Medicaid, SCHIP, & Federal Authority

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Section 1115 Waiver - In July 2006, Massachusetts received approval from the Centers for Medicare and Medicaid Services (CMS) for the revised Section 1115 MassHealth waiver.  The waiver was renewed on July 31, 2008. The MassHealth waiver program provides federal funding and support for key components of the state’s comprehensive health care reform initiative to achieve universal coverage.  To support state coverage programs which build upon private insurance and to stimulate employers to offer coverage to low-income workers, the MassHealth program provides premium assistance for low-income workers of qualified small employers.  The waiver makes revisions to the Insurance Partnership (IP) raising income guidelines from 200 percent to 300 percent of the FPL and coordinating coverage between IP and the Connector.  Beginning in 2006, the waiver program’s uncompensated care pool, now the Health Safety Net, incorporated a significant reform, shifting funds to include premium subsidies for the uninsured in addition to uncompensated care payments to facilities.


Massachusetts Health Safety Net – The Massachusetts legislature established the Uncompensated Care Pool in 1985 to help ensure access to needed health care services to individuals with income below 400% FPL and no other source of health care coverage. The health care reform act transitioned the Uncompensated Care Pool to the Health Safety Net on October 1, 2007.  The Health Safety Net makes payments to acute care hospitals and community health centers for eligible services provided to low-income uninsured and underinsured individuals.  Enrollment of eligible UCP individuals in Commonwealth Care began in October 2006.  As a result HSN usage has dropped 16% in the first year of health care reform. That drop is expected to continue and funds from the Health Safety Net will be shifted into premium subsidies for the uninsured. 


Insurance Partnership – Massachusetts operates the Insurance Partnership as part of its Medicaid program under an 1115 waiver.  The Partnership helps small employers (<50) offer insurance and helps low-income workers afford premiums.  Small employers can have part of their cost paid for premiums paid on behalf of qualified employees.  Workers with family income below 300 percent FPL qualify for premium assistance through the MassHealth program. 


Adult Medical Security Plan – The Medical Security Plan, run by the Division of Unemployment Assistance, helps laid-off workers and their families who receive unemployment insurance payments. Depending on the workers’ circumstances, the program either provides direct, state-based coverage or helps pay the cost of coverage available through former employers. This is a short-term program that serves a relatively healthy population and is available to families who have family incomes up to 400 percent FPL.  The state’s 1115 waiver provides federal Medicaid matching funds for all enrollees.