Category Archives: Medicaid/Medicare

Republican States Look to Customize Medicaid Expansion, Not Eliminate It

Source: Christine Vestal, Stateline, January 23, 2017

… As Congress prepares to repeal and replace the Affordable Care Act, 14 other states with GOP governors that opted to expand Medicaid under the law may face the same reality Bevin and Hutchinson did: Taking health insurance away from hundreds of thousands of people is a complicated and risky proposition. Medicaid spending for all states was about $532 billion in 2015, with about 63 percent funded by the federal government and the rest by states. In expanding Medicaid under the ACA, Republicans in expansion states chose economics over politics, even though it meant cooperating with a law that nearly all conservatives abhor. That calculus won’t change with the transition in Washington, according to Matt Salo, who heads the National Association of Medicaid Directors.

… In upcoming legislative sessions, many GOP-dominated states are likely to preserve expansion while adding so-called personal responsibility policies that have been proposed in Kentucky and adopted in Arkansas and five other states. Those policies include monthly premiums, copays and work requirements for low-income beneficiaries. … Under the Obama administration, Arkansas, Indiana, Iowa, Michigan, Montana and New Hampshire received federal approval to expand their low-income health care programs for adults under different rules than traditional Medicaid. Arkansas, with its so-called private option, was the first state to receive federal approval for an alternative expansion plan in 2013. Instead of enrolling newly eligible adults in its traditional Medicaid plan, which serves primarily children, pregnant women and the elderly and disabled, the plan for low-income adults substituted private insurance for traditional Medicaid. A bipartisan collaboration between former Democratic Gov. Mike Beebe and the state’s Republican-dominated Legislature, the plan has managed to come in under budgeted costs while covering far more people than originally projected, said Amy Webb, a spokeswoman for the state’s human services agency. After it was approved, Iowa and New Hampshire proposed similar plans. … If the Medicaid expansion remains intact, Kentucky could be the first state to get approval for an alternative plan under the Trump administration. With enough latitude, even holdouts such as Florida, Texas and Virginia might be persuaded to accept federal money to cover low-income adults.

Nebraska Modifies Its Privatized Medicaid; Iowa’s Called “A Disaster”

Source: Deborah Newcombe, Omaha Public Radio, January 4, 2017

Effective January 1st, Nebraska has made modifications in the administration of its Medicaid program by private insurance companies.    All Nebraska Medicaid recipients who did not pick one of the available plans by December 1st were automatically enrolled in one.  Molly McCleery, Staff Attorney for the Health Care Access Program at Nebraska Appleseed, stresses that recipients who are not happy with their plan have 90 days to change. … A recent Des Moines Register editorial calls Iowa’s privately managed Medicaid program, now less than nine months old, “a disaster.” Claiming Iowa’s Medicaid  costs had been among the lowest in the country, it says the state recently agreed to pay $127 million more than anticipated in state and federal funds – while recipients complain of being denied services and providers of not being reimbursed. McCleery says with profit margin a factor, a similar scenario could play out in Nebraska. …

Florida’s Medicaid privatization raises costs, not quality

Source: F. Douglas Stephenson, Social Justice Solutions, November 3, 2016

You might think that we learned the lesson of discredited managed care in the 1990s. The term “managed care” is confusing to many, but really amounts to managed reimbursement rather than managed care. A set prospective annual payment is made by federal/state governments, as in the case of Florida Medicaid managed care, to cover whatever services patients will receive over the coming year. There is therefore a built-in incentive for managed care organizations to skimp on care and pocket more profits. The same problem is back in Florida in the form of privatized Medicaid managed care, facilitated further by the Affordable Care Act. More than one-half of Medicaid beneficiaries are now in privatized plans, which have been catching on in Florida and many states based on the unproven theory that private plans can enable access to better coordinated care and still save money. That theory is not just unproven, it is patently wrong as the state forecasters are now discovering. Medicaid will eat up 45.9 percent of growth in general revenue over the next three years, ballooned by approval of a 7.7 percent increase in payment to private managed care plans. …


Florida says privatizing Medicaid cut costs, but insurers say they’re underpaid by state
Source: Daniel Chang, The Miami Herald, July 17, 2015

In less than a year, Florida’s switch to privately managed healthcare for more than 3 million poor, disabled and elderly residents has achieved one of its primary goals: cutting costs for Medicaid, the public health insurance program for low-income people that accounted for roughly one-fifth or about $9.5 billion of state spending last year. But the savings may be short lived after the private companies that took over insuring Florida’s Medicaid patients asked for a mid-year raise of nearly $400 million, and a 12 percent rate increase starting Sept. 1. That has state health officials, including Elizabeth Dudek, head of the Agency for Health Care Administration, worried that “the vast majority” of Medicaid savings from the first year could be wiped out if Florida gives in to the insurers’ demands.

