Health and Human Services (HHS) Secretary Kathleen Sebelius recently sent a letter to National Governors Association (NGA) Chair, Governor Jack Markell (D-DE), and NGA Vice-Chair, Governor Mary Fallin (R-OK), in response to governors' questions and requests for greater flexibility in the Medicaid program.  The letter reiterates recently established and existing flexibilities the Department has offered to states and discusses potential new flexibilities.  In the area of cost sharing, the Secretary noted that the recently released proposed rule by HHS would make additional changes by revising and simplifying policies regarding Medicaid premiums and cost-sharing requirements and would allow states to establish higher cost sharing for non-preferred drugs and non-emergency use of the emergency departments.  The Secretary also said that states already have significant flexibility when it comes to designing delivery and payment systems.  Under the Affordable Care Act, states may design coverage for newly eligible adults that is consistent with private coverage without requiring a waiver as long as essential health benefits are covered, subject to HHS approval.

Link: HHS Letter