Joel E. Miller

Senior Director of Policy and Health Care Reform NASMHPD

The Affordable Care Act (ACA) will create a new landscape for the delivery of mental health and health care in your state.

How your state chooses to implement the essential elements of the

law will determine funding priorities, delivery models, and most importantly, the health and wellness of people with a serious mental illness (SMI).

People with serious mental illness and other behavioral health

conditions will comprise a significant portion of the population in your state that is eligible under the new Medicaid Expansion Program and the Health Insurance Exchanges created by ACA.

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To provide access to standardized, comprehensive health insurance across the country, the ACA establishes a new marketplace in every state called “insurance exchanges.” Available on internet websites, these new virtual shopping malls for private health insurance will begin in January.

Designed to offer consumers an easy way to compare health insurance policies and understand their options, and federal subsidies (sliding income scale) are only available to individuals who enroll in an exchange health plan.

Exchanges will be open to individuals & small businesses to compare and purchase

insurance. CBO estimates that 24 million people will purchase coverage through the exchanges by 2017.

Private insurance companies will offer plans and prices in each exchange. The business of

health insurance in the individual and small group markets will follow federal parameters, including minimum benefit requirements for health plans offered through the exchange.

Within this federal framework, states may choose to operate a fully state-based exchange, opt for a state-federal partnership exchange, or default to a federally-facilitated exchange.

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1. Certify qualified health plans (QHPs); 2. Run a toll-free hotline and website; 3. Assign a price and quality rating to plans; 4. Inform individuals of their eligibility for Medicaid

and Children’s Health Insurance Program (CHIP); 5. Issue exemptions from the individual mandate; 6. Provide Treasury (IRS) with information to enforce

employer penalties and determine eligibility for premium and cost-sharing subsidies; and

7. Provide information to the Social Security Administration (SSA) to determine immigration

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In State-Federal Partnership Exchanges, states will share responsibility for the exchange with the federal government. States will administer some functions of the enrollment and exchange process, while delegating others to HHS.

For any state that is not willing or does not make sufficient progress to

create a state-based exchange or State-Federal Partnership Exchange, the federal government shall assume all of the state’s exchange responsibilities.

As of June 1, 2013, 27 states will default to a Federally-Facilitated

Exchange, 17 states and the District of Columbia received HHS certification to run a state-based exchange, and seven states are planning to operate a state-federal partnership exchange.

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The federal government has extended the deadline for employers to provide written

notice to employees about their insurance coverage options available on the ACA’s new exchanges from March 1, 2013, to October 1, 2013.

The notice must include information from the company explaining how much of the total cost of its employer-offered health plan it will pay, and if that number is less than 60%, that the employee may be eligible to receive a premium tax credit to purchase a qualified health plan through an exchange.

The notice must also inform the employee that if they purchase a plan through the exchange, the employee may lose the employer contribution to any health benefit plan offered by the employer, and that all or a portion of the employer contribution may be excludable from income for federal income tax purposes.

The Department of Labor expects that the timing for distribution of notices will be in the late summer or fall of 2013, which coordinates with the open enrollment period for the exchanges.

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Health Plan Competition on the Federally-Facilitated Exchanges: The Obama

Administration announced on May 30, 2013, that more than 120 insurance companies have applied to participate in the 19 states defaulting to a federally-facilitated exchange. Based on this preliminary data, they estimate that about 90 percent of people enrolling in the federal exchanges next year will have at least five different health plan options. The data do not include states entering into partnership exchanges with the federal government.

California (State-Based) Exchange: California was the first state in the nation to pass

legislation in December 2010 establishing a health exchange under the ACA. Governor Brown submitted California’s exchange blueprint and declaration letter on July 10, 2012 for a state-based exchange, and HHS granted conditional approval on January 3, 2013.

California Releases Participating Health Plans and Rates: California recently

announced the participating health plans (13 total) and insurance premium rates for their 2014 state exchange, Covered California, on May 23, 2013. Covered California officials report that the 13 health plans represent a wide range of insurance companies and that the rates submitted for individuals on the exchange will be about the same or lower than the current rates for small businesses.

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New Hampshire (Partnership): The New Hampshire House and Senate passed legislation

on June 16, 2012 – HB 1297 – to prevent state officials from implementing a state-based exchange. Then-Governor John Lynch signed the bill.

While the law prohibits New Hampshire from participating in or enabling a state-based

exchange, it allows state agencies to interact with the federal government for creating a partnership or federally-facilitated exchange.

