VIA ELECTRONIC SUBMISSION
Centers for Medicare & Medicaid Services
Department of Health and Human Services
P.O. Box 8016
Baltimore, MD 21244-8016
The National Health Law Program (NHeLP) is a public interest law firm working to advance access to quality health care and protect the legal rights of low-income and underserved people. We appreciate the opportunity to provide comments to both of Iowa?s proposed § 1115 Demonstration Applications, the Iowa Wellness Plan (IWP) and the Marketplace Choices Plan (MCP).
NHeLP recommends that HHS not approve the IWP and the MCP applications for § 1115 authority exactly as requested. The applications include provisions that clearly or arguably are not authorized by any law. We urge HHS to address these problems and require Iowa to bring the proposals to a legally approvable form. We urge HHS to work with Iowa to achieve a Medicaid Expansion that will serve future Medicaid enrollees well, including those inside Iowa benefiting from these proposals and those in other states who may pursue similar proposals. We request that HHS zealously enforce its stated policies and the legal limits of Medicaid § 1115 demonstration law, to ensure progress in Iowa without opening the door to policies that ignore the fundamental nature of Medicaid as an entitlement program.
Second, we ask that before HHS takes action on this request, it take steps to address its own ?stewardship of federal Medicaid resources.? GAO, Medicaid Demonstration Waivers: Approval Process Raises Cost Concerns and Lack of Transparency at 32 (June 2013). As the GAO recently concluded, ?HHS?s [budget neutrality] policy is not reflected in its actual practices and, contrary to sound management practices, is not adequately documented?.[T]he policy and processes lack transparency regarding criteria.? Id.
A. Legal Authority for Premium Assistance
In its MCP application, Iowa proposes to conduct a § 1115 demonstration program to use individual market premium assistance to implement a Medicaid Expansion. It is our understanding that Iowa proposes to conduct individual market premium assistance relying on authority at § 1905(a). However, the statute and legislative history create serious questions about the validity of this claimed authority. Section 1905(a) defines ?medical assistance? and, for the most part, is a listing of services that can or must be included in this definition. By contrast, Congress has dealt with premium assistance in other, specific provisions of the Act. Congress has authorized states to conduct group or employer coverage premium assistance, which are unambiguously and carefully detailed in statute at §§ 1906 and 1906A. Notwithstanding two very recent policies from HHS (in regulatory and sub-regulatory guidance), there is no history of statutory or regulatory guidance for § 1905(a) authority. Given the uncertainty of the statutory authority and the untested regulatory framework, we believe it is incumbent upon HHS to be extremely cautious and exacting in the approval of any such authority, and even more so for related waivers. HHS should hold tightly to the principles announced in its March 2013 Question and Answer document. And under these circumstances, HHS must also be unmistakably clear as to the waiver authorities being granted and their legal limits.
B. Single State Agency
In addition to premium assistance authority concerns, Iowa?s request, as currently written, fails to ensure that the single state Medicaid agency will remain in charge of the Medicaid program for affected populations, as the Medicaid Act requires. The application does not provide the general public or HHS with information and specifics establishing that the single state agency will continue to make administrative and policy decisions for the program. By law, the single state agency must be in control and accountable for developing and implementing Medicaid coverage. While Iowa may not formally delegate away Medicaid authority, it in effect surrenders control over the majority of benefits for an entire category of enrollees. As currently proposed, Iowa will not control many benefits package details, authorization criteria, and provider contracts and terms but will leave these to health plans. The application only envisions a ?written agreement? between the state and the issuers ?outlining expectations? of the state. Such an agreement does little to reduce the concern that the health plan would act as an independent entity with its own authority contrary to what Medicaid law permits. NHeLP is very supportive of HHS requiring written agreements between the involved entities to satisfy the legal requirement for a single state agency, clearly delineating roles and responsibilities, with the ultimate authority and responsibility housed in the Medicaid agency. However, the application is sparse on details and the mere presence of a written agreement ?outlining expectations? does not satisfy this requirement. HHS should require more of Iowa as a condition of approval. While assuring consumer protections and enabling ongoing reporting and monitoring, this would also address some of the GAO?s conclusions that find HHS processes lack the supporting evidence required to justify deviations from historical requirements. GAO, supra. at 32.
