State Medicaid Waivers

ACP Chapter Action Campaign

Background

Federal law establishes certain eligibility, benefit, payment, and other parameters for state Medicaid programs. However, states have a substantial amount of flexibility and may test new policies. The Section 1115 demonstrations allow states to waive certain requirements and have been used by states to expand eligibility, test delivery system reforms, and establish managed care programs, among other things.

Some states have sought waivers to establish cost-sharing and premiums, wellness programs, health savings accounts, and other characteristics common in the private insurance market. Many states have also requested that Medicaid eligibility be contingent on whether an individual is working, volunteering, or participating in some other “community engagement” activity. On January 28, 2021, President Biden issued an Executive Order on Strengthening Medicaid and the Affordable Care Act authorizing the examination of “demonstrations and waivers, as well as demonstration and waiver policies, that may reduce coverage under or otherwise undermine Medicaid or the ACA.”

The Biden Administration also notified states with approved work requirements that it was preliminarily disapproving work requirements as a consequence of the COVID – 19 public health emergency and because the requirements were not likely to promote the objectives of Medicaid.  Letters have been sent to Arkansas, Arizona, Indiana, Michigan, and other states notifying them that their waivers are withdrawn.

On February 25, 2021, ACP submitted a joint letter to HHS Secretary-Designate Becerra urging him to rescind approval for waivers that reduce coverage, such as work and community engagement requirements; that include high premiums and cost sharing on beneficiaries; or that seek to eliminate or pare back retroactive coverage, non-emergency medical transportation, and other crucial benefits.

ACP’s position paper, Medicaid Expansion: Premium Assistance and Other Options, includes a number of recommendations on how Medicaid waivers should be constructed.  The paper cautions against excessive premiums and cost-sharing requirements, complex health savings accounts, and work requirements that would result in low-income patients losing medical assistance.

How it Works

Since some waiver applications do not reflect ACP policy, the College has developed this Chapter Action Plan to enable state chapters to submit comments based on ACP recommendations. Many waivers propose other changes to the state Medicaid program that may align with ACP policy, such as payment reforms that encourage high-value care. Chapters may express support for such proposals as long as they reflect College policy. You can learn more about ACP policy recommendations by searching the ACP Policy Compendium.

State chapters may have a number of opportunities to submit comments. 

For initial 1115 waiver submissions and extensions of existing waivers. States are mandated to have a public notice and comment period of at least 30 days.  Once the state has submitted the application to the federal government and it has been deemed to be complete, a 30-day federal public comment period begins.

The link below, labeled “accompanying chart,” provides information on elements of Medicaid waivers that do not reflect ACP policy, such as work requirements, excessive premiums and cost-sharing, and benefit cuts. The first column includes a summary of a state’s waiver proposal that other states may seek. The second column displays sample language that the chapter can use in its own letter. Chapters are encouraged to review their own state’s waiver application and develop a comment letter that summarizes the waiver proposal and includes sample language that explains ACP’s concern.

As of June 2021, 12 states have yet to expand their Medicaid programs. Some of these holdout states are now considering expansion on the condition they receive approval for a waiver that requires enrollees to work or search for employment, pay cost sharing, etc. In this case, ACP Chapters should take a more nuanced approach and express support for expansion while also expressing concern for waiver elements that may hinder access to coverage.

ACTION

ACP chapters should evaluate and submit comments, if appropriate, on proposed Medicaid waivers submitted by their state, especially if those waivers conflict with ACP policy. Sample language for comment letters can be found in the accompanying chart.

You can also review comment letters submitted by ACP National. Sample talking points are also available.

Examples of Waivers on which ACP has Submitted Comments

Important Links

For questions and comments please contact Ryan Crowley at rcrowley@acponline.org.