Altruis Blog

Update: Medicaid waivers and expanding care by collecting on self-pay balances

Oct 16, 2018 3:06:17 PM / by Chris Caspar, CEO

Don’t let the Kentucky case fool you. Medicaid waivers aren’t going anywhere. And they will likely include onerous work requirements and prohibit retroactive enrollment.

Despite the federal court’s ruling (Stewart vs. Azar) this summer that blocked Kentucky’s §1115 Medicaid waiver (that includes work requirements and dramatically limits retroactive Medicaid), states continue to seek the waivers to tighten Medicaid. Kentucky plans to merely tweak its original proposal and resubmit.

Ostensibly, §1115 Medicaid demonstration waivers allow states to come up with approaches to Medicaid that differ from federal program rules that nevertheless, in theory, advance Medicaid program objectives.

In practice, they appear to be making it harder for vulnerable patients to qualify--and for providers to be paid. In fact, according to Modern Healthcare, interest in these waivers has “skyrocketed.”, Tennessee and Virginia posted draft waivers on their Medicaid websites in September.


Work requirements trending

Several states are seeking §1115 waivers that will allow them to add work requirements. As we’ve discussed before, that seems more punitive than practical.  . After all, researchers estimate that only 6 percent of non-exempt, able-bodied adult Medicaid beneficiaries are not working. But because they are in low-end jobs, they face interruptions due to unstable employment or irregular hours, warns the Center on Budget and Policy Priorities. Another crucial factor cited in a recent Health Affairs Blogpost: lack of the requisite email and Internet access. (Participants need to report work via an online portal, something that can be a challenge without ready access to the internet.)

Still, states are champing at the bit to put in a work requirement.

Here’s where it stands now: In late August and early September, South Dakota, Alabama and Michigan submitted proposals for a work requirement, Health Affairs reports, bringing the total number of pending proposals to 10. The other eight are Alabama, Kansas, Maine, Mississippi, Ohio, South Dakota, Utah and Wisconsin.

In addition, Kentucky, New Hampshire, Arkansas and Indiana have had their waivers approved. Kentucky’s, of course, has been set aside for now; Arkansas’ is being litigated.

 Litigation notwithstanding, the culling has begun. In September, more than 4,300 people lost their Medicaid benefits in Arkansas for not adhering to the new rules. At least 5,000 more are reported to be out of compliance for two months, putting them at risk.

 Understandably, it’s the work requirement provision of these waivers that captures headlines, but many, including, Kentucky’s, have one that’s just as dangerous: elimination or drastic reduction of retroactive coverage.


Too deep a cut? Eliminating retroactivity

The§1115 Medicaid waiver approach continues to gain traction. For example, earlier this year, Florida a request to eliminate the 90-day retroactive eligibility period for non-pregnant adults effective July 1, 2019.

In addition to Kentucky and Florida, other states that have eliminated (or have concrete plans in place to eliminate) retroactive coverage include Arizona, Arkansas, Indiana, Iowa, Maine, New Hampshire and New Mexico.

Expect the number of states to increase. Retroactive Medicaid has become a popular target, even though its future is uncertain in light of the Stewart case. Similar issues are being litigated in Gresham v. Azar, which challenges the Arkansas waiver.

 Still, states seem almost as enamored of doing away with retroactivity as they are of work requirements. But each state does it a little differently. For instance:

  • Arkansas received federal approval in March to, among other things, cut the three-month retroactive eligibility to 30 days.
  • Indiana’s ACA expansion waiver--one of the earliest--eliminated retroactive coverage for newly eligible adults under the ACA as well as some traditional populations
  • Iowa’s demonstration waiver eliminated retroactive coverage for nearly all new Medicaid applicants as of November 1, 2017.

 Most of these waivers emerged post-ACA, in response to Medicaid expansion. However, waiving retroactive eligibility isn’t unprecedented:Delaware, Massachusetts, Maryland, Tennessee and Utah all have some version of this. But in the past, according tothe Commonwealth Fundthey have generally excluded high-need populations and--unlike the current crop--they have been tied to coverage improvements.

 For safety net providers, the trend toward eliminating retroactive Medicaid can be devastating. For example, a Commonwealth study estimates that retroactive eligibility accounts for 5 percent of safety-net hospital revenue.

The Florida Health Justice Project points out that such efforts seem to contradict the stated purpose of the waiver: “It is also not clear that Florida’s elimination of the ninety day [retroactive Medicaid enrollment] period constitutes a ‘novel approach’ that would ‘improve medical assistance for low income people.’”

After all, many self-pay and uncompensated patients obtain Medicaid aftertheir initial visit. Once these patients are successfully enrolled, their Medicaid coverage can be applied retroactivelyto cover previously provided care.

But only if it’s available.


Fund your center while you help your community stay covered

Collecting your Q4 open self-pay balances through a Retroactive Medicaid strategy can help safety net providers like you keep your doors open and even expand services in 2019.

Yes, it would be wonderful if everyone eligible for Medicaid enrolled the moment they became eligible. But we all know that’s not the case.

We know there are many reasons Medicaid-eligible patients aren’t already enrolled. Some of the more common ones include

  • They think enrollment is automatic.
  • They don’t know how to apply.
  • They don’t realize they’re eligible.
  • The illness or injury came on so suddenly they didn’t have the opportunity to complete an application.
  • They mistakenly think Medicare covers long-term care, until it’s too late.

Here’s one example, courtesy of the Florida Health Justice Project: Adults with progressive diseases, such as cancer, who previously applied for Medicaid based on disability and were denied, “will have to ‘guess’ the moment in time in which their disease had made them just disabled enough to qualify.”

Whatever the reason, there’s often a delay when a clinic or hospital first provides care and an eligible patient becomes a Medicaid enrollee. Once these patients are successfully enrolled, their Medicaid coverage can be applied retroactivelyto cover previously provided care--at least in most states. But the clinic needs to be able to identify the eligible patients and bill appropriately.

A retroactive Medicaid solution creates new revenue streams by collecting on self-pay and then automates the process that identifies coverage, bills payors and reduces the stress of payment on the individuals that need relief from that stress the most.

But--at least in red states--it may not be an option in the future. Your best bet is to capture all the outstanding self-pay balances you can, make sure all eligible patients are enrolled, and enrolled before the retroactive billing option disappears in your state.

We can help andstart to recover funds in less than 30 days with our RetroPayTMsolution.  To learn more, contact us for a free analysis of your AR or go to more information.

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Topics: FQHC, RetroPay, Medicaid, Medical Billing Service

Chris Caspar, CEO

Written by Chris Caspar, CEO

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