Health and Human Services Commissioner Mary Mayhew has spoken often of her desire for a “global waiver” from the federal government that allows her department substantial flexibility in administering a Medicaid program governed by legions of complicated federal rules.
Gary Alexander, the discredited welfare consultant hired by the LePage administration last fall to review Maine’s government assistance programs, made a name for himself in the Medicaid world for his tenure as health and human services chief in Rhode Island.
His crowning achievement? Securing a “global waiver” from the federal government for Rhode Island’s Medicaid program.
And when his “Baseline Analysis” of Maine’s government assistance programs came out earlier this month, his primary recommendation for Maine’s Medicaid program was, unsurprisingly, a “global waiver.” He made the same recommendation for Arkansas last year in a report for lawmakers in that state.
“If granted, a global waiver would grant Maine the ability to appropriately tailor benefit packages, increase provider competition, and introduce innovative services,” the Alexander Group wrote in its 228-page document.
Payments to the consulting firm have stopped following revelations that much of its work was plagiarized. But should any of the group’s policy recommendations live on in state government or on the campaign trail, voters and policymakers should know the Medicaid waiver is an unrealistic, and even dangerous, recommendation.
The Alexander document listed several supposed advantages to a global waiver — from allowing the state wider latitude to charge Medicaid’s low-income enrollees premiums, to allowing the state not to cover transportation to medical appointments. It barely discussed how Maine should design its Medicaid program upon receiving global waiver authority.
Alexander touted the waiver his agency secured for Rhode Island in 2009 as a “national model for Medicaid reform” in a paper he authored for the conservative Galen Institute the following year. He reported in the paper that it saved the Ocean State $100 million in its first 18 months.
But, like the quality of the analyses he has produced for Maine DHHS, Alexander’s claims simply don’t hold up.
Rhode Island’s Medicaid director has said very little in the Galen Institute report was accurate — especially the $100 million savings claim. Instead, an independ ent analysis conducted for the state found Rhode Island posted about $55 million in Medicaid savings during the first three years of the global waiver. Yet less than half of that sum, $23 million, actually required the additional authority Rhode Island secured through the global waiver — and Rhode Island could have secured that authority without a global waiver.
Under a Medicaid waiver, a state typically agrees to a finite budget cap in exchange for flexibility from federal rules. The federal government seeks budget neutrality, so the spending cap corresponds with the level the federal government would expect to spend on that state’s Medicaid program without a waiver. If state spending exceeds the budget cap, the state’s taxpayers are at risk for all excess spending.
While Alexander has touted the Rhode Island waiver as a model, no other state is likely to secure the same waiver terms Rhode Island did. Working for a Republican governor, Alexander secured the waiver four days before the end of President George W. Bush’s administration. The budget cap set for Rhode Island was well in excess of what the state was already spending, according to the Center on Budget and Policy Priorities, virtually ensuring the state’s taxpayers wouldn’t be at risk.
Essentially, Alexander recommended a strategy that could leave Maine taxpayers on the hook if Medicaid spending exceeded what would likely be a substantially more conservative budget cap than Rhode Island’s. As it stands now, Maine can already make many of the changes that saved money for Rhode Island. It doesn’t need a global waiver.