Mathematica Policy Research, Inc. has released a brief examining the Money Follows the Person demonstration program.  Established as part of the Deficit Reduction Act of 2005, the program provides incentives to states to transition Medicaid beneficiaries from long-term care institutions into community-based care settings.  The authors examine program participants' quality of life over the course of their first year of participation in the program, finding an increase in life quality measures after individuals transitioned into community settings.

From the report:

The Money Follows the Person (MFP) Demonstration, established by Congress through the Deficit Reduction Act of 2005 (DRA), provides state Medicaid programs the opportunity to help transition into the community Medicaid beneficiaries living in long-term care institutions. The MFP program provides states with enhanced federal matching rates for spending on home- and community-based services (HCBS) provided to program participants and provides funding for associated administrative costs. MFP grantees, in turn, provide enhanced community services to participants during their 365-day period of program participation. In 2007, the Centers for Medi­care & Medicaid Services (CMS) awarded grants to, and has since overseen the implementation of MFP programs in 29 states and the District of Columbia.1 CMS awarded another 13 grants in February 2011; these states are currently getting the details of their programs approved and start­ing program operations.

Full report:  Money Follows the Person: Change in Participant Experience During the First Year of Community Living (PDF | 328 KB)

Mathematica Policy Research, Inc.  (2011).  Money Follows the Person: changes in participant experience during the first year of community living.  Simon, S. and Hodges, M.

On March 23, Republican members of the House Energy and Commerce Committee released a report projecting the future of the national health care reform law’s Early Retiree Reinsurance Program (ERRP).  Under the program, health reform allocates $5 billion for businesses, unions, and state and local governments to cover health care costs for early retirees between the ages of 55 and 65.  Running through December 2014, the program will cover 80 percent of the costs of retirees’ claims between $15,000 and $90,000 and offer coverage for early retirees’ spouses and dependents.  The committee found that the program spent $535 million on health care costs for 253 organizations in 2010.  Noting that over 5,000 additional organizations are approved to receive future payments from the program, the authors caution that the fund could be depleted in 2011 if all approved organizations access funding at a rate similar to the first 253.

From the report:

The Early Retiree Reinsurance Program (ERRP), a $5 billion fund hailed as one of the key early benefits of the Patient Protection and Affordable Care Act (PPACA), will exhaust its resources long before the planned sunset on January 1, 2014, according to information provided by the Center for Consumer Information and Insurance Oversight (CCIIO). Recent figures show that CCIIO has approved over 5,000 entities to participate in the program. In 2010, however, CCIIO doled out $535 million to just 253 of those entities. Based on those spending patterns, the fund will exhaust its resources much sooner than originally estimated, with the majority of that money going to state and local governments. If the fund runs out of money, it is highly unlikely that the remaining beneficiaries, including unions and large corporations, would be able to obtain Congressional approval or public support for assistance on an individual basis.

Full report:Impending Exhaustion of Funding for Early Retiree Reinsurance Program (PDF | 117.99MB)

House Energy and Commerce Committee.  (2011).  Impending exhaustion of funding for early retiree reinsurance program.  

On January 27, the Kaiser Family Foundation (KFF) released a brief examining the role of Medicare in dual eligibles’ health care. The brief notes that the 9 million individuals who are eligible for both Medicare and Medicaid account for a disproportionate share of spending in both programs and often have greater health care needs and lower incomes than the other Medicare beneficiaries. The brief outlines dual eligibles’ use of Medicare-covered services and examines Medicare spending data for their care. The authors also highlight opportunities to improve health services and care coordination for the dual eligible population, particularly within national health care reform. The brief notes that current policy discussions centered on reducing spending target dual eligible spending as an area for cost savings. The authors suggest that improving care coordination may improve dual eligible care while reducing program costs; however, they contend that policymakers must ensure that dual eligibles’ access to care is not negatively affected by spending reduction.

From the report:  

The 2010 health reform law incorporates a number of provisions designed to improve the quality of medical care for high-need, high-cost populations, including the nine million low-income elderly and disabled people who are dually eligible for Medicare and Medicaid (Exhibit 1). These “dual eligibles” are more likely than other Medicare beneficiaries to be frail, live with multiple chronic conditions and have functional and cognitive impairments. They also face the challenge of navigating two health care programs, Medicare and Medicaid, which do not always work well together because they have different benefits, billing systems, enrollment, eligibility, and appeals procedures, and often different provider networks.

Full Article:  The Role of Medicare for the People Dually Eligible for Medicare and Medicaid (PDF | 468 KB)

Kaiser Family Foundation. (2011). The role of Medicare for the people dually eligible for Medicare and Medicaid.

