We have previously submitted the complete version of these comments. The Proposed Waiver has at least 10 fatal flaws, including the following:

1. The Proposed Waiver would require most Medically Needy recipients to pay exorbitant and unsustainable premiums that would put them and their families in financial peril. Specifically, recipients could be required to pay up to 90% of their income on premiums.

2. The burden imposed by the Proposed Waiver is particularly cruel considering the income distribution of the Medically Needy population. The vast majority of Medically Needy recipients live in poverty, and almost all are low-income.

3. The Proposed Waiver is contrary to provisions of federal law that cannot be waived.
Under Medicaid Maintenance of Effort (MOE) requirements, which were established by the Affordable Care Act and upheld by the U.S. Supreme Court, remain in full effect. Florida currently collects no premiums from Medicaid recipients. Because a recipient who does not pay his or her premium would lose his or her eligibility, the Proposed Waiver would indisputably amount to a tightening of Medicaid eligibility standards, in violation of MOE.

4. The Proposed Waiver is extreme and unyielding.
Astoundingly, among all the premium requirements that the State could have sought to impose, these requirements:
• Apply regardless of any hardship or special circumstance that the recipient may experience.
• Apply to children and certain individuals with disabilities who do not control their own finances.
• Apply to every recipient in a family (unless they are eligible for regular Medicaid coverage).

5. Congress has already given states considerable power to levy premiums, and nothing in the Proposed Waiver justifies giving Florida special permission to massively boost that power.
Congress specifically addressed the issue of imposing premium payment requirements in the Deficit Reduction Act of 2005 (DRA), allowing states to charge premiums of certain recipients with incomes above 150% of the federal poverty level.

It is true that some Medically Needy recipients – albeit fewer than 10% - have household incomes exceeding 150 percent of poverty and so could be charged premiums under the DRA. However, the DRA also imposed a cap of 5% of total income on premiums and out-of-pocket costs.

By contrast, under the Proposed Waiver, virtually every household would be required to pay more than the maximum 5% of income on premiums. Most Medically Needy households with seniors and disabled persons at these “higher” (150%+ FPL) income levels would pay at least half (and up to 90%) of their household income on premiums. Such a system is unsustainable and guarantees that many recipients will lose coverage.

6. The State has consistently misled regarding the ability of Medically Needy recipients to pay premiums and the expected impact of the Proposed Waiver on them upon implementation.

In reality, based on the data provided to CMS by the State, less than 6 percent of elderly and disabled Medically Needy recipients had incomes at or above the “average” income level cited. Less than ½ percent of Medically Needy families with children have incomes in line with the Medicaid Director’s example.

As for the Proposed Waiver itself, the State has described it as a means for ensuring continuous coverage
for a group that currently has Medicaid coverage only on a month-to-month basis. The current reality, however, is that recipients need merely incur medical expenses equal to their share of cost, as these households have absolutely no ability to pay such an amount from their own resources. Under the Proposed Waiver, by contrast, following the first month of eligibility, recipients would be required to directly remit this amount each month or face eventual disenrollment and denial of access to care.
Yet the State amazingly describes the changes as singularly beneficial for recipients.

7. The State has not studied or even estimated the effect of imposing premiums on recipients’ access to care or eligibility, reflecting a basic disregard for the well-being of vulnerable patients.
Furthermore, the Proposed Waiver is entirely silent on the mechanics of premium payment. Medicaid recipients in particular are underserved by financial institutions, and many would face logistical and financial barriers associated with making payment. It is also unclear what statements, reminders or warnings recipients would receive, or whether they would receive any such notification at all. The Proposed Waiver is even more dangerous in that regard than its predecessors, in that Medically Needy recipients would pay premiums directly to managed care plans, which will be mostly for-profit Medicaid HMOs, who have a financial disincentive to keep unprofitable recipients enrolled.

8. The Amendment seeks to create a program that operates entirely outside of the Medically Needy framework. The State is in fact attempting to create an entirely new program for which there is no sound basis and for which the potential risks far outweigh any potential benefits.

9. Most of the Medically Needy would qualify for regular Medicaid under the expansion called for in the Affordable Care Act, and State participation in Medicaid expansion would serve patients far better.

10. Allowing managed care plans to vary the amount, duration, and scope of benefits based on medical sufficiency and actuarial equivalence standards derived separately for the Medically Needy population, as is seemingly called for in the Proposed Waiver, could have adverse but avoidable consequences for recipients and their access to benefits.