Rather than default to a federally-facilitated exchange, newly confirmed Governor Hassan decided she wanted the state to retain the most control possible while maximizing federal funding. Governor Hassan submitted an exchange blueprint and declaration letter for a partnership exchange on February 13, 2013, and HHS granted conditional approval on March 7, 2013.

Only One Participating Insurer: State officials recently confirmed on May 28, 2013, that

only one insurer, Anthem BlueCross BlueShield, had applied to participate on their partnership exchange. The lack of participation of varying health plans in New Hampshire may undermine the health exchange’s goal of creating an even playing field for competition to drive down insurance premiums.

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New Mexico (State-Based): Governor Martinez submitted an

exchange blueprint and declaration letter to HHS on December 13, 2012, requesting confirmation for the development of a state-based exchange. HHS granted conditional approval for New Mexico’s exchange on January 3, 2013.

New Mexico Seeks Dual-Exchange: Following Utah’s model, New

Mexico announced its intention on May 20, 2013, to operate a dual-exchange partnership with the federal government.

In this arrangement, New Mexico would run an insurance exchange for small businesses and the federal government would independently run one for individuals. HHS has yet to approve New Mexico for this exchange model.

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Utah (Partnership, Dual-Exchange): Former Governor John Huntsman

established the Utah Health Exchange – a defined contribution model known as “Avenue H” – for small employers in 2008. Avenue H allows employees to shop for coverage within the exchange using a fixed amount of money from their employer.

After Congress passed the ACA, Utah sought to avoid establishing a health insurance exchange as envisioned by the health reform law and instead submitted a declaration letter to HHS on December 14, 2012, asking the agency to certify its existing small employers exchange. HHS granted Utah conditional approval for the state to run its Utah Health Exchange as a state-based exchange on January 3, 2013.

Utah Obtains First Dual-Exchange: In seeking greater flexibility for Utah

to retain its Avenue H model, Governor Herbert met with HHS officials in February 2013 and requested permission to continue running its existing exchange for small businesses while having the federal government independently run the individual exchange. HHS recently approved this new type of dual-exchange

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Unlike travel websites where consumers can simply compare prices and purchase airline tickets, the health insurance exchange websites face a far more daunting task.

Behind the scenes, computer programs must communicate with the IRS,

and other gov’t data-bases to confirm that the applicant is a U.S. citizen or legal resident and, if so, whether the person is eligible for subsidies to secure coverage on the exchanges.

The programs also must interface with state Medicaid systems and

dozens of insurers that are expected to offer plans on the exchanges. The goal is for all of this occur seamlessly and get consumers signed up in about 30 minutes for health plans that take effect on Jan. 1.

Limited time frame to test the roll out.

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The Obama Administration’s goal is to enroll 7 million people through

the new health insurance exchanges in the first year (2014).

The ACA’s success depends on a significant number – about 2.6 million – of young and healthy people signing up for coverage. Need to enroll this population to spread costs to keep premiums in check – ala the group health insurance principle.

Major outreach to this population of 18-35 year olds who are uninsured – one third who are clustered in California, Florida, and Texas.

HHS is targeting Hispanic populations working with Spanish-language media to provide information on health insurance accessibility and affordability.

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Florida is on course to spend $6 million to reach out to nearly 4 million uninsured people and help them sign up for coverage in the federal health law's online marketplace this fall.

Maryland will spend more than four times as much, or about $24.8

million, to help about 730,000 uninsured. The District of Columbia expects to spend about $9 million assisting 42,000 without insurance.

The wide variation in spending to hire and train “navigators” and

others to assist consumers in the first year of the new marketplaces could have a major impact on how many people actually get coverage under the new health law, according to many observers.

Obama Administration recently moved $54 million from the ACA Prevention Fund to provide new monies to hire and train people to assist consumers in choosing healt plans.

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Currently, each state Medicaid program determines eligibility for coverage, creating wide disparities among programs. One state may cover only pregnant women who earn less than 25 percent of the federal poverty level (FPL), while another state may offer Medicaid to all adults who make up to 150% of FPL.

Lawmakers designed the ACA to standardize eligibility criteria for Medicaid across the country and provide health insurance for millions of poor, uninsured Americans. According to the statute, all individuals and families under age 65 with incomes up to 133 percent of the FPL –$14,856 for an individual and $30,656 for a family of four (2012 FPL) – would become eligible for Medicaid through New Expansion.

The Supreme Court ruled on June 28, 2012 that states are not required to expand Medicaid as the ACA

originally mandated. Of the approximately 32 million Americans who stood to gain coverage at the time of the ACA’s passage, nearly 17 million – or half – were supposed to receive health insurance through Medicaid. Now, the total number of individuals covered by the Medicaid expansion depends on the states.

