Clip file/News from the states

Each month, this column features selected short items about state health care policy digested from publications from around the country.

Mississippi reimbursement pilot for pharmacists incites national turf war on credentialing

Jackson, MS—In May, when the Baltimore-based Health Care Financing Administration (HCFA) approved a plan by Mississippi’s state pharmacy board and Medicaid program to pay pharmacists for clinical disease management in that state, the program was hailed as a breakthrough with national implications. But when HCFA told the state it had to establish a pharmacist credentialing process by July 1 or the plan couldn’t go forward, the breakthrough threatened to break down.

No one disagreed that credentialing can help assure payers, patients and physicians that pharmacists are qualified to run clinics in the four approved disease states — asthma, diabetes, dyslipidemia, and anticoagulation — but credentialing for pharmacists had never been done in Mississippi.

Not wanting to lose momentum, the state board turned to the National Association of Boards of Pharmacy (NABP) in Park Ridge, IL, as well as the National Association of Chain Drug Stores (NACD) and the National Community Pharmacists Association (NCPA), both in Alexandria, VA, for help. To start with, NABP looked to an existing set of clinical objectives already drawn up by NCPA under the auspices of its National Institute for Pharmacist Care Outcomes, then went on to produce credentialing tests and workshops for Mississippi pharmacists to take for three of the four approved disease states: asthma, diabetes and dyslipidemia.

The three organizations decided to expand the Mississippi effort by forming the National Institute for Standards in Pharmacist Credentialing (NISPC) and began positioning its credentialing process as a national model. To say that the other dozen or so national pharmacy organizations were caught off guard is an understatement.

And for formidable players like the Washington, DC-based American Pharmaceutical Association; the American Association of Colleges of Pharmacy and the Academy of Managed Care Pharmacy, both in Alexandria; and American Society of Health-System Pharmacists (ASHP) in Bethesda, MD, for example, injury was added to insult in this case when the newly formed NISPC sent out a letter in late June asking these and four other national groups to join their effort.

So far, the Mississippi effort is getting a decidedly cold shoulder from other pharmacy groups, but in the meantime, things are moving forward in Mississippi. Sixty-three pharmacists have taken a total of 95 exams in one or more of the three disease states available for testing. The total cost of testing is $125, and recertification will be required every two years.

Pharmacists who pass will be listed with the state Medicaid program as credentialed in a specific disease state. They will receive a Medicaid provider number for filing claims and then can begin seeing physician-referred patients. Newly certified pharmacists will be listed on both the state pharmacy board and NABP Web sites as having passed the testing for each disease state sought.

In Mississippi, the state’s Medicaid program expects to pay about $20 for a 15- to 30-minute office visit, with that payment going directly to the pharmacist as opposed to the pharmacy department to which he or she belongs.

—Drug Utilization Review, September 1998

Study shows locality makes big difference in ability of uninsured people to get health care

Washington, DC—If you are uninsured, where you live can make a big difference in whether you get the health care you need, according to a new study released in the Sept. 7 issue of The Journal of the American Medical Association.

While only 18% of the uninsured in Orange County, CA, and just 25% of those without health coverage in Newark, NJ, said they had difficulty obtaining health care, more than 40% of uninsured people in Lansing, MI, and Cleveland did have problems.

The researchers, Drs. Peter Cunningham and Peter Kemper, of the Center for Studying Health System Change in Washington, DC, report that nationally, 14% of those who were uninsured did not obtain needed medical care and 29% delayed getting care.

The findings are derived from data obtained from the 1996-1997 Community Tracking Study Household Survey of 60,446 people living in 60 communities, and included 7,200 individuals without health insurance. It is not clear why obtaining health care was easier in some communities, the researchers said, but it appeared to be unassociated with the urgency of the patient’s need or other patient-related factors.

The authors speculated that the "higher-than-average supply’’ of physicians in Orange County and Newark, wealthy regions with small pockets of poverty, may have something to do with it. Doctors in those areas "may not feel as threatened financially by the uninsured and may be more willing to treat them for free or reduced cost,’’ the authors suggested.

The researchers predicted that the problem will only grow because the federal government is increasingly shifting care of the uninsured to state and local government. "As a result, variation across communities in access to care for the uninsured is likely to persist or grow even larger,’’ they concluded.

—The Journal of the American Medical Association 1998; 280: 921-927

Florida’s uninsured population is 6th largest in nation, according to state’s hospitals

ft. lauderdale, fl—A new study by the Florida Hospital Association says the state’s uninsured population is the sixth largest in the nation. The report says that at least 2.8 million of Florida’s 14.7 million residents (19%) have no health insurance, and the cost of treating the uninsured has increased by 24% since 1990 to $940 million in 1996.

