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Possible "Without Waiver" Baseline Adjustments to Support Budget Neutrality

Draft Only

Past Act

Justification

Reaction

Pro

Con

CMS

Stakeholders

12

Hospital Contracting Program

California was the only state to use this cost control approach, and could have used a Section 1115 waiver.

CMS/OIG has raised questions regarding the actual savings of the program.  

The hospital contracting waiver required a 1915b and is now under the current 1115. California benefited from SPCP, which may diminish CMS sympathy.

Likely No Opinion

13

Low Medi-Cal Managed Care Rates

* California ranked 29 of 36 states in a rate survey, paying under major states. (2001)   * Permissible to increase rates absent a waiver.

* Data is old and difficult to quantify. * California has low managed care rates overall, causing some to dismiss this argument.

CMS policy is that budget neutrality is only affected by policy where a waiver was needed.

Likely No Opinion

14

Pharmacy Rebates

California's pharmacy rebates have greater success than most states.  NY got BN credit for CA-type program.

CMS may raise other issues regarding pharmacy spending.

CMS policy is that budget neutrality is only affected by policy where a waiver was needed.

Likely No Opinion

15

Utilization Management

California has Superior Systems Waiver with major savings, that could support BN.

Need to make an argument on how California is different than other states.

CMS policy is that budget neutrality is only affected by policy where a waiver was needed.

Providers will express concern.  

16

Anti-Fraud Activities

California has had an aggressive anti-fraud effort.  Other states such as NY are starting these programs and getting credit.

Need to make an argument on how California is different than other states.

CMS policy is that BN is only affected by policy where a waiver was needed.

Providers will express concerns about the state program.  Press may raise fraud issues.

Health Management Associates/Harbage ConsultingPage 53

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