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Medicaid Health Homes Still a Work in Progress

By Marissa Evans, CQ Roll Call

June 22, 206 -- Health homes for Medicaid beneficiaries could save money, but not all states are sold on implementing them the way the Centers for Medicare and Medicaid Services (CMS) wants.

The care settings are designed to coordinate all of a patient's primary, acute, mental health, and long-term care while also guiding them toward supportive services such as housing and food assistance programs. The 2010 health law allows states to receive an enhanced 90 percent match rate for up to two years after the health home program is created. Twenty-one states and the District of Columbia have implemented health homes under the federal guidelines as of April, according to a CMS report.

The Medicaid and CHIP Payment and Access Commission (MACPAC) released a report earlier this month stating that while states have access to programs and demonstrations that could help them lower their costs, they do not always take advantage of it.

"Mindful of their own budget constraints, as well as other political and economic factors that shape their health care markets and the design of their Medicaid programs, states respond differently at different times and in different circumstances and thus do not always take the opportunity to draw federal match or even enhanced federal match," the report stated.

Anne Schwartz, executive director of MACPAC, said in an interview that the number states that have implemented health homes through the health law is a clear sign of interest, even if fewer than half have taken up the idea.

"When states are trying to balance budgets when you look back at some of the debates, in many cases coming up with money for Medicaid is a significant issue," Schwartz said. "While there are these opportunities for states they have to balance their own priorities where they think they would like to improve their Medicaid's a different issue in each state."

The MACPAC report comes as lawmakers grapple with lowering costs. While Democrats call for more funding and for states to take advantage of the health law's Medicaid expansion, Republicans want per capita spending caps and block grants on the program, a means to get states to be more efficient with how they allocate federal dollars.

Julia Paradise, an associate director of the Kaiser Commission on Medicaid and the Uninsured, said in an interview that the enhanced match helps but states also have to personally invest to build infrastructure around the program for needs such as health information technology and electronic health records.

"It is a resource and an intensive undertaking because health homes represent a model of care that involves a lot of activities that providers haven't historically provided," Paradise said.

A July 2015 joint report from the Urban Institute and Department of Health and Human Services Office of the Assistant Secretary for Planning and Evaluation found that states with health homes spent the first year saw "significant administrative burden and lost productivity for participating providers." The report cited instances in which states had difficulty at first enrolling beneficiaries, reimbursing provider services provided and sharing beneficiary clinical data. Providers also felt the brunt of working with health homes by working on getting certified or implementing information technology.

Matt Salo, executive director for the National Association of Medicaid Directors said in an interview that many states are working toward overhauling how they do payment and care delivery. However, he said, states are finding ways to do so without the federal health law's parameters for health homes. He said it comes down to states maximizing their resources and examining if the enhanced match rate is truly worth it for them.

"[States] have to be really really thoughtful and strategic about how they take on new projects," Salo said. "A little bit of an enhanced match is not going to be all it takes to get you there, that's a very important distinction and takeaway. For incentives to really work they have to be meaningful and achievable."

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