Flexibility and Innovation in Medicaid

October 19, 2018

Public Briefing

States have significant flexibility to tailor their Medicaid programs within parameters established by the federal government. The Trump administration has altered these parameters allowing states to pursue changes to their Medicaid programs that previous administrations did not allow, including the establishment of work and community engagement requirements as a condition of Medicaid eligibility. In response to political constraints, states are also leveraging new mechanisms to alter their Medicaid programs. During this briefing, experts detailed the landscape of diverse coverage policies and benefit designs states are pursuing in their Medicaid programs and discussed the impact of these innovations on beneficiaries and the health care delivery system.


  • Thomas Barker, J.D., partner, co-chair, Healthcare Practice, Foley Hoag, LLP
  • Cynthia Beane, MSW, LCSW, commissioner, West Virginia Bureau for Medical Services
  • Leonardo Cuello, J.D., director, Health Policy, National Health Law Program (NHeLP)
  • Cindy Gillespie, director, Arkansas Department of Human Services
  • Calder Lynch, senior counselor, Office of the Administrator, Centers for Medicare and Medicaid Services

Moderated by Sarah J. Dash, president and chief executive officer of the Alliance for Health Policy, and Rachel Nuzum, MPH, vice president of Federal and State Health Policy at The Commonwealth Fund.


The Alliance for Health Policy gratefully acknowledges the support of The Commonwealth Fund for this event.


12:00 p.m. – 12:10 p.m.                       Welcome and Introductions

  • Sarah J. Dash, MPHpresident and chief executive officer, Alliance for Health Policy (@allhealthpolicy)
  • Rachel Nuzum, MPH, vice president, Federal and State Health Policy, The Commonwealth Fund (@raenuzum)


12:10 p.m. – 12:50 p.m.          Panelist Opening Remarks

  • Calder Lynch, MSHAsenior counselor to the Administrator, Centers for Medicare & Medicaid Services
  • Thomas Barker, J.D., partner and co-chair, Health Care Practice, Foley Hoag, LLP
  • Cynthia Beane, MSW, LCSW, commissioner, West Virginia Bureau for Medical Services (@WV_DHHR)
  • Cindy Gillespie, M.A., director, Arkansas Department of Human Services
  • Leonardo Cuello, J.D., director, Health Policy, National Health Law Program  (@NHeLP_org)


12:50 p.m. – 1:30 p.m.                        Question and Answer Session

Event Resources

Event Resources

Key Resources (listed chronologically, beginning with the most recent)

“Medicaid and the Role of the Courts.” Rosenbaum, S. The Commonwealth Fund. June 2018. Available at http://allh.us/jaTd.

“Medicaid Section 1115 Waiver Trends in an Era of State Flexibility.” National Association of Medicaid Directors. March 2018. Available at http://allh.us/Wua4.


Additional Resources (listed chronologically, beginning with the most recent)

“Status of Medicaid Expansion and Medicaid Work Requirement Waivers.” The Commonwealth Fund. October 4, 2018. Available at http://allh.us/gDFu.

“Nation’s First Medicaid Work Requirement Sheds Thousands from Rolls in Arkansas.” Health Affairs Blog. October 2, 2018. Available at http://allh.us/qgce.

“Considering Federal Medicaid Policy Changes in Light of State-Level Delivery System Reforms.” Mann, C. The Commonwealth Fund: To the Point (blog). September 20, 2018. Available at http://allh.us/mab6.

“Kansas and Medicaid: New Evidence on Potential Expansion and Work Requirements.” Goldman, A. and Sommers, B. The Commonwealth Fund. September 17, 2018. Available at http://allh.us/wGrm.

“Changes in Health Insurance Coverage 2013-2016: Medicaid Expansion States Lead the Way.” Skopec, L., Holahan J., Elmendorf, C. The Urban Institute. September 2018. Available at http://allh.us/EnDJ.

“2018 Elections: Key Medicaid Issues to Watch.” Rudowitz, R., Hall, C. The Henry J. Kaiser Family Foundation. September 2018. Available at http://allh.us/7wGB.

“A New Group of States Looks to Expand Medicaid.” Moulds, D. et al. The Commonwealth Fund: To the Point (blog). August 27, 2018. Available at http://allh.us/nDjG

“Summary of Lawsuit Filed Against HHS Approval of “Arkansas Works” Amendment.” Perkins, J., Edwards, E., Cuello, L. National Health Law Program. August 14, 2018. Available at http://allh.us/tfKm.

“Kentucky Medicaid Waiver Blocked by Federal Courts.” Barker, T. Medicaid and the Law (blog). July 2, 2018. Available at http://allh.us/Bt79.

