Medicaid Family Planning Programs: Case Studies of Six States After ACA Implementation

Overview

The passage of the Affordable Care Act (ACA) in 2010 made changes to the Medicaid program that have had considerable implications for family planning coverage and services available to low-income women. Prior to the ACA, over 3 million low income women received family planning services through stand alone, limited Medicaid benefit family planning programs.¹ The ACA enabled many low and modest-income women who were previously only eligible for family planning coverage to obtain full-scope insurance through Medicaid or the Marketplaces for the first time. These changes have altered the role of family planning programs within many states and created a more complex environment for family planning providers.

While still responding to coverage changes created by the ACA, family planning programs and providers are also facing new, emerging changes brought about by other industry trends. The ACA’s delivery system reform provisions sparked changes in how care is paid for and delivered. Family planning programs traditionally operated through specialty “stand alone” providers with direct contracts with the state. These providers are now grappling with how to integrate into the broader delivery system and, in states that have expanded Medicaid, how to work with Medicaid managed care organizations (MCOs) and the transition from uninsured or limited family planning benefit packages to comprehensive Medicaid coverage. These changes are impacting how family planning providers interact and contract with Medicaid MCOs and other payers, how they are reimbursed for care, the scope of services they provide and how they form and value relationships with other providers. Besides ACA changes, Congressional and federal efforts to “defund” Planned Parenthood through limits on Medicaid and Title X funding would limit access to family planning services for women living in certain communities across the country. This study addresses the shifting landscape in which family planning services are being provided, including routes to coverage; eligibility and enrollment; benefits; access; impact on providers of changes; and delivery system reform. Based on case studies in six states and interviews with national experts, providers, advocates and government officials, it describes major trends in how women secure Medicaid family planning coverage and services and the implications of ACA-related changes for family planning providers and the role of family planning more broadly in Medicaid delivery system reform initiatives.

This study was conducted in the summer of 2016 before the November election changed the outlook for the ACA and Medicaid. The Trump Administration has signaled that they intend to give states considerably more flexibility to reshape their Medicaid programs and to block federal funding to Planned Parenthood, a leading source of family planning care for low-income women. With Medicaid reform under debate at the federal and state levels, it is important to understand the role of family planning programs and how they could be affected by Medicaid restructuring.

Background and Context

Prior to the ACA’s passage, Medicaid was already the single most important payer of publicly-funded family planning services in the United States, financing more than 75% of all publicly-funded family planning services.² Family planning services long have had a special role within Medicaid, reflecting recognition by policymakers that there are significant social and economic consequences to unintended pregnancies, including greater poverty and reliance on public benefit programs.³ Family planning services have been a mandatory benefit in Medicaid since 1972 and are reimbursed by the federal government at a 90% matching rate. Federal law also requires that family planning services be exempt from cost-sharing and that beneficiaries have the right to secure the services from the providers of their choice, a provision known as the “freedom-of-choice” requirement.

Until the 1990s, however, many women simply did not qualify for Medicaid family planning services because they did not meet categorical eligibility rules that limited Medicaid eligibility to adults who were pregnant, parents/caretaker relatives, disabled or elderly. Then, with California in the lead, a number of states sought and secured Medicaid 1115 waivers to establish family planning programs that could serve low-income women, and sometimes men, beyond Medicaid categorical eligibility rules. By 2009, the year prior to passage of the ACA, at least 24 states had family planning waivers,⁴ and over 3 million women had gained coverage for family planning services through these programs. California’s program, FamilyPACT, was the largest, with 2.5 million enrollees, while there were approximately 942,000 enrollees in all other programs combined.⁵

Impacts of ACA Coverage Changes on Medicaid Family Planning

While family planning was not the primary focus of the Affordable Care Act (ACA), the law has had sizable implications for how many women receive family planning services and for family planning providers. The ACA extended eligibility for full-scope Medicaid to adults under 138% FPL and also created new Marketplaces that offer subsidized coverage up to 400% FPL. Although Medicaid expansion now is optional as a result of the 2012 Supreme Court decision on the ACA, the District of Columbia and 31 states have elected to expand Medicaid. In these states, many women who previously qualified only for a Medicaid family planning program have been able to secure coverage that offers a comprehensive benefit package (i.e., “full-scope” Medicaid).

