House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and Senate Finance Committee Ranking Member Orrin Hatch (R-Utah) sent Centers for Medicare & Medicaid Services (CMS) Administrator Marilyn Tavenner a letter on Wednesday asking for clarification of CMS’ issuance of a waiver pertaining to Arkansas’ Medicaid program.
The letter follows a new Government Accountability Office (GAO) report that raised concerns about the cost-effectiveness and budget neutrality of Arkansas’ Medicaid program.
The report found CMS approved a spending limit for Arkansas’ 1115 Medicaid waiver that assumed that the state would make significantly higher payments to providers under expanded coverage than were currently made under the traditional Medicaid program. GAO found that CMS did not request any data to support the state’s assumptions and said the spending limit that CMS approved is $778 million higher than it would have been if actual payment rates for services were included across the duration of the proposal.
“While we are supportive of states’ ability to use premium assistance programs to create innovative benefit designs…, we also have a responsibility to ensure that federal dollars are accounted for in a transparent and accurate manner,” Upton and Hatch said in the letter.