Sellers Dorsey Digest

Federal Updates

News

COVID-19 Cases Expected to be on the Rise with the Discovery of a New Class of Subvariants

• Scientists have identified a new class of COVID subvariants, dubbed FLiRT. These new subvariants are said to be more infectious than the JN.1 subvariant that was active last year. Scientists do not know the impact this new class will have but believe it will follow similar patterns to JN.1 and, due to increased transmission, could result in increased hospitalization and COVID-19 related deaths. As with COVID-19 cases generally, older adults and those with underlying health issues are at a higher risk of severe illness (Newsweek, May 18).

Medicaid Unwinding Continues to Affect Native American Populations

• As the Medicaid unwinding process continues, many Native American tribal leaders are speaking out and reporting challenges related to redeterminations. Leaders report a lack of timely information, individuals being unaware of the process, long processing times, lack of staffing at the tribal level, lack of communication at the state level, and concerns with obtaining accurate tribal data. While Native American and Alaska Native adults are enrolled in Medicaid at higher rates than their white counterparts, policy experts have been concerned that Indigenous communities would face greater obstacles to renewing healthcare coverage and therefore be disproportionally harmed in the process. Tribal health leaders are concerned that a high number of disenrollments among their members will financially undercut their health systems and that diminishing Medicaid funding will exacerbate long-standing health disparities that plague Native Americans (Missoula Current, May 20).

Bipartisan White Paper Proposes Telehealth Expansion and Medicare Physician Pay Reforms

• On May 17, Senate Finance Committee Chair, Ron Wyden (D-OR), and ranking member, Mike Crapo (R-ID), released a white paper seeking input on reforms to the Medicaid physician payment system and permanent telehealth expansion. The white paper includes the following recommendations: connecting the conversion factor (CF) to the Medicare Economic Index (MEI); increasing incentives for Alternative Payment Models (APMs) such as Accountable Care Organizations (ACOs); considering hybrid payment models to streamline billing processes; and, raising the $20 million threshold for budget-neutrality adjustments without causing payment cuts. Additionally, the white paper discusses the expansion of telehealth flexibilities first started during the COVID-19 pandemic and currently scheduled to expire at the end of 2024, to maintain accessible care for Medicare beneficiaries (Inside Health Policy, May 20).

Federal Legislation

Two House Committee Bills Emerge Calling for Telehealth Extensions

• Two House Committees, the Energy & Commerce and Health Subcommittee (E&C Health Subcommittee) and Ways & Means (W&M), are advancing bills adding a two-year extension of COVID-19 telehealth waivers that would otherwise expire at the end of this year. The bill passed out of the E&C Health Subcommittee, HR 7858, calls for a delay in in-person care and originating site restrictions for mental health services and the extension of audio-only telehealth services for the next two years. The E&C Health Subcommittee bill also includes a payment parity provision to allow telehealth services to be billed the same amount for in-person services at Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs), while the bill passed out of the Ways & Means Committee, HR 8261, does not. Both bills include preventive measures to fight against Durable Medical Equipment fraud and a five-year waiver extension for the Acute Hospital Care at Home program. These bills also include transparency requirements for pharmacy benefit managers and to delay new changes to Medicare payment rates for clinical lab tests by a year (Inside Health Policy, May 16).

Senate Committee Unveils Comprehensive Dental Reform Act

• On May 17, the Senate HELP committee considered a package of dental reforms, the Comprehensive Dental Care Reform Act of 2024, which aims to address the five drivers of the oral healthcare crisis. The bill aims to address this crisis through increased access to coverage across federal health programs, creating more places to obtain dental care, investing in the oral health profession, educating non-dental health professionals on the significance of oral health, and funding research on prevention and disease management. The bill includes coverage for Medicare, Medicaid, and Veterans Affairs beneficiaries and makes dental services an essential benefit under the Affordable Care Act (ACA). The bill also increases funding for school-based dental services and health clinics and promotes the use of telehealth-enabled dental services (Inside Health Policy, May 17).

New IVF Protection Bill Could Mean Medicaid Funding Cuts for States that Don’t Comply

• Senator Katie Britt (R-AL) and Senator Ted Cruz (R-TX) are co-sponsoring a bill that would require states to protect access to in vitro fertilization (IVF) as a condition for receiving federal Medicaid funding. The bill was advanced following a recent Alabama Supreme Court decision that ruled embryos are considered children, thereby impacting IVF access; after which, Alabama’s Governor signed a bill into law protecting IVF clinics from lawsuits (Alabama Local News, May 20).

