Washington State has dropped plans to put its Supplemental Security Income (SSI) population into managed care only months after it began mandatory enrollment of SSI clients in the eastern part of the state.
The "pent-up demand" for services by SSI recipients drove up utilization and costs as much as 35% above reimbursement levels for some plans, said Tom Bedell, finance director for the state Medical Assistance Administration, who adds that the plan experience is still being analyzed. "Our budget wouldn’t allow us to increase rates," he said.
Plan executives and consumer advocates say the state made its decision when it became obvious that not enough plans were willing to continue to participate in the program. But, Mr. Bedell said that they were only unwilling to continue under the same capitated rate of about $330 per month. Plans wanted the state to convert to a primary care case management model so that they would not be bearing 100% of the risk and could gain experience with the population, but the state decided against it.
Some 8,300 SSI recipients in eastern Washington were disenrolled from their selected plans in January and have reverted to fee-for-service care. The state also has canceled its plans for mandatory enrollment of the SSI population in the more populous western part of Washington this year.
Mr. Bedell said that access to health care improved for SSI recipients under managed care because plans were under contractual requirements to meet their needs and also because they were required to hire exceptional needs care coordinators (ENCCs). The ENCCs, who were charged with making contact with new enrollees, evaluating their needs and developing a care plan, succeeded all too well in facilitating access.
"If you have that role, you have increased costs," said Mr. Bedell, who adds that state officials were under a legislative mandate to run the program at a savings. The budget was equivalent to fee-for-service spending minus 1%. He also noted that Initiative 601 in Washington has placed a cap on the state’s budget, only allowing for increases tied to the Consumer Price Index and population growth.
The care plans were "the pathway to significantly higher utilization," said Tom Revis, director of government affairs for Group Health Northwest in Spokane, WA, one of the plans that participated in the state’s managed care program for the SSI population. "It was a tough decision for the state because they knew it improved access," Mr. Revis said.
There developed a "battle of objectives" within the plans, he said. On the one hand, the ENCCs were working to identify needs and expand access while, on the other hand, the state was unwilling to spend any more than it had spent under fee-for-service.
The "pent-up demand" for services by SSI recipients drove up
utilization and costs as much as 35%
Mr. Bedell agrees that the conflicting pressures of the program led to its breakdown. "There has to be an acknowledgement that if fee-for-service is not meeting the full needs of the population and you put into the system contractual requirements for plans to do so, you face costs that have to be in the budget."
While the surge in utilization due to improved access "may have been short-term and may have gone down in the future," Mr. Bedell said, "neither the state nor the plans could afford to find out."
Mr. Revis said there were few opportunities to reap savings from bringing the SSI population into managed care. In Yakima, when the mainstream Medicaid population enrolled in managed care, emergency room use was eight times higher than the commercial population. Utilization and costs could be reduced there by linking recipients to primary care providers. "This is not the case with SSI recipients who have great difficulty getting access." Mr. Revis adds that many health plans in Washington are operating on tighter profit margins, which makes them less willing to continue to absorb losses in programs.
Betsy Plastino, special programs manager for Community Health Plan of Washington, said ENCCs at her plan succeeded in reaching some clients who had been "afraid to go to the doctor for many years." There was an "influx of people who came out of the woodwork and were unknown to the fee-for-service system," she said.
Once these people came back into the loop, they had health problems that needed to be treated. Although the plans and the state will be analyzing utilization experience, Ms. Plastino believes prescription drugs and durable medical equipment are two categories where costs exceeded expectations in her plan. Because Community Health Plan of Washington is composed of community health centers and receives an enhanced reimbursement, its losses will be less than that of other plans.
While the intent was for ENCCs to evaluate patients needs and then refer them to services, often they could not make referrals because there were no community services to meet the needs, Ms. Plastino said.
They were "holding a need in their hand but there was nowhere to take it." Referrals to mental health services and services for the elderly meant jumping through hoops for means testing and other paperwork. "It brought up an instructive process and we learned that state silos (individual state programs) don’t connect," said Ms. Plastino. The ENCCs often were playing the role of case managers who manage needs more intensely. Instead of evaluating clients and making referrals to services, they "grew to be the critical link in the chain."
Washington health plans urged the state to continue the program on a primary care case management model under which they would manage care but wouldn’t be bearing 100% of the risk. But the state declined.
Mr. Bedell said the state had two primary care case management pilots in Clark County, but the results were mixed. One plan experienced spending close to fee-for-service levels; the other pilot exceeded spending under fee-for-service. Mr. Revis of Group Health Northwest said he wished the state had "shared" its experience with higher utilization of services by the SSI population in these pilots.
Kate Willey, an early intervention consultant for Children’s Hospital in Seattle, who is also the parent of a disabled daughter and a coordinator for the advocate group, Family Voices, believes the state should tie plan participation in managed care for the SSI population to the Healthy Options managed care program for the rest of the Medicaid population. Mr. Revis noted that in the bidding for Healthy Options, the state gave bonus points for participation in the SSI managed care
program.
Contact Mr. Bedell at 360-664-0008 or Mr. Revis at 800-497-2210.
HCA’s guiding principles
The Health Care Authority's (HCA) continued refinement of its risk adjustment process is being done in the context of a set of guiding principles.
•Reflect the HCA's public purchaser role of providing incentives for plans to enroll any person or category of people, regardless of health status, and without fear by plans of financial disadvantage.
•Reinforce that plans are in the insurance business and not interfere in their roles as risk-bearing and risk-managing entities.
•Be practical and feasible: Simplicity, practicality, acceptability, and timeliness will be weighed along with accuracy.
•Focus on data that are likely to be useful to plans because of the value for managing quality care.
•Ensure appropriate safeguards to protect individuals' rights to privacy regarding health status information.
•Emphasize refinement, not reinvention: Aim for better, not best; the next, not the final, level of refinement. Make changes where benefits clearly outweigh the costs.
•Be consistent with the way the HCA does business. For example, in all refinements the HCA seeks to maintain a level playing field among health plans. In addition, the HCA currently uses competitive bidding, statewide rates, risk adjustment following open enrollment, and risk adjustment that moves dollars among plans in a HCA expense-neutral way.
Washington state abandons SSI managed care Care coordinators and improved access to care drove up utilization
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