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HHS FY2016 Budget in Brief


HHS FY2016 Budget in Brief: Centers for Medicare & Medicaid Services (CMS): State Grants and Demonstrations

Centers for Medicare & Medicaid Services

The Centers for Medicare & Medicaid Services ensures availability of effective, up-to-date health care coverage and promotes quality care for beneficiaries.

CMS State Grants and Demonstrations Budget Overview

(Dollars in millions)

Current Law Budget Authority 2014 2015 2016 2016
+/- 2015
Medicaid Integrity Program /1 76 77 84 +7
Money Follows the Person Demonstration 417 416 449 33
Money Follows the Person Evaluations 1 1 1
Demonstration Program to Improve Community Mental Health Services 2 25
Funding for the Territories 928
Total, Current Law Budget Authority 1,424 494 559 +65

Proposed Law Budget Authority 2014 2015 2016 2016
+/- 2015
Create Demonstration to Address Over-Prescription of Psychotropic Medications for Children in Foster Care/2 500 500
Expand Funding and Authority for the Medicaid Integrity Program /1 25 +25
Extend and Improve the Money Follows the Person Demonstration
Total, Proposed Law Budget Authority 525  +525
Total, Current and Proposed Law Budget Authority 1,424 494 1,084 +590

Current Law Outlays 2014 2015 2016 2016
+/- 2015
Incentives for Prevention of Chronic Diseases in Medicaid /3  16 22 23 +1
Medicaid Emergency Psychiatric Demonstration /3 25 32 4 -28
CHIP Outreach and Enrollment Grants /3 /4 18 17 9 -8
Medicaid Integrity Program /1 53 70 82 +12
Psychiatric Residential Treatment Demo and Evaluation /3  28 23 20 -3
Money Follows the Person Demonstration 351 400 425 +25
Money Follows the Person Evaluations 1 2 2  
Expansion of State Long-Term Care Partnership Program /3 * * *
Ticket to Work Grant Programs /3 1 1 1
Medicaid Transformation Grants /3 *  
Emergency Services for Undocumented Aliens /3 15 4 2 -2
Demonstrations to Improve Community Mental Health Services 1 25 +24
Total, Current Law Outlays 508 572 593 +21

Proposed Law Outlays 2014 2015 2016 2016
+/- 2015
Create Demonstration to Address Psychotropic Medication Over-Prescription for Foster Care Children /2
Expand Funding and Authority for the Medicaid Integrity Program /1 25 +25
Extend and Improve the Money Follows the Person Demonstration
Total, Proposed Law Outlays 25 +25
Total, Current and Proposed Law Outlays 507 569 591 +22

Table Footnotes
1/    Budget authority for the Medicaid Integrity Program is adjusted annually by Consumer Price Index for All Urban Consumers.  This program and the related legislative proposal are described in the Program Integrity chapter.
2/    This is a joint proposal with the Administration for Children and Families (ACF).  These totals represent the proposed law budget authority and outlays for State Grants and Demonstrations.  Please see the ACF Chapter for more information.
3/    Outlays are from prior year budget authority.
4/    See CHIP chapter for additional information about this program.
 

CMS State Grants and Demonstrations Activities

The State Grants and Demonstrations account funds a diverse set of program activities.  Many activities were authorized in the Affordable Care Act, Children’s Health Insurance Program Reauthorization Act, the Deficit Reduction Act of 2005, and the Ticket to Work and Work Incentives Improvement Act of 1999.  Such activities include strengthening Medicaid program integrity, supporting enrollment of children into Medicaid and the Children’s Health Insurance Program (CHIP) through funding for outreach activities, and promoting prevention and wellness by providing grants to states to prevent chronic diseases.

Incentives for Prevention of Chronic Diseases in Medicaid:  The Affordable Care Act provides $100 million for states to award incentives to Medicaid beneficiaries of all ages who participate in prevention programs and demonstrate changes in risky health behaviors and outcomes related to chronic disease, including by adopting healthy behaviors.  Funds are available through December 31, 2015, and states must commit to operating prevention programs for a minimum of three years.  In September 2011, CMS awarded the first year of grants to 10 states.  All ten state grantees are operational and currently enrolling beneficiaries.  The initial Report to Congress was submitted on December 16, 2013.

