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DHHS head objects to Dems’ Medicaid hikes

Monitor staff
Published: 6/11/2019 5:36:52 PM

New Hampshire’s Health and Human Services commissioner is objecting to a Democratic approach to raising Medicaid reimbursement rates, citing the need for more flexibility and throwing a complication into one Senate Democrats’ key budget priorities.

In a letter sent to House and Senate budget writers Tuesday afternoon, Commissioner Jeffrey Meyers said that the department had “concern over the methodology used for raising Medicaid rates” in the Senate’s proposed budget and said it could result in redundant or overlapping increases.

“The Department believes there is a better process to allocate Medicaid rate increases,” Meyers wrote.

In its budget passed last week, the Senate included an across-the-board increase in Medicaid reimbursement rates of 6.2% over two years.

That $60 million proposal represented a major shift for the state’s heath care sector. Reimbursement rates determine the amount that health care providers and physicians receive on individual services when treating patients on Medicaid or Medicaid expansion. New Hampshire’s have long been some of the lowest in the country; many of the state’s codes have not been increased since 2006.

Senate Democrats’ plan, introduced by Nashua Sen. Cindy Rosenwald, would include a flat 3.1% annual increase for all providers for two years.

But Meyers argued that that approach is too simplistic, and would result in “the inequitable allocation of rate increases” among the providers themselves.

Furthermore, he added, “the Section 392 rate increases do not take into consideration multiple additional rate increases already reflected in the budget or provided for in other legislation,” referring to the House Bill 2 budget trailer language added by Senate Democrats.

For instance, the House and Senate budgets already include an 8% bump in rates under the mental health fee schedule, according to Meyers. And the Senate has proposed appropriating $5 million to inpatient and outpatient substance abuse and mental health treatment rate increases.

That could mean some provider classes receive significantly more money for certain services than for others, Meyers wrote.

“Section 392 does not take into account any of these rate increases, despite the fact that many providers of Medicaid services have not sen any or only minimal rate increases in years,” Meyers wrote.

Instead of raising the rates across the board, the commissioner argued, the money should be transferred to the department to devise rate increases with stakeholder inputs, hold public hearings on the increases, and send them to the joint House and Senate Fiscal Committee.

“This alternative process would allow for a more equitable allocation of rate increases in order to address the most pressing needs,” Meyers wrote. “It would also ensure legislative approval of the final plan.”

Democrats were not immediately available to respond to the letter Tuesday evening. But adopting the recommendations would represent a significant shift from the present strategy, held up as a signature piece of their budget.

Gov. Chris Sununu has been circumspect on Medicaid rate increases in recent months. On Friday, he vetoed Senate Bill 5, a short term, $3 million expenditure to raise rates for substance abuse treatment and mental health providers into the new biennium. In his veto message, Sununu said he thought the increase was worthy of consideration but argued it should have been done in the budget itself.

In general, aides to the governor have downplayed broad rate increases, expressing a preference for raising rates through the state contracting process with Medicaid managed care providers.

Meyers’s letter introduces a new element in a period of uncertainty for the state’s two-year budget. The $60 million rate increases proposed by Rosenwald were not included in the budget passed by the House earlier this year, which focused primarily on education funding.

House and Senate lawmakers are set to soon begin negotiations to reconcile their proposals into a final budget, which must receive a final vote from both chambers by June 27.

Sununu, meanwhile, is scheduled to appear at a press conference on the budget at 10:30 a.m Wednesday.

(Ethan DeWitt can be reached at edewitt@cmonitor.com, at (603) 369-3307, or on Twitter at @edewittNH.)

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