The Partnership for Medicaid is a nonpartisan, nationwide coalition made up of organizations representing health care providers, safety-net health plans, counties, and labor. The 23 members of the Partnership for Medicaid are strongly committed to the Medicaid program’s foundation as a federal-state-local partnership. We believe Medicaid plays a vital role in delivering necessary health care and other related services and supports to the nation’s most vulnerable citizens.

Medicaid is a major source of funding for essential health services in communities across the country and is vital to the financial stability of safety-net providers. For decades, state Medicaid programs have tailored services and developed innovative models of care through state plan authority to streamline health care delivery and improve health. Current Medicaid rules allow states significant flexibility to address local needs through innovative models, such as Medicaid health homes, shared savings, bundled payments, and other mechanisms.

Section 1115 of the Social Security Act permits the Secretary of the Department of Health and Human Services to issue demonstration waivers to states so that they may use federal Medicaid and CHIP funds in ways that are “likely to assist in promoting the objectives of the program,” but may not be otherwise allowed under the federal rules. States have used 1115 demonstration waivers to expand coverage, test new delivery systems, and quickly extend coverage during public health emergencies. Section 1115 demonstration waivers allow states the flexibility to achieve – even exceed – the national objectives of the program in ways that spur innovation in coverage and delivery of care.

Given this existing state flexibility, the Partnership is united behind the following core set of principles related to 1115 Medicaid demonstration waivers:

Upholding Process and Transparency Standards

  • It is vital that existing transparency requirements remain in effect. This should include, but not be limited to, demonstrable stakeholder engagement at the state and federal level, and transparency during the waiver development and revision process.
  • Rigorous evaluation of existing demonstration waivers on programmatic flexibilities, and their impact on enrollees, providers, and plans, should be considered when assessing new waiver applications.

Maintaining Coverage, Access, and Affordability

  • Any change to the Medicaid program allowed by a demonstration waiver must uphold the program’s guarantee of coverage and at a minimum, maintain current eligibility standards.
  • Medicaid 1115 demonstration waivers must ensure access to needed care and services for affected enrollees. This includes ensuring that rates paid by states, to either providers or plans, are adequate and sufficient to encourage provider and plan participation and to ensure access by covering the costs of caring for Medicaid patients. Affected individuals should also maintain timely access to any willing, qualified provider.
  • Medicaid 1115 demonstration waivers must be structured so that enrollees continue to be able to receive, at a minimum, all mandatory care and services in order to meet their unique needs and ensure quality care.
  • Medicaid 1115 demonstration waivers should not increase administrative complexity and cost for Medicaid enrollees, providers, and plans.
  • Medicaid 1115 demonstration waivers should not employ cost-sharing through copayments, health savings account contributions, deductibles, or premiums for the purpose of discouraging access to needed care and services, or effectively act as a de facto reduction in payment to providers. Incentives should reward enrollees, not penalize them.

Fostering Innovation

  • While considering Medicaid 1115 demonstration waivers, CMS should balance state flexibility and innovation with necessary federal standards to protect patients.
  • Medicaid 1115 demonstration waivers should advance population health through innovations that influence health outcomes and directly address the social determinants of health. Waivers should also support the provision of integrated, seamless, patient-centered care, promote the continued innovation of health care delivery, and consider both public- and private-sector solutions, while protecting essential benefits.
  • Medicaid 1115 demonstration waivers that implement payment and delivery system innovations that require substantial investment in new technologies and resources should take into consideration these costs and should be supported with appropriate upfront federal investment. This will ensure that states have the capacity and resources to develop delivery system and payment models that improve health outcomes and decrease long-term costs, and can help to ensure state Medicaid programs continue to lead the way in innovation and payment and delivery reform.

November 2017