Health Beat: Move Over 1115 Waiver, Say Hello To 1332

by Talk Business & Politics staff ( 37 views 

Editor’s note: Each Wednesday, Talk Business & Politics provides “Health Beat,” a round-up of health-related topics in our email newsletter, which you can sign up to receive daily for free here.

Arkansas’ experimentation with Medicaid waivers under the Affordable Care Act has drawn national attention through the controversial Private Option. However, a new waiver program may lead to more experimentation and offer critics of the ACA some encouragement to do some heavy lifting.

The federal health care law has a provision known as Section 1332, which allows new waiver authority beyond Medicaid.

A Section 1332 waiver would allow states to:

  • Modify or eliminate the Individual Mandate
  • Modify or eliminate the Employer Mandate
  • Modify Benefits or Subsidies
  • Modify or eliminate Marketplaces and Qualified Health Plans

There are restrictions to the waiver plan, including that it must not increase the federal deficit, but that should appeal to conservatives who have railed against the ACA for its purported deficit-inflating provisions.

The Arkansas Center for Health Improvement (ACHI), led by former state surgeon general Dr. Joe Thompson, has issued a short memo on Section 1332 waivers. The memo notes:

Section 1332 of the PPACA permits states, beginning in 2017, to request up to a five-year waiver of specific PPACA requirements with the option to renew after five years.

These waivers are different from 1115 waivers primarily due to the ability to waive non-Medicaid provisions of law. During the five-year waiver period, the state can implement state-specific reform with the assistance of federal funding, and seek waivers of certain PPACA provisions.

To qualify for a waiver, states must enact a law that allows for submission of a 1332 waiver application, outline adherence to four specified criteria (described below), provide an implementation timeline with a 10-year budget plan, and regularly report progress to the Department of Health and Human Services (HHS) and the Department of the Treasury. The state can fund reform by re-directing federal funding from tax credits, cost-reduction payments, and small business tax credits to the reform efforts.

Payment reforms have helped to reduce costs and improve care efficiency at the same time the state’s Medicaid growth rate has slowed from about 6% to between 2-3%, according to the Arkansas Center for Health Improvement’s Statewide Tracking Report.

The report is the first of three studies meant to describe the effects of the Arkansas Health Care Payment Improvement Initiative (AHCPII).

As many as 73% of Medicaid health care providers and 60% of Arkansas Blue Cross and Blue Shield principal accountable providers involved with those episodes have improved or contained costs so far, the study found. Pregnancy screening rates have improved, and there was a 17% reduction in unnecessary antibiotic prescriptions for non-specific upper respiratory infections.

The report also found that 73% of the state’s primary care providers caring for 80% of eligible Medicaid beneficiaries were participating in the patient-centered medical home model through 2014. Read more here.

The Senate Public Health Committee is expected to take up two bills today involving the Private Option. Sen. Jim Hendren, R-Sulphur Springs, is running the Governor’s bill to end the PO by Dec. 2016 but to create a task force to generate new options for health care coverage by Dec. 2015.

Sen. Linda Collins-Smith, R-Pocahontas, will run her bill to end the Private Option this year. A new House bill to terminate the PO this year was also filed. Read more from under the dome at this link.

A key freshman legislative leader and two industry representatives were optimistic that a solution could be fashioned to wind down the private option and create a longer-term solution to health care coverage in Arkansas, after Gov. Asa Hutchinson’s major policy speech Thursday at UAMS.

Rep. Laurie Rushing, a Hot Springs Republican and leader of the bipartisan 40-member House Freshmen Caucus, was part of a Talk Business & Politics panel discussion with QualChoice CEO Mike Stock and Arkansas Hospital Association CEO Bo Ryall. Read their thoughts and watch a video of their discussion at this link.