The ISMA is monitoring discussions and potential changes to Medicaid following passage in March of the Patient Protection and Affordable Care Act (PPACA), and the companion reconciliation bill that passed as health care reform legislation.
ISMA Government Relations Director Mike Rinebold attended a May 12 meeting of the State Budget Committee where the actuarial firm Milliman, Inc., delivered a report on future costs of the Medicaid program. (Find the Milliman report at in.gov.)
“The meeting opened dialogue in what will be a long summer of discussing the importance of the act (PPACA) to our state,” Rinebold said. “There were no surprises in the Milliman numbers. The impact to the state’s budget will be significant, and it is clear from the comments during the budget hearing that party lines have been drawn regarding how the PPACA will be received.”
Rinebold noted that as Congress wrestles with many of the details and adopts additional regulations and rules, any future impact the federal legislation will have on our state will be further clarified.
However, the actuarial report indicated the state faces the loss of millions from pharmaceutical rebates, which will now go to the federal government. The Healthy Indiana Program (HIP) will be discontinued since it would be reimbursed at only 65 percent, and the state would need to make up the difference.
“We will work to ensure that the cigarette tax money used to finance HIP will continue to fund health care,” Rinebold stated. No discussion about cigarette tax dollars has occurred.
The Milliman report did suggest Indiana would need to increase physician payment to guarantee access to the one in four Hoosiers projected to be insured by Medicaid. The firm recommended reimbursing doctors at 80 percent of the current Medicare fee schedule.
Federal dollars will pay primary care physicians at 100 percent of Medicare for some services for 2013 and 2014. The federal government makes no additional funds available for specialty care or the full range of physician services.
“One thing is certain,” said Rinebold. “The General Assembly will debate over the next year about where to find the funds necessary to cover the cost of implementing the new legislation – even if Indiana’s portion is only 10 percent of the total cost of the new act.”
Continue reading ISMA Reports for further updates.