Fiscal Fitness: How States Cope

PA Medicaid's EPCCM med home program saves $85M in four years

Without the cost savings generated by various programs, including a successful medical home initiative, Pennsylvania Medicaid "would have been in a much worse position than what we're in," says David K. Kelley, MD, MPA, chief medical officer for the Pennsylvania Department of Public Welfare Office of Medical Assistance Programs.

Over the past five or six years, says Dr. Kelley, "a whole host of programs" were put into place that generated significant cost savings for Medicaid, including a more robust pharmacy management program, a radiology management program, and the Access Plus Enhanced Primary Care Case Management (EPCCM) program.

"We weren't forced to do a lot of benefit cuts, but we are facing a pretty big budgetary hole," says Dr. Kelley. "In this governor's current budget, there will be some benefit reductions. These are very challenging times for us."

Current projections are for an increase in enrollment of around 4.5% throughout Fiscal Year 2011-12, which is a slightly less steep increase than for the previous five years, says Dr. Kelley. "Seven years ago, we were at 1.6 million. Now, we are at 2.2 million recipients," he says.

Revenues were slightly higher than projected for the last quarter, adds Dr. Kelley, but the state has an aging population, growing enrollment and expects rising costs over the long term.

"We have a lot of fiscal challenges," he says. "But some of the programs we put in place helped us keep our Medicaid program at the level it's been at for many years, without having to do huge cuts in benefits."

In fact, some minor increases in provider fees were made in previous years, including some evaluation and management, dental and early periodic screening, diagnosis and treatment codes. "Had we not had some of these cost savings, that would have been extremely difficult to do," says Dr. Kelley.

Access Plus EPCCM

The Access Plus program provides care management and coordination, either telephonic or community-based, for people with complex diseases. "In our current program, there are 21 disease entities that the Access Plus vendor is responsible for better managing and coordinating care," says Dr. Kelley. "There are several mechanisms by which they do that."

The program utilizes community nurses in 42 rural and suburban counties who contact consumers by phone or interact with them face to face. The nurses also work with primary care practices to identify care gaps, improve quality, and coordinate services. Consumers are directed to select a medical home that will help them to better coordinate their care, says Dr. Kelley, and refer them for appropriate services.

"We have books through our actuaries showing an $85 million savings over the first four years," says Dr. Kelley. "And that is after all of the costs of the program have been taken out, after paying our vendor and everything else." There has been a very significant improvement in quality over the first five years of the program, he adds, based on the state's measurements.

Over the first five years, the program has seen the below improvements in access to care, as measured by the National Committee for Quality Assurance's Healthcare Effectiveness Data and Information Set (HEDIS):

• Well child visits ages 3 to 6 (67.4% to 74.4%)

• Adolescent well care visits (53.3% to 58.9%)

• Cervical cancer screening (63.0% to 67.2%)

• Frequency of ongoing prenatal care (62.4% to 76.9%)

• Emergency room utilization visits per 1,000 member months (61.1% to 41.7%)

• Annual dental visit for children ages 2 to 21 (41.8% to 49.5%)

• Diabetes poor control (43.3% to 35.0%)

• Blood pressure control (59.1% to 68.4%)

The Access Plus program has been able to link consumers to a medical home, reduce emergency room visits, improve results related to chronic conditions, and save money, according to Dr. Kelley.

"It's not that we were in a great budgetary position, but we were willing and able to try out a new model," he says. "We have gotten a good return on that, both in terms of dollars saved and quality and access improved."

Broader population reached

In 2007, major insurers, providers, consumers and other stakeholders in Pennsylvania were brought together to develop a program to pay for improved care of patients with chronic conditions. This led to the implementation of Pennsylvania's multipayer medical home project, which is now in its fifth year, says Dr. Kelley.

The medical home program began as a pilot in southeastern Pennsylvania, and eventually was rolled out statewide in five different regions, each with a slightly different model, says Dr. Kelley, with more than 500 physicians currently participating. While other states have implemented multipayer medical homes, he adds, they haven't been doing so as long or at the same level as Pennsylvania.

During the initial rollout, the program gave incentives to practices to become accredited by the NCQA, says Dr. Kelley, and they were paid according to their level of NCQA accreditation.

"One of the common themes that goes across all regions in the collaborative are learning network sessions that the practices attend, where they are sharing best practices and results," says Dr. Kelley. Practices are required to report measures to a registry on a monthly basis, he explains.

The state's Medicaid managed care plans helped to fund the initiative, says Dr. Kelley, which ties in with Pennsylvania Medicaid's pay-for-performance programs for managed care organizations that aligns incentives with HEDIS numbers.

During the first three years, the program focused solely on adult diabetics and children with asthma. "We have been able to show fairly significant and sustained quality improvement around diabetes measures," reports Dr. Kelley.

Contact Dr. Kelley at