Medicaid Mandates on Orlando Medical News

Medicaid Mandates

By: LYNNE JETER

Posted: Tuesday, June 7, 2011 4:52 pm

Medicaid Mandates | Florida Medicaid Managed Care Expansion, Florida Legislature, John Herbkersman, Blue Cross Blue Shield of Florida, Lynne Jeter.

Lawmakers Approve Statewide Expansion of Managed Care Enrollment for Medicaid

TALLAHASSEE—At best, the labyrinth overhaul of the state Medicaid program provides the medical community with light encyclopedic reading to fully understand mandates and special provisions.

In summary, House Bills 7017 and 7019 that comprise the new law have seven significant provisions covering provider service networks (PSNs), the Medicaid medically needy, mandated contracting, transparency and accountability, intergovernmental transfers, the low income pool and access to care partnership, and managed care regions.

“Blue Cross and Blue Shield of Florida believes the proposed bills will significantly improve access to healthcare for Medicaid beneficiaries, while also helping to rein in Medicaid’s skyrocketing costs,” said John Herbkersman, senior director of external communications for Blue Cross Blue Shield of Florida.

Two programs were created to implement statewide mandatory managed care enrollment for most Medicaid recipients: the medical assistance program for primary and acute care, and long-term managed care for residential, home and community-based care. Floridians considered medically needy under Medicaid will continue to receive coverage and will be enrolled in qualified managed care plans.

The timeline:

To implement the program by Aug. 1, the Agency for Health Care Administration (AHCA) must apply for federal waivers. At press time, the application for necessary waivers had not been filed.
AHCA must issue the Invitation to Negotiate (ITN) for long-term care plans by July 1, 2012.
All long-term care eligible recipients must be enrolled in managed care plans by Oct. 1, 2013.
The ITN for the managed medical assistance program must be issued by AHCA by Jan. 1, 2013; full enrollment must be completed by Oct. 1, 2014.

PSNs

As alternatives to Health Maintenance Organizations (HMOs), hospital-owned PSNs may be developed. Eligible plans include PSNs, Accountable Care Organizations (ACOs), and the Children’s Medical Services Network. In each of the 11 managed care regions, a slot is reserved for a PSN if a responsive bid is submitted. In regions that lack a PSN responsive bid within 12 months, AHCA must issue another ITN limited to PSNs only. PSNs may opt for fee-for-service rates with a shared savings settlement for the first two years of operation; afterward, they will be paid on a capitated basis.

Medicaid Managed Care Regions:

1. Escambia, Okaloosa, Santa Rosa and Walton counties.

2. Bay, Calhoun, Franklin, Gadsden, Gulf, Holmes, Jackson, Jefferson, Leon, Liberty, Madison, Taylor, Wakulla and Washington counties.

3. Alachua, Bradford, Citrus, Columbia, Dixie, Gilchrist, Hamilton, Hernando, Lafayette, Lake, Levy, Marion, Putnam, Sumter, Suwannee and Union counties.

4. Baker, Clay, Duval, Flagler, Nassau, St. Johns and Volusia counties.

5. Pasco and Pinellas counties.

6. Hardee, Highlands, Hillsborough, Manatee and Polk counties.

7. Brevard, Orange, Osceola and Seminole counties.

8. Charlotte, Collier, DeSoto, Glades, Hendry, Lee and Sarasota counties.

9. Indian River, Martin, Okeechobee, Palm Beach and St. Lucie counties.

10. Broward County.

11. Miami-Dade and Monroe counties.

Medicaid Medically Needy

All plans are mandated to accept medically needy recipients that are assigned or selected to a plan, and to provide continuous enrollment for 12 months. If approved by the federal government, the enrollee would pay a premium equal to the share of cost as the Department of Children’s Affairs determines, and would be responsible for payment of incurred claims used to determine eligibility. A 90-day grace period prior to dropping enrollees who fail to pay their premium will be allowed.

Mandated Contracting

After much wrangling on this issue, state lawmakers bowed to the side of medical advocacy groups by developing the concept of statewide and regional essential providers and then mandated a payment rate if no contract was negotiated. Even though plans must attempt to contract with all essential providers in their region and with all statewide essential providers, the essential providers are not mandated to contract with the plans.

Statewide essential providers include faculty plans for Florida medical schools, regional perinatal intensive care centers and freestanding specialty children’s hospitals. The payment rate would equal the applicable Medicaid rate, with the exception of children’s hospitals, in which case payment must equal the highest rate established by contract with any Medicaid managed care plan.

Regional essential providers include federally qualified health centers, statutory teaching hospitals, trauma centers and hospitals located 25 miles from another hospital with similar services.

Transparency and Accountability

Even though the final legislation contains many safeguards to ensure that tax dollars are used to pay for patient care and not corporate profits, it falls short in the most important area of making sure the majority of tax dollars are used to offset medical services. The provision for an achieved savings rate limits profits; pretax income may not exceed 7.5 percent under this provision. State lawmakers declined to establish a statutory medical loss ratio and create a mechanism to guarantee that plans are in continual compliance. AHCA is mandated to contract with an independent certified public accountant to conduct compliance audits that must be paid by the plans.

Intergovernmental Transfers (IGTs)

State and local partnerships are required to encourage IGTs—qualified revenue from counties, municipalities, tax districts and public hospitals—from local funding sources to enhance the quality and accessibility of services for Medicaid and uncompensated care patients. Specific guidelines and conditions have been set, including time limits, for receiving local contributions and covering the costs of additional Medicaid resources. The order of priority for IGTs: Low Income Pool, Disproportionate Share Program, and enhanced hospital rates.

Low Income Pool (LIP) and Access to Care Partnership

Legislation repeals the approval of the LIP Council, effective Oct. 1, 2014, and concurrently establishes the Access to Care Partnership as an administrative entity for the allocation and distribution of LIP funds to participating providers designated by local funding sources.

Managed Care Regions

In 2010, the House created six regions. This year, the number of regions was expanded to seven and ultimately eight. The Senate began with 19 regions, compromising on 11 regions for the medical assistance and managed long-term care programs. The managed care regions are favorable to the development of PSNs.