March 3, 2008

The Honorable Harry Reid
United States Senate
528 Hart Senate Office Bldg.
Washington, D.C.  20510-0001

The Honorable John Ensign
United States Senate
119 Russell Senate Office Bldg.
Washington, D.C.  20510-0001

The Honorable Shelly Berkley
House of Representatives
405 Cannon House Office Bldg.
Washington, D.C.  20510-4708

The Honorable Dean Heller
House of Representatives
103 Longworth House Office Bldg.
Washington, D.C.  20515-0001

The Honorable John C. Porter
House of Representatives
218 Cannon House Office Bldg.
Washington, D.C.  20515-0001

Dear Nevada Congressional Delegation:

As you know, Nevada faces a state budget shortfall of roughly $540 million.  Nevada Medicaid is being reduced roughly $80 million (Fed/State) as its share of the budget cuts.  On top of that cut, the federal share (known as FMAP) of Medicaid is being reduced from roughly 52.5% to 50% which will cost an additional $19.7 million in SFY ‘09. Moreover, increased caseloads caused by our economic turndown, are likely to lead to additional cuts.

Over the past year the Administration has proposed or issued regulations which will force states to make significant changes to Medicaid.  If implemented, it is estimated that Nevada will lose $262 million in Medicaid funded services over the next five years unless we replace federal dollars with state General Fund.  At a time of such a budget crisis, shifting costs to our state and local governments forces Nevada to make difficult choices between vital services and an additional burden on our tax payers.  The below signed cross section of advocates and providers strongly urge you to protect Nevada from these harmful changes by passing legislation to extend existing moratoria on harmful regulations and to delay additional regulations which will go into effect if Congress fails to act.  A number of programs/services are impacted.  Here are a few examples:

The Centers for Medicare & Medicaid Services (CMS) is refusing to allow states to bill for children in custody that may be receiving services while in foster care (called therapeutic foster care).  Medicaid is an appropriate payer of mental health services including therapeutic treatment that may occur regardless of who has parental custody.  CMS’s position is wrong and would impact some 300 Nevada children in Clark County alone. 

Another service which would be lost is adult day health care.  Nevada currently has 6 adult day care health care centers serving approximately 255 Medicaid recipients.  These centers allow seniors to live with their families in the community.  If funding is terminated, these residents would be admitted to a nursing facility at a higher cost.  This also makes it difficult for the state to comply with the ADA requirements as outlined in the Olmstead decision which holds that it is discrimination against people with disabilities to serve them in a restricted setting rather than in the community. 

The proposed rules would also hurt Nevada’s school districts.  There are some 62,000 students in the Clark, Washoe and Carson City school districts who are Medicaid eligible.  Administrative activities performed by school employees in assisting students with Medicaid enrollment or accessing Medicaid benefits would not be allowed.  The school districts would lose some $9 million over 5 years and children would have decreased access to health care.           

Last year Congress acted on a bipartisan basis to pass legislation to temporarily delay implementation of regulations which would have significantly restricted federal support for services provided to children in schools, for rehabilitation services provided to children and people with disabilities, and for our health care safety net.  These moratoria are scheduled to expire this spring will be particularly damaging to Nevada if the regulations go into effect. 

Nevada is also preparing to implement regulations restricting federal reimbursement for targeted case management services which became final on March 3rd.  We urge Congress to delay implementation of this regulation as well.  This regulation alone will cost Nevada some $28 million per year in services.

In conclusion to protect 1) vulnerable seniors, children and people with disabilities who rely on Medicaid and 2) our state, local and local governments as well as school districts from increased budget pressure during a recession, we ask you to support the efforts that are under way to extend existing moratoria before their expiration this Spring and to implement additional moratoria on the more recently issued regulations.




E-mail other members of the House of Representatives

Support Legislation to Delay Harmful Medicaid Regulations

To date, the following bills have been introduced to extend or enact moratoria to delay various Medicaid regulations. In upcoming weeks, it is likely that a bill will be introduced to delay all of the regulations.

Legislation and Regulations

H.R. 5173 / S. 2578 — Temporarily delays application of proposed changes to Medicaid payment rules for case management and targeted case management services. Targeted Case Management: The regulation significantly limits federal Medicaid matching funds for case management services. The Deficit Reduction Act (DRA) made some changes to Medicaid’s case management benefit, but the regulation the Centers for Medicare and Medicaid Services issued to implement these changes goes far beyond what Congress intended and will have a detrimental impact on beneficiaries, especially children in foster care and people with physical or mental disabilities or other chronic health conditions. Status: Interim Final Rule goes into effect March 3rd.

H.R. 4355 — Imposes a one-year moratorium on the regulations or other administrative actions to restrict Medicaid coverage or payment for rehabilitation services, or school-based administration, transportation, or medical services.

Administrative Claiming and Transportation Costs for School-based Services — The regulation eliminates federal funds for outreach, enrollment assistance, coordination of health care services, and related activities by school personnel to enroll more eligible poor children in Medicaid. The rule also would reverse current policy that allows federal funds to be used to transport children to school if the children have special health needs and receive health care services at school. Status: Final rule issued; implementation delayed by Congressional action until 6/30/08.

Rehabilitation Services — Limits the types of rehabilitative services that states can cover with federal funds, including special instruction and therapy for children and other beneficiaries who have mental illness or developmental disabilities. The prohibits the use of federal Medicaid funds for therapeutic foster care, designed for children with serious mental illness, and significantly limits states’ ability to provide rehabilitative services designed to enable individuals with disabilities to improve their mental or physical capacities and remain out of an institution. Status: Delayed by Congressional action until 6/30/08.

H.R. 3533 — Extends by one year the moratorium on implementation of the hospital cost-limit rule and on finalization of the graduate medical education rule.

S. 2460 — Extends by one year the moratorium on implementation of the hospital cost-limit rule and on finalization of the graduate medical education rule, and includes a moratorium on the finalization of the outpatient Medicaid rule.

Hospital Cost-Limits — Limits payments to hospitals and other institutions operated by state or local governments to the cost of providing services to Medicaid beneficiaries, despite the fact that these hospitals need additional support from Medicaid to help in defraying the costs of providing care to the uninsured, along with the provision of essential services such as trauma care, emergency response, and neonatal intensive care. Also revises the definition of “providers” for purposes of Medicaid financing. Status: Final rule issued; implementation delayed by Congressional action until 5/25/08.

Graduate Medical Education — Eliminates federal Medicaid reimbursement for the costs of graduate medical education (GME) provided by teaching hospitals, which many state Medicaid programs have historically reimbursed to help offset the additional costs these facilities incur as a result of their special missions of educating physicians and caring for patients who require more intense, complex care. Status: Delayed by Congressional action until 5/25/08.

Outpatient Clinic and Hospital Facility Services — Changes the definition of outpatient hospital services to significantly narrow the types of services states can cover under this benefit category, severely restricting reimbursement rates for such services as hospital-based physician services, routine vision services, annual check-ups, and vaccinations. Status: Proposed rule issued 9/28/07, not subject to any moratorium.


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