Mass. Receives Three-Year Medicaid Waiver

December 21, 2011

Seeking a change in how it finances its health programs, Massachusetts has won approval yesterday of a three-year renewal of its Medicaid waiver.

Governor Deval Patrick sought the new waiver as a means of maintaining the state's high level of health coverage. Approximately 98 percent of Massachusetts residents are covered by some type of health insurance.

The waiver is worth $26.7 billion, $5.7 billion more than the state's previous Medicaid waiver.   Governor Patrick said the extension was critical to the continued success of the state's model health care program.

"This new federal agreement will help us build on our success and tackle the next phase of our work — cracking the code on health care costs," Gov. Patrick said in a statement.

The original waiver expired last June, but a number of temporary extensions were granted while state and federal officials negotiated the final version.   Much of the delay was over the issue of additional payments to hospitals that are not fully compensated for providing care.  

The funds associated with the waiver will help support MassHealth, the state's Medicaid program, and Commonwealth Care, a state program that subsidizes private insurance coverage.

Like similar waivers recently approved for other states, the waiver requires that more Medicaid patients are enrolled in managed care settings.   

In return for receiving the waiver, the Massachusetts agreed to fully implement the provisions of the Affordable Care Act.

The waiver contains a number of measures aimed at improving both access to and quality of care, among them early intervention and express eligibility for children of families that receive food stamps.

While the state may have the highest rate of health coverage, that doesn't mean that hospitals receive adequate payment for the care they provide. To help close that gap, hospitals that treat a disproportionate percentage of MassHealth and Commonwealth Care patients will be able to tap hundreds of millions in additional funding.