Connecticut Hospitals, Health Systems Outline Key Recommendations for Medicaid Redesign

In response to the Connecticut Department of Social Services’ (DSS) request for comment on Medicaid redesign and Section 17 of Public Act 23-171, An Act Protecting Patients And Prohibiting Unnecessary Health Care Cost, the Connecticut Hospital Association (CHA) on Friday, October 25, submitted a comprehensive response, which is available here.

Pursuant to this legislation, DSS is required to develop a strategy to reform the state’s Medicaid program to improve Medicaid provider reimbursement, healthcare outcomes, community health, and health equity.  DSS must submit the HUSKY Health Report to the Medical Assistance Program Oversight Council (MAPOC) no later than January 1, 2025.  Stakeholders have been encouraged to provide input on how to achieve the six goals set forth in the statute, including:

1. Improve healthcare access and outcomes
2. Increase adoption of interventions to support improved access to preventive care services
3. Identify and address social, economic, and environmental drivers of health to advance long-term preventive health and healthcare outcomes
4. Explore innovative financing reforms that support high-quality care, promote integration of primary, preventive, and behavioral healthcare, and address health-related social needs and long-term preventive outcomes
5. Improve collaboration and coordination among healthcare providers and cross-sector community partners
6. Improve Medicaid reimbursement and performance to achieve a sustainable healthcare delivery system and improve healthcare affordability for all

In its comment letter, CHA provided three primary recommendations to serve as the cornerstones of Medicaid redesign: address Medicaid hospital underpayment, engage multi-sector partnerships, and establish a regional investment and accountability financing model.  Through a coordinated statewide response, Connecticut hospitals and health systems also submitted comment letters describing their experiences with rising expenses, demonstrating the success of cross-sector community partnerships, and supporting CHA’s proposed financing framework.

Increasing Medicaid reimbursement is the most significant immediate contribution the state can make to enhance healthcare affordability for all patients, CHA explained in submitted comments.  For years, the Office of Health Strategy (OHS) has calculated a Medicaid payment-to-cost ratio that shows hospitals are reimbursed about 60 to 65 cents on the dollar for care provided to Medicaid patients.  That shortfall places an enormous burden on hospitals, which in turn is borne by the employers and employees who cover these uncompensated costs in their annual premiums.

The second pillar of the redesign framework is strengthening collaboration and coordination between healthcare providers and cross-sector community partners.  CHA and Connecticut hospitals and health systems are continuing efforts to build a statewide coalition of community leaders and organizations focused on expanding community health and equity improvement initiatives.

The third pillar of CHA’s Medicaid redesign framework is a regional investment and accountability model that consists of four interdependent financing innovations.  Notably, the model provides substantial and sustained funding to hospitals and multi-sector partnerships and returns 100% of the savings produced by those collaborations back to hospitals, community partners, and primary care providers.

CHA continues to work with community partners and maintain an open dialogue with state officials on how to improve the Medicaid program.  Additional materials and information related to Medicaid and Medicare reimbursement are available on CHA’s website here.