Keeping Up-To-Date on Shifting Medicaid Eligibility Laws

Common Medicaid waiver requests include payments for new mental health and substance abuse approaches and for value-based care models.

Keeping up with the changing Medicaid laws presents challenges for many hospital and health system revenue cycle leaders. Medicaid is a political football at the federal level, and states are regularly applying for waivers with the Centers for Medicare & Medicaid Services (CMS) to tailor programs to their needs.

How can healthcare finance leaders keep track of these complex rules and stay compliant with this program that represents a key source of revenue for many hospitals and health systems?

In this interview, Marie Hinds, Parallon’s director of government relations, shares her approach for staying up-to-date on Medicaid eligibility regulations.

What are some of the key Medicaid eligibility challenges facing hospitals?

Hinds: There is a whole laundry list of challenges, but here are the areas I keep an eye on. On the federal level, I watch for changes from CMS. With so much talk about healthcare at the national level, I continually keep an eye on movement in that area.

There is a lot more to keep track of on the state side. The Trump administration and the Department of Health and Human Services (HHS) secretary have promoted the use of the 1115 waivers, which allows for changes to state-specific Medicaid programs that are not in federal law. The HHS secretary can grant a waiver as long as the intent of the waiver request is deemed to assist in the promotion of Medicaid objectives.

One of the most highly publicized 1115 waivers was in Kentucky, where the governor wanted to institute work requirements to be eligible for Medicaid. While approved by HHS, the requirement was struck down by a court, and it is back in the hands of the federal government.

In my role with Parallon, I work with clients in 22 states to keep track of the status of their 1115 waivers.As the laws governing these programs shift, they have a profound impact on the ability of hospitals to capture Medicaid revenue retroactively as well as moving forward.

What types of changes are happening at state levels with 1115 waivers? Are you seeing some common issues?

Hinds: Absolutely. A few of the most common are in behavioral health, enabling payments to different healthcare models for treating mental health and substance abuse issues. Delivery system reform waivers are the next most common approved waiver requests. Sixteen states have approved waivers related to new payment models focused on value-based care. For Medicaid eligibility specifically, work requirements are gaining popularity along with other eligibility enrollment restrictions, which include waiving retroactive Medicaid, implementing premiums, and adding a lock-out period for non-compliance. We track all of these at the state level while they are pending and once they are approved.

How does your team have an impact on compliance issues around Medicaid eligibility?

Hinds: When there are challenges with one state, we reach out to the Medicaid director and have face-to-face meetings about the challenges that we are seeing. We can provide those directors with hospital and health system perspectives related to Medicaid requirements. We want to add those perspectives to conversations that revolve around what is in the best interest for state programs. We aren’t just reacting to problems; we’re participating during these conversations. That is possible because of our size and reach.