Medicaid Health Plans of America Reacts to Supreme Court Ruling on Health Care Law

WASHINGTON, June 28, 2012 /PRNewswire-USNewswire/ -- Thomas L. Johnson, president and CEO of Medicaid Health Plans of America (MHPA), the leading trade association solely focused on representing Medicaid health plans, issued the following statement today after the Supreme Court of the United States ruled to uphold the Patient Protection and Affordable Care Act (ACA).

"We commend the Supreme Court for keeping in place key elements of this historic legislation. MHPA and its member health plans remain committed to a strong partnership with the states and CMS to find a way to cover this population in need. The Medicaid health plan industry has been growing and will continue to grow as states continue to see Medicaid health plans as part of the solution to their budget woes, whether or not they participate in the expansion of Medicaid.

"We are pleased that the Medicaid drug rebate equalization policy included in the ACA remains intact. This provision that extended rebates to pharmaceuticals provided to Medicaid managed care enrollees represents a tremendous improvement in the administration of state Medicaid programs. The result will be improved care coordination and quality of care for beneficiaries enrolled in Medicaid health plans.

"We also laud HHS efforts to coordinate the care for the nine million Americans who are eligible for both Medicare and Medicaid through the Capitated Financial Alignment Demonstration. These dual eligibles account for only 15 percent of Medicaid enrollees yet represent more than 39 percent of Medicaid spending. Medicaid health plans, given their experience in care coordination for the majority of the Medicaid population, can offer the same integrated care for dually eligible individuals, resulting in better health outcomes and significant savings. We therefore urge HHS to go full speed ahead on the Capitated Financial Alignment Demonstration that tests the payment and delivery system models for Medicare/Medicaid dual eligibles via enrollment in managed care plans. Unlike the care coordination that Medicaid health plans can offer this unique population, we believe the fragmented fee-for-service delivery system is failing Medicare-Medicaid enrollees and is fiscally unsustainable for both the federal and state governments.

"However, we must reiterate that the ACA-mandated $8 billion annual fee on the health insurance industry in 2014, which gradually increases over time, should be repealed. According to a study by Milliman, Inc., an actuarial firm, approximately one-sixth of this fee will be placed on Medicaid health plans, but because of federal actuarial soundness requirements, will be paid entirely by state Medicaid programs, already financially-strapped even without the upcoming Medicaid expansion. Milliman's estimates show that the cost to states will be about $13.6 billion over the first ten years. Because state Medicaid programs are jointly funded by the federal and state governments, the fee will not only result in a large loss for state governments,   but also amounts to the federal government taxing itself. This misguided policy hurts state Medicaid programs and Medicaid managed care programs and should not have been even considered.

"MHPA and the Medicaid health plan industry stand ready to assist as the ACA is rolled out.  Via the managed care model, Medicaid plans will continue to offer a viable way to address state budget crises while ensuring access to quality care. More important, Medicaid health plans will continue to make a difference in the lives of the underserved. By working together we believe that the worthy goal of access to affordable quality health care is well within reach."

About MHPA

Medicaid Health Plans of America is the leading national trade association solely focused on representing the universe of Medicaid health plans. MHPA provides advocacy, research and organized forums that support the development of policy solutions to enhance the delivery of quality health care to Americans in need.

Media Contact:
Joe Reblando
202-857-5722
jreblando@mhpa.org

SOURCE Medicaid Health Plans of America