For the first three years of the expansion, 2014 to 2016, the ACA requires the federal government to pay

states’ full costs of covering the newly eligible Medicaid recipients. Afterwards, the federal government’s share gradually decreases to 90 percent by 2020, leaving states responsible for funding the remaining 10 percent. In the Current Medicaid program, the federal government only covers an average of 57 percent of a state’s total Medicaid costs, making the expansion – now voluntary – a lucrative opportunity (based on several studies) for many states seeking to cover more of their uninsured residents.

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CMS wrote to state officials on May 17, 2013, providing guidance on

how they can streamline their Medicaid enrollment process to help manage the ACA’s expansion of coverage. CMS recommended 5 “targeted enrollment strategies” for the states to consider:

1. Implementing the early adoption of Modified Adjusted Gross Income

(MAGI)-based rules; 2. Extending the Medicaid renewal period so that renewals that would

otherwise occur during the first quarter of calendar year 2014 (January 1, 2014 – March 31, 2014) occur later;

3. Enrolling individuals into Medicaid based on Supplemental Nutrition Assistance Program (SNAP) eligibility;

4. Enrolling parents into Medicaid based on children’s income eligibility; and

5. Adopting 12-month continuous eligibility for parents and other adults.

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Arizona (Supports): Governor Brewer has strongly supported the Medicaid expansion, pushing for its adoption by the state legislature since January 2013.

To counter inaction on the issue by state lawmakers, Governor Brewer pledged to veto all unrelated bills on May 10, 2013, until progress was made on the FY 2014 budget – including the Medicaid expansion. Six days later, the Arizona Senate voted 19-11 to approve Gov. Brewer’s plan to expand Medicaid. The measure faces an uncertain future in the Arizona House.

Governor Brewer Blocks Legislation, Pending Medicaid Solution: Following

through on her threat, Governor Brewer vetoed five unrelated bills on May 23, 2013.

In letter to Senate President, Governor Brewer stated, “I warned that I would not sign additional measures into law until we see resolution of the two most pressing issues facing us: adoption of a Fiscal 2014 State Budget and plan for Medicaid. It is disappointing I must demonstrate the moratorium was not an idle threat.”

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Arkansas (Supports): Arkansas made waves in health politics by being

the first state to propose using the Medicaid expansion funding to send newly eligible Medicaid beneficiaries to shop for private insurance policies on the exchanges.

This so called “private option” for expanding Medicaid seems like one potential compromise between Democrats and Republicans for covering this uninsured population. The Arkansas Republican state legislature passed the measure and Democratic Governor Mike Beebe signed it into law in the last week of April 2013. However, HHS has yet to approve the Arkansas model for the Medicaid expansion.

New Details on the Arkansas Private Option: New details on the

implementation timeline, health plan options, and mechanisms behind the Arkansas Private Option have emerged following a meeting between the state House and Senate Public Health Committees on May 23, 2013. State health officials are working on a detailed waiver proposal to obtain HHS approval, which they hope to receive by October 1, 2013.

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Iowa (Opposes): Iowa Governor Branstad is opposed to

the Medicaid expansion, preferring instead to scale back Medicaid coverage and send more enrollees to the upcoming ACA health insurance exchange.

Iowa Governor Branstad Changes Position: Governor

Branstad softened his position on the Medicaid expansion at a press conference on May 20, 2013, suggesting that he may accept it if it came with “stronger assurances” that the federal government will not cut back on the ACA’s funding rates in the future.

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Maine (Opposes): Maine’s current Medicaid program already covers both parents and

childless adults up to 133% of the FPL as called for by the ACA’s expansion.

Since expanding the program would not add new eligible enrollees, Maine would largely continue to receive its standard matching rate of 62.5% under the ACA rather than the higher new federal match rates. This lack of additional funding has led Governor LePage to lean against formally expanding Medicaid, but he has not made a final decision.

CMS Rejects Maine’s Request for Further Funding: Maine previously expanded Medicaid over the last decade to its current level without a higher federal matching rate. Governor LePage recently requested CMS to provide Maine with 100% funding for the Medicaid expansion population for 10 years, to make up for his state having completed the expansion already, as a prerequisite for his support.

CMS rejected LePage’s request on May 24, 2013, stating that they could not change the duration of the higher federal rates because “these rates are set by law, and CMS has no authority to change [them] by regulation or waiver.” In addition, CMS wrote that they had reached a “tentative conclusion” that childless adults in Maine covered under a previous expansion would be considered newly eligible for the federal government’s higher matching rate because the coverage offered prior did not meet the ACA’s criteria.

