FRANKFORT — Medicaid — the federal-state program that provides health care to almost 1.5 million Kentuckians — is on the chopping block in Washington and could soon come under examination in Frankfort.

The House has approved creating a 21-member Medicaid Oversight and Advisory Board to look for ways to rein in Kentucky Medicaid cost increases.

Meanwhile, the Beshear administration would be barred from making any changes to Medicaid eligibility, coverage or benefits in Kentucky without first getting a green light from the General Assembly unless the changes are required by federal law.

The House also voted to reinstate prior authorization requirements for Medicaid behavioral health benefits which include treatment for substance use disorder.

Rep. Adam Bowling, R-Middlesboro, the sponsor of House Bill 695, said the legislation is necessary because of unsustainable growth in Medicaid’s cost.

“Roughly one out of three Kentuckians is currently enrolled in Medicaid. … It’s the second largest general fund unit within our state budget. And the growth we are seeing currently is at a rate … it’s just not sustainable,” Bowling said. “So all we are trying to do with House Bill 695 is just stabilize the program, hold it where it is today.”?

The House approved HB 695 by an 80-19 party line vote on March 4 while Bowling’s House Bill 9 creating the oversight board was approved 99-0.

Prior authorization requirements

Democrats opposed the requirement for prior authorizations to receive mental health care. Rep. Lindsey Burke, D-Lexington, called it a “bridge too far.”?

HB 695 gives the Cabinet for Health and Family Services 90 days after the bill becomes law to “reinstate all prior authorization requirements for behavioral health services in the Medicaid program that were in place and required” on Jan. 1, 2020.

During the House debate, Burke said, “When someone has made the brave and courageous decision to come to seek mental health treatment, they are often in a position where they need immediate service. And it troubles me to think that we’ve asked someone who has made that courageous decision to wait and see if their insurance will cover it. Our citizens are already experiencing a mental health epidemic, and we know that prior authorization slows down essential treatment for Kentuckians.”?

Emily Beauregard, the executive director for Kentucky Voices for Health, opposed the prior authorization requirement during a Feb. 25 committee meeting, saying quick access to mental health care can avert costlier medical crises.?

“We know from years of experience that prior authorizations can delay access to behavioral health services for individuals facing an acute need and for conditions like depression, anxiety and substance use disorder, early intervention is crucial to improving health outcomes and reducing the need for higher cost services such as emergency room visits or inpatient hospitalization.” she said.?

However a group of independent treatment providers supports the reinstatement of prior authorizations, saying they will help ensure that available funds go to help those most in need.

John Wilson, president of the Kentucky Association of Independent Recovery Organizations, told the Lantern that? “bad actors” during the COVID-19 pandemic “exploited the system.” That, he said, led to “unnecessary services and payments – with little to no respect given to patient care or outcomes.”??

“We recognize the additional burden prior authorizations bring to providers, but this important tool to control waste, fraud and abuse has already been reinstituted in other areas of health care,” Wilson said. “KAIROS believes that reinstituting prior authorizations will ensure that the available funds are spent on those who need it most. In fact, many KAIROS members did not change their own policies and procedures regarding prior authorizations during the suspension and continued to function as though authorizations were still required.”?

Kentucky Medicaid already has restored some mental prior authorization requirements which were suspended during the COVID-19 pandemic.??

Kendra Steele, a spokeswoman for the Cabinet for Health and Family Services, said “changes were made to specific services and additional changes are on track to be implemented in the near future” following the COVID-induced pause for those prior authorizations.

“When the policy is reinstated, (the Department for Medicaid Services) will work to ensure Medicaid members continue to receive the appropriate level of care needed in a timely manner,” Steele said, adding that the state “is committed to ensuring health care access for Kentuckians, including access to behavioral health services, counseling and treatment for addiction.”

Budgetary ‘triage’

During the Feb. 25 meeting, Rep. Jason Petrie, chairman of the House budget committee, likened HB 695 to? a “type of triage to put a stasis on the program so that it doesn’t grow uncontrollably, ineffectively and inefficiently in the very, very short term, until the Medicaid Oversight Advisory Board can get on its feet and start making better make informed policy decisions, along with executive branch and participants in this big program.”?

The advisory board would be made up of 10 lawmakers (five from the Senate and five from the House) and 11 non lawmakers including the state’s chief medical officer, the state auditor, the chair of the Advisory Council for Medical Assistance and others. Its job would be to “review, analyze, study, evaluate, provide legislative oversight, and make recommendations to the General Assembly regarding any aspect of the Kentucky Medicaid program.”

Bowling told the committee that HB 9 is “a good way to get the executive branch, the legislative branch and then stakeholders as well, all at the table, to be able to go through all these issues that have come up surrounding Medicaid.”?

Bowling pointed out the legislature must “figure out how to piece the funding” for Medicaid changes made by the administration.?

“We want to come together with the executive branch to make sure we have a better idea and we can make more educated decisions about which changes we want to implement and which changes are not in Kentucky’s best interest, as we see it,” he said.?

Medicaid in Kentucky costs taxpayers about $15 billion a year. Most of that money — 70% to 90% — comes from the federal government. Medicaid pays for medical and nursing home care for low income people and people who have disabilities, including 4 in 9 Kentucky children, according to KFF, a nonprofit research organization focused on health care.

In Washington, Rep. Brett Guthrie of Kentucky is chairman of a U.S. House committee that’s looking for ways to cut $880 billion from the federal budget to pay for extending tax cuts enacted in 2017 — a task that is considered impossible without cutting Medicaid which costs the federal government more than $600 billion a year.