“The Role of Medicaid in Supporting Employment.” Medicaid and CHIP Payment and Access Commission. July 2018. Available at http://allh.us/rydh.

“New Approaches in Medicaid: Work Requirements, Health Savings Accounts, and Health Care Access.” Sommers, B. et al. Health Affairs. June 20, 2018. Available at http://allh.us/ENhM.

“Implications of Work Requirements in Medicaid: What Does the Data Say?” Garfield, R., Rudowitz, R., Musumeci, M., Damico, A. The Henry J. Kaiser Family Foundation. June 12, 2018. Available at http://allh.us/C8pF.

“Medicaid Payment and Delivery Reform: Insights from Managed Care Plan Leaders in Medicaid Expansion States.” Rosenbaum, S., Gunsalus, R., Velasquez, M., Jones, S., Rothenberg, J., Beckerman, Z. The Commonwealth Fund. March 2018. Available at http://allh.us/nCuR.

“Medicaid’s Role in Addressing the Opioid Epidemic.” The Henry J. Kaiser Family Foundation. February 27, 2018. Available at http://allh.us/cNT9.

“Medicaid Waiver Tracker: Which States Have Approved and Pending Section 1115 Medicaid Waivers?” The

Henry J. Kaiser Family Foundation. February 8, 2018. Available at http://allh.us/gNfd.

“Government as Innovation Catalyst: Lessons from the Early Center for Medicaid and Medicaid Innovation Models.” Perla, R. J., Pham, H., Filfillan, R., Berwick, D. M., Baron, R. J., Lee, P., McCannon, C. J., Progar, K., and Shrank, W. H. Health Affairs. February 2018. Available at http://allh.us/Mktb.

“Summary of Lawsuit Filed Against HHS Approval of Kentucky Waivers.” Perkins, J., McKee, C., Cuello, L. National Health Law Program. January 24, 2018. Available at http://allh.us/v9q8.

“Starting off the New Year with Work: How CMS’ “Work and Community Engagement” Policy Change Could Affect Stakeholders.” Springer, C. Foley Hoag, LLP. January 12, 2018. Available at http://allh.us/KQFH.

“Understanding the Relationship between Medicaid Expansions and Hospital Closures.” Lindrooth, R., Perraillon M., Hardy, R., Tung, G. Health Affairs. January 2018. Available at http://allh.us/tcTh.

“Ballot Initiative Requirements in Non-Medicaid Expansion States.” Melia, A. Health Management Associates. November 20, 2017. Available at http://allh.us/mPvT.

“CMS Issues New Guidelines on 1115 Waivers; Signals New Medicaid Objectives.” Margulies, R. Foley Hoag, LLP. November 7, 2017. Available at http://allh.us/wQKr.

“Work as a Condition of Medicaid Eligibility: Key Take-Aways from TANF.” Medicaid and CHIP Payment and Access Commission. October 2017. Available at http://allh.us/BhTY.

“Everything You Have Ever Wanted to Know about Medicaid Waivers.” Barker, T. Foley Hoag, LLP. February 18, 2015. Available at http://allh.us/UVen.




Thomas Barker Foley Hoag, LLP, Partner and Co-Chair of the Healthcare Practice

202-261-7310   tbarker@foleyhoag.com

Cynthia Beane West Virginia Bureau for Medical Services, Commissioner

304-558-1700   cynthia.e.beane@wv.gov

Leonardo Cuello National Health Law Program, Director of Health Policy

202-289-7661   cuello@healthlaw.org

Cindy Gillespie Arkansas Department of Human Services, Director

501-682-8648   cindy.gillespie@dhs.arkansas.gov

Calder Lynch Centers for Medicare & Medicaid Services, Senior Counselor
to the Administrator
202-619-0630   calder.lynch@cms.hhs.gov


Experts and Analysts

James Capretta  American Enterprise Institute, Resident Fellow and Milton Friedman Chair


Sara R. Collins The Commonwealth Fund, Vice President of Health Care Coverage and Access

2212-606-3838   src@cmwf.org

Ed Haislmaier


The Heritage Foundation, Senior Research Fellow in Health Policy Studies at the Institute for Family, Community, and Opportunity