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Another factor affecting states’ decision on the Medicaid expansion is the ACA’s scheduled reductions in Disproportionate Share Hospital (DSH) payments. Those payments are critical to hospitals to help them manage the cost of uncompensated care they provide mostly to low-income and uninsured Americans ($41.3 billion in 2011).

The ACA cut back on these hospital payments because lawmakers designed the Medicaid expansion to provide coverage to a large portion of the low-income, uninsured population, decreasing the uncompensated care burden on providers. With the U.S. Supreme Court ruling, hospitals and providers in states that opt-out of expanding Medicaid will still lose DSH payments without gaining greater insurance coverage to offset them.

CMS released a proposed rule outlining the ACA’s Medicaid State DSH allotment

reductions on May 13, 2013, which becomes effective on October 1, 2013. The rule specified the following annual reductions to state-wide DSH allotments for all states:

Fiscal Year Reduction (Federal Share):

2014 $500 million 2015 $600 million 2016 $600 million 2017 $1.8 billion 2018 $5.0 billion 2019 $5.6 billion 2020 $4.0 billion

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The proposed rule establishes the reduction methodology for the next two years, FY 2014 and 2015, to give CMS the opportunity to refine its data and methodology before the larger DSH reductions start in FY 2017. In addition, the rule dictates that decisions on the Medicaid expansion will not be a factor considered in determining a state’s reduction in DSH payments.

The full list of factors involved in developing the methodology for each state’s reductions includes:

1. Low DSH states will receive smaller reductions. 2. States with the lowest percentages of uninsured individuals will receive larger reductions. 3. States that do not target their DSH payments to hospitals with high volumes of Medicaid beneficiaries will receive larger reductions. 4. States that do not target their DSH payments to hospitals with high levels of uncompensated care will receive larger reductions. 5. States that have increased coverage under Section 1115 demos as of July 31, 2009, and adjusted their DSH allotments will have these adjustments taken into account.

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Health plans offered in the new health insurance exchanges must meet essential health benefits (EHB) requirements. The law requires HHS to specify the package, which must at least include services covered within the following 10 categories: Ambulatory patient services Emergency services Hospitalization Maternity and newborn care Mental health and substance abuse disorder services Prescription drugs Laboratory services Rehabilitative and habilitative services and devices Preventive, wellness and chronic disease management Pediatric services including oral and vision care

The purpose of the EHB requirement is to ensure that enrollees have comprehensive coverage and a set of basic services they can expect any health plan policy to cover. According to data submitted by health insurance companies to HealthCare.gov, many consumers who purchase their own health insurance currently lack coverage of EHBs.

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For 2014 and 2015, states may pick a “benchmark plan” from one of the following four categories:

the largest plan by enrollment in any of the three largest small group insurance products in the State’s small group market;

any of the largest three State employee health benefit plans by enrollment; any of the largest three national Federal Employee Health Benefit Plan options by enrollment; or

the largest insured commercial non-Medicaid Health Maintenance Organization (HMO) operating in the state. In 30 states, the benchmark includes habilitative services, services to maintain or improve skills for daily living. Nine of the remaining 21 states define habilitative services, while 12 leave that definition up to the health plan. Examples of habilitative services include physical therapy and speech-language services.

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Americans who currently buy coverage in the individual health insurance market (about 18 million) in 2014 will gain access to essential health benefits. Based on current estimates of the size of the individual market and the percent of enrollees in currently marketed plans without coverage for certain services, coverage of benefits in the individual market may expand as follows:

Expected EHB Expansion:

8.7 million Americans will gain maternity coverage 4.8 million Americans will gain substance abuse coverage parity *

2.3 million Americans will gain mental health coverage parity *

1.3 million Americans will gain prescription drug coverage *7.1 million Americans alone who have coverage in the individual market will gain BH parity through insurance reforms and the EHP.

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EHB Final Rule : On February 20, 2013, a 149-page final rule on EHBs was

released. The rule is intended to help consumers shop for & compare insurance options in the individual & small group markets by offering consistency across plans, protecting consumers by ensuring plans cover a core package of items –equal in scope to benefits offered by a typical employer plan – and limiting their OOP expenses.

It also outlines insurance issuer standards related to the coverage of EHBs and the

determination of actuarial value (AV), while offering flexibility to states to shape how EHBs are defined.

The rule includes a timeline for accreditation requirements and finalizes an

application process for accrediting entities seeking to be recognized by the Secretary to fulfill the accreditation requirements for issuers offering coverage in any Insurance Exchange.

States pay either insurers or enrollees for cost of benefits not included in the EHB.