Feds give permission to privatize long-term Medicaid care
Source: Kathleen Haughney, Sun Sentinel, February 4, 2013

The Obama administration Monday gave Florida permission to transfer part of its Medicaid program to private health-care companies beginning this summer.

The state will enroll 87,000 Medicaid patients — low-income seniors needing long-term care – in one of five health-care plans that were selected last month to cover patients living in 11 districts around the state. The companies include American Eldercare, Sunshine State Health Plan, United HealthCare of Florida, Coventry Health Care of Florida and Amerigroup Florida.

In 2011, the Legislature approved a shift from fee-for-service to managed care for most of its 3.3 million Medicaid population, in hopes of curbing soaring costs of the $22-billion program. But the shift requires a “waiver” from the U.S. Health and Human Services Administration, which pays about 58 percent of the program’s total cost.
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As NC seeks to privatize Medicaid, nonprofit touts cost savings

Source: John Murawski, The News & Observer, September 2, 2016

As federal authorities weigh the North Carolina legislature’s request to privatize Medicaid services here, a Raleigh-based nonprofit that manages 1.6 million Medicaid patients for the state said it continues delivering financial savings and improved health outcomes for patients. The nonprofit organization, Community Care of North Carolina, or CCNC, published its 2015 performance measures in the summer issue of N.C. Medical Journal, the first time that CCNC has publicized its performance in such a fashion. The Journal’s editors requested the submission for a special July/August issue dedicated to the subject of value-based care, an emerging health care trend that seeks to measure quality as it relates to the cost of providing care. … In the medical journal article, CCNC said that in 2015 the state’s Medicaid results are beating expectations. CCNC said total costs were 5 percent below an established benchmark, emergency room visits were 7 percent below, inpatient hospital admissions were 26 percent below, and hospital readmissions were 51 percent below. … Among the 1.6 million patients CCNC manages, the average cost per patient per month last year was $543. That amount has fallen every year since 2010, when the average monthly cost per patient was $597. … The state pays $3.6 billion toward Medicaid for state residents and is a huge chunk of the state’s $22 billion budget. The federal government pays the majority of North Carolina’s $15 billion Medicaid program. That money largely pays for doctors, medicine, hospitals and other related costs. Of the CCNC-managed patients, 53,875 were admitted to hospitals last year. That year there were 3,262 hospital readmissions within 30 days of the original admission, but more than 6,600 readmissions had been expected based on the 2012 performance benchmarks. …


State proposes privatizing Medicaid
Source: Kent McDonald, Daily Tarheel, March 9, 2016

State officials announced a multi-year draft of a plan to reform North Carolina’s Medicaid program last week, effectively moving it toward privatization. The plan has been in the works since reform legislation was approved in September by the N.C. General Assembly. The N.C. Department of Health and Human Services has helped coordinate and create the draft for the new program, which features a patient-centered approach. …

Providers fret, insurers hail N.C. move to Medicaid managed care
Source: Virgil Dickson, Modern Healthcare, October 6, 2015

North Carolina hospitals and doctors say the state’s push to institute Medicaid managed care will reduce services for the poor and shortchange providers despite the legislation giving them the opportunity to bid on the contracts. Late last month, Republican Gov. Pat McCrory signed legislation enabling changes that will move the state’s $12.7 billion Medicaid program serving 1.9 million residents from fee-for-service payments made directly to providers to capped payments to managed care insurers. … Providers, on the other hand, wanted the state to build on the success of a medical home initiative already in place for some Medicaid beneficiaries. The Community Care of North Carolina initiative organized 14 provider-based community networks, which still use fee-for-service but are paid a monthly per-member fee to coordinate patient care. The model appears to have saved the state money, according to a report from North Carolina’s Office of the State Auditor released in August. Community Care of North Carolina saved the state $312 a year for every non-elderly Medicaid patient from 2003 to 2012, which equates to more than $400 million a year.

Lawmakers ignore their own Medicaid expert
Source: Chris Fitzsimon, The Courier-Tribune, September 28, 2015

Rep. Nelson Dollar, a prominent member of the House Republican leadership and its top budget writer, not only opposed the plan that he correctly said would be putting stockholders ahead of N.C. citizens, he challenged the misleading claims about the current Medicaid system made by the ideologues and special interests who are intent on privatizing it. Dollar pointed out that for all the bluster about the current system being broken and out of control — two characterizations repeated incessantly by the privatizers — Medicaid claims costs have fallen in the last five years even as the program now serves 200,000 more people. Dollar said North Carolina ranks 42nd in the nation in the cost per full-time Medicaid enrollee and the cost per patient has declined in the last four years. …
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Lawmakers meet to discuss Medicaid backlog