202-608-6078   ed.haislmaier@heritage.org

Katherine Hayes


Bipartisan Policy Center, Director of Health Policy

202-204-2400   khayes@bipartisanpolicy.org

Hannah Katch Center on Budget and Policy Priorities, Senior Policy Analyst

202-408-1080   hkatch@cbpp.org

Debra Lipson


Mathematica Policy Research, Senior Fellow

202-238-3325   dlipson@mathematica-mpr.com

Cindy Mann Manatt, Phelps & Phillips, LLP, Partner

202-585-6572   cmann@manatt.com

John McCarthy Speire Healthcare Strategies, Founding Partner

615-386-7061   info@speirehcs.com

Tricia McGinnis Center for Health Care Strategies, Senior Vice President


MaryBeth Musumeci


Kaiser Family Foundation, Associate Director for the Program on Medicaid and the Uninsured

202-347-5270   marybethm@kff.org

Sara Rosenbaum George Washington University, Milken Institute School of Public Health, Harold and Jane Hirsh Professor and Founding Chair of the Department of Health Policy

202-994-4230   sarar@gwu.edu

Robin Rudowitz


Kaiser Family Foundation, Associate Director for the Program on Medicaid and the Uninsured

202-347-5270   robinR@kff.org

Judith Solomon Center on Budget and Policy Priorities, Vice President for Health Policy

202-408-1080   solomon@cbpp.org


Government and Government-Related Experts

Tom Bradley


Congressional Budget Office, Chief of Health Systems and Medicare Cost Estimates Unit

202-226-9010   tom.bradley@cbo.gov

Jack Rollins National Association of Medicaid Directors, Senior Policy Analyst

202-403-8628   jack.rollins@medicaiddirectors.org

Matt Salo National Association of Medicaid Directors, Executive Director

202-403-8621   matt.salo@medicaiddirectors.org

Anne Schwartz Medicaid & CHIP Payment Access Commission, Executive Director

202-350-2000   anne.schwartz@macpac.gov

Kristal Vardeman


Medicaid & CHIP Payment Access Commission, Principal Analyst

202-350-2000   kristal.vardeman@macpac.gov

Vicki Wachino


Viaduct Consulting, LLC, Principal



State Experts

Tom Betlach State of Arizona, Director of Arizona Health Care Cost Containment System

602-417-4000   tom.betlach@azahcccs.gov

Mandy Cohen North Carolina Department of Health and Human Services, Secretary

919-855-4800   mandy.cohen@dhhs.nc.gov

Trish Riley


National Academy for State Health Policy, Executive Director

202-837-4815   triley@nashp.org

Hemi Tewarson National Governors Association, Division Director of the Health Division

