Dave Richard, deputy secretary for the state's Medicaid program, has said the Cooper administration's plan, submitted Nov. 20, has three main focuses:
* Integrating whole-body services to combined physical, mental, intellectual and developmental disabilities and substance-use disorders.
* Tackling unmet social needs and their effect on overall health, such as improving telemedicine access and putting more focus on the state's opioid addiction crisis.
* Enhancing successful existing programs, such as care management, while supporting providers and beneficiaries through any changes, such as creating a "one-stop shop" for credentialing and streamlining beneficiary eligibility and enrollment processes.
"This is a well thought out plan that puts Medicaid reform on a strong footing," said Mark Hall, a law professor at Wake Forest University and a national health-care expert. "I expect that it will be well-received and approved by the federal government."
North Carolina became eligible Thursday to require Medicaid recipients to either work or participate in activities such as job training and volunteering, in order to qualify for benefits.
The ruling from the Centers for Medicare and Medicaid Services affects the federal Medicaid waiver request submitted by the McCrory administration in June 2016 and amended Nov. 20 by the Cooper administration.
The ruling affects nine other states, eight of which - like North Carolina -are led by Republican-controlled legislatures. Recipients are not legally required to hold a job to be on Medicaid.
Seema Verma, CMS' administrator, said in a statement that the controversial plan aims "to improve Medicaid enrollee health outcomes by incentivizing community engagement among able-bodied, working-age Medicaid beneficiaries."
"Medicaid needs to be more flexible so that states can best address the needs of this population. Our fundamental goal is to make a positive and lasting difference in the health and wellness of our beneficiaries, and today's announcement is a step in that direction."
There are more than 2 million North Carolinians who receive Medicaid services, nearly 20 percent of the state's population.
Cobey Culton, spokesman for N.C. Department of Health and Human Services, said the department is "reviewing the new guidance to understand how it may impact us."
Several public-health advocacy groups wasted little time in opposing the ruling, with some threatening legal actions to halt its implementation.
"Work requirement provisions are thinly veiled efforts to reduce the number of people who receive affordable and quality healthcare through Medicaid," Harold Wimmer, national president and chief executive of the American Lung Association, said in a statement.
"The nonpartisan Congressional Budget Office concluded that states would use work requirements to further reduce enrollment in Medicaid. In their work requirement proposals, many states acknowledged that they will reduce the number of people enrolled."
Families USA said the decision represents "a radical shift in CMS policy that violates federal law and is part of an ideological agenda that is hostile to government assistance with health coverage."
"It is telling that both the Trump administration and the states proposing work requirements also have proposed major cuts to Medicaid that would take away coverage from millions of people," said Eliot Fishman, senior director of health policy of Families USA.
"For those who cannot find work, requiring unpaid volunteer work in exchange for health coverage is unconscionable legally and morally, recalling the days of work houses for the poor."
Other states to receive approval are Arizona, Arkansas, Indiana, Kansas, Kentucky, Maine, New Hampshire, Utah and Wisconsin. They are eligible for a waiver request in part because they have agreed to test Medicaid demonstration programs.
CMS said individuals eligible for Medicaid due to a disability, elderly beneficiaries, children and pregnant women would be exempt from the requirement. State DHHS would be "required to make reasonable modifications for individuals with opioid addiction and other substance use disorders."
According to the Kaiser Family Foundation, 40 percent of Medicaid recipients nationwide, or 9.8 million, do not work, while 42 percent work full time and 18 percent work part time.
Among those who do not work, 36 percent report they are ill or disabled, 30 percent report they are taking care of an ill family member or friend, 15 percent say they are in school and 9 percent say they are retired.
A Kaiser survey in 2017 found that 70 percent of the public support allowing states to impose work requirements on Medicaid recipients.
The Nov. 20 amendment by N.C. DHHS includes elements of House Bill 662, known as "Carolina Cares," that was introduced during the 2017 legislative session by Rep. Donny Lambeth, R-Forsyth. The bill did not emerge from committee.
Under the bill, Medicaid enrollees would be required to be employed or engaged in activities to promote employment, with exemptions similar to those set by CMS.
Lambeth said Carolina Cares would work "more like an insurance product for those working who can pay a portion of the cost, and the benefits and coverage are built around preventive and wellness care."
For example, participants would have to follow protocols for routine physicals and screenings to improve their health if they have such conditions as diabetes, obesity, etc.
An additional 500,000 could be eligible if North Carolina expands its Medicaid program, which is not included in the current N.C. waiver request.
Most Republican legislative leaders are opposed to expansion, with some saying it is a non-starter, because of concerns that the federal government may not provide 90 percent of the annual administrative costs for the expansion.
CMS said the requirements "should take into consideration areas of high unemployment or care giving for young children or elderly family members."
The Medicaid work and community service requirements would be aligned with those involving federal food-stamp eligibility if applicable in those states, CMS said.
"People who participate in activities that increase their education and training are more likely to find sustainable employment, have higher earnings, a better quality of life, and, studies have shown, improved health outcomes," Verma said.
The N.C. waiver request proposes a hybrid public- and private-sector reform solution that eventually would combine physical and behavioral health into a whole-body care platform.
The end goal of Medicaid oversight is services being put into the hands of three statewide managed-care organizations, likely prepaid health plans from commercial insurers, and up to 12 provider-led entities, likely to involve not-for-profit health-care systems. A coalition of health-care systems has plans to create a statewide MCO option.
Each of six regions established by the reform legislation could have up to five provider-led entities providing services. Most recipients will be able to choose whether to be covered by a prepaid plan or a provider-led entity.
DHHS had set a goal of beginning in March the bid process for the statewide and provider-led entities. "We are working this week in hopes we can get this resolved by March to move forward with our bid process," Lambeth said.
Sen. Joyce Krawiec, R-Forsyth, said she supports the work and community service requirement because "I believe that most people think it's appropriate to require certain able-bodied recipients to work, volunteer or receive training."
"The goal should be to assist folks, who are able bodied, to become members of the work force."
Lambeth said he has been puzzled by the Trump administration's slow approach to the state Medicaid waiver request.
"We are approaching two years since our request was submitted," Lambeth said. "Our plan is innovative, saves taxpayers money and improves access and quality of care."
DHHS projects about $400 million in savings in the first five years of implementation.
"I have personally talked to the Trump administration and asked for an expedited review, and I get full assurances we will get their full priority," Lambeth said.
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