What CMS' Seema Verma says states should think about before applying for Medicaid waivers

States looking to propose changes to their Medicaid programs should consider whether their ideas would help meet the ultimate goal of shifting beneficiaries off the programs, Centers for Medicare and Medicaid Services Administrator Seema Verma told reporters on Tuesday.

"As I’m looking at states that have these types of proposals, what I want them to consider is: We need to figure out a pathway, a bridge to self-sufficiency. And hopefully, it's a permanent path out of poverty," Verma said during a roundtable briefing with reporters in Washington. "We have to make sure whatever we put together doesn’t create those big subsidy cliffs."

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In the roundtable briefing, Verma said she wanted to address how CMS is looking at some of the major decisions that are coming its way with state requests to the Medicaid program, including requests to impose requirements for able-bodied recipients to work. Those programs have been faced scrutiny, and in Kentucky, face a legal challenge.

According to a report from The Hill, Verma had originally planned to use the briefing to announce CMS would reject Kansas’s request to impose a three-year lifetime limit on Medicaid benefits before changing plans at the last minute.

During her remarks to reporters, Verma expressed general caution about the idea of lifetime limits.

"The concern has been with a lot of these programs: Are we creating a disincentive to not try to improve their lives? That’s why we are getting these proposals with lifetime limits," Verma said. "We understand people’s circumstances change over time. They may get a job and then something happens. Those are the things we want to keep in mind."

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She said her time as a state and local health official in Indiana shaped her thinking with regards to the Medicaid program. So while the administration supports work requirements, she said it took a "pragmatic and empathetic" approach by considering exceptions such as individuals who need care for substance abuse concerns or have too few jobs available where they live.

Verma said state officials need to consider step-down programs to extend benefits as individuals' economic situation improve rather than forcing them off a subsidy cliff where they lose their benefits all at once. "We’re talking to states, we’re having discussions with them about how can you fashion your program to make sure there is an incentive for a person," Verma said.