Medicaid State Plan Amendments and Waiver Authority

Waiving certain provisions of the Medicare and Medicaid statutes is appropriate and even desirable under some circumstances. However, prior to approving a waiver, the Centers for Medicare & Medicaid (CMS) must ensure that the state meets certain criteria to safeguard existing coverage and maintain important protections.

States and CMS should gather public comments on any waivers or plan amendments and publish responses to public comments, including how the comments were considered and (if appropriate) incorporated into the waiver. CMS should also publish a summary of how the state met each of the criteria used to evaluate the state’s application, reflecting the objectives of the Medicaid program.

States should not use the waiver process to gain permission to disenroll people from Medicaid, deny services to eligible beneficiaries, impose lifetime limits on Medicaid eligibility, eliminate retroactive eligibility, limit or cap spending for important benefits or necessary care, or otherwise inappropriately restrict access to Medicaid.

States should not seek to achieve statutorily required budget neutrality in the waiver process in any way that threatens existing services for eligible beneficiaries.

The federal government should conduct rigorous oversight of Medicaid waivers. 

The federal government must ensure that the entitlement nature of Medicaid applies to all new and existing eligibility populations. Current prohibitions against enrollment caps, exclusions for preexisting conditions, and waiting periods should not be waived. In addition, Medicaid presumptive and retroactive eligibility policies should be maintained.

Federal and state governments must ensure that eligibility expansions are consistent with the principle of covering those more in need before those less in need. For example, Medicaid programs should not cover people with income at 200 percent of the federal poverty level unless they have extended coverage to those below that income level. 

Federal and state governments must comply with the transparency requirements established by the Affordable Care Act.

The transparency requirement should be extended to include amendments to waivers and SPAs. 

The federal government should not allow states to impose or enforce greater than nominal Medicaid premium- and cost-sharing on Medicaid beneficiaries. It should only be permitted if states and the federal government determine that these changes will not deny access to needed care or increase barriers to receiving services.

Federal and state governments must ensure that waivers cover all mandatory Medicaid services in the same amount, duration, and scope for all eligible beneficiaries. Benefit changes should not deny access to needed care.

Federal and state governments must ensure waivers demonstrate adequate protections for vulnerable populations. Among these populations are Medicaid beneficiaries with disabilities, older adults who need long-term services and supports (LTSS), and people with mental illness or other complex health care needs. Protections must include adequate provider networks.

Federal and state governments should ensure that all eligibility populations have adequate access to the same or comparable provider networks.

Waivers that include Medicaid beneficiaries with disabilities, older adults needing long-term services and supports, and people with mental illness or other complex health needs, federal and state governments must ensure adequate protections for these populations, including adequate provider networks.

Maintaining strong provider networks is important to beneficiaries. Virtual providers and virtual networks should not supplant local, in-person providers. Telehealth should be an additional tool for delivering care, not a replacement for in-person care.

Receipt of Medicaid should not be conditioned upon compliance with work requirements or personal incentive programs.

Receipt of Medicaid should also not be conditioned upon compliance with premium payment and other cost-sharing requirements.

Medicaid beneficiaries should not be subject to work requirements. Waivers and SPAs that condition receipt of Medicaid on work, education, job search, volunteering, or any other activity are counter to the objective of the Medicaid statute. The statute describes that objective as “to furnish medical assistance on behalf of individuals whose income and resources are insufficient to meet the costs of necessary medical services.”

If work requirements are imposed by a waiver or by an SPA, federal and state governments should ensure that the state is adequately prepared to implement the requirements. The state and federal government must also ensure those work requirements or any personal incentive programs:

• are not used to deny access to covered services to eligible individuals,
• are not funded by money redirected from necessary services,
• are not administered in ways that penalize people who do not participate in incentive programs such as weight-loss or smoking-cessation programs,  
• define family caregivers as those caring for adults or children, and  
• exempt caregivers from work requirements, or if caregivers are not exempted, allow caregiving to count as work.

The state must demonstrate that adequate outreach and education are conducted and must provide reasonable accommodation and support services for those who need assistance in completing any processes required to comply with the requirements.  

Federal and state governments must ensure that existing Medicare and Medicaid waiver authority is used to integrate health care and LTSS under the following conditions.

• Beneficiaries must retain their rights to full Medicare and Medicaid benefits. Consumers’ ability to direct their own care must be ensured.
• Cost-sharing and other participation requirements must not result in coercive inducements to enroll or disenroll or be a barrier to receipt of services.
• Strong consumer protections, including an independent ombudsman program and external grievance and appeal procedures, must be in place. In addition, beneficiaries must have access to independent enrollment counseling.
• The state and CMS must provide thorough and timely oversight.
• Consumers must have the opportunity to participate in the development, implementation, and oversight of the waiver program.

Strong quality assurance standards must be in place, including measures of functional and medical outcomes.

Eligibility criteria for LTSS should consider and appropriately measure the need for these services among people with physical impairments, mental impairments, and chronic illnesses. Determination of need should be based on measures of physical and mental functioning. Individuals should not have to meet medical criteria to be eligible for LTSS.

Contracting specifications should be adopted to ensure that a wide range of organizations are able to compete for the opportunity to manage the integrated systems. The organizations could include nonprofit, public, and community-based organizations; entities experienced in the delivery of LTSS; and managed care plans. 

The federal government should require states to demonstrate the ability to conduct robust outreach and education when using waiver authority. This should include when enrolling individuals or making changes that affect eligibility or coverage for Medicaid or marketplace plans.

Quality assurance standards should include, at a minimum, internal and external quality review, meaningful grievance and appeals procedures, robust state monitoring and oversight (e.g., by an ombudsman), and strong sanctions for violations of quality standards.

The research design component of Section 1115 waivers must be adequate to support independent evaluation. At a minimum, states should be required to demonstrate that the research goals are measurable, and that relevant data is collected and made available to the public.