HHS FY2015 Budget in Brief

Centers for Medicare & Medicaid ServicesCenters for Medicare & Medicaid Services (CMS): State Grants and Demonstrations

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

2013

2014

2015

2015
+/ 2014

Medicaid Integrity Program /1

76

72

78

+6

Money Follows the Person Demonstration

426

417

449

+32

Money Follows the Person Evaluations

1

1

1

Total, Current Law Budget Authority

503

490 

528

+38 


 


 

Proposed Law Budget Authority

2013

2014

2015

2015
+/ 2014

Demonstration to Address Over-Prescription of Psychotropic Medications for Children in Foster Care (State Grants and Demonstrations) /2

500

+500

Medicaid Integrity program Investment and Expanded Authority /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

503

490 

1,053 

+563


 

 
 

Current Law Outlays

2013

2014

2015

2015
+/ 2014

Incentives for Prevention of Chronic Diseases in Medicaid /3

10

19

22

+3

Medicaid Emergency Psychiatric Demonstration /3

13

28

21

-7

CHIP Outreach and Enrollment Grants /3 /4

24

20

25

+5

CHIP Grants for Prospective Payment System Transition /3

1

*

*

Medicaid Integrity Program /1

57

79

47

-32

Psychiatric Residential Treatment Demo and Evaluation /3

33

50

23

-27

Money Follows the Person Demonstration 

347

531

531

Money Follows the Person Evaluations 

1

2

2

Expansion of State Long-Term Care Partnership Program /3 

*

2

-2

Ticket to Work Grant Programs /3

16

3

-3

Medicaid Transformation Grants /3 

*

Emergency Services for Undocumented Aliens /3

15

14

4

-10

Total, Current Law Outlays

517 

749

673

-76 


 

Proposed Law Outlays

2013

2014

2015

2015
+/ 2014

Demonstration to Address Over-Prescription of Psychotropic Medications for Children in Foster Care (State Grants and Demonstrations) /2

Medicaid Integrity Program Investment and Expanded Authority /1 

25

+25

Extend and Improve the Money Follows the Person Demonstration

Total, Proposed Law Outlays

25

+25 

Total, Current and Proposed Law Outlays

517

749

698

-51


 

Note: Totals may not add due to rounding.

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.

* Outlays are less than $500,000.

 

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, CHIPRA, the Deficit Reduction Act (DRA) 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 health risk 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: The Affordable Care Act provides $75 million for a three year demonstration to provide federal matching funds to states to provide inpatient emergency psychiatric care to Medicaid beneficiaries ages 21 to 64 in private psychiatric hospitals. Funding for this demonstration is available through December 31, 2015. In March 2012, CMS announced the 11 states and the District of Columbia as participants.

All of the participants began implementing their programs during 2012. The Department recently submitted a report 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; the

Department will submit 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, 2012, over 31,000 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.

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State Grants and Demonstrations Legislative Proposals

Demonstration to Address Over-Prescription of Psychotropic Medications for Children in Foster Care: The Budget proposes to authorize a five-year Medicaid demonstration in partnership with the Administration for Children and Families beginning in FY 2015 to address the over-prescription of psychotropic medications for children and youth in foster care. 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. This investment is paired with $250 million in 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]

Extend and Improve the Money Follows the Person Demonstration: This proposal would extend the 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 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]


HEALTH REFORM -- Medicaid Incentives for the Prevention of Chronic Disease

In September 2011, CMS awarded the first year of grants to 10 states, including California, Connecticut, Hawaii, Minnesota, Montana, Nevada, New Hampshire, New York, Texas, and Wisconsin. Grantees must address at least one of the following prevention goals: tobacco cessation, controlling or reducing weight, lowering cholesterol, lowering blood pressure, and avoiding the onset of diabetes or in the case of a diabetic, improving the management of the condition. All participating states began enrolling participants in 2012 or 2013. State programs provide a variety of direct or indirect financial incentives for program participation and health outcome attainment to beneficiaries and providers.

CMS awarded an evaluation contract in May 2012. This evaluation focuses on: 1) the effect of such programs on the use of health care services by Medicaid beneficiaries participating in the program; 2) the extent to which special populations (including adults with disabilities, adults with chronic illnesses, and children with special health care needs) are able to participate in the program; 3) the level of satisfaction of Medicaid beneficiaries with respect to the accessibility and quality of health care services provided through the program; and 4) the administrative costs incurred by state agencies that are responsible for administration of the program.

The Department submitted a Report to Congress as mandated by the demonstration’s authorization on December 16, 2013. As of August 31, 2013, there were 7,936 participants across the 10 states. Data continue to be collected on satisfaction and outcomes for the enrolled participants and impacts on state agency administrative costs. The Department will submit an updated evaluation of the demonstration in 2016.

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FY 2015 State Grants and Demonstrations Legislative Proposals

Dollars in millions

(negative numbers reflect savings and positive numbers reflect costs)
 

State Grants and Demonstrations Proposals

2015

2015 -2019

2015 -2024

Demonstration to Address Over-Prescription of Psychotropic Medications for Children in Foster Care (State Grants and Demonstrations Impact) /1

390

500

Medicaid Integrity Program Investment and Expanded Authority /2

25

131

276

Extend and Improve the Money Follows the Person Demonstration

Total Outlays, State Grants and Demonstrations Proposals

25

521

776

 

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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