Medicaid Emergency Psychiatric Demonstration:  Section 2707 of the Affordable Care Act, authorizes a demonstration project where selected States may provide payment under the State Medicaid plan, under Title XIX of the Social Security Act, to an institution for mental diseases that is not publicly owned or operated for eligible Medicaid beneficiaries ages 21 through the age of 64, who require medical assistance to stabilize a psychiatric emergency medical condition.  The Affordable Care Act authorized $75 million for the demonstration, of which $68 million is for federal matching share payments to the participating states, and $7 million was set aside for implementation and evaluation of the demonstration.  In March of 2012, CMS announced 11 participating states and the District of Columbia to participate in the demonstration.  The demonstration will be conducted for a period of three consecutive years from July 1, 2012 through June 30, 2015 with the funding for the demonstration ending on December 31, 2015.  In January of 2014, an evaluation report was submitted to Congress as mandated by the demonstration’s authorization.  The report indicated there were 2,791 participants in the program constituting 3,458 admissions to Institutions for Mental Disease through June 30, 2013.  Data continues to be collected on outcomes for the enrolled participants and impacts on Medicaid costs; an updated evaluation of the demonstration in 2016.

Money Follows the Person Demonstration:  This demonstration, extended by the Affordable Care Act through FY 2016, helps states support individuals to achieve independence.  States that are awarded competitive grants receive an enhanced Medicaid matching rate to help eligible individuals transition from a qualified institutional setting to a qualified home or community based setting.  Approximately $3 billion has been awarded to 44 states and the District of Columbia since the program’s inception.  This demonstration is funded at $450 million for each fiscal year through FY 2016.  Funding awarded to states in FY 2016 is available to states for expenditures through FY 2020.  These additional funds will enable state grantees to continue to develop their home and community- based programs and increase the number of beneficiaries served while continuing to rebalance their long‑term care systems between institutional and community settings.  As of December 31, 2013, over 40,600 individuals across 44 states and the District of Columbia have transitioned to community services and supports through this effort.  In 2013, CMS issued a funding opportunity announcement to offer states and tribes the resources to build sustainable community based long‑term services and supports specifically for American Indians through the tribal initiative. 

State Grants and Demonstrations Legislative Proposals

Create Demonstration to Address Over-Prescription of Psychotropic Medications for Children in Foster Care:  The Budget proposes a five-year Medicaid demonstration in partnership with the Administration for Children and Families beginning in FY 2016 to encourage states to implement evidence‑based psychosocial interventions targeting children and youth in the foster care system, as an alternative to the current over-prescription of psychotropic medications in this population. States would receive performance‑based Medicaid incentive payments to improve care coordination and delivery for children and youth in foster care through increased access to evidence‑based psychosocial interventions with the goal of reducing the over-prescription of psychotropic medications and improving outcomes for these young people.  The Medicaid investment of $500 million over five years would provide incentive payments to states that demonstrate measured improvement in outcomes.  This investment is paired with $250 million from the Administration for Children and Families to support state efforts to build provider and systems capacity.

[$500 million in Medicaid State Grants and Demonstrations costs and $250 million in mandatory child welfare costs over 10 years]

Improve and Extend Money Follows the Person rebalancing demonstration:  This proposal would extend the Money Follows the Person demonstration period through FY 2020 to enable states to continue to rebalance their long-term care systems and transition individuals to home and community-based services as well as providing additional flexibility to states to support individuals remaining in the community within the existing appropriation.  Currently, individuals must enter institutions to qualify for covered home and community based services in the Money Follows the Person Demonstration.  To support individuals remaining in the community, this proposal would modify the demonstration to allow funds to be used to prevent individuals from entering an institution in the first place, as well as transition services.  This proposal would also reduce the institutional requirement from 90 to 60 days and allow skilled nursing facility days to be counted towards the institutional requirement.  Lastly, this proposal would allow individuals in certain mental health facilities to transition to home and community-based services under the demonstration.  [No budget impact]

Expand Funding and Authority for the Medicaid Integrity Program: This proposal is described in the Program Integrity chapter.

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FY 2016 State Grants and Demonstrations Legislative Proposals

Dollars in millions
(negative numbers reflect savings and positive numbers reflect costs)

State Grants and Demonstrations Proposals 2016 2016
-2020
2016
-2025
Create Demonstration to Address Over-Prescription of Psychotropic Medications for Children in Foster Care /1 390 +500
Expand Funding and Authority for the Medicaid Integrity Program /2 25 180 +580
Extend and Improve the Money Follows the Person Demonstration
Total Outlays, State Grants and Demonstrations Proposals 25 570 1,080

1/    This is a joint proposal with CMS and the Administration for Children and Families.
2/    The totals represent proposed budget authority for the Medicaid Integrity Program rather than outlays. 

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Content created by Office of Budget (OB)
Content last reviewed on February 2, 2015