National Association for Medicaid Program Integrity

1
National Association for Medicaid Program
Integrity

• Stan Rosenstein, Chief Deputy Director of
  Programs
• California Department of Health Care Services

2
Overview

• What is Medicaid and why is it important?
• Who does Medicaid serve?
• What does Medicaid cost?
• How can we control Medicaid costs?

3
What is Medicaid and Why is it Important?
4
Medicaid in 2007 A State Federal Partnership

• 337 billion and over 60 million lives, the
  largest health program in America
• 29 million children (including 1.5 million
  newborns)
• 16 million adults in families
• 10 million persons with disabilities
• 6 million persons age 65 or older

Source CBO March 2006 Medicaid Baseline, HMA
projections, State Health Facts at KFF.org
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Medicaid 1/6 of U.S. Health Spending
Before Part D
After Part D
SOURCE Cynthia Smith, et.al., National Health
Spending in 2004, Health Affairs,
January/February 2006. Based on National Health
Care Expenditure Data for 2004, CMS, Office of
the Actuary, 2006
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Medicaid the Utility Man of the U.S. Health
Care Safety Net

• Mental health over half of publicly financed
  care
• Public health and school based care
• Hospitals that serve the uninsured special
  Medicaid DSH payments 16 billion in 2007
• Community Health Centers (CHC) Medicaid provides
  an average of 40 of CHC revenues
• More than 7 million low-income elderly and
  disabled are dual eligibles on both Medicaid
  and Medicare
• Duals account for 40 of Medicaid spending

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Who Does Medicaid Serve?
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Medicaid Serves

• More than 40 of non-elderly Americans living in
  poverty and about a quarter of the near-poor
• More than 7 million of Medicares almost 44
  million enrollees
• More than 40 million low-income children and
  parents, most of whom are in working families

100-199 of FPL SOURCE Kaiser Family
Foundation, Medicaid, A Primer, 2007.
9
Health Insurance Coverage of the Non-Elderly by
Poverty Level, 2005
SOURCE Kaiser Family Foundation, Medicaid, A
Primer, 2007.
10

• Medicaid is a key source of coverage for
  low-income pregnant women
• Medicaid provides health and long-term care
  coverage for 8 million low-income Americans with
  disabilities and chronic illnesses

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• Medicaid is the single largest source of
  long-term care coverage and financing in the U.S.
• 6 of every 10 nursing home residents is covered
  by Medicaid.
• Medicaid represents 40 of total long-term care
  spending in the U.S.

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What Does Medicaid Cost?
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Medicaid Payments Per Enrollee by Acute and
Long-Term Care, 2003
SOURCE Kaiser Family Foundation, Medicaid, A
Primer, 2007.
14

• Medicaid spending per enrollee varies
  significantly by eligibility group
• Children and parents make up the majority of
  beneficiaries
• The disabled and the elderly account for the
  majority of expenditures

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Medicaid Enrollees and Expenditures by Enrollment
Group, 2003
Total 55 million
Total 234 billion
SOURCE Kaiser Family Foundation, Medicaid, A
Primer, 2007.
16

• States commit significant resources to their
  Medicaid programs
• On average, states spend 18 of their general
  fund on Medicaid
• Costs rise during an economic downturn as the
  number of uninsured increases

17
Total Medicaid Spending as a of Total State
Budgets
SOURCE National Association of State Budget
Officers, various reports. 2010 percentage
projected by HMA.
18
State Tax Revenue and Medicaid Spending Annual
Percentage Changes, 1997-2006
NOTE State Tax Revenue data is adjusted for
inflation and legislative changes.
Preliminary estimate for 2006. SOURCE KCMU
Analysis of CMS Form 64 Data for Historic
Medicaid Growth Rates and KCMU / HMA Survey for
2006 Medicaid Growth Estimates Analysis by the
Rockefeller Institute of Government for State Tax
Revenue.
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Outlook Medicaid Costs Tend to Increase about as
Fast as Overall Health Spending

• Medicaid spending as a share of national health
  spending will average 16.6 percent from 2006 to
  2025 roughly unchanged from the 16.5 percent in
  2005.
• (Notwithstanding the anticipated decline in
  employer-sponsored health insurance and the long
  term care needs of the baby boomers)

SOURCE Richard Kronick and David Rousseau, Is
Medicaid Sustainable? Spending Projections for
the Programs Second Forty Years, Health Affairs
Web Exclusive, February 23, 2007.
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How Can We Control Costs in Medicaid?
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Experts View To Control Medicaid Spending,
Control Overall Health Costs

• Medicaid is one purchaser in a larger health
  care market the most effective way to control
  Medicaid spending growth is to pursue strategies
  to control overall health care spending growth.
• Richard Kronick and David Rousseau, Is Medicaid
  Sustainable? Spending Projections for the
  Programs Second Forty Years, Health Affairs
  Web Exclusive, February 23, 2007.

22
Controlling Health Costs

• Focus on prevention and primary care to reduce
  the incidence of chronic disease
• Alternate health care delivery systems
• Medical Case Management
• Limit services provided and recipient eligibility
• Program Integrity

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• Program integrity partnership
• Program integrity equals value

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• Medicaid program staff must work in partnership
  with program integrity staff People responsible
  for Medicaid program must work closely with
  program integrity staff to insure that we can
  provide the most benefits for least cost and the
  money goes to recipient care and not to crooks
• I want to thank everyone here for all your
  efforts in protecting the scarce resources of the
  Medicaid program and making sure every dollar
  pays for genuine health care

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Key Messages

• Medicaid is the largest health program in the
  United States and one of the most significant
  programs administered by the states.
• States have a huge stake in the future of
  Medicaid, particularly due to the limits of state
  fiscal capacity to sustain it.
• Medicaid has the potential to improve the health
  of beneficiaries that could help slow overall
  health costs and costs to Medicaid.

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Key Messages, contd

• Program integrity is the foundation that makes it
  all work