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States provide health care coverage to 40 million low-income uninsured adults & children through 2 Fed.-state programs -- Medicaid (M) & the State Children's Health Insur. Prog. (SCHIP). M covers low-income families & elderly & disabled individuals, while SCHIP provides health coverage to children in families whose incomes, while low, are above M's eligibility require. HHS has indicated that it would allow states greater latitude in using waivers (W) to modify the M & SCHIP prog. This report examines: What types of W proposals have been submitted & approved? Has HHS ensured that the approved W are consistent with the goals & fiscal integrity of M & SCHIP? & To what extent has there been opportunity for public input in the process? Tables.
Medicaid and SCHIP: Recent HHS Approvals of Demonstration Waiver Projects Raise Concerns
States provide health care coverage to about 40 million low-income uninsured adults and children largely through two federal-state programs-Medicaid and the State Children's Health Insurance Program (SCHIP). Medicaid generally covers low-income families and elderly and disabled individuals, while SCHIP provides health coverage to children in families whose incomes, while low, are above Medicaid's eligibility requirements. To receive federal funding, which covered on average about 57 percent of Medicaid expenditures and 72 percent of SCHIP expenditures in 2001, states must meet certain statutory requirements including providing a certain level of benefits to specified populations. Under section 1115 of the Social Security Act, the Secretary of Health and Human Services (HHS) can waive many of the statutory requirements in the case of experimental, pilot, or demonstration projects that are likely to promote program objectives. As part of their responsibility to protect the fiscal integrity of the programs, traditionally, HHS and the Office of Management and Budget (OMB) have had a policy that all approved waiver projects be "budget neutral" for the federal government-that is, the proposed project cannot result in federal expenditures that are higher than they would have been without the project.
" Medicaid, a $436 billion federal and state health care program for low-income individuals and families, is a significant and growing expenditure. Section 1115 of the Social Security Act authorizes the Secretary of Health and Human Services to waive certain Medicaid requirements and allow otherwise uncovered costs for demonstration projects that are likely to promote Medicaid objectives. By HHS policy, these demonstrations should be budget neutral, that is, not increase federal spending over what it would have been if the state's existing program had continued. States estimate what their spending would have been without the demonstration, and HHS approves a spending based on projected spending. GAO was asked to review HHS approval of recent Medicaid section 1115 demonstrations. GAO examined (1) the purpose of new demonstrations, and (2) the extent to which HHS's policy and process for reviewing proposed demonstration spending provide assurances that federal costs will not increase. For 10 new comprehensive demonstrations approved from January 2007 through May 2012, GAO reviewed application, approval, and budget neutrality documents provided by HHS; calculated estimated spending limits; and interviewed HHS officials. "
Medicaid Demonstration Waivers: Recent HHS Approvals Continue to Raise Cost and Oversight Concerns
" Medicaid, a $436 billion federal and state health care program for low-income individuals and families, is a significant and growing expenditure. Section 1115 of the Social Security Act authorizes the Secretary of Health and Human Services to waive certain Medicaid requirements and allow otherwise uncovered costs for demonstration projects that are likely to promote Medicaid objectives. By HHS policy, these demonstrations should be budget neutral, that is, not increase federal spending over what it would have been if the state's existing program had continued. States estimate what their spending would have been without the demonstration, and HHS approves a spending based on projected spending. GAO was asked to review HHS approval of recent Medicaid section 1115 demonstrations. GAO examined (1) the purpose of new demonstrations, and (2) the extent to which HHS's policy and process for reviewing proposed demonstration spending provide assurances that federal costs will not increase. For 10 new comprehensive demonstrations approved from January 2007 through May 2012, GAO reviewed application, approval, and budget neutrality documents provided by HHS; calculated estimated spending limits; and interviewed HHS officials. "
States provide health care coverage to about 40 million low-income uninsured adults and children largely through two federal-state programs-Medicaid and the State Children's Health Insurance Program (SCHIP). Medicaid generally covers low-income families and elderly and disabled individuals, while SCHIP provides health coverage to children in families whose incomes, while low, are above Medicaid's eligibility requirements. To receive federal funding, which covered on average about 57 percent of Medicaid expenditures and 72 percent of SCHIP expenditures in 2001, states must meet certain statutory requirements including providing a certain level of benefits to specified populations. Under section 1115 of the Social Security Act, the Secretary of Health and Human Services (HHS) can waive many of the statutory requirements in the case of experimental, pilot, or demonstration projects that are likely to promote program objectives. As part of their responsibility to protect the fiscal integrity of the programs, traditionally, HHS and the Office of Management and Budget (OMB) have had a policy that all approved waiver projects be "budget neutral" for the federal government-that is, the proposed project cannot result in federal expenditures that are higher than they would have been without the project.