There are certain categories of individuals, and certain types of services, for which federal Medicaid funds are not ordinarily available. As a general rule, states may cover these individuals and pay for those services through their Medicaid programs if they so choose, but they must do so entirely with their own funds. The Secretary of Health and Human Services has authority to grant exceptions to these limitations on federal funding on a state-by-state basis through federal Medicaid waivers.
Broader use of financing waivers to restructure Medicaid health insurance coverage and an expedited administrative process for individual states to obtain waivers will undoubtedly be at the center of Medicaid policy in the coming year.
Through the "Health Insurance Flexibility and Accountability" (or HIFA initiative) individual states are offered the flexibility to expand health insurance coverage but also to reduce benefits (including mental health benefits), increase cost sharing, and set limits on the number of lower-income people served. All waivers must be budget-neutral to the federal government.
The HIFA waiver policy raises a number of concerns:
The NAMI Policy Research Institute has just recently released a report entitled "What Lies Beneath the Medicaid Waivers: A Guide for Consumers and Families."