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MACPAC Commissioners Nudge Innovation Center Official on Medicaid Policies

By Rebecca Adams, CQ HealthBeat Associate Editor

May 22, 2012 -- Sean Cavanaugh, a top official at the Center for Medicare and Medicaid Innovation, confirmed for members of a government commission last week that some demonstration projects that could reshape Medicaid could be expanded nationally.

At the meeting of the Medicaid and CHIP Payment and Access Commission (MACPAC), which is charged with advising Congress and government officials on best practices for the programs, Cavanaugh said the innovation center might be willing to test some of the policy changes that the commissioners advocate.

Cavanaugh, the acting deputy director of the Innovation Center, did not cite any specific demonstrations that the administration plans to expand nationally. But in response to questions about how Health and Human Services officials could convert a demonstration project funded by the center into national policy, he said officials could either expand a pilot into a nationwide project or initiate a rulemaking process to create a new regulation.

"There's been quite a bit of thought about it," Cavanaugh told commission member Sara Rosenbaum, a professor at the George Washington University School of Public Health and Health Services. Rosenbaum asked Cavanaugh what would prompt the administration to use evidence from a demonstration project to justify a broader policy, and Cavanaugh said there is not yet agreement among administration officials about how strong the evidence would have to be to trigger nationwide expansion of a policy that is being piloted.

Several commissioners took the opportunity to lobby Cavanaugh and other center officials to support changes in Medicaid policy that they find problematic.

The commission consists of experts, government officials, executives and medical professionals who serve on the panel part time. It was created by the Children's Health Insurance Program Reauthorization Act of 2009 (PL 111-3) and expanded in the 2010 health care overhaul (PL 111-148, PL 111-152).

Commission Vice Chairman David Sundwall told Cavanaugh that states should be able to apply for the center's health care innovation grants. That was not allowed during the first round of funding, but Sundwall said his understanding is that the process may be more open in the future.

Denise Henning, a midwife at a health center in Florida, said Centers for Medicare and Medicaid Services (CMS) officials should weigh in on the side of midwives, whom she said are often denied hospital privileges, in part because physicians "don't want the competition." She said it would be helpful "if CMS would say this isn't allowed" and inform hospital executives that "if you want to take Medicare and Medicaid money, you have to allow privileges to midwives."

Henning is president of the Midwifery Business Network and a chapter chairwoman for the American College of Nurse Midwives, according to her MACPAC biography.

"We could use CMS to be in our corner just a little bit more," Henning said.

Cavanaugh made no promises but said he believed that CMS officials could try some type of requirement under the conditions of participation in the programs.

"Clearly, we have a team that cares quite a bit about women's health," he said.

Another commissioner, Donna Checkett, raised concerns about the so-called institutions for mental disease (IMD) exclusion, which bans federal Medicaid matching payments for patients between the ages of 22 and 64 at inpatient mental health institutions. The policy has been in place since Medicaid was created in 1965. Back then, Congress was concerned that county and state governments would shift costs for state-run institutions to the federal government.

Checkett, vice president of state government relations for Aetna, suggested that the policy is outdated and arbitrary. Cavanaugh said CMS officials would take the concern into consideration.

The move from a limited demonstration project to a national one is a more straightforward path than starting up a new rulemaking process, Cavanaugh suggested. However, it is "very real that the administration can decide to pursue" expansion by proposing a new rule if it seems warranted, he said.

Before answering questions from commissioners, Cavanaugh went through a PowerPoint presentation about the Medicaid-related projects that the Innovation Center is funding.

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