Republican governors craft historic attempt to improve Medicaid delivery

Today (Monday, June 13), 28 Republican governors released a joint letter laying out broad market-oriented principles for Medicaid reform. Oklahoma Governor Mary Fallin was among those signing the document. 

In a statement sent to CapitolBeatOK, Gov. Fallin said, “Given the flexibility to craft their own solutions, states can meet the health care challenges of their citizens better than a one-size-fits-all plan handed down from Washington. 

“These principles will serve as a guide as we work with the federal government to improve the delivery of Medicaid.”

In response to a question from CapitolBeatOK, Christie Herrera of the American Legislative Exchange (ALEC) said the state legislators groups was “encouraged that Governor Fallin, and 28 of her colleagues, are demanding fiscal certainty and flexibility from the Medicaid program.”

Herrara, director of ALEC’s Health and Human Services Task Force, said, “For too long, Medicaid has rewarded states for spending more taxpayer dollars, not performing better.  Whether it’s through a block grant or a capped allotment structure, ALEC believes that the states are in the best position to truly transform the Medicaid system and bring quality care at lower costs.”

The seven principles were laid out in a letter to U.S. Sen. Orrin Hatch of Utah, the ranking Member of the Senate Committee on Finance, and to U.S. Rep. Fred Upton of Michigan, chairman of the House Committee on Energy and Commerce.

Principles guiding the governors, as listed in the letter circulated Monday, were:

1. States and territories are best able to make decisions about the design of their healthcare systems based on the respective needs, culture and values of each state.

2. States and territories should also have the opportunity to innovate by using flexible, accountable financing mechanisms that are transparent and that hold states accountable for efficiency and quality healthcare.  Such mechanisms may include a block grant, a capped allotment outside of a waiver, or other accountable and transparent financing approaches.

3. Medicaid should be focused on quality, value-based and patient-centered programs that work in concert to improve the health of our states’ citizens and drive value over volume, quality over quantity, at the same time containing costs. 

4. States and territories must be able to streamline and simplify the eligibility process to ensure coverage for those most in need, and states must be able to enforce reasonable cost sharing for those able to pay.

5. States and territories can provide Medicaid recipients a choice in their healthcare coverage plans, just as many have in the private market, if they are able to leverage the existing insurance marketplace through innovative support mechanisms.   

6. Territories must be ensured full integration into the federal healthcare system so they can provide healthcare coverage to those in need with the flexibility afforded to the states.

7. States must have greater flexibility in eligibility, financing and service delivery in order to provide long-term services and support that keep pace with the people Medicaid serves. New federal requirements threaten to stifle state innovation and investment.  In addition, since dual eligibles now constitute 39 percent of Medicaid spending, Medicare policies that shift costs to the states must be reversed and the innovative power of states should be rewarded by a shared-savings program that allows full flexibility to target and deliver services, which are cost-effective for both state and federal taxpayers.

Applauding the joint letter of the state chief executives was an analyst for the Oklahoma Council of Public Affairs (OCPA), who told CapitolBeatOK the group “gladly supports Gov. Fallin’s effort to gain greater Medicaid flexibility for Oklahoma.” 

OCPA health policy analyst Jason Sutton continued, “Right now, Oklahoma Medicaid patients have trouble finding even a primary care physician, much less a specialist, and are forced to utilize our emergency rooms for even basic, non-emergency treatments. Costs are spiraling out of control and taxpayers simply can’t sustain this program as is. 

“We’ve simply made too many promises to too many people that we can’t keep. We need real cost-containing flexibility to continue providing services to the most needy Oklahomans.”

In addition to Fallin, signatories on the letter included Govs. Robert J. Bentley of Alabama, Sean Parnell of Alaska, Jan Brewer of Arizona, Rick Scott of Florida, Nathan Deal of Georgia, C.L. “Butch” Otter of Idaho, Mitch Daniels of Indiana, Terry L. Branstad of Iowa, Sam Brownback of Kansas, Bobby Jindal of Louisiana, Paul L. LaPage of Maine, Hayley Barbour of Mississippi, David Heineman of Nebraska and Brian Sandoval of Nevada.

Also on the letter were Govs. Chris Christie of New Jersey, Susana Martinez of New Mexico, Jack Dalrymple of North Dakota, John R. Kasich of Iowa, Tom Corbett of Pennsylvania, Nikki Haley of South Carolina, Dennis Daaugard of South Dakota, Bill Haslam of Tennessee, Rick Perry of Texas, Gary R. Herbert of Utah, Robert F. McDonnell of Virginia, Scott Walker of Wisconsin, Matthew H. Mead of Wyoming, and Luis Fortuno of Puerto Rico.

The joint letter was copied to President Barack Obama, HHS Secretary Kathleen Sebelius, Speaker of the U.S. House John Boehner, Democratic Senate Majority Leader Harry Reid, Republican Senate Minority Leader Mitch McConnell, and Democratic House Leader Nancy Pelosi.