MEDICAID REFORM PROPOSAL Stakeholder Meeting August 24, 2004

1
MEDICAID REFORM PROPOSAL Stakeholder
MeetingAugust 24, 2004
2
Medicaid Growth is Unsustainable!

• In FY2005, Medicaid will require 43 of all new
  state revenue
• By FY2008, Medicaid will require over 50 of all
  new state revenue.
• By FY2011, Medicaid will require 60 of all new
  state revenue.

3
Percent of All New Revenue Required by the
Medicaid Program

4
Utilization Management is a Necessity

• Medicaid utilization drives more than 35
  of total growth year over year

• From FY05 to FY10 utilization is expected
  to increase in the following major categories of
  service
• Inpatient Admissions 23
• Physician Visits 42
• Prescriptions 30
• Outpatient Hospital Visits 34

Utilization Growth
Enrollment Price Growth
5
Quality Indicators HealthCheck Comparative Data
National Data Georgia Data Georgia and
National data is current except where noted
below. National Participation Screenings are
FFY 98 National Lead Screening is FFY 02
6
Quality Indicators ER Utilization Per 1,000
Georgia Better Health Care FY2001
APHSA Medicaid MC Plans HEDIS Benchmark FY2001
State Health Benefit Plan FY2003
Medstat Employer (Commercial) Client Data FY2003
7
Why Medicaid Reform?

• To focus on system-wide improvements in
  performance and quality
• To consolidate fragmented systems of care
• To control unsustainable trend rate in Medicaid
  expenditures
• To adopt a management of care approach to
  achieve the greatest value for the most efficient
  use of resources

8
Goals of Reform

• Improve health care status of member population
• Establish contractual accountability for access
  to and quality of healthcare
• Lower cost through more effective utilization
  management
• Budget predictability and administrative
  simplicity

9
Vision

• To create a statewide, full-risk organized
  system of care for Medicaid and PeachCare members
  that incorporates Georgia-specific initiatives as
  well as best practices for the provision and
  purchasing of healthcare.

10
Strategy

• A successful model for the management of care
  for Georgia Medicaid involves
• An organized system of care
• Responsibility for case oversight
• A network of contractually accountable providers
  to ensure both quality and cost containment
• Medically based guidelines for appropriate
  treatment leading to healthy outcomes

11
Population-based Strategy

• DCH will apply different strategies for reform
  based upon the unique needs of our populations.
• Part I will include Low-income Medicaid adults
  and children PeachCare for Kids, Right from the
  Start Medicaid and Refugees
• Part II will include the Elderly and
  Disabled, Medically Fragile Children and Foster
  Children

12
The Plan Part I

• Regionalized approach 6 geographic regions
• Competitive procurement for up to 2 care
  management organizations (CMOs) in each region
• CMOs will
• Be licensed by Georgia Department Of Insurance as
  risk-bearing entities
• Be subject to net worth and solvency standards
• Have demonstrated ability to provide all covered
  healthcare services and an adequate provider
  network

13
Proposed CMO Regions Eligible Member Counts
Avg. Member/Month FY 2004
CATOOSA
RABUN
FANNIN
TOWNS
DADE
North
UNION
155,940
MURRAY
WHITFIELD
GILMER
WALKER
HABERSHAM
WHITE
LUMPKIN
STEPHENS
CHATTOOGA
GORDON
PICKENS
FRANKLIN
DAWSON
HART
HALL
BANKS
499,334
FORSYTH
BARTOW
CHEROKEE
FLOYD
ELBERT
Atlanta
JACKSON
MADISON
POLK
BARROW
COBB
OGLETHORPE
CLARKE
GWINNETT
PAULDING
OCONEE
HARALSON
WILKES
WALTON
LINCOLN
79,851
DEKALB
DOUGLAS
FULTON
GREENE
TALIAFERRO
CLAYTON
ROCKDALE
COLUMBIA
CARROLL
MORGAN
MCDUFFIE
NEWTON
HENRY
FAYETTE
WARREN
RICHMOND
JASPER
PUTNAM
148,995
COWETA
HEARD
HANCOCK
BUTTS
GLASCOCK
East
SPALDING
JEFFERSON
MERIWETHER
BURKE
BALDWIN
PIKE
JONES
LAMAR
MONROE
TROUP
WASHINGTON
UPSON
JENKINS
WILKINSON
BIBB
SCREVEN
JOHNSON
HARRIS
CRAWFORD
TWIGGS
TALBOT
EMANUEL
Central
LAURENS
PEACH
TAYLOR
MUSCOGEE
BULLOCH
EFFINGHAM
BLECKLEY
HOUSTON
MARION
TREUTLEN
CANDLER
MACON
CHATTAHOOCHEE
MONTGOMERY
SCHLEY
PULASKI
DODGE
EVANS
DOOLY
BRYAN
WHEELER
CHATHAM
WEBSTER
STEWART
TOOMBS
TATTNALL
SUMTER
WILCOX
Southeast
TELFAIR
CRISP
LIBERTY
QUITMAN
LEE
LONG
JEFF DAVIS
BEN HILL
TERRELL
APPLING
TURNER
RANDOLPH
WAYNE
IRWIN
MCINTOSH
BACON
COFFEE
CLAY
WORTH
DOUGHERTY
CALHOUN
TIFT
PIERCE
Southwest
EARLY
BAKER
ATKINSON
GLYNN
BERRIEN
BRANTLEY
WARE
COLQUITT
MITCHELL
MILLER
COOK
LANIER
CAMDEN
SEMINOLE
CLINCH
CHARLTON
DECATUR
GRADY
THOMAS
BROOKS
LOWNDES
ECHOLS
114,624
131,336
Rev. 12/20/04
14
The Plan Part I

