There are many precedent-setting issues that have been surfacing as we move quickly toward a shutdown of state government—federal payment expectations and compliance with regulatory requirements being one set of issues. As we worked with legal counsel over the past few days to gather data and supporting materials for our legal arguments to continue Medicaid payments even during a state shutdown, many questions surfaced about what happens to the federal matching funds. In Minnesota there is a 50-50 federal-state match for all Medicaid payments, and an even greater federal match during the past biennial cycle. We reached out to staff at the American Health Care Association (AHCA) for input and guidance on state shutdown implications, and they responded quickly with a letter to Dr. Berwick, the administrator of the Center for Medicare and Medicaid Services (CMS), which is the oversight agency for Medicaid payments. While their letter to CMS was sent prior to the governor amending his petition to the courts which now includes provider payments, the issue of who is considered essential to the state, and whether any payments can be made given the separation of powers, is still up for debate. So, the letter, signed by Governor Mark Parkinson, President/CEO of AHCA and pasted in part below, will hopefully result in a response from CMS that can help bolster our legal argument:

“Dear Dr. Berwick:

"The American Health Care Association and National Center for Assisted Living (AHCA/NCAL) is the nation’s leading long term care organization. AHCA/NCAL and our membership of nearly 11,000 non-profit and proprietary facilities are dedicated to continuous improvement in the delivery of professional and compassionate care provided daily by millions of caring employees to more than 1.5 million of our nation’s frail, elderly, and disabled citizens who live in nursing facilities, assisted living residences, subacute centers, and homes for persons with mental retardation and developmental disabilities.

"We are writing to ask for your immediate attention and assistance to a very serious situation in Minnesota that could have significant impacts on the care of approximately 30,000 individuals residing in nursing facilities in the State, nearly 60 percent of whom rely on Medicaid to pay for their care. The Governor and Legislature of Minnesota are currently locked in a budget battle that threatens to shutdown their government if no agreement is reached by July 1st.

"The Governor signaled, in a letter to the Minnesota courts, that the provision of care for residents of nursing homes as well as hospitals and other care providers is a priority and must continue in the event of a government shutdown. However, the Governor also stated that such providers would not receive any payment during the shutdown. The Legislature goes a step further in their proposal for a complete blackout that would not only cease payments to providers, but also stop state agencies from performing their core functions.

"If the draconian measures proposed by either the Governor or Legislature are executed, long term care beneficiaries and providers would be placed in an almost unimaginable scenario that could potentially lead to facility closures and patient discharges. With such a “doomsday” scenario looming, we believe it is imperative that the Centers for Medicare and Medicaid Services (CMS) step in and clarify to the State that not only is Minnesota jeopardizing the health and welfare of its vulnerable beneficiaries, but it is also placing federal matching funds at risk.

"We respectfully request, therefore, that CMS clarify in a letter to the Minnesota Governor and Legislature that the State must meet federal Medicaid requirements and that CMS would not pay the federal match if Minnesota stops payment to its providers. This is in line with a previous Minnesota court decision relating to the threatened government shutdown in 2005. At that time, the court held that the Supremacy Clause of the US Constitution mandates that any funds paid by the State as a result of participation in federal programs must continue.

"Such a letter from your office would be especially useful if received in time to support arguments defending Medicaid beneficiaries’ needs during this crisis in the Minnesota courts. Hearings are scheduled for this Thursday, June 23.”

Patti Cullen, CAE
952.851.2487
pcullen@careproviders.org