Medicaid is a joint venture between the federal government and individual states, providing health coverage to low-income individuals and families. This partnership means both the federal government and states share the costs and responsibilities of running the program.
Its main purpose is to ensure that vulnerable groups like children, pregnant women, elderly adults, and people with disabilities have access to necessary medical care and community-based services.
1115 Demonstration Waivers
One of the unique aspects of Medicaid is the flexibility it offers states through things called ‘1115 waivers. These waivers allow states to explore new ways of delivering and paying for Medicaid services that differ from standard federal requirements.
In order to get an ‘1115 waiver’ to explore creative and new ways to provide services, states need to prove to the Centers for Medicare and Medicaid services that they will measure and publish the results of their innovative strategies.
They also have to show that the waiver’s cost won’t be more than it would have been without the waiver (i.e., the total federal cost if the state didn’t have the waiver.
For example, states can propose innovative pilot projects aimed at improving care quality and efficiency while potentially reducing costs. A state might use an 1115 waiver to extend Medicaid coverage to groups not traditionally eligible or to try out new payment models for healthcare providers (e.g. AHCCCS’ Targeted Investment strategies).
State Plan Amendments
States can also use a less complicated tool to amend their Medicaid program called a State Plan Amendments, (which also need to be approved by CMS). SPAs let states adjust their Medicaid plans within the existing federal framework. Think things like changing eligibility criteria, changing benefits, or updating payment rates.
While SPAs must align with federal regulations, 1115 waivers offer more leeway, enabling states to implement unique approaches outside standard guidelines. Perhaps that’s why 1115 waivers require more information to be approved and receive more scrutiny by CMS than SPA’s do.
Contractor Operations Manuals
You’ve also probably heard the words AHCCCS Contractors Operations Manual (ACOM) bandied about in the field. Among other things, ACOMs provide information to Contractors and Providers regarding services that are covered within the AHCCCS program. You can think of ACOMs as the way AHCCCS actually implements the terms of their various 1115 waivers and SPAs.
ACOM manuals don’t require CMS approval but are designed to make sure their contracted Managed Care Organizations follow the terms of AHCCCS’ waivers, SPAs and other state and federal regulations. ACOM manuals are also designed to make sure their contractors keep consistent care standards and manage Medicaid resources efficiently.
Here’s a video that explains more https://www.youtube.com/watch?
1115 Waiver Example: Housing
AHCCCS also recently received an 1115 waiver to help their members with housing – called the Housing and Health Opportunities (H2O) Demonstration Waiver. The AHCCCS H2O demonstration waiver enhances and expand housing services and interventions for AHCCCS members who are homeless or at risk of becoming homeless. Key elements of the waiver focus stabilizing members’ mental health conditions, reducing substance use, increasing the use of primary care and prevention services, and increased member satisfaction.
The waiver also focuses on housing stability initiatives that focus on reduce the cost of care for individuals successfully housed through decreased use of crisis services, ED use and inpatient hospitalization; reducing homelessness and improving skills to maintain housing stability.
1115 Waiver Example: KidsCare Expansion
Arizona recently received approval for an 1115 waiver to expand its KidsCare program, which provides health coverage to children from low-income families who don’t qualify for Medicaid. This waiver allows Arizona to increase the income eligibility threshold, making more children eligible for the program. The aim is to ensure that children have access to preventive and comprehensive healthcare, improving overall health outcomes.
Recent State Plan Amendment: Doula Care
AHCCCS, recently submitted a State Plan Amendment to include doula care as a covered (reimbursable) service. This change acknowledges the important role doulas play in supporting pregnant women through childbirth and postpartum care. The SPA ensures that Medicaid enrollees can access continuous, personalized support during pregnancy from a doula, which has been shown to reduce complications and improve birth experiences.
