| With billions of dollars on the line, Gov. Charlie Baker hopes to renegotiate a federal Medicaid waiver with the Obama administration by this summer, he said Tuesday.
In October 2014, the Patrick administration secured a five-year deal with the Obama administration worth $41.4 billion that did not fund the state’s safety net care pool in the fourth and fifth years.
“The Patrick administration didn’t get a five-year waiver. They got a five-year waiver with three years of funding, so we’ve known for a while that we needed to go in and basically negotiate the last two years of the waiver,” Baker said outside an event in Boston. “And the reason the feds only gave us three years is they were unhappy with the level of reform associated with the Patrick administration’s proposal.”
Administration and Finance Secretary Kristen Lepore told lawmakers during testimony on Baker’s budget last week that the state must renegotiate the deal or it will lose $1 billion per year. According to the state Office of Health and Human Services, the state would start losing $1 billion per year on July 1, 2017.
Baker, who served as health and human services secretary in the Weld administration and led the insurer Harvard Pilgrim Health Care through financial straits, said federal regulators want the state to move more toward accountable care organizations.
An alternative to the traditional fee-for-service model, accountable care organizations, called ACOs for short, transfer risk to providers who are generally given the holistic task of serving the health needs of a population.
“There were a lot of elements to it, but I think the larger piece was they were looking for something that moved a little more toward what I think everybody in today’s nomenclature calls accountable care organizations,” Baker said.
Baker said he would prefer to renegotiate the deal with the administration of President Barack Obama, who is serving out his final months in office.
“In a perfect world we’d like to get it done by this summer, because obviously the closer you get to the election the harder it gets to get something like that done,” Baker said. “Since it was this administration that raised issues with the previous waiver, right, I’d rather get it done with this administration than have to start it all over again with a new one.”
The governor also expressed optimism that the next deal would extend beyond the five-year term of the current agreement.
“I feel pretty confident that we’ll be able to secure the last two years and maybe even – depending upon what we come up with – extend that out beyond that so we don’t have to go back and do it again in two years,” Baker said.
