The Economic Stimulus and Health Chairs

Transcription

1 The Economic Stimulus and Health Chairs Friday, April 17, 2009, 2:00 pm EDT A partnership between the Kaiser Family Foundation and the NCSL Health Chairs Project

2 Moderators: Donna Folkemer, Group Director, National Conference of State Legislatures Jennifer Tolbert, Principal Policy Analyst, Kaiser Commission on, Kaiser Family Foundation Speakers: Robin Rudowitz, Principal Policy Analyst, Kaiser Commission on, Kaiser Family Foundation Joy Johnson Wilson, Federal Affairs Counsel, Health Policy Director, National Conference of State Legislatures 2

3 Figure 3 Health Care Provisions in the American Recovery and Reinvestment Act (ARRA) Presented by Robin Rudowitz Principal Policy Analyst Kaiser Commission on Kaiser Family Foundation NCSL Health Chairs Webinar April 17, 2009

4 Figure 4 Economic Situation is Severe Unemployment rising 8.5% unemployment in March 2009 (up from 4.9% at the start of the recession in Dec. 2007) 5.1 million jobs have been lost since Dec states facing budget shortfalls of $350 to $370 billion for the rest of 2009 through 2011 Growing uninsured and increasing Medicaid and CHIP enrollment

5 Figure 5 States with Unemployment Rates at Various Levels, February 2009 WA VT NH ME OR CA NV ID AZ UT MT WY CO NM ND SD NE KS OK MN WI IA IL IL MO AR MS NY MI PA OH IN WV VA KY NC TN SC AL GA CT NJ DE MD DC MA RI TX LA AK FL HI 3.4% - 5.4% (9 states) 5.5% - 6.9% (10 states) 7.0% - 8.9% FPL (17 states) SOURCE: State and territory figures from the Table 3, Regional and State Employment and Unemployment: December 2008, Bureau of Labor Statistics. 9.0% % (15 states including DC)

6 Figure 6 Families Affected by the Economic Downturn Individuals with secure jobs laid off and unable to find new jobs Families struggling to pay bills including health care Individuals lost jobs and ESI could not afford COBRA or other coverage Many not getting needed care Many turning to Medicaid for the 1st time unfamiliar with public assistance Medicaid has been critical for access to care, particularly for children Better outreach, easier application processes and broader coverage options for adults could better help families in need

7 Figure 7 Effect of a 1% Point Increase in Unemployment % = & Increase in National Unemployment Rate Decrease in State Revenues 3-4% Increase in Medicaid and SCHIP Enrollment (million) Increase in Uninsured (million) SOURCE: Medicaid, SCHIP and Economic Downturn: Policy Challenges and Responses, Kaiser Commission on, April 2008

8 Figure 8 Medicaid is an Economic Engine in State Economies Federal Medicaid Matching Dollars Injection of New Money State Medicaid Dollars Direct Effects Health Care Services JOBS Vendors (ex. Medical Supply Firm) Indirect Effects Consumer Goods and Services Employee Income Taxes Induced Effects

9 Figure 9 Temporary Medicaid Fiscal Relief Made a Difference in the Last Economic Downturn Helped Resolve a Medicaid Budget Shortfall 42 Helped Avoid, Minimize or Postpone Additional Medicaid Cuts or Freezes 27 SOURCE: KCMU survey of Medicaid officials in 50 states and DC conducted by Health Management Associates, January 2004.

10 Figure 10 Distribution of Health Funding in the American Recovery and Reinvestment Act (ARRA) Billions of Dollars Other, $5.5, 4% NIH, $10.0, 7% HIT, $19.2, 13% FMAP Increase, $86.6, 57% COBRA, $ % Total Health Spending = $149.2 billion Other Medicaid, $3.2 2% SOURCE: Detailed Summary of ARRA from the Appropriations Committee and Senate Finance and Ways and Means Committees. and White House Summary.