Source: Gabriella Dunn, Wichita Eagle, August 4, 2016

Lawmakers say they have received a flood of phone calls from residents who are fed up with how long it’s taking the state to process applications for Medicaid, the insurance program for people with low incomes or who are disabled. … Mounting problems with the state’s backlog of Medicaid applications prompted Thursday’s meeting of the KanCare Oversight Committee. State officials told lawmakers Thursday that 3,587 applicants have been waiting 45 days or longer. That’s down from the 10,961 who had been waiting for that amount of time in mid-May. Hawkins said one of his family members submitted the same document three or four times and received notice from the state each time that the application clearinghouse had not received the documentation. … The backlog was caused in part by the state switching its computer system that processes Medicaid applications about a year ago. The problem worsened in January, when the state switched the agency that oversees some of the applications. Then in mid-May the state found out that backlog had been inaccurately reported by its third-party contractor, Accenture, and was four times larger than previously thought. …


‘It’s a pretty epic screw up’: Kansas contractors’ miscue misses 12,000 on Medicaid waiting list
Source: Tim Carpenter, Topeka Capital-Journal, June 17, 2016

An error by a contractor working for the Kansas Department of Health and Environment dramatically underrepresented — by 12,000 people — the scope of Kansas’ backlog of applications for Medicaid eligibility, officials said Friday. Susan Mosier, secretary of KDHE and the state’s Medicaid director, sent a letter to federal officials in early June disclosing a contractor relied upon a flawed method of reporting the Medicaid processing. The correction pushed the waiting list from 3,500 people on May 8 to 15,400 on May 22. … Shifting of processing oversight from the Kansas Department for Children and Families to KDHE in January escalated the bottleneck for people seeking to enroll in KanCare, the state’s Medicaid program. In February, more than 18,200 applications for Medicaid were awaiting action by the state. Of that total, 7,750 applications had been sitting in the queue for more than the federal limit of 45 days. Documents submitted by KDHE to the Centers for Medicare and Medicaid Services, which required updates on progress addressing the backlog, indicated the state narrowed the application blockade to 15,800 in March and 7,700 in April. The number exceeding the 45-day limit also appeared to have been reduced to 2,000 on May 8. However, the corrected report showed that on May 22 the number of stalled applications jumped to 15,400 and the portion on hand more than 45 days amounted to 10,900. …

Kansas Medicaid Applicants Face Delays After Rollout Of New Computer System
Source: Andy Marso, KCUR, December 14, 2015

The Kansas Legislature’s auditors say that the rollout of the computer system the state now uses to process Medicaid applications was long delayed in part because the contractor’s software required numerous modifications. State officials say the system is improving and ultimately will make applying for Medicaid and social services a much more efficient process. But documents obtained by KHI News Service show that state workers must learn dozens of “workarounds” to process applications. And some service providers who help clients get Medicaid coverage are reporting much longer processing times since the system went live in July and the state deals with a backlog of applications. Kansas signed a contract with Accenture to build the Kansas Eligibility Enforcement System, or KEES, in 2011. The system originally was slated to be complete by the end of 2013, , but considerable delays caused lawmakers to seek an audit in March. The audit report published Thursday said the KEES timeline was unrealistic from the beginning. The system had to be adjusted because of state and federal changes to Medicaid, some due to the Affordable Care Act. But there also were problems with Accenture’s “out-of-the-box” software.

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Opinion: Privatizing long-term care for profit

Source: Wisconsin Gazette, May 6, 2016

A year ago during the legislative budget session, GOP leaders proposed to dismantle Wisconsin’s highly rated long-term care system. The proposal came as a shock to the state’s nonprofit managed care organizations — or MCOs. They’re the long-term care providers and personal care workers. No one bothered to consult the 55,000 elderly and disabled individuals who receive assistance from the programs or the family members who participate in their care. … In late April, Walker and GOP legislative leaders announced again that they plan to shift the current system of eight regions overseen by nonprofit MCOs to three regions administered by national for-profit health insurance companies. They have the votes and the power to do whatever they want. … Pardon my skepticism toward the newfound altruism of our one-party state. In the past few years, the GOP has slashed access to food stamps, rejected almost $1 billion in federal Medicaid funds for the poor, and defunded and forced the closure of Planned Parenthood clinics. Walker and GOP Rep. John Nygren claim that turning the long-term care system over to the private sector will save the state $300 million over the next six years. That sounds good, but expanding caseloads and payouts to insurance company shareholders over those years can only result in cuts to services for our most vulnerable citizens. …

Feds propose privatizing management of reservation hospital

Source: Associated Press, April 27, 2016

The management of an embattled hospital on the Rosebud Indian Reservation could be privatized under a proposal from the federal agency responsible for the facility. The Indian Health Service is suggesting the privatization as part of a plan to significantly improve the hospital’s quality of care. The agency and the Centers for Medicare and Medicaid Services have until Friday to reach a last-chance remediation agreement. Without an agreement, the hospital won’t be allowed to bill the government for services provided to Medicare- and Medicaid-eligible patients after May 16. …