The rule does not specify how the requirement will be enforced. The rule also includes protections for consumers against discrimination based on age, expected length of life, present or predicted disability, degree of medical dependency, quality of life, or other health conditions in the EHB definition process.

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The ACA requires plans and issuers that offer coverage to children on their parents’ plan to make the coverage available until the adult child reaches the age of 26. This applies to all individual and group policies for plan or policy years beginning on or after September 23, 2010.

Children can join or remain on their parents’ plan even if they are: Married

Not living with their parents Attending school

Not financially dependent on their parents

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BH Accounted for 40% of Hospital Costs for Young Adults

Enrolled in in Parent’s Health Plans Under ACA – EBRI Report

Three conditions – addiction treatment, mental health

treatment and maternity care – accounted for 60 percent of hospital claims for young adults who were enrolled in their in their parent’s health plans in 2011 as a result of the ACA.

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Eligible to enroll in their employer’s plan: A June 2012 ASPE report

found that from September 2010 to December 2011, the percentage of adults ages 19 through 25 with insurance coverage increased from 64.4 percent to 74.8 percent which translates to 3.1 million young adults with coverage.

New England Journal of Medicine Study (May 2013): A New England

Journal of Medicine (NEJM) study released in May 2013 showed that private insurers covered $147 million in medical costs for young adults in the first year this provision was active. Youth covered under the young adult health care law requirement made more than 22,000 nondiscretionary emergency room visits in 2011.

The NEJM study examined details about emergency medical care provided to young adults at 392 hospitals from January 2008 through December 2011 to compare care before and after the provision went into place.

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Employers largely report that workplace wellness programs are delivering on their intended benefit of improving health and reducing costs.

According to the 2012 Kaiser/HRET survey, 73 percent of respondents that offered wellness programs stated that these programs improved employee health, and 52 percent believed that they reduced costs. In the RAND Employer Survey, only about half of employers with wellness programs stated that they had formally evaluated program impact, and only two percent reported actual cost savings.

The ACA increases the maximum permissible reward employers can

offer under wellness program, which increases to 30 percent in 2014 but can be up to 50 percent for health-contingent programs designed to prevent or reduce tobacco use. This provision establishes 10 state pilot programs to permit participating states to to apply similar rewards for participating in wellness programs in the individual market.

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HHS released its proposed rule regarding employee wellness programs on November 26, 2012. The proposed regulations continued to divide wellness programs into (1) participatory wellness programs and (2) health-contingent wellness programs.

Examples of participatory wellness programs include reimbursing the cost of membership in a fitness center; examples of health-contingent wellness programs include imposing a premium surcharge based on tobacco use; and using a health risk assessment to identify employees with specified medical conditions or risk factors and providing a reward to employees identified as within a normal or healthy range.

HHS released its final rule regarding employee wellness programs on May 29, 2013. The

final regulations provide criteria for a program of health promotion or disease prevention offered or provided by a group health plan or group health insurance issuer that must be satisfied in order for the plan or issuer to qualify for an exception to the prohibition on discrimination based on health status.

The final rule gives the most attention to standards for outcome-based programs that reward individuals with lower premiums for meeting certain health goals, like healthy cholesterol or blood pressure. Unlike “activity-only” programs, such as gym membership or attendance of health seminars, which are defined in the rule, the outcome-based incentives require results, and that can be a challenging standard if employees cannot achieve those results for medical reasons.

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To test innovative payment and service delivery models, the CMMI oversees demonstration projects with the goal of reducing Medicare or Medicaid program expenditures while preserving or enhancing quality of care. CMMI gives preference to models that improve coordination, quality and efficiency and for which evidence exists that the models address care deficits and reduce avoidable expenditures.

Once selected, CMMI has the authority to test the model for an

unspecified period of time during which it does not have to be budget neutral. Model evaluations must assess quality of care, including patient-level outcomes and patient-centered criteria and changes in spending. Upon completing the evaluation, the Secretary can use the rulemaking process to expand the model’s duration and scope, including implementation on a nationwide basis.

To exercise this authority, the HHS Secretary must determine that the

expansion expects to reduce spending without reducing quality or improve quality of care without increasing spending.

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Medicare currently makes separate payments to

various providers for the services they furnish to the same beneficiary for a single illness or course of treatment (an episode of care).

Offering these providers a single, bundled payment for an episode of care makes them jointly accountable for the patient’s care.

It also allows providers to achieve savings based on effectively managing resources as they provide treatment to the beneficiary throughout the episode.

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Network of providers that coordinate care for patient populations with key goals: control costs, increase quality, improve population health.

Bonuses for hitting quality and cost targets (some ACOs may also receive penalties for not hitting them).

