Roadmap to Medicaid Reform: New Options to Improve & Expand Insurance Coverage for Acute Care Needs

More than $100 billion of Medicaid spending is currently delivered through waivers and demonstrations. The very nature of a waiver, candidly stated, is to demonstrate more modern approaches than those contained in the outdated rules of title XIX. But even with the success of waivers and demonstrations, they can be cumbersome to administer. Waiver and demonstration programs must show that they meet a variety of budget neutrality and cost-effectiveness tests, necessitating detailed analyses and lengthy discussions with the Federal government while putting states at risk for expenditures beyond the predetermined spending ceilings. State plan amendments (SPAs) do not have either feature and are administratively much more straightforward. As a result of DRA, the statute now gives states the tools they need to manage their programs without waivers or demonstrations in ways they have requested, tested, and proven over decades. A state's 21st century health care Medicaid program recognizes the different needs of the different populations served under title XIX.

By combining the new tools provided by the DRA with the options available under titles XIX and XXI and other programs, a state can:

• Expand access to affordable mainstream coverage
  
   
• Offer benchmark benefit packages
  
   
• Build public-private partnerships through premium assistance with employer coverage options
  
   
• Apply for High-Risk Pool Seed and Operational Grants
  
   
• Promote personal responsibility for health and in accessing health care
  
   
• Implement cost-sharing that is appropriate for an individual or family's income level
  
   
• Demonstrate the potential efficacy of Medicaid HOA and incentive-based approaches to health care delivery.

Improve quality and cost effective coordination of care:

• Expanding access to services through managed care
  
   
• Re-aligning Medicaid prices on prescription drugs with other purchasers and protect community pharmacists
  
   
• Reaping the benefits of disease management and similar strategies
  
   
• Taking aggressive steps with generic drugs
  
   
• Implementing electronic transmission of prescriptions or 'e-prescribing'.