202-624-7803   htewarson@nga.org

Joe Thompson Arkansas Center for Health Improvement, President and CEO

501-526-2244   drjoe@achi.net



  Please note: This is an unedited transcript. Note: This is an unedited transcript. For direct quotes, please see video at http://allh.us/9AEg SARAH DASH:  Good afternoon, everybody and welcome. Thank you for joining us here today for today’s briefing on flexibility and innovation in Medicaid.  My name is Sarah Dash, and I am President and CEO of the Alliance for Health Policy. For those of you who are not familiar with the Alliance, we are a non-partisan organization dedicated to advancing knowledge and understanding of health policy issues. We want to say hello as well to those watching us live on CSPAN today, and if you’re following us on Twitter, we’ll be live tweeting during the event, and you can join the conversation using the hashtag Allhealthlive, as well as ask a question over Twitter at the appropriate time. So this year’s state Medicaid policies have made national headlines, and while states have always had significant flexibility to tailor their Medicaid programs within parameters established by the federal government, there is ongoing discussion about additional changes that have been allowed this year and recently, and we’re going to have a good discussion about those today. Many states are considering changes to their Medicaid programs, which include perhaps most notably work in community engagement requirements, as well as expanding coverage to additional beneficiaries, and establishing innovative care models to address the opioid epidemic and other challenges. We are really pleased today to have a panel of distinguished Medicaid experts here to talk about how states are responding to the administration’s new priorities for the Medicaid program, as well as the role of the courts in shaping Medicaid policy.  And we’re particularly pleased to be joined by the leaders of Medicaid programs in two states: West Virginia and Arkansas, who are leveraging flexibility through 1115 waivers to alter the design of their Medicaid program.   So before we get started, I’d like to thank the Commonwealth Fund for making today’s briefing possible, and introduce Rachel Nuzum, Vice President of Federal and State Health Policy at the Fund, who will join me as co-moderator during today’s briefing. And Rachel, I’m going to introduce the panel, and then we’re going to turn it over to get you started with some brief opening remarks. Terrific.   So joining us today we are really pleased to have today Calder Lynch, who is Senior Counselor to the Administrator of the Centers for Medicare and Medicaid Services. Prior to this role, Mr. Lynch served in several senior level health policy positions in state governments. Most recently, he served as Nebraska’s Medicaid Director, under Governor Pete Ricketts.   Next we will hear from Thomas Barker.  Thomas is partner and co-chair of the healthcare practice at the law firm, Foley Hoag. Mr. Barker established, and is a contributor to the firm’s blog, Medicaid and the Law. Prior to joining the firm, he served in a series of senior level positions at the Centers for Medicare and Medicaid Services, and the Department of Health and Human Services, during the George W. Bush Administration.   Following Thomas’s presentation, we will hear from Cindy Beane, who is Commissioner of the West Virginia Bureau for Medical Services. She led policy implementation for changes under the Affordable Care Act, which enabled approximately 165,000 West Virginians to gain healthcare coverage. Commissioner Beane manages and oversees project development, implementation of health policies and assures compliance with federal and state regulations, while creating innovative healthcare services to address the needs of West Virginians.   We will also hear from Cindy Gillespie, the Director of the Arkansas Department of Health and Human Services.  Her previous career includes serving as a principle at the multinational law firm Dentons, where she lead the health policy and health insurance exchange teams, and as advisory to Massachusetts Governor Mitt Romney on health policy, and federal programs.   Finally, we will hear from Leo Cuello, who is the Director of Health Policy at the National Health Law program. Prior to joining NHealth, Leo worked at the Pennsylvania Health Law Project for six years, focusing on a wide range of healthcare issues dealing with eligibility and access to services in Medicare and Medicaid.   So we have a full panel and we’re really excited to hear what everybody has to say. Before I turn it over to Rachel, how many people have a burning question  you want answered? Can we just have a show of hands? How many people came here because you have a burning question you want answered about Medicaid and what’s going on in the States? Come on, there’s got to be more burning questions than that. You are going to get to write your questions down, and ask them later, so get ready. Before that, I’m going to turn it over to Rachel.   RACHEL NUZUM:  Great, thanks so much, Sarah, and thanks to all of you for being here. I am Rachel Nuzum, I’m the Vice President for Federal and State Health Policy at the Commonwealth Fund.   I just want to take a couple minutes just to kind of lay the groundwork. I think for those who work in health policy, we don’t really need to explain why we’re talking about Medicaid, but for others that may be wondering, well, how much do really need to focus on this program? I just want to give a little bit of context into how central of a role it is actually playing in our healthcare system federally, but also in the state level. There has been a lot of discussion now about Medicaid as the largest insurer in the nation, and in fact, it is the largest single insurer. We also know that it covers the majority of births in the United States, it also covers the large proportion of care at the end of life, and more recently it has emerged just the importance of Medicaid as a provider of behavioral health services. About over half of the behavioral health services in the country are provided, and financed by the Medicaid program, and the estimate is about 20% of Medicaid and these do have behavioral health needs. This is a really critical program that is serving a number of Americans. The old adage about Medicaid is that if you’ve seen one Medicaid program, you’ve seen one Medicaid program, and I think that’s probably never been more true than it is today. Not since the program’s inception in 1965 have we seen this much variation across the country. States have always been unique. States have always developed their Medicaid programs to reflect their own communities, their own marketplaces, their own populations, their own financial and legislative framework. But right now we see a very varied landscape when we look across the country. 