Conclusion: Building a Strong State-Federal Partnership

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Many of the ideas related to essential elements of a federal-state partnership are not new—during the national reform discussions in the early 1990s, the Reforming States Group provided recommendations that still hold true today, including the establishment by the federal government of “a timetable for action, standard core benefits, and standards for access to and quality of care, cost containment, administrative efficiency, and portability of coverage between states, …[and that] the federal government should grant the states flexibility to implement reforms that meet federal requirements and that equitably and efficiently address access, coverage, and cost containment...”[i]

Despite the need for collaboration between federal and state governments, many state officials fear that some federal reforms could have a negative impact on states. This is based on the experience of the CMS August 17directive, the citizenship requirements under DRA, the “clawback” provisions under the Medicare Part D legislation[ii] and inflexible, burdensome Medicaid regulations. The federal government has often made changes to federal-state programs without appropriate consultation and communication with affected states. As a result, states have been forced to shoulder additional financial burden in the context of ambiguous or conflicting directives from the federal government.
While states may be skeptical about the possibility of national reform and anxious about the parameters of such reform, inaction is not an option. A collaborative federal-state partnership that builds on the respective strengths of each offers real potential and should be considered.

[i] Rydell, C. “An Agenda for Federalism from State Leaders,” Health Affairs, Vol.13, No. 5, Winter 1994, pp. 252-55.
[ii] On January 1, 2006, prescription drug coverage for the duals was transitioned from Medicaid to the Medicare Part D program but states remain required to finance a portion of this coverage through a payment to the federal government, often referred to as the “Clawback.” (Smith, V. p. 13)