Managed Medicaid

Medicaid Plans Called ‘Foundation For Reform’ Despite Struggles

Reprinted from the Sept. 24, 2009, issue of MEDICARE ADVANTAGE NEWS, biweekly news and analysis on the Medicare (and Medicaid) managed care programs.

Medicaid managed care plans could serve as an important foundation for national health reform efforts, state Medicaid directors told a recent conference in Washington, D.C. But a plan executive told MAN that even in a generally supportive state such as New York, plans are struggling to manage low-income members who are dually eligible for both Medicare and Medicaid.

“We believe Medicaid is the foundation for reform…both nationally and in New York,” New York Medicaid Director Deborah Bachrach said during a Sept. 16 roundtable discussion at the annual Medicaid conference sponsored by America’s Health Insurance Plans (AHIP). “…Of almost 5 million people we cover, well over 3 million are in managed care plans….We believe in the managed care model. We believe it has served our [Medicaid population] well.”

Maura Bluestone, president and CEO of Affinity Health Plan in New York, who moderated the roundtable, told MAN that despite New York state’s ongoing health reform efforts, Affinity — which has two Medicare Advantage (MA) Special Needs Plans (SNPs) for dual eligibles — faces major ongoing challenges. “It’s been a struggle for us,” she said.

Bluestone explained that New York developed a model for enrolling duals, allowing plans to offer a rider called “Medicaid Advantage” that covers non-Medicare benefits. “We created one SNP with that rider, and another [SNP] for all duals, not just those with full Medicaid,” she said.

According to Bluestone, Affinity already has state contracts for its dual SNPs, which will become a nationwide requirement for dual SNPs as of Jan. 1, 2010. State officials in New York “had a great idea to create a robust, comprehensive dual program,” she said, “but it hasn’t taken off as expected.”

“The biggest thing that took us by surprise is how many people lose eligibility,” Bluestone said, “so we put in full-time staff to help people maintain Medicaid, low-income subsidy [LIS] eligibility.” Out of approximately 236,000 members, Affinity has only 2,000 Medicare members, she said, adding: “It’s been very slow. It’s not that we don’t bring people in, but we lose them.”

At another conference session, Medicaid directors Patrick Finnerty of Virginia and Emma Forkner of South Carolina described Medicaid managed care’s dramatic growth in their respective states.

Approximately 64% of Virginia’s 700,000 Medicaid recipients are now in managed care, “and it has done very well for us,” Finnerty said. He said five Medicaid plans contract with the state. He noted that Medicaid enrollment in Virginia “has just gone off the charts” during the economic downturn, with an increase of 10,000 Medicaid members in a single month.

Forkner said about 65% of South Carolina’s Medicaid population is now in managed care, of which about 50% is enrolled in one of six Medicaid HMOs. That is up from about 25% of Medicaid recipients being in managed care when the program began in August 2007, she said. Managed care “has helped save Medicaid and made people a lot healthier, I think,” she asserted.

During a question-and-answer session, Finnerty was asked about Virginia Medicaid’s failed reform attempt at integrating Medicaid acute- and long-term-care. “We wanted…to add more populations to managed care, and we wanted to integrate acute and long-term care,” he replied. “We saw it not only as a way to control costs, but we also saw it as better care….We took two-and-a-half years, worked with the plans…but at the end of the day the budget caught us…and there was not enough money for plans to take the risk.”

“I think it was absolutely better to have gone through the process” of acute- and long-term care integration, he said, “…and it’s our hope we can take it out at the right time” for reconsideration.

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