25 states have expanded Medicaid, about eight are advancing expansions with the use of 1115 waivers, like Sarah mentioned. Work requirements are kind of the issue of the day that a lot of people are focused on, and interested in, and we are starting to see those. Ten states have work requirement provisions submitted, included in an 1115 waiver. Some of those have been approved, one has been blocked, we are going to hear more about those, and just hear about this. But the use of waivers is not new in Medicaid. I just wanted to kind of remind us that that’s been kind of a guiding principle all along that states have always had this flexibility to ask for additional opportunities to really craft their program, and design it in a way that makes sense to them. And so I’m looking forward to having a discussion about how those trends have happened over time and what we’re seeing now in terms of those impacts.   We are seeing additional waves of states considering next steps on Medicaid, such as the ballot initiatives and perhaps more so this year than we’ve potentially seen in years in the past. And why does this really matter? It matters because Medicaid has been solely responsible, or singularly responsible for some of the biggest changes in the rate of uninsured over the last couple of years. All states between the years of 2013 and 2015 saw a reduction in rate of uninsured. We saw much larger rates of uninsurance obviously in the states that expanded. And the big reason to focus on Medicaid is because actually having coverage does matter. This slide shows just a part of a study that we did with Ben Summers and his colleagues that looked at Medicaid beneficiaries and their ability to access a personal doctor, how often they went to the Emergency Room, and whether or not they were able to get a check-up. To really help answer this question, are we just extending a Medicaid card? Or are we actually kind of connecting folks to care, which is obviously the goal, and something that we’ll be talking about as this panel goes on.   And then finally, Medicaid is a driver of innovation, it’s not just about the way we cover and about, you know, discussions around our benefits and design and eligibility. Medicaid as a program has a tremendous amount of leverage and market power, and it also plays a very distinguished role in terms of finances for the safety net system, and for many state and local economies. So with that, I’m going to turn it over and so we can get started with our panel, thank you.   SARAH DASH:   Fantastic. Thanks, Rachel.  We will turn it over now to Calder Lynch. Thanks, Calder.   CALDER LYNCH:  Good afternoon. Thank you for the opportunity to be here today, I’m Calder Lynch, I serve as the senior counselor to CMS administrator, Seema Verma. I’m pleased to be here to talk about some of the administration’s work and priorities around Medicaid, and then engage with this very distinguished panel this morning.   So let me begin by saying that the work that we’re doing in Medicaid is really guided around three pillars that the administrator outlined nearly a year ago last fall at the National Association of Medicaid Director’s Conference, and those are:  Flexibility, Accountability, and Integrity.  And I will talk about some of our work around each of those, of course focusing on the flexibility aspects since that’s the topic of today’s briefing.   I will begin with Flexibility. That’s been articulated in a number of efforts. Of course we are working on a number of regulatory provisions to provide states with increased flexibility and to remove some of the administrative burdens they face. But much of that has been articulated through our work around 1115 research and demonstration waivers, which we heard a little bit about here this morning. The first area I will talk about, before we move into community engagement, is focused on the work done by states really respond to the growing opioid epidemic across the country. A year ago, we released guidance to states, opening new opportunities for them to more quickly gain access to substance use disorder waiver authority, to be able to expand access to residential treatment, as well as build out community-based treatment options for people facing substance use disorder. I’m happy to say that we’ve since that time approved ten states under that more flexible guidance that we released, bringing the total number of states with an SUD waiver authority to 15, and we have several more pending before us. And so that’s something that’s really important that we really work to try to issue and be responsive to the national epidemic, and give states that flexibility. And we’re seeing some very positive results already from the early implementers of that authority in terms of reductions in Emergency Room visits, and improvements in care for individuals.   The other piece I will talk about that I think we’ll hear a lot about today, is the community engagement demonstrations. This January we released guidance to states really in response to strong interest that we’d heard, that states were very interested in finding ways to connect non-disabled adult beneficiaries to working community engagement opportunities through Medicaid. Since the Affordable Care Act was implemented, the Medicaid program has expanded to over 15 million working age adults that have newly enrolled into the program. So this was a growing interest and concern that we’d seen from states. So in response to that, we worked really hard over the course of 2017 to understand those requests, and to craft guidance and policy to better facilitate them, and that culminated in the release of a state Medicaid director letter in January that outlined our commitment to that approach, as well as the considerations that states would need to undertake to design such a waiver, including protections for beneficiaries, encouragement to align their programs with what exists already in the SNAP and TANF programs; really encouraging partnership between