Medicaid's future might not be rosy under new administration

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Elizabeth Newman
Elizabeth Newman

On the surface, it would be easy to cheer the nomination of Seema Verma as the next Centers for Medicare & Medicaid Services leader. She's well-regarded and credited with expanding Medicaid in Indiana.

Her role as a private sector consultant means she could provide a pro-business approach to long-term care. Plus, she has experience, specifically in helping red states add elements such as health savings accounts and employment requirements to programs.

So perhaps it's possible she'll lead CMS in a new direction that is positive for both long-term care residents and providers. But how you feel about this direction is somewhat dependent on your philosophical and practical views about the chronically sick and poor.

Let's start with how Indiana expanded Medicaid under the Affordable Care Act, of which Verma was an instrumental part. (We'll leave aside for the moment whether there was, as reported by the Indianapolis Star, a conflict of interest related to her consulting work with Hewlett Packard, a Medicaid vendor.) As Fortune and others explained, Indiana expanded Medicaid after it cajoled the White House into accepting a caveat. Beneficiaries have to pay fees. They may be as low as $4, but if they don't keep up, beneficiaries lose their healthcare. Opponents also noted how many beneficiaries appear to be confused by their program's details, and that the plan likely created more administrative costs.

Still, Verma, in a Health Affairs piece last year, wrote, “Today's Medicaid program operates largely within an antiquated framework that is not designed to prepare members for health coverage after Medicaid, and may even be counterproductive to that end.” Indiana's solution, of beneficiaries under age 64 having to contribute to Healthy Indiana Program, means they are more responsible for their healthcare. As she wrote, “Because HIP Plus members' own dollars are at stake, they have ‘skin in the game' and therefore an incentive to make cost-conscious healthcare decisions.”

Who could disagree with that, right? To be clear, the HIP plan doesn't apply to dual eligibles or seniors. But long-term care providers should be wary of this push from Verma toward “personal responsibility” related to benefits. Even in Indiana, not all Republicans were on board with a solely financial approach, with some asserting that beneficiaries should have to also quit smoking or provide other evidence they are working on their health.

More responsibility sounds fine in theory. But most of us have seen the vulnerability and sickness of many Medicaid beneficiaries, even those younger than 64, especially by the time they land in a nursing home. When Medicaid funds become insufficient, nursing homes often pick up the slack.

The bottom line is you have to take a sober look at the political climate. It's not really a question of how you voted, but whether you can stop attempts to curb your funding. Do not be distracted by cheering over arbitration or potential easing up of regulations. Association groups can put whatever type of spin they want on the new administration, but it's up to those on the front lines to worry about both resident care and the ability to stay in business. As you look forward, ask which of your staff is headed to both your state capitol and Washington to plead your case.

Follow Elizabeth Newman @TigerELN.


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Daily Editors' Notes

McKnight's Daily Editors' Notes features commentary on the latest in long-term care news and issues. Entries are written by Editorial Director John O'Connor, Editor James M. Berklan, Senior Editor Elizabeth Newman and Staff Writer Marty Stempniak.