C. Limits of § 1115 Waiver Authority
Prior to addressing specific features of the requested waivers, we believe it is important to address one repeated misapplication of § 1115 authority within these waiver applications. § 1115 explicitly circumscribes waiver authority in Title XIX to requirements contained in § 1902. Anything outside of § 1902 is not legally waivable through the 1115 demonstration process. Despite this legal fact, Iowa repeatedly requests waiver of requirements that lie outside of § 1902. These waiver requests, sometimes explicit and other times necessitated by their objectives, include attempts to skirt requirements in § 1906, § 1916, § 1916A, § 1927, and § 1937. None of these waiver requests are permissible because the substantive requirement rests outside of 1902 and independently requires state compliance. In other words, any reference to the provision in section 1902, which could be waived, does not and cannot also waive the independent, freestanding requirements of these Medicaid Act provisions. Such waivers are also patently contrary to all of HHS? stated regulation and policy on premium assistance.
In particular, Iowa also seeks to waive several requirements contained within § 1937. However, as Iowa designs a Medicaid Expansion implementing § 1937 benefits, it cannot waive § 1937 requirements which lie outside of § 1902. Iowa attempts to avoid this problem by identifying citations in § 1902(a) to waive ? but none of these change the fact there is an independent requirement at § 1937. Consequently, Iowa cannot properly waive EPSDT (protected at § 1937(a)(1)(A)(ii)), FQHC or RHC services (protected at § 1937(b)(4)), any EHB services including maternity care and pediatric dental and visions services (protected at § 1937(b)(5)), or family planning services and supplies (protected at § 1937(b)(7)). Moreover, placed outside of 1902 by Congress these provisions have been repeatedly amended to be strengthened, thus evidencing their core roles as objectives of the Medicaid Act.
Finally, Iowa cannot, in this proposal, circumvent these requirements in § 1937 by requesting waiver of § 1902(k)(1). Iowa?s MCP proposal (along with IWP) is predicated on receiving enhanced matching funds (100% FMAP in 2014) for its Medicaid Expansion population. However, under § 1903(i)(26), Iowa cannot receive any matching funds for the Medicaid Expansion population that are not tied to coverage of § 1937 benefits. To put it simply, HHS cannot waive elements of § 1937 and pay enhanced FFP.
Iowa has requested § 1115 demonstration authority to waive the EPSDT requirement for the 19 and 20-year olds who may enroll in the IWP and MCP. HHS cannot approve a waiver of EPSDT because EPSDT is specifically required in § 1937 and broadly required by Medicaid law.
As described in Part C above, § 1937(a)(1)(A)(ii) requires that all Medicaid ABP plans cover EPSDT. This requirement should apply to both the IWP demonstration population below 100% FPL and the MCP population above 100% FPL, since both groups are ultimately eligible for an ABP (unless medically frail).
EPSDT waiver is also not permitted under Medicaid law more broadly. No feature of a § 1115 application can be approved if it is inconsistent with the objectives of the Medicaid Act. Congress designed Medicaid with a sweeping requirement to cover EPSDT for children out of the recognition that research has repeatedly documented that poverty-level children need a range of enabling and developmental interventions. On numerous occasions since introducing it in 1967, Congress has amended the Medicaid Act EPSDT provisions ? to strengthen them and require states to do more to address the ills that low-income and vulnerable children disproportionately face. Young people are one of the core populations of the Medicaid program and to diminish EPSDT ? the most essential and enduring feature of coverage for children and youth ? is clearly inconsistent with the objectives of the Medicaid program.
Iowa justifies this request based on a need to promote consistency with the commercial market. Yet, HHS has already made clear that, even in the case of individual market premium assistance, when a state explicitly purchases private coverage for an individual, the state must wrap around required EPSDT services. This is confirmed in regulation at 42 C.F.R. §435.1015(a)(2) and premium assistance guidance from HHS issued in March 2013. We urge CMS: Do not back away from this clearly articulated principle. Rather, be clear that waiver of EPSDT is not permitted for premium assistance (in this case, above 100% FPL) under HHS? own regulations and guidance, and it would be an unfair result to not extend the same protection to more vulnerable individuals in non-premium assistance expansions (in this case, below 100% FPL).
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