state agencies and state partners to be able to help better serve individuals how to be successful in meeting those requirements, and outlining the kinds of things we’d expect to see in a demonstration for us to be able to approve it. We’ve obviously had very strong interest, as you’ve seen, across the country, in terms of states submitting demonstrations in response to that guidance. We have three that are currently approved. One that has implemented that we’ll here more about today, and we’re learning a lot as we move through this process, about how this is working on the ground. So to that effort, we’ve engaged states in a learning collaborative to be able to learn from each other’s implementation, to be able to provide better guidance to states that are working on these policies. We have had 18 states engaged with us in this learning collaborative, we’ve had several webinars, our first in-person session, and really getting down to some of the nuts and bolts around how to operationalize community engagement demonstration programs effectively, how to partner with your other sister state agencies, your workforce programs, to be able to connect beneficiaries to the types of resources that will help them be successful. How to build the right systems to be able to better support those initiatives, to be able to connect the different existing state data sources. To be able to verify employment and participation in ways that reduce administrative burden for beneficiaries. So a lot of real heavy work is going into this to try to have good results for folks, and we’re going to continue that effort with the current states we had before, and some more that are coming through.   The next pillar I want to quickly touch on is Accountability, because this goes hand-in-hand with our commitment to flexibility. As we offer states greater flexibility, we respond to their requests to test new and innovative demonstration designs, we want to make sure we have accentuality for achieving the outcomes we’re setting out to achieve. So with that effort we — this is something that we spent a lot of time focused on, especially considering just the growth in spending in Medicaid. It’s gone from 10% of state budgets, to 26% over the last 30 years. We’ve seen over $100 billion in increased federal spending in just the last five years, so a lot of interest in having accountability on what are we getting for this investment, especially on behalf of the 75 million beneficiaries that we’re serving. So that’s why we’re working specifically in the 1115 space to standardize metrics across waivers, to have stronger evaluation designs that states need to use when they’re implementing these programs, to use consistent monitoring and evaluation terms across all of our 1115 demonstrations, so that we can have better transparency, better consistency in knowing the types of outcomes that we’re producing. That’s also why early this summer we released the first ever Medicaid and CHIP scorecard, to begin public reporting around both outcome and administrative performance metrics, for the first time actually looking at both state and federal administrative performance, where we are already seeing reductions in things like state plan processing times, managed care rate approval processing times, and we are able to begin reflecting that into a public dashboard that we can report on. We are going to continue to evolve and update that dashboard, add additional measures and metrics to it, new functionality as we update it at least annually. And you’ll see that reflected in future versions.   And the final pillar I want to touch on in my remaining time is Integrity. With all of these program’s enhancements, investments that we’re making, we want to make sure the dollars are being spent on behalf of eligible beneficiaries for qualified services, so earlier this summer we released an outline, a comprehensive Medicaid program integrity strategy that would really focus on making sure that the program is spending dollars where it needs to be spending them. So that strategy includes looking closely at state eligibility determinations, and responses from OIG audits we’ve seen, make sure that process is being done accurately and appropriately, looking at state managed care, financial rate setting and claiming, which we see as managed care use continues to grow across the country. Making sure that those rates are being set appropriately and being reported appropriately. And also looking at how we can better utilize claims and provider data in our program integrity efforts. Many of you probably heard of TMSIS, this is our new Transform Medicaid Statistical Information System, where we now have every state and D.C. and Puerto Rico reporting in a much more robust data set to CMS. We are able to begin utilizing that, and looking at program outcomes, program integrity measures, to understand how the program is performing.  And in 2019, we’ll begin releasing our first analytic files to the research community to be understanding better how the Medicaid program is performing.   So I think you can see there is a lot of work happening across the agency, a real commitment across those three pillars of flexibility, accountability, and integrity, and very much view those as going hand and hand, and complimentary of each other, as we continue to work to implement the vision that the administrator has set out.  Thank you.   THOMAS BARKER:  Thank you, and good afternoon everyone.  My name is Tom Barker, I am a partner at the law firm of Foley, Hoag, and I co-chair our firm’s healthcare practice. I have a couple of slides that I’m going to walk through. I’m going to give sort of a background on Section 1115 of the Social Security Act, waivers in general, and then I’m going to say a little bit more about some of the points that Calder focused on; some of the guidance that the administration has issued, and some of the history of waivers in this administration.   So just by way of level setting, or by way of background, Section 1115 of the Social Security Act allows the Secretary of HHS to waive “any of the requirements of Section 1902 of Medicaid, if in the Secretary’s judgement, doing so would promote the objectives of Medicaid.” So what is Section 1902? So if you are ever on Jeopardy, and the clue is “This is the longest sentence in the English language.”  