The report also chronicles the story of doctors and patients frustrated with the domination of HMOs in the Florida market place. HMOs are projected to increase their market share to 70% of covered lives over the next 12 years.

Florida Medical Association President-elect Mathis Becker, MD, is quoted as saying: "Doctors are having to see more patients a day for shorter periods of time, so patients are unhappy. And doctors are unhappy because that’s not the way they want to take care of their patients."

The competition is already taking its toll on managed care companies in the state; less than half recorded a profit last year. The report goes on to predict that the surviving HMOs will probably raise premiums, "which will bump more Floridians into the ranks of the uninsured." Other major findings include:

• An estimated 25% of the population under 65 will be uninsured by 2002.

• Teen pregnancy and infant mortality rates surpass the national average.

• A high death rate is largely attributable to the large number of citizens over age 65.

• Rates of "suicides, firearms deaths, poisonings, falls, drownings and pedestrian/vehicle deaths" are all higher than the national average.

• The HIV/AIDS rates among adults and children are the third and second highest in the nation, respectively.

However, the state’s insurance program for children, KidCare, got high marks. It is projected to cover 256,000 of the state’s estimated 823,000 uninsured children.

—Fort Lauderdale Sun Sentinel, Sept. 14

Study finds high rate of uninsured in Nevada

LAS VEGAS—Nearly 20% of Nevada’s residents are uninsured, according to a study commissioned by the Nevada Legislature. Data from the Center for Business and Economic Research at the University of Nevada-Las Vegas indicates that 81.7% of adults and 81.3% of children are continuously covered; 9.6% of adults and 10.4% of children have had temporary lapses in coverage from three to six months.

Researchers say that while the survey did not indicate the number of children that would be eligible for Nevada’s children’s health insurance plan, known as Nevada Check Up, data would be available within several months. Estimates of the number of uninsured children have ranged from 10,000 to 45,000.

—Las Vegas Sun (Associated Press), Sept. 12

Montana children’s health insurance program is approved; qualifies for $9 million grant

helena, mt—Montana received approval Friday from the Department of Health and Human Services for its program to expand insurance coverage to uninsured children, qualifying for up to $9 million in matching federal funds under the federal Children’s Health Insurance Program. The state plans to insure more than 9,000 children by June 2000 through a new, non-Medicaid insurance program.

Children under age 18 in families earning less than 150% of the federal poverty level ($16,450 for a family of four) will be eligible. An estimated 27,000 Montana children do not have health insurance, the majority of whom come from working families that earn too much to qualify for Medicaid but not enough to afford private insurance.

In conjunction with the pilot program, Montana Gov. Marc Racicot plans to ask the 1999 state legislature to appropriate a 20% match that will enable Montana to qualify for about $10 million in federal funding. If lawmakers approve the long-term program, Montana will receive $47 million over five years. When fully enacted, the state will be able to provide insurance to about 9,000 children.

—Montana Department of Health and Human Services release, Sept. 11

Highlights of national health expenditure projections, 1997-2007, show average 6.8% rise

Baltimore—The nation’s total spending for health care is projected to increase from $1 trillion in 1996 to $2.1 trillion in 2007, with average annual increases of 6.8%, according to a report released by the Health Care Financing Administration. Over this period, health spending as a share of gross domestic product is estimated to increase from 13.6% to 16.6%. The Balanced Budget Act (BBA) of 1997 is expected to slow growth in Medicare spending between 1998 and 2002.

These projections are presented in an article titled "The next ten years of health spending: What does the future hold?" published in the September/October 1998 issue of Health Affairs. The projections were produced by the Health Care Financing Administration’s Office of the Actuary.

National health spending growth is expected to accelerate beginning in 1998, growing at an average annual rate of 6.5% from 1998 to 2001. This compares to 5.0% average annual growth from 1993 to 1996. The slower growth over the past few years was due mostly to slow spending growth in the private sector (2.9%), while public-sector spending grew more quickly (7.5%). However, between 1998 and 2001, this pattern is projected to reverse, with private sector health expenditures growing at faster average annual rates (7.2%) than the public sector (5.7%).

The article notes that real per capita private-sector health spending growth is projected to accelerate as "recent stronger growth in real per capita income is expected to boost underlying demand for medical services, and higher medical inflation is expected to fuel increasing health spending growth. An anticipated slowdown in the growth of private-sector managed care enrollment and a pause in the downward trend for private health insurance coverage also are expected to contribute to the acceleration in health spending growth."