Federal Studies and Reports

KFF Data Shows that Non-Expansion States Have Seen Steepest Increase in Enrollment

• According to a KFF analysis, southern, non-expansion states are experiencing some of the most significant growth on state and federal health insurance exchanges. Between 2020 and 2024, all ten southern states experienced significant enrollment growth. Texas experienced growth of 212.2% and Mississippi experienced growth of 189.6%, with Georgia, Tennessee, and South Carolina seeing growth in excess of 100%. Additionally, individuals selecting plans on the exchanges rose from 11.4 million in 2020 to 21.5 million in 2024, an increase of approximately 88%. States using the healthcare.gov federal exchange saw an average enrollment increase of 126% while state-based exchanges saw an average growth of only 22%, partially due to having higher enrollments initially (Health Payer Specialist, May 17).

KFF Analysis Takes Closer Look at Implications of the Nursing Facility Final Rule

• On May 21, KFF published an analysis on the CMS nursing facility final rule that was released in April. The final rule creates new requirements for nurse staffing levels in nursing facilities, as the issue of adequate staffing in nursing facilities has been a long-standing concern. The analysis conducted by KFF used Nursing Home Compare data from April 2024 to compare to the final rule provisions and examine the percentage of nursing facilities that currently meet the final rule minimum staffing requirements. What they found is that in 45 states, fewer than half of nursing facilities have enough staff to meet the new federal requirements. Some other key takeaways include:
  • Less than one in five (19%) of nursing facilities currently meet all three staffing minimums required in the final rule.
  • A smaller share of for-profit facilities currently meets all requirements in the final rule than non-profit and government facilities (11%, 41% and 39%, respectively).
  • Rural nursing homes are as likely as urban facilities to meet the final rule’s requirements based on current staffing levels, but rural facilities will have a longer time period to comply with the new requirements.
  • In over half of states, fewer than one-quarter of facilities meet all three staffing minimums required in the final rule (KFF, May 21).

State Updates

News

Indiana’s Family and Social Services Administration (FSSA) Being Sued Over Attendant Care Services Change

• As part of a cost-savings plan for its Medicaid program, Indiana will no longer reimburse guardians or other family members providing attendant care services effective July 1. Following this announcement, the parents of two children with disabilities sued the FSSA in federal court, stating that the changes violate the Americans with Disabilities Act (ADA) and federal Medicaid laws. The lawsuit alleges that while the FSSA stated it will work to find care options for the families, the reimbursement rates are insufficient and could result in medically needy children being placed in institutional settings. The ACLU of Indiana and Indiana Disability Rights are representing the families and the Indiana Protection and Advocacy Services Commission in the proceedings (MSN, May 18).

Texas Begins STAR Kids Bidding Process

• Texas has officially launched the bidding process to reprocure contracts for its STAR Kids program that provides Medicaid coverage to approximately 150,000 children and youth under 21 with disabilities. According to the state’s request for proposals (RFP), proposals are due July 11, and the evaluation period will end in January 2025. Once awarded, the contracts will run for six years with the possibility of up to three extensions for two-year periods (Health Payer Specialist, May 20).

SPA and Waiver Approvals

Waivers

• 1115
  • Delaware
    • On May 17, CMS approved a five-year extension of the Delaware Diamond State Health Plan (DSHP) Section 1115 waiver demonstration. The state will sunset a waiver of retroactive eligibility on January 1, 2025, which will allow the state to expand access by providing three months of retroactive eligibility to all eligible demonstration enrollees. The extension transitions children’s dental services to a managed care model and implements a new benefit for postpartum supports, including home delivered meals and a weekly supply of diapers and baby wipes. The extension also allows the state to extend a number of longstanding authorities, including: providing substance use disorder (SUD) treatment services for short-term residents in residential and inpatient treatment settings that qualify as an institution for mental diseases (IMD); adult dental services; and coverage for former foster care youth under age 26 who currently reside in Delaware but were enrolled in Medicaid in a different state or tribe when they aged out of foster care. Additionally, the state received approval for some new services, including contingency management services for certain adults with stimulant use disorder or opioid use disorder. The extension is effective through December 31, 2028.
  • Tennessee
    • On May 17, CMS approved an amendment to Tennessee’s TennCare III Section 1115 waiver demonstration. This amendment gives the state the authority to expand eligibility for parents and caretaker relatives of dependent children up to 100% FPL; provide for coverage of a monthly supply of diapers for infants and children; and enhance home and community-based services available to individuals with disabilities, by adding additional coverage for employment services and transportation, in addition to providing exceptions to individual cost neutrality test and expenditure caps for certain waiver beneficiaries. This amendment is effective May 17, 2024, through December 31, 2030.