If you were to say, “What is Section 1902 A of the Social Security Act, Alex”,  likely, you would win. Because Section 1902 A begins with the words “A state plan for medical assistance must…” and then it lists, if I’m not mistaken, 83 requirements that a state plan for medical assistance must comply with. All Section 1115A is doing, is allows the secretary to waive any of those 83 provisions. And some of the provisions for example; benefits have to be available statewide; benefits have to be made available with reasonable promptness; beneficiaries have a free choice of provider; payment rates have to be set through a public hearing process. All of those provisions can be waived if, in the secretary’s judgement, doing so would promote the objectives of Medicaid. Section 1115 also allows the secretary to fund programs in Medicaid that would not otherwise be authorized under allowable expenditures under Section 1903A of the Social Security Act.   One of the key phrases in that sentence is:  “If in the judgement of the secretary…” So the courts had been incredibly deferential to the secretary over the years in implementing or assessing Section 1115 waivers. Generally speaking, courts do not see it as their role, to second guess a decision that’s been made by the secretary in granting a waiver. Never the less, there is some case law that suggests that the secretary’s discretion is not absolute. There are a couple of cases from the 9th Circuit going back to the mid ‘90s that suggest that a state has to at least provide some cursory level of review to a state’s request, and of course more recently Leo will talk more specifically about the most recent example of a court setting aside a 1115 waiver, based on the principle that the failure of a state to consider whether a waiver promotes the objectives of Medicaid can be fatal. And we’ll say a lot more about that as we go on this afternoon. I would also say waivers cross political boundaries, so I thought Rachel made a really good point in her presentation when she said we’re talking a lot about waivers now, but Rachel’s point was, but waivers have been around for a long time. And so at least as far back as the Carter Administration, where President Carter and Secretary Califano approved waivers of cost-sharing; the cost-sharing prohibitions in Medicaid. President Reagan, if I’m remembering the history correctly, personally directed HHS to approve what became called, or known as Katie Beckett waivers, which really now are Section 1915B, home and community-based services waivers. The genesis of those was the so-called Katie Beckett waiver that if, again, if I’m remembering correctly, arose because President Reagan received a letter from a family saying that their daughter had to live in a nursing home in order to qualify for Medicaid. President Clinton approved a waiver that I remember reading about back in the early ‘90s, for the State of Oregon that really completely transformed Oregon’s Medicaid program. President George W. Bush approved waivers for the State of Florida that expanded the use of managed care in Medicaid, and also allowed states to impose a global cost cap in Rhode Island and Vermont. And then in the Obama Administration, some degree of the Medicaid expansion in the ACA was implemented via waivers, and the Obama Administration was also quite aggressive in approving delivery system reform waivers as well, and of course the Trump Administration now is also very aggressive. And so I’d like to turn to that now.   So Calder mentioned a lot of the guidance that’s come out. Some of what I’m going to say, duplicates his comments, although one thing I didn’t hear Calder mention to me, at least as an outsider, it all started with a letter that Administrator Verma and then Secretary Price sent to the governors in April of 2017, announcing what they called “a new era” in Medicaid. And they said in that guidance that they would give priority to waivers that focus on improving program management, community engagement, so the concept of community engagement goes back to the Spring of 2017, just a couple months after President Trump took office, in that letter. There was an information bulletin to states that came out in November of last year, that came just a couple of months after Administrator Verma’s speech to the Medicaid directors that Calder mentioned in his presentation. Calder mentioned the community engagement requirements that came out in January of this year, and Administrator Verma made some announcement just a couple of weeks ago — made some announcements, or sort of reiterated the administration’s position at a Medicaid Managed Care Summit a couple of weeks ago.   A couple points:  It seems to me that CMS has been quite aggressive in approving community engagement waivers, despite the obvious litigation risks. The administration seems to be continuing forward with the concept of community engagement waivers. CMS is also using waivers to combat the opioid epidemic, and I think that is worth focusing on a little bit, so there’s this quirk in the Medicaid program called the IMD exclusion, which essentially prohibits Medicaid from paying for services in an institution for mental disease, for individuals between the ages of 21 and 65. And that exclusion, that IMD exclusion, really historically CMS has been very, very reluctant to waive. Legally, it’s not quite as easy to waive it, as there are other provisions in Medicaid, but this administration has been quite aggressive in approving waivers of the IMD exclusion, at least to the extent that it’s to deal with the opioid crisis. CMS clearly has some limits. The Massachusetts waiver, we saw that Governor Baker wanted to waive provisions of the Medicaid prescription drug rebate program and the CMS rejected that waiver, so there are some limitations.   So I’m going to wrap up there, happy to take questions after we’re all done speaking and I’m going to pass this down, if I may.   SARAH DASH:  Thank you, Tom, and before we hear from Cynthia Beane, can I just ask if you could elaborate a little — what kind of falls under community engagement specifically?  If you could elaborate on that. Either Calder or Thomas, actually.   CALDER LYNCH:   Sure, I’ll elaborate. So really our guidance outlines a number of activities that states can count toward meeting a community engagement requirement, including work, volunteering, education, training, and states have some flexibility. What we’ve encouraged states to do is look at the activities that count under other existing work and community-engagement programs like those used in SNAP and TANF, and potentially align with those. Or add additional activities as they think appropriate for the population of the targeting through the Medicaid waiver, but really have a lot of flexibility in designing that at the state level.   