Real per capita public-sector health spending growth is expected to decelerate between 1998 and 2002, primarily as a result of the Balanced Budget Act (BBA) of 1997 and its effect on Medicare. The introduction of prospective payment systems for different services and cutbacks in payment formulas are expected to slow the rate of increase in Medicare expenditures. However, growth in Medicare managed care enrollment as a result of the BBA is not expected to reduce growth in overall Medicare spending.

For 2001-2007, average annual growth is expected to be similar for both the private and public sectors. Private sector spending growth is estimated to slow from the 1998-2001 period as income growth slows and the number of uninsured people begins to rise again. Public sector spending growth is estimated to accelerate after 2002 because the BBA will no longer affect payment updates.

Patterns of growth will differ substantially across types of services. While all health providers will be affected by rising costs, hospitals are expected to continue to face relatively slow growth in labor compensation as downsizing in this sector continues. Hospital growth is projected to lag increasingly behind growth in drugs and physician and other professional services as the trend away from the inpatient setting toward ambulatory care settings is reinforced by the movement of Medicare beneficiaries into managed care. The rapid rise in outpatient hospital services will be tempered as the potential for further substitution for inpatient services declines.

Expenditures for drugs are expected to grow at fairly rapid rates through 2007 as a result of rising utilization (number of prescriptions) and intensity (including changes in size and mix of prescriptions). For extended care, both nursing home and home health expenditures growth are expected to slow as provisions of the BBA that implement PPS systems and introduce new limits and caps are felt in the public sector.

—Health Care Financing Administration release, Sept. 15

Rhode Island plans to cut uninsured rolls

providence, ri—Rhode Island Gov. Lincoln Almond has announced an aggressive three-part plan to reduce by 25% the number of state residents without access to health insurance by the year 2000.

The three legs of the plan are: 1) organize an outreach program to enroll the state’s eligible 17,000 uninsured children in the Rite Care plan; 2) get the federal government to waive a requirement that funding provided for the Children’s Health Insurance Program only be used to cover children (the governor wants to use some of the money to cover approximately 8,000 uninsured adults); 3) have the state contract with health insurers to provide health insurance for small businesses and individuals.

The governor, who is running for re-election, points to the state’s Rite Care plan’s success in improving care for residents formerly covered by Medicaid. He released a report showing that 97% of the recipients were happy with the plan; the number of pregnant women receiving prenatal care rose from 55% in 1993 to 69% in 1996; and the number of inner-city infants receiving immunizations increased from 88% to 95% between 1993 and 1996.

The state’s experience with Rite Care proves it can create programs that work and provide quality care, Almond maintains.

—Providence Journal-Bulletin, Sept. 10

Preliminary data suggest CHIP crowds out private insurers

Washington, dc—Preliminary data from a study documenting low-income children’s health insurance status indicate the $24 billion Children’s Health Insurance Program drowns out some employment-based insurance for some Medicaid-eligible children. But the study notes the current data are inconclusive, said the Employee Benefit Research Institute (EBRI). The study checked Census Bureau data from October 1994 to September 1995 for sources of children’s coverage and time uninsured. The most prevalent source of coverage for children and adults was employment-based coverage. But Medicaid was the most prevalent source for children with family incomes below 125% of the poverty level.

—EBRI release, Sept. 1

Federal judge strikes down Medicaid drug reimbursement program

philadelphia—A federal judge has ruled that Pennsylvania Medicaid program administrators violated federal law in 1995 when they changed Medicaid payment rates for prescription drugs, and has barred reimbursements based on those changes after Oct. 1. The court said the Pennsylvania Department of Public Welfare failed to comply with a federal requirement disallowing revisions in Medicaid pharmacy reimbursement rates unless its methods or procedures for ensuring its payments are "efficient, economical, maintain quality of care, and provide equal access.

"All of three methods used by the Department to evaluate efficiency and economy are improper or deficient," according to Judge Harvey Bartle III of the U.S. District Court for the Eastern District of Pennsylvania, who granted summary judgment to Rite Aid of Pennsylvania Inc. and the Pennsylvania Pharmacists Association in their lawsuit challenging the new rate schedule.

The court also concluded that the Welfare Department had not considered quality of care in its decision-making process, "but even if it did, the administrative record does not support the department’s decision." The court said the way the department patterned its reimbursement schedule after 13 commercial third-party payers in Pennsylvania for brand-name drugs was "arbitrary and capricious." The court was equally dismissive of comparisons with other states’ reimbursement formulas and Medicaid program expenditures. The Health Care Financing Administration said, "each state should establish a dispensing fee to reflect the characteristics of that state."

—BNA, Inc. Medicare/Medicaid Reimbursement Alert, Sept. 22