Little noticed provision of Inflation Reduction Act will have a big impact on Medicaid, improving health outcomes for enrollees

Little noticed provision of Inflation Reduction Act will have a big impact on Medicaid, improving health outcomes for enrollees

The Inflation Reduction Act (IRA), signed into law by President Biden in August, provides landmark changes in health care. For the first time, the Department of Health and Human Services will have authority to negotiate the prices of high cost drugs it purchases for Medicare enrollee. The IRA also extends the more generous subsidies that help people purchase health insurance through the Affordable Care Act (ACA) Marketplaces (these were set to expire at the end of 2022). When open enrollment begins November 1, many consumers will find health plans for no cost, building upon the Biden-Harris administration’s achievement of reducing the number of people without health insurance to an all time low.

Every Republican voted against the IRA, and Democrats had insufficient votes to include important measures such as closing the coverage gap for people living in states that have not yet expanded Medicaid and a substantial new investment in Home and Community Based Services (HCBS). Advocates will continue to work on these and other important health issues in the months to come.

Despite not closing the coverage gap, the IRA contains a little noticed provision that will greatly improve health care outcomes for many people enrolled in Medicaid – expanded access to adult vaccines.

Federal law currently requires state Medicaid programs to cover vaccines for children as part of the robust set of benefits for people under 21 – EPSDT – Early and Periodic Screening, Diagnostic, and Treatment program. However, Medicaid coverage of vaccines for adults has been patchwork.

Under the ACA, low income adults eligible under the new Medicaid Expansion category must receive Essential Health Benefits (EHB), which includes adult vaccines recommended by the Advisory Committee on Immunization Practices (ACIP). People who are dually enrolled in Medicare and Medicaid have adult vaccine coverage through Medicare.

However, adults enrolled in Medicaid under other eligibility categories, such as Parent and Caretaker Relatives, or on the basis of disability, do not have guaranteed access to vaccines. As an optional benefit, states may cover some adult vaccines under a variety of service categories such as physicians services, inpatient hospital services, outpatient hospital services, and rural health clinic services. However, coverage and cost sharing vary widely across states.

A recent federal report found that 2 in 5 adult Medicaid enrollees have varying access to vaccines, often with cost sharing. In addition, data (see Table 2.5) show that vaccination rates for influenza are significantly lower for pregnant people enrolled in Medicaid and the Children’s Health Insurance Program (CHIP) than for people enrolled in private health plans.

The COVID-19 pandemic underscored inequities and coverage gaps for adult vaccines in Medicaid. Congress provided a temporary increase federal Medicaid matching funds for states that maintain continuous coverage and offer COVID vaccines as part of The Families First Coronavirus Response Act (Section 6008). The American Rescue Plan Act (Section 9811) made Medicaid coverage of COVID-19 vaccines mandatory, and with no cost sharing, for the duration of the Public Health Emergency (PHE) and twelve months after, providing a 100% federal match.

Under the IRA’s Section 11405, Congress amended the statutes for Medicaid and the Children’s Health Insurance Program to require coverage of ACIP recommended vaccines for all adults, with no cost sharing, beginning in Fall 2023. State Medicaid programs will also receive a 1% increase in their federal match for vaccine coverage and administration for the next two years.

Finally, Congress has provided equal access to vaccines for low income adults, persons with disabilities, pregnant people, and others who rely on Medicaid and CHIP. Adult vaccines prevent painful and life-threatening conditions such as shingles, hepatitis, and influenza. For a relatively small investment, the IRA will yield significant rewards in preventing serious illness and ensuring better health outcomes.

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