SPAs

• Eligibility SPAs
  • Louisiana (LA-24-0004, effective January 1, 2024): Provides for 12 months of continuous eligibility for children under the age of 19.
  • Nevada (NV-23-0032, effective January 1, 2024): Provides for 12 months of extended postpartum coverage to individuals who were eligible and enrolled under the Medicaid state plan during their pregnancies (including during a period of retroactive eligibility).
  • Texas (TX-24-0001, effective January 1, 2024): Provides for 12 months of continuous eligibility for children under the age of 19.
• Payment SPAs
  • California (CA-24-0015, effective April 1, 2024): Adds coverage and payment for services provided by Associate Professional Clinical Counselors, under FQHC, RHC and Tribal FQHC services.
  • Maine (ME-15-0023, effective October 1, 2015): Updates the payment methodology for personal care services delivered on Remote Island locations provided by Private Non-Medical Institutions.
  • Texas (TX-24-0005, effective September 1, 2024): Adds requirements for Prescribed Pediatric Extended Care Centers (PPECCs) to provide transportation for a recipient if the recipient’s physician believes the recipient is stable, parents/guardians want the recipient to receive transportation service and the recipient is accompanied by a PPECC nurse or direct care staff member identified in the recipient’s plan of care. The amendment also revises qualifications for the PPECC nursing director and alternate nursing director to align with state licensing rules.
  • Virginia (VA-24-0005, effective January 1, 2024): Updates coverage for ophthalmologists as physician services and clarifies coverage of optometrists and opticians as other licensed practitioner services.
• Service SPAs
  • Alaska (AK-24-0003, effective March 1, 2024): Adds coverage and payment for Advanced Practice Dental Hygienists as other licensed practitioners for the expansion population, under the Alternative Benefit Plan (ABP).
  • Louisiana (LA-24-0002, effective January 1, 2024): Clarifies coverage and payment for Chiropractor services for children under 21 years of age under EPSDT services.

Private Sector Updates

News

Wellstar Health System to Begin Using Clear Check-in Kiosks

• Clear, a digital identity verification company known for their airport kiosks, is introducing check-in kiosks to the Georgia- and South Carolina-based Wellstar Health System following a successful pilot. Clear plans to expand to other systems using Epic’s electronic health records, charging hospitals by the amount of usage. The kiosks aim to streamline processes, reduce staff workload and wait times, and prevent inaccuracies in patient data. Before their appointment, patients register with Clear which links their data to Wellstar. When patients arrive for the appointment, they use the kiosk to check in and verify their identity with facial recognition or the taking of a selfie at the kiosk. However, some concerns remain about patient navigation for certain demographics and the popularity of the kiosks compared to traditional check-in methods (Modern Healthcare, May 21).

Sanford Health Considering Expansion into Government Plans

• Sanford Health Plan is considering expanding into Medicaid as well as continuing growth in its Medicare Advantage and exchange businesses. Currently, the regional affiliate of Sioux Falls, South Dakota-based Sanford Health provides services to approximately 200,000 individuals in North Dakota, South Dakota, Wisconsin, and Iowa. To expand its service footprint, Sanford Health Plan is considering partnering nationally with other regional plans and providers. Additionally, Sanford Health Plan’s CEO, Dr. Tommy Ibrahim, believes that the plan’s vast experience in the rural health space gives it a strategic advantage when considering Medicare Advantage growth opportunities (Modern Healthcare, May 21).

Sellers Dorsey Updates

Webinar Recording Available Now: Unpacking the New CMS Medicaid Managed Care Rules

• Didn’t have a chance to attend our webinar? View the recording to gain valuable insights from our experts! They cover everything you need to know including implications for states, managed care, and so much more. Click here to watch it, today.