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Medicaid: Hassan enlisted hired gun as governor

New Hampshire Union Leader

August 17. 2017 12:50AM

CONCORD — Then-Gov. Maggie Hassan deployed a prominent New York law firm 15 months ago to convince the Obama administration to drop opposition to how the state would help pay for New Hampshire’s Medicaid expansion, according to documents the New Hampshire Union Leader has obtained.

While this got the key federal agency to silence its unrest through the 2016 election, that opposition came roaring back this spring with a new President and program administrator.

Gov. Chris Sununu, barely on the job five months, had no idea the career staff at the Center for Medicare and Medicaid Services was gunning for New Hampshire’s program until he asked Health and Human Services Commissioner Jeffrey Meyers on May 10 why CMS Administrator Seema Verma was trying to telephone him.

“I am now convinced that the administrator is calling the governor to advise him that the voluntary donations made by the hospitals will not be credited by CMS for matching funds to help defray the cost of the non-federal share of the New Hampshire Program,” Meyers answered in an e-mail to Sununu’s staff.

Later Meyers ominously concluded, “Without these matching funds, I would be required to determine that there were insufficient funds for the program and initiate its termination.”

Last week, Sununu revealed that the Trump administration has given the state of New Hampshire until the end of 2018 to get rid of these provider donation payments or face a “deferral or disallowance” of the expansion that provides health insurance to 50,000 low-income adults.

Sununu was grateful to get the 16-month reprieve, which came only after placing calls to Vice President Mike Pence and U.S. Health and Human Services Commissioner Tom Price.

In the same May e-mail, Meyers confided the CMS bureaucracy for some time was opposed to the idea of New Hampshire using provider donations from insurance companies and health care providers instead of state dollars to support its New Hampshire Health Protection Program.

“CMS’ position is wrong as a matter of law. I firmly believe that career CMS personnel who do not favor the use of voluntary donations (for historical reasons) are internally driving this issue. They did in the last (Hassan) administration and they may well in this one,” Meyers wrote.

Meyers stressed how hard Hassan, Meyers and former Attorney General Joseph Foster worked in 2016 to keep this controversy from blowing up Medicaid expansion.

“You also need to know that Governor Hassan and I had numerous phone calls and meetings in Washington with former Secretary Burwell and CMS Medicaid Director Victoria Wachino — both are now gone,” Meyers said in his email.

Hired gun enlisted

The New York firm of Manatt, Phelps and Phillips was already a state contractor. The Executive Council gave them a $1.7 million, no-bid contract in March 2014 to perform legal, policy and technical services to support Medicaid expansion — including negotiating with federal officials on Medicaid waivers.

Hassan and Meyers asked the firm in April 2016 to prepare a legal brief to CMS specifically defending these provider donations.

“The Center for Medicare and Medicaid Services have expressed concern that provider taxes deposited in the Trust Fund, as authorized by the legislation, may not qualify as bona fide provider donations, and thus could not be used to draw down federal matching funds,” the Manatt firm wrote in its argument.

Conflicting accounts

Now a U.S. senator, Hassan said Tuesday that GOP legislative leaders last year told her federal officials were skeptical about New Hampshire’s Medicaid expansion financing.

“When we crafted this bipartisan legislation, Republican legislators said to me that they knew that the way they were funding this program would be scrutinized by CMS and would possibly be challenged by CMS, and they said they thought that they had made it as legally defensible as they could, but that it was going to be up to me as governor to defend the program to the Obama administration, which is exactly what I did,” Hassan said during an interview with the Keene Sentinel.

But Senate Majority Leader Jeb Bradley, R-Wolfeboro, the GOP architect of the 2016 law that made the controversial changes to Medicaid expansion, said neither he nor Senate President Chuck Morse, R-Salem, were aware of CMS’ opposition in 2016 — or that a law firm had been enlisted to help save the program.

“I never knew that. Senator Morse never knew there was a problem with CMS,” Bradley said.

Two-year patch

Bradley said the New Hampshire Hospital Association and Hassan’s team had much better knowledge than GOP legislative leaders about how the Medicaid expansion design would be received.

The 2016 law used insurance premium taxes, payments from insurers to a high-risk pool and provider donations instead of state budget dollars to cover the $22.6 million, non-federal money share of Medicaid expansion starting in 2017.

Bradley did say GOP legislative leaders thought the 2016 law was a two-year patch because the next President and Congress would likely work to change Medicaid into a block grant program for the states.

“It was always thought this was going to be a one-time deal with the hospitals and the insurers,” Bradley said.

On Wednesday, Hassan’s staff did not answer a question from a Union Leader reporter asking if Sununu got a briefing from Hassan on this ongoing controversy before she left office.

“Senator Hassan expressed to Governor Sununu the need for constant engagement with CMS on a wide range of Medicaid issues, and it is incumbent upon Governor Sununu and Republicans in the Legislature to work with the Trump Administration to ensure that federal funding for the program continues as part of the legislative reauthorization process,” said Hassan Communications Director Aaron Jacobs.

Politics Obamacare

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