The ACA also gives states the option to establish family planning programs through a simpler mechanism than a complex and lengthy waiver application process that needed to be renewed and evaluated periodically. By enacting a state plan amendment (SPA), states could base eligibility solely on income, while waivers may limit eligibility by other criteria such as age and sex. States using the SPA option must also set the eligibility threshold for their family planning program at or below the income threshold for pregnant women in the state. Fourteen states have transitioned to or have newly established a SPA family planning program since the option became available.^6,7

Finally, the ACA established integrated, modernized and streamlined standards for eligibility and enrollment processes that are used to evaluate eligibility for Medicaid, Marketplace coverage and related subsidies, and the Children’s Health Insurance Program (CHIP). Medicaid agencies and Marketplaces are required to use a “single, streamlined application,” to ensure individuals end up enrolled in whichever program for which they are eligible regardless of whether they submit their application to a Medicaid agency or a Marketplace. As a result, many more people are finding their way to coverage by applying through Marketplaces, raising the importance of understanding how Marketplace web sites and related eligibility and enrollment procedures work for women who qualify for full-scope Medicaid or family planning programs.

Other Developments

Family planning is garnering more attention than ever before at both state and national levels. In the political realm, highly controversial videos on the role of Planned Parenthood staff in disposing of fetal tissues have generated heated debate over the role of Planned Parenthood affiliates in Medicaid family planning programs. Some states have sought to ban Planned Parenthood providers from receiving any Medicaid funds while other states have ongoing inquiries into the role of clinics that offer abortion services within family planning programs. For example, Oklahoma’s Medicaid agency announced it was terminating its contracts with Planned Parenthood until, two months later, the agency reversed course and entered into “conditional one-year Provider Agreements” with the two Planned Parenthood affiliates in the State.⁸ In Missouri, the Legislature passed a fiscal year 2017 budget that effectively converts the Medicaid family planning program (supported by a combination of federal and State funds) into a fully State-funded program and excludes providers who offer abortion services.

In the past few years, CMS has issued a number of regulations and informational bulletins aimed at strengthening access to family planning services. In April 2016, CMS released a final Medicaid managed care rules that includes several provisions directly relevant to family planning services.⁹ As described in more detail later in the report, these include: new requirements for Medicaid MCOs to inform beneficiaries of the freedom-of-choice provision; stronger network adequacy standards for family planning providers; and, a reiteration of the importance of ensuring that beneficiaries can elect the family planning method of their choice. CMS also released three informational bulletins in 2016 on family planning: (1) reminding states that they cannot exclude family planning providers from Medicaid unless they are unfit to provide a covered service;¹⁰ (2) encouraging best practices for promoting access to long-acting reversible contraception (LARC);¹¹ and (3) highlighting that states cannot employ utilization controls, such as step therapy, that would interfere with a beneficiary’s right to choose her preferred method of family planning, regardless of whether a state operates a managed care or fee-for-service program.¹²

Methodology

This study is based largely on interviews with state officials, providers and consumer advocates in Alabama, California, Connecticut, Illinois, Missouri and Virginia.¹³ The in-depth state case studies were supplemented by interviews with national experts, family planning provider organizations and federal policymakers with expertise on Medicaid and family planning services, quality metrics, eligibility and enrollment issues, and waivers. Using a standardized questionnaire, interviewees were asked about their perspective on a range of issues, including: the implications of the ACA for how low-income women secure family planning services; family planning benefits and access to care; the role of family planning issues in broader delivery system reform; and impacts on family planning providers. A full list of interviewees is attached as Appendix C.

These six states were selected to represent a cross-section in terms of geography, Medicaid expansion status, implementation of a Medicaid family planning program and whether that program was established via a waiver or a SPA. Table 1 displays the characteristics of the states included in the analysis. Three of the selected states expanded Medicaid (California, Connecticut, and Illinois); two converted Medicaid family planning waivers to the state plan option (California and Virginia); one newly established a Medicaid family planning program post ACA enactment (Connecticut); two continued existing Medicaid family planning programs operated under waivers (Alabama, Missouri); and one terminated its program after expanding Medicaid (Illinois).

Table 1: Interviewees’ Medicaid Family Planning Program and State Characteristics
		Medicaid Family Planning (FP) Program				Full Scope Medicaid Expansion	% of Medicaid enrollees in Managed Care14	Rely on HealthCare.gov?
	Name	Waiver or SPA	Gender/Age Eligibility	Income Eligibility	FP-Related Benefits?
Alabama	Plan First	Waiver (Established in 2000)	Women, 19-55 Men, 21 and older (only for vasectomies)	141% FPL	No15	No	0%	Yes
California	Family PACT	SPA (Converted from waiver in 2011)	Women, no age restrictions Men, no age restrictions	200% FPL	Yes	Yes	77%	No
Connecticut	N/A	SPA (Established in 2012)	Women, no age restrictions Men, no age restrictions	263% FPL	Yes	Yes	0%	No
Illinois16	N/A	N/A (Waiver terminated in 2014)	N/A	N/A	N/A	Yes	53%	Yes
Missouri	N/A	Waiver (Established in 1998)	Women, 18-55	201% FPL	Yes	No	51%	Yes
Virginia	Plan First	SPA (Converted from waiver in 2011)	Women, no age restrictions Men, no age restrictions	200% FPL	No	No	66%	Yes