• Additional preferred attributes for consideration
• of CMOs
• Incorporate technological advances (i.e.
  electronic prescribing and telemedicine)
• Focus on the education and empowerment of the
  Medicaid member
• Introduce elements of consumerism to Medicaid
  members to drive better healthcare choices (i.e.
  financial incentives and quality information)
• Incorporate disease and case management functions
  as part of their medical management strategy
• Georgia provider-owned/sponsored organizations

15
The Plan Part I

• Required enrollment for
• Low-income Medicaid adults and children
• PeachCare for Kids
• Right from the Start Medicaid
• Refugees
• CMO enrollment mandatory, but
• Enrollees will have 30 days to select one of at
  least two CMOs
• Enrollees will have 90 days to change CMO without
  cause thereafter, will remain in selected CMO
  until one-year anniversary

16
The Plan Part I

• CMOs will be responsible for providing all
• covered Medicaid services, which include
• Physician visits, laboratory and diagnostic
  testing, and inpatient and outpatient
  hospitalization
• Mental health and substance abuse treatment
• Pregnancy-related services
• Prescription drugs
• Dental and vision care services (to eligible
  populations)
• Screening and preventive services (to eligible
  populations)
• Durable Medical Equipment

17
The Plan Part I

• CMOs will not be responsible for
• ICFMR- Intermediate Care Facility/Mentally
  Retarded
• HCBS- Home and Community-based Services under a
  1915 (c) waiver
• Other long-term services

18
Healthcare Delivery and Access Standards

• DCH will protect the patient/provider
• relationship by contractually requiring CMOs
• To have sufficient numbers of providers of both
  primary and specialty care
• To include sufficient numbers of safety-net
  providers and rural and critical access hospitals
• To have a culturally appropriate mix of providers

19
Rights of Members

• DCH will contractually require CMOs to provide
• to members
• Bi-lingual written materials and oral
  interpretation services
• Clear information on grievance and appeal rights
• Multiple means to access CMO member services

20
Rights of Providers

• DCH will contractually require CMOs to provide
• healthcare providers with
• Prompt payment and adherence to State
  reimbursement policies
• Expedited grievance and appeal processes
• Multiple means to access CMO provider resources

21
Quality Management

• DCH will require CMOs to have an internal
• program that monitors and assures
• DCH-mandated
• Levels of service quality and efficiency
• Outcomes and health status targets
• Contractual obligations will prevent the CMOs
  from sub-optimal provision of healthcare

22
Quality Management

• DCH will require CMO reporting on
• Well child visits and childhood immunizations
• Rates of breast cancer and cervical cancer
  screening
• Rates of diabetic eye exams and HgbA1c testing
• Early initiation of prenatal care and incidence
  of
• C-Sections
• Appropriateness of emergency room utilization
• Incidence of avoidable procedures
• Other possible quality indicators

23
Reform Strategy Part II

• Who is not included in the CMOs
• Elderly and Disabled
• Medically Fragile Children
• Foster Children
• And what is our strategy for them?
• An overview of Part II

24
Care Management for Elderly and Disabled Part
II

• An initial strategy of statewide disease
• management programs focusing on
• Congestive Heart Failure
• Diabetes
• Chronic Obstructive Pulmonary Disease
• Programs to reach and manage both Medicaid and
  SHBP members
• Programs could be implemented as early as July 1,
  2005

25
Care Management for Elderly and Disabled Part
II

• A longer-term, more comprehensive strategy in
  development for 275,105 Medicaid members in
  Elderly and Disabled sub-programs
• Will be consistent with new policy direction of
  DHR
• Will be coordinated with the Governors Office
  and DHR
• Will combine vigorous assessment and case
  management with traditional fee-for-service
  reimbursement to providers
• Vouchers for self-directed care could be made
  available for those eligible and able to manage
• Health outcomes improved and utilization reduced
  through oversight and management by a statewide
  ASO vendor
• Vendor incentivized to attain outcomes and cost
  goals
• Program could be moved to full risk over time

26
Timeframe

• Development of System of Organized Care Model -
  September 1 October 30
• Statewide consensus building
• Development of SPA RFP/Contract
• Administrative Functions
• Submit SPA RFP/Contract to CMS for review (CMS
  approval mandatory and can take 90 days)
• Release RFP (target is 1st week of January 2005,
  pending CMS approval)
• Evaluation of RFP responses
• Contract decisions made
• Contracts negotiated and signed
• Readiness evaluation
• Implementation January 1, 2006
• Implement CMOs in two/three regions, with
  remaining two/three regions phased in during the
  next 6 12 months

27
Conclusion

• Current trend for the Medicaid program is
  unsustainable
• A more efficient and effective system for
  appropriate utilization management is necessary
• This plan will create a more organized and
  accountable system of care
• Quality outcomes must be a primary goal

28

• Questions Comments