consistent with Chapter 5 of this Act; and

(2) if the federal government establishes a block grant funding system in accordance with Chapter 2, Section 1 of this Act, consistent with Chapters 2-4 of this Act.

(B) The task force consists of 12 members appointed as follows:

(1) one member appointed by the governor;

(2) two members of {insert appropriate state Senate body} appointed by the lieutenant governor;

(3) two members of {insert appropriate state house of representatives body} appointed by the {insert ranking member of state house of representatives body};

(4) one member from the {insert Senate Committee on Finance or comparable committee}, appointed by the presiding officer;

(5) one member from the {insert House Appropriations Committee or comparable committee}, appointed by the presiding officer;

(6) one member of {insert Senate Committee on Health and Human Services or comparable committee}, appointed by the presiding officer;

(7) one member of {insert House Public Health Committee or comparable committee}, appointed by the presiding officer;

(8) the executive commissioner of the commission or the executive commissioner’s designee;

(9) one representative of {insert Legislative Budget Board or comparable board}; and

(10) one representative of the {insert state Department of Insurance or comparable department}.

(C) The governor shall appoint the presiding officer of the task force.

(D) A member of the task force serves without compensation.

(E) Not later than {insert date}, the appropriate appointing officers shall appoint the members of the task force.

(F) Not later than {insert date}, the task force shall submit a report to the legislature regarding its activities under this section.

(G) This section expires {insert date}.

Chapter 7. Federal Authorization, Effective Date, Severability, and Repeal.

Section 1. Federal Waiver or Authorization.

Before implementing any provision of this Act, other than Chapters 2-4 of this Act, {insert applicable state health and human services agency or commission} shall request any waiver or authorization from a federal agency that is necessary for implementation of that provision and shall delay implementing that provision until the waiver or authorization is granted.

Section 2. {Severability clause.}

Section 3. {Repealer clause.} 

Section 4. {Effective date.}

Approved by the ALEC Board of Directions March 19, 2014.

Keyword Tags: Health and Human Services Task Force