Connecticut Moves Away From Private Insurers to Administer Medicaid Program

Source: Melinda Beck, Wall Street Journal, March 18, 2016

In 2012, Connecticut fired the companies that were running Husky, as its Medicaid system is known, and returned to a more traditional “fee-for-service” arrangement where the state reimburses doctors and hospitals directly. State officials, physicians and patient advocates have welcomed the move: Average cost per patient, per month, is down from $718 in mid-2012 to $670 last year, according to state data. The number of doctors willing to treat Medicaid patients is up 7% and as a result fewer patients are using emergency rooms for routine care. … Once known as “the insurance capital of the world,” Connecticut had 11 companies offering Medicaid managed-care plans in 1995, each with different rules and reimbursement rates. Industry consolidation, battles over rates and other disputes whittled that down to four by 2000—near the minimum required by federal law—which some observers say limited the state’s ability to bargain and enforce rules. Patient advocates complained about denied services, delayed payments and inadequate provider networks. In a state-sponsored survey in 2006, only one in four callers posing as Husky patients was able to get an appointment with a network doctor; the others encountered erroneous listings or refusals to see Medicaid patients. State officials, meanwhile, were frustrated by the plans’ refusal to share data on costs and claims, prompting lengthy court battles.


Conn. has big Medicaid change in works
Source: Mary E. O’Leary, New Haven Register, February 09, 2011

HARTFORD — Gov. Dannel P. Malloy’s administration, in a major break from the past, will drop the for-profit managed care organizations from running the state’s huge Medicaid program and also beef up a transition that takes seniors out of nursing homes and provides services to help them live in their own communities.

The state is projected to pay $3.96 billion for Medicaid services this year, one of its most costly commitments out of a $19.01 billion budget. Ellen Andrews, of the Connecticut Health Policy Organization, said its studies projected a savings of $40 million for switching HUSKY clients alone to the new model, but that adding the elderly, disabled and blind population could double that.

Wyman said under the new system, the state will assume the risk of paying medical claims, but it will now know what it is paying for and with 600,000 people in a network, there will be more predictability and accountability. The MCO contracts are costing the state $863.6 million this year.

Potential move to privatize some Medicaid services in Nevada draws scrutiny

Source: Yesenia Amaro, Las Vegas Review-Journal, January 23, 2016

A possible move to privatize certain Medicaid services for the vulnerable continues to draw scrutiny in states across the country, including Nevada. Similar attempts have failed in at least one state in the past, and at least one other state is currently struggling. … This issue drew concerns from the beginning when legislation was introduced during last spring’s legislative session with the public, and those directly impacted by the potential switch from state to private management of the services, knowing little about it. The original legislation died, but the concept survived after quietly being grafted onto a different bill right before the Legislature adjourned. … The number of Medicaid recipients has increased across the nation, including in Nevada, where many more became eligible under the Medicaid expansion under the Affordable Care Act. The total number of Medicaid recipients in the Silver State as of December was 608,790. Advocates have estimated that about 50,000 elderly, blind and disabled could be affected by the potential switch to managed care. The state’s total Medicaid budget for fiscal year 2016 is more than $3 billion.


Possible privatization of Medicaid Services raises concerns
Source: Yesenia Amaro, Las Vegas Review-Journal, June 6, 2015

Legislation that would have privatized Medicaid services for the elderly, the blind and the disabled in Nevada died in the Assembly Ways and Means Committee, but the concept survived after being grafted onto a different bill. Senate Bill 514 was introduced a day before the June 1 adjournment and was quickly approved by the Legislature. Advocates who raised concerns about defunct Assembly Bill 310 say they are worried about SB514. It’s unclear how many people would be affected under the newly passed bill, which as of Friday hadn’t been signed by Gov. Brian Sandoval. ….

The Efficiency Consequences of Health Care Privatization: Evidence from Medicare Advantage Exits

Source: Mark Duggan, Jonathan Gruber, Boris Vabon, NBER Working Paper No. w21650, October 2015

There is considerable controversy over the use of private insurers to deliver public health insurance benefits. We investigate the efficiency consequences of patients enrolling in Medicare Advantage (MA), private managed care organizations that compete with the traditional fee-for-service Medicare program. We use exogenous shocks to MA enrollment arising from plan exits from New York counties in the early 2000s, and utilize unique data that links hospital inpatient utilization to Medicare enrollment records. We find that individuals who were forced out of MA plans due to plan exit saw very large increases in hospital utilization. These increases appear to arise through plans both limiting access to nearby hospitals and reducing elective admissions, yet they are not associated with any measurable reduction in hospital quality or patient mortality.