Now more than 440 ACOs in the U.S. Medicare Shared Savings Program (3 options) - Medicare Pioneer Program, Private Insurer ACO Contracts, Medicaid Initiatives.

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Primary Care Practices (PCPs) that receive monthly fees to provide “whole person” enhanced care for patients (primarily those with chronic conditions).

Multiple Models Multi-payer Advanced Primary Care (PC) Practice Demo FQHC Advanced PC Practice Demo HRSA Patient-Centered Medical/Health Home Initiative Medicaid Health Home State Plan Option Comprehensive PC Initiative

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Potential roles in coordinated care efforts, like health homes and ACOs. ◦ Clinical provider in PCHH partnerships; ACO networks. ◦ Offer enabling services, community programs that enable health homes,

ACOs, to meet population health goals. ◦ Convene stakeholders; help ensure a true focus on prevention health as

contracts are made.

Potential roles in value, quality, and efficiency efforts like health homes, value-purchasing, HER ◦ Collection and analysis of data. ◦ Development of new quality measures.

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CMS announced the over 500 organizations on January 31, 2013 that will be participating in a three-year bundled payment demonstration, called the, authorized by the ACA. The bundling demonstration will test four payment models in order to achieve higher quality and more coordinated care at a lower cost for Medicare. Traditionally, Medicare makes separate payments to providers for each individual service they provide to beneficiaries for a single illness or course of treatment—an approach, which can result in fragmented care with minimal coordination across providers and health care settings. Research has shown that bundled payments can align incentives for providers, allowing them to work closely together across specialties and care settings.

Under the BCPI initiative, organizations will enter into payment arrangements that include

financial and performance accountability for episodes of care. Participants choose from 48 episodes, including, for example, pacemakers, stroke, diabetes, and renal failure.

CMMI will be testing the following four payment models:

Model 1: Retrospective Acute Care Hospital Stay Only

Model 2: Retrospective Acute Care Hospital Stay plus Post-Acute Care Model 3: Retrospective Post-Acute Care Only Model 4: Acute Care Hospital Stay Only

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Model 1 BPCI Awardees Announced The announcement from CMS included the selection of 32

awardees in Model 1 that began testing bundled payments for acute-care hospital stays in April 2013. CMS also plans to announce a second opportunity for providers to participate in Model 1, with an anticipated start date of early 2014.

Model 1 Applications Due in July 2013 CMS is recruiting acute hospitals to apply for participation in

Model 1 (inpatient services) of the Bundled Payments for Care Improvement initiative that began last month (Section 3021 of the ACA). CMS accepts applications until July 31, 2013. Currently, 24 health care facilities in New Jersey are participating in this initiative.

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CMMI issued two rounds of grants under its Health Care Innovation Challenge in 2012. Total funding under the program is expected to reach $1 billion for applicants who implement the most compelling new ideas to deliver better health, improve care and lower costs.

Providers, payers, local governments, public-private partnerships and multi-payer collaboratives were eligible to apply for the three-year grants which range from approximately $1 million to $30 million. Key objectives include:

Engage broad sets of partners to identify and test new care delivery and payment models; Identify new models of workforce development and deployment and related training and education that support new models either directly or through new infrastructure activities; and Support innovators who can rapidly deploy care improvement models through new ventures or expansion of existing efforts.

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CMMI awarded 26 grants totaling $123 million dollars on May

8, 2012. The funded projects – led by a mix of academic institutions, health care systems and hospitals – are expected to decrease spending by $254 million over three years. Just over a month later, CMMI released an additional set of awards to 81 organizations.

Second Round of Health Innovation Awards Announced : CMS

announced a second round of Health Care Innovation Awards on May 15, 2013. A mandatory letter of intent for interested applicants is available online beginning June 1, 2013.

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Major Flurry of Activity… Slowed to a Crawl

January 2013 1. Mental Health and Gun Safety 2. Long-Term Federal Budget Deficit Reduction 3. Entitlement Reforms 4. FY 2014 Budget 5. Tax Reforms 6. Immigration Reform

June 2013 1. Immigration Reform 2. Hearings on Scandals (e.g., IRS, DOJ) 3. Agency Oversight Hearings 4. The Sequester & FY 2014 Budget 5. Debt Reduction 6. Mental Health and Gun Safety

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Sen. Barbara Boxer (D-CA) plans to push a bill to provide $250 million and perhaps more to help local and state governments pay the cost of health care to uninsured immigrants who seek legal status under legislation now before the Senate.

The immigration bill before the Senate would bar most immigrants seeking

legal status from receiving federal benefits, such as food stamps and Medicaid, during the years it would take to become legal residents or U.S. citizens.

