The Challenges of the Medicaid Modernization Mandate – Part 1

Joel L. Olah, Ph.D., LNHAExecutive DirectorAging Resources of Central Iowa

Iowa Assisted Living AssociationAugust 26, 2015

The Challenges of the Medicaid Modernization Mandate

•Definitions, Goals, and Expectations of Managed Medicaid Care

•Medicaid Modernization – Iowa

• Iowa’s Managed Care Organizations

• Impact of Managed Medicaid on the provider network

•Client education, care management, and service delivery

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Managed Care• Managed care is a health care delivery system

organized to manage cost, utilization, and equality.

• Medicaid health benefits and additional services through contract arrangements between state Medicaid agencies and Managed Care Organizations(MCOs) that accept a set per month (capitation) payment for services.

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Medicaid Managed CareManaged care is the predominant delivery system for

Medicaid beneficiaries

66% of all Medicaid beneficiaries in 2011 in a health plan (for some or all services)

39 States deliver some or all Medicaid benefits through health plans (comprehensive or limited)

Capitated health plans payments represent ~33% of all Medicaid expenditures

Virtually all of the 11 million adults receiving coverage under the ACA are in managed care plans

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State Processes• States can decide how to structure their managed

care program by deciding:‒ Who will enroll (eligibility groups)‒ What services will be provided (scope of benefits)‒ Where it will operate (geographic reach)‒ Who will provide the services (type of provider)

• CMS provides technical assistance and directs States to the Federal authority that will accommodate their program design

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Managed Care Fundamentals• States select managed care plans (typically through

competitive procurement• CMS has ~85 pages of Federal requirements that

states and health plans must follow• States execute a contract (approved by CMS) with

each managed care plan that makes the plan responsible for providing Medicaid services

• Managed care plans are paid an amount per member per month (PMPM) in exchange for providing all services included in the contract

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Managed Care Fundamentals

• Managed care plans are required to:‒ Have sufficient providers to ensure access to

services‒ Monitor and report on the quality of

services, which the state establishes‒ Provide access to member services and case

management for members‒ Have an appeal process for disagreements

on service access

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Iowa’s Managed Care Programs

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Why are states pursuing MLTSS?

•Managed care payments provide budgetpredictability for states•Potentially can provide more HCBS services tobeneficiaries on waiting lists (HI, WI, DE)•Plans have incentives to provide care in leastrestrictive/most cost-effective settings•Plans may speed rebalancing by contractingand reimbursement practices with providers (TN, AZ)

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CMS “Requirements” for MLTSS

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1. Adequate Planning & Transition Strategies

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2. Stakeholder Engagement

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3-5. Preference for HCBS Over Institutional Services

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6. Support for Consumers

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7. Person-Centeredness

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8. Qualified Providers

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9. Participant Protections

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10. Quality

What is Medicaid Modernization?

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• Medicaid Modernization is:‒ The movement to a comprehensive risk-based

approach for the majority of current populations and services in the Medicaid program.

• The goals include:‒ Improved quality and access‒ Greater accountability for outcomes‒ Create a more predictable and sustainable Medicaid

budget

What are the initiative’s goals?

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Improve the quality of care and health

outcomes for enrollees

Integrate care across the healthcare delivery

system

Emphasize member choice & increase access

to care

Increase program efficiencies and provide budget accountability

Hold contractor responsible for

outcomes

Create a single system of care which delivers efficient, coordinated and high quality health care that promotes member choice and accountability in health care coordination

How could Medicaid managed care work?

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• Medicaid agencies contract with managed care organizations (MCO) to provide and pay for health care services.

• MCOs establish an organized network of providers.• MCOs establish utilization guidelines to assure

appropriate services are provided the right way, at the right time, and in the right setting.

• Shifts focus from volume to per member, per month capitated payments and patient outcomes.

What do other states do to manage Medicaid?

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• Nationally, over half of Medicaid beneficiaries are enrolled in comprehensive risk-based MCOs.

• Under comprehensive risk-based managed care, an MCO receives a fixed monthly fee per enrollee and assumes full financial risk for delivery of covered services.

• 39 states, and the District of Columbia, contract with MCOs to provide services to various populations.

2014 State of the States in Aging & Disability

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