11 Figure 11 Medicaid FMAP Provisions Timing and amount of Medicaid FMAP relief $87 billion Relief for 10/1/08 12/31/ components: Hold harmless (no state would see a drop in FMAP) Base increase of 6.2% Additional assistance based on unemployment State requirements to receive the funds: Cannot have more restrictive eligibility levels or standards than 7/1/2008 (or come into compliance by July 1, 2009) Cannot deposit funds in a reserve or rainy day fund Cannot require counties to contribute a greater portion of the non-federal share for Medicaid Additional FMAP must be for eligible expenditures Must comply with prompt pay standards

12 Figure 12 Other Medicaid and COBRA Provisions Other Medicaid Provisions ($3.2 billion) Temporary increase in DSH allotments - 2.5% in Extension of moratoria on Medicaid regulations Extension of TMA and QI1 programs Indian Health - Medicaid and CHIP amendments Premium Subsidies for COBRA ($25 billion) 65% subsidy for COBRA premiums for 9 months for workers involuntarily terminated between 9/1/2008 and 12/31/2009 Trade Adjustment Assistance - Health Coverage Tax Credit Increases tax credit from 65% to 80% of qualified health insurance premiums between 4/1/2009 and 12/31/2010

13 Figure 13 Health Infrastructure & Investment Provisions Health Information Technology ($19.2 billion) Fiscal incentives for Medicare / Medicaid to adopt EHR National Institutes of Health ($10 billion) Comparative Effectiveness ($1.1 billion) Investment in Health Centers ($2 billion) Development of Primary Care Workforce ($500 million) Indian Health Service ($500 million)

14 Figure 14 Looking Ahead Although the economic recovery package provides significant funds for state fiscal relief, states will still face budget gaps The enhanced FMAP and the COBRA subsidies are designed to help support coverage during the economic downturn, but many will not be eligible for these programs leaving significant coverage gaps for recently unemployed workers The stimulus funds were intended to provide temporary assistance to help boost the economy and to put investments in place for broader health reform and coverage expansions

15 Health Care Provisions in the American Recovery and Reinvestment Act (ARRA) Joy Johnson-Wilson Federal Affairs Counsel and Health Policy Director National Conference of State Legislatures

16 ARRA is Different 2003 Medicaid ($10 billion) Few restrictions Block Grant ($10 billion) General government purpose ARRA Medicaid ($87 billion) More restrictions More reporting 2 pots of money Supplemental Appropriations New Programs

17 Medicaid - State Requirements Maintenance of Effort (Floor & Ceiling) and Extended Definition Use of Reserve or Rainy Day Funds Local Government Contributions Prompt Pay (Practitioners, Nursing Facilities and Hospitals Reporting and Transparency Eligible Expenditures/Cash Management Improvement Act (CMIA)

18 Discretionary Health Program Requirements Supplemental Appropriations Rules related to the underlying program not specifically addressed by the ARRA apply (Example: Immunization Funds) Some of the funds are subject to the discretion of the Secretary (Example: Hospital Acquired Infection Grants)

19 Health IT State Grants Grants to Promote Health Information Technology Competitive Grants to States and Indian Tribes to Develop Loan Programs to Facilitate the Adoption of Certified EHR Technology Medicaid Incentives for providers to adopt EHR technology Providers includes: practitioners, hospitals, rural health clinics and FQHCs $40 million for each of FY 2009 through FY 2015

20 COBRA - Includes Certain Employers Private, non-governmental employers with 20 or more employees; Federal, state and local government employers; and State Mini-COBRA laws that apply to small employers and other employers not covered by federal law where the state law requires the employer to offer comparable continuation coverage.

21 Complicated COBRA Administration Three federal departments are developing the guidelines: Department of Labor (DOL) Centers for Medicare and Medicaid Services (CMS), U.S. Department of Health and Human Services Internal Revenue Service (IRS), Department of the Treasury

22 Any Questions? Among the Panelists? From the audience? Use Q and A option After the call Health.Chairs@ncsl.org

23 Additional Resources NCSL resources webpage on the 2009 Economic Stimulus: Kaiser Family Foundation's Resources on Health Coverage During an Economic Downturn: Administration's webpage on the ARRA: Feel free to contact us for more information at This program was recorded and will be made available on line.