FEDS APPROVE WAIVER: ESSENTIAL & HIV CAP LIFTED AND CCHIP FUNDED

The long-awaited waiver approval by the federal Centers for Medicare & Medicaid Services (CMS) received on July 26, 2006, allows the Commonwealth to begin receiving federal funds for a number of health reform programs.

The immediate impact is the lifting of the enrollment cap in the MassHealth Essential program from 44,000 to 60,000 people. MassHealth Essential covers long-term unemployed adults below the poverty level. The state will automatically transfer these 10,500 individuals from Free Care-only over to MassHealth Essential, although they will need to select a PCC under the MassHealth PCC Plan in order for their benefit to begin. If individuals haven't chosen a PCC in 2 weeks, then the state will autoassign them to a site. The enrollment cap will also increase for the MassHealth HIV program, although there is no current waiting list for this program.

The waiver allows the state to set up a $1.3 billion “Safety Net Care Pool,” consisting of federal and state funds. The federal funds will include $385 million for this year and next year that the state had been receiving as managed care supplemental payments. The Safety Net Care Pool will fund CCHIP, the subsidized “Commonwealth Care Health Insurance Program,” that begins on October 1 (the program resulting from the Health Reform law), as well as other programs. The law gradually shifts a portion of Medicaid money from payments to hospitals that serve the poor -- primarily Boston Medical Center and Cambridge Hospital -- to using that money to insure poor residents, a change pushed by the federal government.

Also approved as part of the waiver is an expansion in the Insurance Partnership (IP) program. The IP program assists small businesses that cover at least half of the health insurance costs of their workers. Employee eligibility for the program will increase from 200% to 300% of the poverty line, effective October 1, 2006.

07/06