Governor Signs Biennial Budget; Legislature Adjourns for Summer

Has good news and bad news for Medicaid

(June 2015) Gov. John Kasich signed HB 64, the state biennial budget, June 30, after vetoing some 44 line item provisions. The health care portion (1) preserves Medicaid coverage for children and pregnant women up to 200 percent of poverty and everyone else up to 138 percent of poverty; (2) invests $286 million over two years to increase opportunities for Ohioans with developmental disabilities to live and work in the community; (3) improves care coordination through managed behavioral health care, and (4) targets resources to reduce infant mortality in the most at-risk neighborhoods.

Although Medicaid expansion was preserved, the administration was not happy with mandates placed on the department in many other areas.  For example, the department is required to apply for a Medicaid Waiver to implement a controversial Medicaid HSA program, called Healthy Ohio, which is based on an Indiana pilot program.  The legislature also reduced fee increases for primary care physicians to about half the amount requested by the Administration.  The Senate also held back the Department’s budget in the second year of the biennium and placed it in a Human Services Account at the State Controlling Board.  The Director will be required to request that money before it will be released subject to certain spending targets. 

The final budget has (1) a slight increase in reimbursement for Medicaid payments to primary care physicians, that is still well below Medicare rates; and (2) a cut in reimbursement for dual eligibles from Medicare to Medicaid levels. The budget bill also creates a 15-member Graduate Medical Education Study Committee that includes one representative from OU-HCOM and the CEO of the Ohio Osteopathic Association or his designee. The Committee is charged with studying Medicaid payments made to hospitals for the costs of graduate medical education. The Committee is required to include in its study “the feasibility of targeting the payments in a manner that rewards graduates of Ohio’s medical schools and colleges who practice medicine and surgery or osteopathic medicine and surgery in Ohio for at least five years after graduation.” The Committee is expected to start meeting in October and is mandated to submit a report to the Governor, the General Assembly, and the Joint Medicaid Oversight Committee by December 31, 2015.

 The budget for the Bureau of Workers Compensation -- approved in a separate bill-- establishes a Health Services Price Disclosure Study Committee to study the feasibility of providing estimates for health care services to patients. The Committee is directed to submit a report and recommendations to the legislature no later than December 31, 2015. The intent is to require all medical providers (including physicians) to furnish patients with a good faith, written estimate of the charges they (or their health plan) will be billed for non-emergency services, products and procedures; the amount the health plan intends to pay; and the difference the patient will be expected to pay personally.  Health plans must furnish requested information to the provider “within a reasonable time.”

 According to the Ohio Office of Health Transformation, Ohio Medicaid enrolled 3 million Ohioans in the state fiscal year ending June 30, 2015, which is almost 40,000 below what was projected when the program expanded in 2014. Enrollment in the expansion group was 152,000 people above the original estimate but more than offset by traditional enrollment. Medicaid spending for the fiscal year was $1.9 billion below the original budget estimate enacted by the Ohio General Assembly

The Administration also released the results of its 2015 Ohio Medicaid Assessment Survey in August after polling nearly 43,000 adults and more than 10,000 children between April and June. The survey determined that 8.7 percent of Ohio adults and only two percent of Ohio children lack health insurance - down from 17.3 percent and 4.7 percent, respectively, in 2012. At the same time, the percentage of adults covered via employer-sponsored insurance remained steady over the period at 54.9% contrary to predictions by Tea Party conservatives in the legislature.