The amount of federal aid Boxer is proposing is far short of the $4 billion

provided to local and state governments under the 1986 immigration overhaul.

Currently, many applicants would be forced to wait 15 years or more

before gaining access to programs such as Medicaid. Under Boxer’s amendment, the longest an applicant would wait is 10 years.

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How big is the nation’s borrowing problem? Is it the $6.3 trillion in fresh debt projected over the next decade? Or is it the more than $70 trillion that Republicans say the nation will rack up over the next 30 years? Under Option 1, the national debt is high but stable as a share of the nation’s overall economy. Under Option 2, the debt is exploding to levels unseen in U.S. history.

The sequester is slicing roughly $40 billion out of agency spending this year. That

figure will more than double in the fiscal year that begins in October, slowing economic growth in the coming calendar year by 0.7 percentage points, according to independent estimates.

GOP wants to keep the sequester cuts but exempt the Pentagon. President Obama

wants to replace most of the cuts for all agencies with higher taxes on the rich and long-term reforms to Social Security & Medicare that would save $1.8 trillion over the next decade &, some in GOP acknowledge, even more over the next 30 years.

But other Republicans have rejected Obama’s approach as it involves higher taxes.

Unless two sides can reach an agreement, the government could shut down Oct. 1, & the Treasury Department will face a potential default before the fiscal year is out.

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Launch of National Dialogues at the Local Level NASMHPD was invited to an unprecedented “White House Conference on Mental Health”

that convened on June 3. The conference included over 200 mental health advocates. President Obama used this forum to address the debilitating issue of mental illness stigma and

to launch a new national dialogue on mental health, “in order to encourage those with mental health and substance use conditions to reach out and seek care.”

NASMHPD will work with the White House, SAMHSA and HHS to help bring this new

dialogue to the states over the next year, as a direct follow up to this conference.

We will forward information to SBHAs on next steps associated with the White House Conference and the local dialogues that are in the planning stages, and which are expected to be launched later this summer.

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The U.S. Departments of Veterans Affairs (VA), Defense (DOD) and Health and Human Services (HHS) announced May 21 the release of an interim report revealing the progress made on various initiatives, such as strengthening suicide prevention efforts and increasing the number of VA mental health providers, in order to expand quality mental health service access for veterans, service members and their families.

The interagency partnership to address veterans’ mental health needs follows an executive order issued by President Obama on Aug. 31, 2012, directing the VA, DOD and HHS in coordination with other federal agencies to take a number of steps to ensure that veterans, service members, and their families receive the mental health services and supports they need.

The “Interagency Task Force on Military and Veterans Mental Health” interim report outlines federal department actions to date, which include: Suicide prevention: The VA and DOD jointly developed and are implementing a national suicide prevention campaign to connect veterans and service members to mental health services. This yearlong effort, which began Sept. 1, 2012, continues to save lives and link veterans with effective ongoing mental health services on a daily basis, said SAMHSA officials.

As of March 2013, the Veterans Crisis Line has received over 814,000 calls, over 94,000 chats, as well as 7,200 texts, and has helped more than 28,000 veterans in imminent danger.

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Enhanced partnerships between the VA and community providers: The VA worked with HHS to help identify potential local community resources to improve veterans’ access to mental health services.

To date, the VA has established initial pilot projects through formal arrangements with 15 community- based mental health and substance abuse providers across seven states. Expanded VA mental health staffing: As of May 7, 2013, the VA has hired a total of 360 mental health clinical providers towards the goal of 1,600 new mental health professionals outlined in the executive order.

Additionally, the VA has hired 2,036 mental health clinical providers to fill existing vacancies. The VA has also hired nearly 250 new peer specialists in support of the specific goal of 800 peer specialists.

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Chairman Murphy in his opening statement at the hearing said that CMHS of

SAMHSA has a budget of approximately $1 billion per year and awards most of these funds through a combination of competitive and formula grants. He expressed concern, “that the committee has seen evidence that too many of these grants are directed to advancing services rooted in unproven social theory and feel-good fads, rather than evidence-based science.”

Dr. E. Fuller Torrey, founder of the Treatment Advocacy Center, implored the committee to take action to improve SAMHSA’s work. He said, “the important issue is what SAMHSA is not doing to improve the broken mental illness and substance abuse treatment system in the United States.” He said “this failure has consequences that affect us all.”

Dr. Sally Satel, a Resident Scholar at the American Enterprise Institute (a DC-based think-tank), said that SAMHSA and the CMHS suffer from a lack of psychiatric experts in leadership roles as well as an ideology that does not adequately and properly serve all patients. She indicated that the, “agency’s guiding ideology leads it to overlook millions of people with long-term psychotic disorders.”