On January 18, Medicare Inspector General Daniel Levinson’s office presented a report to Centers for Medicare & Medicaid Services (CMS) Administrator Donald Berwick, finding that Medicare could save up to $450 million annually through changes to Medicare Advantage (MA) payment policies.  The report examines data from an audit of 50 MA plans, finding that the federal government’s policy of early payment allowed insurers to earn interest on the payments for an average of 46 days before using them to pay for services.  The report found that interest earnings on prepayments totaled $450 million in 2007. 

From the report:

The Centers for Medicare & Medicaid Services (CMS) finances the Medicare program through the Federal Hospital Insurance (Part A) and Supplementary Medical Insurance (Part B) trust funds. The assets of the trust funds are held in special-issue U.S. Treasury securities, which earn interest income. The Medicare Part C program offers beneficiaries managed care options through the Medicare Advantage program (formerly called Medicare+Choice), which is also financed by the Part A and Part B trust funds.

Pursuant to the Social Security Act (section 1853(a)(1)(A), 42 U.S.C. § 1395w–23(a)(1)(A)), CMS makes advance capitated payments (prepayments) to Medicare Advantage organizations (MA organizations) for each enrollee at the beginning of each month. MA organizations may invest these Medicare funds in interest-bearing instruments until the funds are needed to pay for medical and administrative services. Federal law does not currently limit the ability of MA organizations to retain as additional revenue the investment income earned on Federal funds. MA organizations must submit, on an annual basis, bid proposals containing their anticipated revenue requirements for providing medical services under each of their plans for the upcoming year.

Full Report: Rollup Review of Impact on Medicare Program for Investment Income That Medicare Advantage Organizations Earned and Retained From Medicare Funds in 2007 (PDF | 465 KB)

Department of Health and Human Services. (2011). Rollup review of impact on Medicare program for investment income that Medicare Advantage organizations earned and retained from Medicare funds in 2007.

This report by The Commonwealth Fund examines the effect that the Affordable Care Act will have on individuals between the ages of 50 and 64. This population is unique in that many are uninsured due to high unemployment rates and the suspension of employer sponsored insurance.

From the report:

The number of men and women between the ages of 50 and 64 who are uninsured climbed to 8.6 million in 2009, an increase of 1.1 million from 2008 (Exhibit 1).1 About 4.2 million women and 4.3 million men were without health insurance. In addition, an estimated 9.7 million adults in this age group—sometimes known as "baby boomers"—have health insurance with such high out-of-pocket costs relative to income that they are effectively underinsured.2 The Patient Protection and Affordable Care Act of 2010 will provide health insurance to all U.S. citizens starting in 2014 and significantly improve the quality of health insurance. In particular, of the 8.6 million 50-to-64-year-olds who were uninsured in 2009, up to 6.8 million would gain subsidized coverage once all the law’s provisions go into effect in 2014—3.3 million in families earning less than 133 percent of the federal poverty level would gain coverage under Medicaid and 3.5 million earning less than 400 percent of poverty would gain subsidized private coverage through the insurance exchanges (Exhibit 2). In addition, about 1.4 million older currently uninsured adults with incomes of 400 percent of poverty or higher would have access to health insurance plans through the exchanges.

Full Report:Realizing Health Reform’s Potential: Adults Ages 50–64 and the Affordable Care Act of 2010 (PDF | 860 KB)

The Commwealth Fund. (2010). Realizing health reform's potential: adults ages 50-64 and the Affordable Care Act of 2010. Collins, S., Doty, M., and Garber, T.

On November 4, the Kaiser Family Foundation (KFF) released the Medicare Chartbook, 2010, offering an in-depth examination of the Medicare program.  The chartbook provides demographic data of the program’s 47 million beneficiaries, explains the program’s benefits, and outlines Medicare’s spending data and financing mechanisms.  KFF’s report also includes data on health service utilization rates, access to care, and out-of-pocket spending.  The authors note that Medicare’s size and critical role in American health coverage will keep it at the forefront of health policy discussions for the foreseeable future.

From the report:

Medicare provides substantial health and financial security for 47 million elderly and disabled americans. medicare is a social insurance program, like social security, that offers health coverage to eligible individuals, regardless of income or health status. People pay into medicare throughout their working lives and generally become eligible for medicare when they reach age 65, although younger adults can also qualify if they have a permanent disability. Comprising approximately 15 percent of the federal budget and 20 percent of total national health spending in 2010 and a rising share of the nation’s gross domestic product (GdP), medicare is often a part of discussions related to the growth in federal spending and rising health care costs. With the dual challenges of providing needed and increasingly expensive medical care to an aging population and keeping the program financially secure for the future, the medicare program is likely to remain at the forefront of national policy discussions in the coming years.

Full Report: Medicaid Chartbook 2010 (PDF | 2.15 MB)

Kaiser Family Foundation. (2010). Medicaid chartbook 2010.