FINANCING SYSTEMS OF CARE

1. FINANCING SYSTEMS OF CARE Medicaid Managed Care Mary B. Tierney, MD April 15, 2004

2. MEDICAID • Federal/State Partnerships • State Agency Requirements • Eligibility • Services • Payment for Services TA Partnership for Child and Family Mental Health

3. MANAGED CARE GENERAL CONCEPTS

4. HISTORY OF HEALTH INSURANCE • Originally based upon fire and flood insurance models – insure against catastrophic loss • Growth in all health insurance through the workplace after World War II • Managed Care was a small component of health insurance movement until 1970’s TA Partnership for Child and Family Mental Health

5. HISTORY OF HEALTH INSURANCE AND MANAGED CARE • Enactment of the Health Maintenance Organization Act of 1973 • In the 1980’s and 1990’s there was continued growth of the private sector and subsequently, public sector use of Managed Care TA Partnership for Child and Family Mental Health

6. DEFINITIONS • Fee for Service • Managed Care • Capitation/Per Member Per Month • Risk Contract TA Partnership for Child and Family Mental Health

7. GROWTH OF MEDICAID MANAGED CARE TA Partnership for Child and Family Mental Health

8. MANAGED CARE LEGISLATIVE AND REGULATORY REQUIREMENTS

9. LEGISLATIVE AND REGULATORY HISTORY • From 1965 To 1997 States must obtain waivers for managed care • The Balanced Budget Act (BBA) of 1997 allows states to mandate enrollment in managed care without waivers • The BBA mandates certain protections such as quality improvement and grievance rights TA Partnership for Child and Family Mental Health

10. LEGISLATIVE AND REGULATORY HISTORY • June 14, 2002, managed care regulations (except external quality improvement) finalized, became effective, June 14, 2003 • January 24, 2003, external quality improvement regulations finalized, become effective January 24, 2004 TA Partnership for Child and Family Mental Health

11. Managed Care Organizations (MCO) Primary Care Case Management (PCCM) All 1915 (b) waivers Most 1115 waivers Contractors State Plan amendments ORGANIZATIONS COVERED BY THE REGULATONS TA Partnership for Child and Family Mental Health

12. Regulatory Requirements • Limits on Enrollment • Guaranteed Eligibility • Protection of MCO members • Restrictions and Regulations on Marketing • Solvency Requirements • Fraud and Abuse Sanctions • Quality Improvement TA Partnership for Child and Family Mental Health

13. LIMITS ON ENROLLMENT • Individuals also Eligible for Medicare • Native Americans • Categories (Katie Beckett) • Foster Care or Out-of Home Placement • Children under age 19 years who are: - On SSI - Other Special Needs TA Partnership for Child and Family Mental Health

14. GUARANTEED ELIGIBILITY • States have the option to guarantee 6 months eligibility for Medicaid if enrolled in an MCO • This guarantee applies even if one loses Medicaid through TANF, SSI or other eligible groups TA Partnership for Child and Family Mental Health

15. Complaints and Grievance Procedures Protection against liability for payments to providers in case of insolvency of the MCO Confidentiality Communication requirements including use of clear concise language Translation into other prevalent languages Distribution of “Rights and Responsibilities” PROTECTION OF MEMBERS TA Partnership for Child and Family Mental Health

16. MARKETING RESTRICTIONS • Marketing Materials Receive State Approval • Distribution to Entire Service Area • No Door to Door, Telephone, Cold-Calls • Accurate Information Provided TA Partnership for Child and Family Mental Health

17. SOLVENCY REQUIREMENTS • Must Comply with State-wide Solvency Requirements Used by the State Insurance Commissioner • Members May Not be Held Liable for Debts Incurred by MCO in the Case of Insolvency TA Partnership for Child and Family Mental Health

18. FRAUD AND ABUSE • Range of Sanctions Must be Available • Monetary Sanctions • Cancellation of the Contract TA Partnership for Child and Family Mental Health

19. QUALITY IMPROVEMENT • Internal Quality Improvement • External Quality Review TA Partnership for Child and Family Mental Health

20. Use of Clinical Practice Guidelines Measure Performance using Objective Indicators Systems Intervention to Improve Quality Evaluation of Effectiveness of Interventions Planning and Initiation of Activities for Increasing or Sustaining Improvement INTERNAL QUALITY IMPROVEMENT TA Partnership for Child and Family Mental Health

21. Independent External Organization with Expertise in QI Review Validation of MCO Internal QI Activities Validation of Performance Measures and Compliance with Measures Review of Previous Activities to Determine Compliance with QI Plan EXTERNAL QUALITY REVIEW/MANDATORY TA Partnership for Child and Family Mental Health

22. EXTERNAL QUALITY REVIEW/OPTIONAL • Validation of Encounter Data • Administration or Review of Member Satisfaction Surveys and Other Activities • Conduction of Quality Improvement Activities in Addition to Those of the MCO TA Partnership for Child and Family Mental Health

23. OPPORTUNITIES FOR SYSTEM OF CARE COMMUNITIES

24. OPPORTUNITIES • Contracting with MCO’s for: - “Case-Management” - Wrap-Around - Provision of Mental Health Services • Contract Requiremements including the Regulations, Licensure TA Partnership for Child and Family Mental Health

25. OPPORTUNITIES • Participation in Quality Improvement Activities - Clinical Practice Guidelines - Assist in Development of Quality Indicators - Measuring Effectiveness of Wrap-Around and Other Activities TA Partnership for Child and Family Mental Health

26. TAKE HOME MESSAGE WHAT GETS MEASURED GETS MANAGED

27. CAN WE TALK?