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The Excellence in Mental Health Act The Mental Health in Schools Act The Mental Health First Aid Higher Education

Act The Behavioral Health Information Technology

Act Mentally Ill Offender Treatment and Crime

Reduction Act (MIOTCRA) -- Reauthorization

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Mostly “Behind the Scene’s Activity” since the Senate defeated efforts to strengthen the national background–check system for gun sales in April.

With parents of the young Newtown victims continuing to provide emotional

reminders of the shooting in private meetings with members of Congress, one of their most high-profile political allies, NYC Mayor Bloomberg has adopted sharper tactics, urging thousands of his city’s top political donors to withhold donations from four Senate Democrats who voted against the gun bill.

By asking campaign donors to withhold funds, Mayor Bloomberg went against the

will of his congressional Democratic allies, who tried but failed to secure enough GOP support for the gun bill and have warned that public criticism of vulnerable Democrats who voted against the bill will result in Republican gains and less of a chance to enact new gun laws.

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In January, President Obama announced a series of Executive Actions to reduce gun violence , including efforts to improve the Federal government's background check system for the sale or transfer of firearms by licensed dealers, called the National Instant Criminal Background Check System (NICS).

Among those persons disqualified from possessing or receiving firearms under Federal law are individuals who have been involuntarily committed to a mental institution; found incompetent to stand trial or not guilty by reason of insanity; or otherwise have been determined, through a formal adjudication process, to have a severe mental condition that results in the individuals presenting a danger to themselves or others or being incapable of managing their own affairs (referred to below as the “mental health prohibitor”).

Concerns have been raised that, in certain states, HIPAA Privacy Rule may be a barrier to States' reporting the identities of individuals subject to the mental health prohibitor to the NICS.

HHS which administers the HIPAA regulations issued a proposed rule in April to solicit public comments on such barriers to reporting and ways in which these barriers can be addressed. In particular, we are considering creating an express permission in the HIPAA rules for reporting the relevant information to the NICS by those HIPAA covered entities responsible for involuntary commitments or the formal adjudications that would subject individuals to the mental health prohibitor, or that are otherwise designated by the States to report to the NICS.

In addition, HHS was soliciting comments on the best methods to disseminate information on relevant HIPAA policies to State level entities that originate or maintain information that may be reported to NICS. HHS was also soliciting public input on whether there are ways to mitigate any unintended adverse consequences for individuals seeking needed mental health services that may be caused by creating express regulatory permission to report relevant information to NICS. 61

Using telemedicine or physician assistants and primary care providers to deliver specialty care instead of specialists seems to give patients broader access to the services without compromising quality, according to an evaluation of initiatives in six states that are still in the early stages.

The study by the Center for Studying Health System Change for the Commonwealth Fund

evaluated efforts to increase access to specialty care among patients, including those enrolled in Medicaid, in Connecticut, Illinois, Minnesota, New Mexico, Oregon and Tennessee. Each model, the study said, showed the potential to be used in other states.

"Some respondents found quality of care and patient outcomes to be the same, if not better"

than when patients were treated by specialty providers. The programs have not been fully analyzed to determine cost savings but the study said that comprehensive evaluations by other groups are planned for the projects in New Mexico, Connecticut, and Minnesota. Each initiative had different ways of expanding access to specialty services.

Some of the early results included, for example, an increase in the Connecticut project in the

percentage of diabetic patients that got retinopathy screening. The percentage grew from 10 percent to 40 percent. In that project, the program created a telehealth program in 2009 to look for early signs of blindness in people with diabetes. Medical assistants were taught to use retinal cameras to take images of patients.

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Financial outlook for Medicare has improved because of a stronger economy and

slower growth in health spending, and the financial condition of Social Security has not worsened but is still unsustainable.

The Medicare trustees — four federal officials and two public representatives —

said in their annual report that the “modest improvement” in the outlook for Medicare’s long-term finances reflected lower projected spending for skilled nursing homes and private Medicare Advantage plans.

The Obama Administration said the outlook for the Medicare trust fund was

brighter because of the ACA. The law has squeezed nearly $500 billion out of Medicare in part by trimming payments to many health care providers, including nursing homes and private health plans.

But the number of Medicare beneficiaries will grow rapidly, to 73 million in 2025

from 52 million today, so paying for the program remains a huge challenge.

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THANK YOU!

Follow up questions, and for any additional information, please contact Joel Miller at: joel.miller@nasmhpd.org, or at 703-739-9333

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