SARAH DASH: Thank you.  Okay, Cynthia Beane from West Virginia.   CYNTHIA BEANE:  Hi, Cindy Beane, I’m the Commissioner at West Virginia Medicaid. I’ve been there in my position for about four years and before that, I was the Deputy Commissioner at Medicaid. So a lot of history with West Virginia Medicaid, and we have gone through a lot of changes. What I want to do is highlight the West Virginal footprint, and all the changes that CMS has made available for us to tailor our program to meet the needs of West Virginians.   So West Virginia Medicaid, just to give you an idea of the footprint of what Medicaid is in West Virginia, one out of every four adults in West Virginia is covered by West Virginia Medicaid, three out of five low income individuals, one out of every two children born in West Virginia are covered by Medicaid, three out of four of all our nursing home residents, and one out of every two people with disabilities. So in West Virginia, Medicaid has quite a large footprint in our healthcare system. So when the decision was whether or not we were going to expand Medicaid under the ACA, one of the things that was taken into consideration is, we need a healthy workforce in West Virginia. Our economy is changing, and at that time of expansion, we were starting to see the rise of the opioid epidemic in West Virginia. 20,000 of our Medicaid expansion members actually have a primary diagnosis of SUD, 50,000 of our expansion members actually have a secondary diagnoses of SUD. So when we expanded Medicaid in West Virginia, we used one of the flexibilities that was offered, and we used it at modified 1115 waiver in order to get people on the roles. Our actuaries predicted that by year two or three, we would have 90,000 individuals enrolled. We were very successful. We had over 100,000 individuals enrolled within a period of six months. What we found was, there was a lot of demand with individuals that previously didn’t have healthcare. We found individuals had a healthcare need that were no longer able to work. We had a hairdresser give testimony on that. She had to have a knee replacement, couldn’t afford it, got an expansion, got her knee replaced, and was back to work. So that’s how expansion worked in West Virginia.   Speaking of the opioid epidemic, and I think it’s mentioned here a couple times, about the 1115 opportunity for SUD. This stat is devastating for the state of West Virginia. We lead the nation in overdose deaths. You can see the national average is around 19, and we are at 52 per 100,000. So we were very excited with the opportunity that CMS gave to produce SUD waivers to get services out there, to get full, continuous services for individuals with SUD. We were the first state to be approved under the Trump Administration for our waiver. Our waiver basically provides a continuous services for individuals that are suffering SUD in West Virginia. It goes from an passement to actually in-patient treatment, waives those IMDs, so we can have some short in-patient stays, and also does some peer recovery supports, and also expands our use of medication assisted treatment, which is an evidenced treatment for SUD, and so in West Virginia, as soon as we applied for that waiver, we got lots of calls from individuals who previously were going to perhaps a methadone clinic, paying cash. I remember one call I took from a grandmother who said, you know, crying on the phone, “Thank you, I hear you’re covering this now, I didn’t know how much longer I was going to be able to hang on. My car is breaking down, but I’m paying the methadone clinic for my grandson, and this is the best he’s been in five years. I’ve getting him back, and I can’t — I don’t know how we would have hung on.” So those are things that are going on in West Virginia, and that’s how Medicaid is making a true difference in the lives of West Virginians.   With the 1115 waiver, with the new administration and it’s always been — an emphasis is an increasing accountability. So with the evaluation, we have partnered with our university — West Virginia University — to really do a robust evaluation of our waiver, and we’re doing a comparison study with regards to our waiver, it’s impact, and actually doing a different study with another state. And we’re also trying to get another state to come on board, but that’s where we’re at right now.   Neonatal Abstinence Syndrome; this is something that happens to babies when they’re exposed to drugs in the womb during pregnancy, and it’s basically the withdrawal of those babies. So a baby with Neonatal Abstinence Syndrome is not best served in a NICU with bright lights and lots of noise. So we actually had a unique opportunity, we had some nurses at one of our NICUs that were being inodiated with these children, and started a place called Lily’s Place, and it is actually a place where these babies are weaned off and withdrawn in a setting that is more conducive to the baby;  not in a bright light NICU. We worked with CMS to figure out, how can we get this approved? CMS actually worked with us for months, and we got a state plan approval for that, and we are the first state to be able to do that and we are very excited about that program.   Another flexibility that West Virginia has taken advantage of is our health home flexibility. This flexibility gives an opportunity for you to have the health home that integrates both your physical and behavioral health, and it gives a team approach to that individual, follows up, makes sure they are following up for their appointments. We have two health homes running in West Virginia. Our first health home was a Bob Hohler Hepatitis C Health Home. Also, due to different factors we lead the nation in hepatitis as well. And we went from a 25% screen rate to a 100% screen rate for hepatitis for our individuals participating in our health  homes.   Just some quick statistics for our first health home. This was our Bob Hohler Health Home and we actually started out in a pilot area, so we had a six county pilot, and then compared it to a six county cohort pilot in another area of West Virginia to see some dram