Amid Covid-19, a longstanding coordination-of-benefits issue pressures state Medicaid agencies

Medicaid

I write today urging better coordination between two of our nation’s most important healthcare systems – Medicaid and TRICARE, the Department of Defense’s (DoS) healthcare plan for veterans and their families.
For years, state Medicaid agencies have been picking up the healthcare tab – to the tune of over $450 million – for individuals who have both Medicaid and TRICARE. This is a blatant violation of, and disregard for, Medicaid’s lawful status as payer of last resort. The solution is simple: increased collaboration between these two programs who collectively cover nearly 90 million Americans.
Without a doubt, the coronavirus has inspired unprecedented collaboration between state and federal government agencies and the private sector alike. From combined research efforts to sweeping regulatory changes and coordinated shipments of personal protective equipment (PPE) and medical devices, the positive impact of effective collaboration in healthcare is undeniable. Our hopes for the moon-shot production of a vaccine and effective anti-viral treatment are hinged upon this unprecedented level of collaboration and coordination.
In this same collaborative spirit, TRICARE and the Centers for Medicare & Medicaid Services (CMS) can work together to improve coordination while promoting the sustainability of Medicaid as a vital safety-net program during this critical time.
Knitting our Healthcare System TogetherToday, Medicaid covers more than 61.4 million individuals, primarily pregnant women and children. TRICARE provides healthcare services to more than 9.4 million military personnel, retirees and their families. Occasionally, individuals have both Medicaid and TRICARE coverage. According to a recent report by The Medicaid and CHIP Payment and Access Commission (MACPAC) about 900,000 individuals have both Medicaid and TRICARE coverage, with children accounting for a significant portion of these individuals.
While access to care for the patient may be seamless, behind the scenes, it’s anything but.  Even something as routine as benefits coordination – the determination of which healthcare entity is responsible for paying for which services – is nonexistent. Medicaid, a program jointly funded by states, the federal government and taxpayers, is supposed to be the “payer of last resort.” This means that if a Medicaid member has two forms of health insurance, Medicaid is secondary. Today, Medicaid is paying claims that should be the responsibility of TRICARE.
The National Association of State Budget Officers (NASBO) reported that in April 2020, year-over-year tax collections fell by at least 50% for many states. As profound as the impact has been thus far, NASBO predicts, “The worst is likely still to come for state tax revenues, as enhanced unemployment benefits expire, as more Americans restrict their spending, and the full economic impacts of the pandemic are felt.” Medicaid costs typically represent the largest or second-largest state budget expenditure, consuming about a fifth of state budgets. With 27 million Americans currently at risk of losing their employer-sponsored health insurance – Medicaid enrollment and costs are expected to soar.
There are few “easy” places to turn for savings. Cutting healthcare coverage or provider reimbursement rates should be avoided given the dire consequences to individuals’ health status and public health at large – especially during a pandemic.
Simply ensuring the responsible payer actually pays would be tremendously helpful in this difficult time. MACPAC’s June report to Congress offers two, fairly simple recommendations to ensure effective coordination between Medicaid and TRICARE – improve data sharing and consistently apply policies and rules as is done today with other programs, like Medicare, the Federal Employee Health Benefit Program and commercial insurers nation-wide.
In the spirit of collaboration, and as the nation continues to grapple with this pandemic, we urge Congress and CMS to resolve the coordination failures between Medicaid and TRICARE. Doing so alleviates some of the inevitable and consequential state budget pressures and ensures compliance with federal Medicaid law, all while promoting the sustainability of Medicaid programs, which provide a vital safety-net for millions of Americans. During this critical time, the importance of preserving Medicaid and providing uninterrupted, comprehensive care for all Americans cannot be overstated. Many lives and the future of pandemic response depend on it.
Photo: zimmytws, Getty Images

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