The Health Subcommittee met to examine the state of Medicaid and the financial situation it faces. Also, the relationship between the Federal government and state governments remains a hotly contested issue. The opinion of the witnesses was the states needed more flexibility in carrying out the program
Hearing Date: June 12, 2013
Hearing Summary: Prepared for AAPS by the Market Institute
The Health Subcommittee recently met to discuss the financial challenges facing the Medicaid program. Quality of care is also an issue facing the government, but at the center of the debate is the relationship between the government and the states. In his opening statement, Chairman Joe Pitts (R-Penn) said many patients under the Medicaid Program face worse outcomes and care than those with no insurance. The spending on Medicaid is also spiraling out of control. Many state’s allocate a quarter of their budgets to support Medicaid. Vice Chairman Michael Burgess (R-Tx.) said that there is a clear need for flexibility in state spending due to population and other factors. Rep. Fred Upton (R-Mich.) said in his opening statement the Affordable Care Act will sign up as many as 30 million additional Americans to the already strained safety net program. Last month, Rep. Upton and Senator Orrin Hatch (R-UT) introduced a blueprint plan to modernize Medicaid based on months of input from policy experts and state partners.
The first witness, Seema Verma, President of SVC, Inc. said in her opening statement that failure to reform Medicaid will jeopardize the states’ ability to care for patients. At the center of the problems is the relationship between the Federal and States’ governments. While jointly funded, the program is not jointly managed. Working within the constraints of Federal guidelines, the state’s medical care and innovation suffers. Finally, the criteria for qualifying for Medicaid coverage must be revisited and cost-sharing policies should consider value based benefit design.
The second witness, Joe Thompson, Surgeon General of Arkansas recounted in his opening statement the transformation of his state’s Medicaid program. The program has implemented episode-based bundled payments instead of fee-for-service standards. Further, the state recently passed a law allowing for a private option that will enable the expansion of private health coverage to low-income patients through Medicaid assisted premium assistance. Lastly, Medicaid is in position, as a substantial purchaser of health care, to help change the health care system as a whole, but strengthening the federal-state Medicaid partnership is critical to a high quality healthcare system.
The last witness, Tony Keck, Director at HHS South Carolina said in his opening statement that as much as 30% of health care spending is waste. In addition, the federal government treats the states like sub-contractors instead of partners in Medicaid. There is a clear need for states to have flexibility in managing programs locally in exchange for improved health care.
In response to questioning, Joe Thompson said:
- The current administration is more effective at streamlining the program than past administrations
- The ACA will benefit rural healthcare providers and patients
- The Federal-State partnership should be maintained to ensure quality care
- Managing care in a decentralized region will be an interesting challenge
In response to questioning, Seema Verma said:
- Many policy changes are aimed at providers, pharmaceutical companies, and insurance companies when they should be aimed at helping patients and quality of care
- States need to be held accountable for outcomes; providers, patients, and states need to be aligned
- Lower income patients have the greatest ability to stretch dollars and seek out affordable healthcare
In response to questioning, Tony Keck said:
- States would benefit greatly from flexibility
Hearing Webpage: http://energycommerce.house.gov/hearing/need-medicaid-reform-state-perspectiv
Testimony:
Tony Keck, Director
Department of Health and Human Services
State of South Carolina
Seema Verma, MPH
President
SVC, Inc.
Joe Thompson
Surgeon General
State of Arkansas
