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SHADAC Examines the Implementation of Section 1115 Medicaid Expansion Waivers: MACPAC ReportFebruary 20, 2018:
A SHADAC analysis of how four states implemented Section 1115 Medicaid expansion waivers is now available. These states—Arkansas, Indiana, Iowa, and Michigan—are among eight that have expanded their Medicaid programs through Section 1115 of the Social Security Act rather than through the expansion option available under the Affordable Care Act (ACA).
About the Analysis
SHADAC’s analysis, commissioned by the Medicaid and CHIP Payment and Access Commission (MACPAC), sought to understand how Arkansas, Indiana, Iowa, and Michigan approached the implementation of key provisions of their Section 1115 Medicaid expansion waivers:
- Exchange plan premium assistance (Arkansas & Iowa)
- Enrollee contribution requirements (Iowa & Michigan)
- Health savings accounts (Arkansas & Indiana)
- Healthy behavior incentives (Indiana, Iowa, & Michigan)
- Graduated copayments for emergency department use (Indiana)
SHADAC researchers conducted interviews with 33 individuals representing current and former state agency staff and health insurance carriers in the four study states to identify the steps that states took to operationalize their programs. The report provides background information on the waiver program elements implemented in each of the four study states, summarizes the key pieces of administrative capacity that states put into place to implement their waivers, and details the specific program challenges they faced.
Key themes that emerged from the interviews include:
- These waiver programs were more administratively complex than traditional Medicaid, but the effort was worthwhile in order to expand access to coverage.
- The value in waiver-based Medicaid expansions is in testing approaches to incentivize behavior change, not necessarily in saving the state money.
- Involving operational staff in the waiver design process as early as possible may help to ensure policy goals are achievable.
- Building off of existing capacity and infrastructure made implementation manageable under short timelines, but it was not necessarily efficient.
- Significant administrative resources were needed to implement and support ongoing operations of these new programs.
- Considerable IT system redesign was required to develop and maintain programs.
- The complexity of policy provisions being tested meant that targeted and ongoing member outreach was essential, but also an ongoing challenge.
- Despite a need for substantial communication and negotiation with states, health plans generally felt equipped to take on additional implementation responsibilities.