June 2018 Report to Congress on Medicaid and CHIP

MACPAC takes an in-depth look at the high cost of prescription drugs and the opioid epidemic—two issues front and center in national health policy—and makes recommendations in its June 2018 Report to Congress on Medicaid and CHIP. In addition, given Medicaid’s role as the nation’s largest payer for long-term services and supports (LTSS), the Commission considers the implications of the growing trend of delivering these services through managed care.

In Chapter 1, the Commission focuses on targeted improvements to the Medicaid Drug Rebate Program—the primary lever states and the federal government have to reduce spending on outpatient prescription drugs—and makes two recommendations to:

close a loophole in current law that allows a manufacturer to sell its authorized generic at a low price to a corporate subsidiary, reducing the rebate obligation for its brand drug; and
give the Secretary of the U.S. Department of Health and Human Services clear authority to impose intermediate financial sanctions on manufacturers that misclassify a brand drug as a generic to lower their rebate payments.

Chapter 2 analyzes federal law and regulations on confidentiality of patient records related to substance use disorder—known as Part 2. Part 2 has been criticized as confusing, restrictive, and challenging to implement. The Commission makes two recommendations directing the Secretary to clarify current regulations to facilitate information exchange while maintaining patient privacy protections.

Chapter 3 reflects on the growing trend among states to deliver LTSS through managed care. While states typically adopt managed care for LTSS (MLTSS) after gaining experience with managed care for acute care, the complex needs of people who receive LTSS and the wide range of services they use makes implementation of MLTSS more complex.

Chapter 4 considers Medicaid coverage for substance use disorder treatment, building on foundational work in MACPAC’s June 2017 report to Congress. The analysis shows that only 12 states pay for the full continuum of clinical services. Significant gaps in coverage exist even though states can cover many of these services under state plan authority, Section 1115 demonstrations, or managed care.

Chapters: