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Medicaid
Program Policy Trends: Financing and Quality of HIV Care
http://www.medscape.com/viewarticle/450515
Risk Management
from
Drug
Benefit Trends®
Posted 03/28/2003
Richard
Conviser, PhD, Miranda Murray, PhD, Christine Lubinski, Andrea
Weddle, MSW, Cindi Grayer, MS
Abstract and Introduction
Abstract
Many
state Medicaid programs have adopted managed care as well as a
variety of other measures to ensure that MCOs caring for
high-cost enrollees can continue to provide quality care and
are protected from financial risk. This article describes
several strategies that state programs have implemented to
protect quality HIV/AIDS care. These strategies include
capitated reimbursement, health-based payment systems, and
risk pools. However, cost containment has driven state
Medicaid programs to alter policies that have a direct impact
on some or all groups of Medicaid beneficiaries. State and
federal policy makers must balance the need for fiscal health
with the public duty to ensure that Medicaid beneficiaries
receive services that preserve and promote health.
Introduction
The
cost of providing care to Medicaid recipients with HIV/AIDS
typically exceeds the average cost of providing health care to
Medicaid recipients without HIV/AIDS, even those with
disabilities. Many state Medicaid programs have adopted
managed care programs, which have established a variety of
measures to ensure MCOs caring for persons living with HIV/
AIDS (PLWH) and other high-cost enrollees can continue to
provide care and are protected from financial risk.
In
1999, the Health Resources and Services Administration,
through its HIV/AIDS Bureau's Special Projects of National
Significance, funded a Center for HIV Quality Care. Its
mission includes gathering information on all state Medicaid
programs, including their reimbursement strategies, with a
special focus on HIV care; documenting the changing costs of
HIV care in the era of HAART, which began in 1996; and
providing access to information on standards of care for HIV
services. Much of the Center's work can be viewed on its Web
site: www.hivma.org/HIV/CEN/Facts.htm.
The
Center for HIV Quality Care has followed the changes and
trends in Medicaid managed care programs that affect
significant numbers of PLWH. These include both cost-
containment strategies and expansion mechanisms used by
various states in treating PLWH. Cost-containment measures
that improve access to care have been develop- ed through home
and community-based service (HCBS) waivers, disease management
initiatives, and tar-geted case management programs. In
addition, efforts by some states to expand access to Medicaid
coverage in ways that benefit PLWH in some cases have offered
potential financial relief rather than additional burdens for
strained state budgets. Although the focus of this paper is on
the care of HIV-infected patients, the impact of state
Medicaid practices and trends have implications for all
Medicaid beneficiaries with high-cost chronic illnesses.
In
the 1990s, many states instituted managed care in their
Medicaid programs. By 1998, more than half of all Medicaid
beneficiaries were enrolled in Medicaid managed care programs.[1]
Full-risk managed care has 2 key features: the use of prepaid
capitated reimbursement rates to participating MCOs and the
use of "gatekeeper" primary care physicians to
control beneficiaries' access to services.
In
Medicaid managed care programs, capitated reimbursement to
MCOs replaced traditional fee-for-service (FFS) payments. To
institute Medicaid managed care programs, states initially had
to obtain waivers from the Centers for Medicare and Medicaid
Services (CMS) because these programs obligate beneficiaries
to use only the providers contracted with the MCOs in which
they are enrolled. This constituted a change from CMS'
"any willing provider" requirement for FFS Medicaid
programs. Congress relaxed the waiver requirement in its 1997
Balanced Budget Act.
Capitation
rates for Medicaid managed care programs are typically
determined on the basis of historic FFS health care
utilization data, and the rates paid to MCOs are generally set
according to a beneficiary's eligibility category. To
participate in Medicaid, states must offer coverage to certain
categories of people, including children of low-income
families and their single parents through Temporary Aid to
Needy Families (TANF), recipients of Supplemental Security
Income (SSI), low-income seniors, and the blind. Within
eligibility categories, beneficiaries must meet income and
asset requirements determined by the state within federal
guidelines. States also have the option of offering Medicaid
coverage to other populations, including the medically needy
and -- if the states apply for special waivers -- the
uninsured and/or uninsurable who would not normally qualify
for Medicaid. The capitation rates assigned to Medicaid
eligibility categories are typically adjusted for enrollees'
age, sex, and the region of the state in which they reside.
The
second key feature of these managed care plans is the use of
primary care provider gatekeepers. Some states have adopted a
blend of managed care and FFS programs by paying primary care
providers a small monthly fee to treat enrollees whose
approved services are reimbursed on a FFS basis; these
programs are known as primary care case management (PCCM).
Both
features of managed care programs are intended to provide
incentives for MCOs to deliver cost-effective care to their
enrollees. However, for PLWH and their advocates (including
many primary care and specialist physician providers), the
application of managed care methods by Medicaid programs in
the 1990s gave rise to several concerns. These included
whether managed care would give patients appropriate and
timely access to specialists, whether the capitation rates
paid to MCOs would be sufficient to ensure adequate
compensation for HIV/AIDS providers, and whether MCOs would be
more inclined to discourage enrollment of potentially
high-cost clients than to develop care programs tailored to
their special needs.[2,3]
If
high-cost clients were distributed relatively uniformly across
MCOs, categorical capitation rate-setting would be equitable.
MCOs' expenditures on high-cost clients would be balanced by
their low expenditures on other patients within the same
capitation rate categories. In practice, however, MCOs with
staffs that include skilled and experienced HIV care providers
-- who, according to several published studies, deliver higher
quality care than inexperienced HIV care providers -- may
attract disproportionate shares of enrollees with HIV/AIDS and
thus be subject to adverse financial risk.[4-8]
The consequence is that the MCOs providing the best HIV care
experience the greatest overall financial liability for
enrolling PLWH.[2] Studies have confirmed that certain MCOs in
several states are indeed at financial risk because they
attract large numbers of PLWH among their enrollees.[9,10]
Various
strategies that states may adopt to protect MCOs against
adverse risk from high enrollment of PLWH, as well as other
measures to assure high-quality care for PLWH enrolled in
Medicaid managed care programs have been explored.[2,11-13]
The first such measures took effect in 1997, when Colorado and
Maryland instituted health-based payments to MCOs in their
Medicaid programs. Over the next several years, other states
turned to health-based payments. In 2001, when CMS held a
conference involving states that had instituted some form of
health-based payment, 10 states were represented.[14]
http://www.medscape.com/viewarticle/450515_2
Medicaid Program Policy Trends
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HIV/AIDS Care Costs and Categorical Capitation Rates
The
financial viability of both MCOs and the providers who
contract with them depends on whether they receive enough
money to cover the costs of care. It is important to estimate
the costs of care with a high degree of accuracy so that
third-party payers are able to develop payment rates that
reflect the true cost of delivering care. Currently, the
federal government -- through Medicaid, Medicare, the
Department of Veterans Affairs, and the Ryan White CARE Act --
is the major payer for care for PLWH. In fact, Medicaid is the
single largest payer for direct medical care for HIV, covering
55% of the adult population at some point in their illness and
90% of children with HIV infection.[15]
Given
the disproportionate effect of the HIV epidemic on
marginalized populations (eg, racial/ethnic minorities,
injection drug users, gay men of color), it is likely that
federal and state governments will continue to be the largest
payers for the care of PLWH. As more of these patients enroll
in managed care plans, novel financing mechanisms, such as
risk-adjusted methodologies, need to be developed so that PLWH
and their providers are not discriminated against by health
plans. The goal of this section is to estimate the cost of
HIV/AIDS care and to compare that cost with reimbursement
rates for enrollees in Medicaid programs.
Before
the availability of HAART, it had been demonstrated that FFS
care costs for Medicaid beneficiaries with AIDS were 6 times
as high as those for other disabled Medicaid beneficiaries.[16] As a result of the growing use of HAART, HIV
care patterns have changed: inpatient hospitalizations have
declined, and spending for pharmaceuticals and outpatient care
has increased.[17]
However, the overall annual costs of HIV care have changed
only slightly. The HIV Cost and Services Utilization Study, a
national probability sample of PLWH receiving care, recorded a
decline of less than 10% in the average monthly cost of care
between 1996 and 1998, from about $1692 to about $1525.
Among
the factors responsible for variations in costs for HIV and
AIDS care are differences in regional practice patterns and
costs and the varying needs of people in different stages of
illness. An analysis of paid, federal, fiscal year 2000
Medicaid claims in New York State for more than 64,000 PLWH
showed monthly Medicaid expenditures averaged $2351, and
monthly reimbursement under the state's impending special
needs plan (SNP) for PLWH will be as high as $2932 (Table
1).[18] Similarly, reimbursement for AIDS care in Maryland in 2002,
based on recent prior service use patterns, was as high as
$2809 per month (Table
2). In contrast, monthly costs for 700 HIV/ AIDS patients
at an Alabama clinic in 2001 averaged just $1553.[19]
In New York, inpatient care accounted for 39% of paid claims,
and pharmaceuticals accounted for 25%. In Alabama, however,
inpatient care accounted for just 13% of the costs, and
medications (both HIV and non-HIV), for 79%. The Alabama study
also showed substantial variations in monthly costs by stage
of illness, ranging from an average of $1157 for PLWH with CD4
cell counts of 350/µL or greater to $1989 for those with
counts between 50 and 200/µL and $3044 for those with counts
less than 50/µL.
Similarly,
a study by the HIV Research Network using 1999 data from 9
sites in 3 regions of the country showed average monthly
inpatient costs varying from $242 for those with CD4 cell
counts greater than 500/µL to $1234 for those with counts
less than 50/µL and outpatient costs of $153 and $208,
respectively.[20]
Not surprisingly, care costs also depend on the incidence of
AIDS-related illnesses. A Maryland study found that costs of
care increased with the presence of opportunistic infections
and other AIDS-related conditions, with cytomegalovirus
retinitis, toxoplasmosis, and AIDS-related dementia being the
most expensive.[21]
Receipt
of ancillary and case management services also affects the
cost of care. A Florida study compared Medicaid spending for
AIDS HCBS waiver program participants with traditional
Medicaid program participants.[22] Case management in the waiver program
provides participants with drug regimen counseling, improving
compliance and reducing the need for inpatient care.[22] Consequently, waiver participants have lower
inpatient costs.
HIV
care costs tend to be far higher than even the highest
categorical capitation rates paid by Medicaid managed care
programs.[16,23] Data on most states' capitation rates are shown
on the Web site of the Center for HIV Quality Care. An
examination of all such rates is beyond the scope of this
paper. In the discussion below, we focus on the rates in 2
states that have large populations infected with HIV: Florida
and Texas. Neither state has adopted any special reimbursement
mechanisms to protect MCOs against adverse risk.
In
Florida, reimbursement to MCOs is based on enrollees' age,
eligibility category, and geographic region. The highest rates
are in Dade County, which includes Miami. As of mid 2001, for
persons aged between 21 and 54 years, capitation rates were
$221.12 per month for TANF enrollees and $663.15 for disabled
enrollees. Behavioral health services are not included in
these rates.
In
Texas, managed care has been adopted on a region-by-region
basis and is mandatory for most TANF enrollees but voluntary
for those with disabilities, except in Harris County
(Houston), where it is mandatory for all. For SSI
beneficiaries without Medicare coverage, the capitation rate
in Harris County in 2002 was $598.55 per month, excluding
prescription drugs, transportation, and tuberculosis clinic
services. For the latter, MCOs refer clients to public health
facilities; prescriptions are filled by pharmacists
participating in the state's Vendor Drug Program and have no
limits. Clearly, capitation rates in both Florida and Texas
are substantially lower than the costs of providing HIV and
AIDS care.
http://www.medscape.com/viewarticle/450515_3
Medicaid Program Policy Trends
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Strategies to Protect MCOs Against Adverse Risk
Health-Based Payment Systems
One
way to protect MCOs against adverse risk is for states to
adopt health-based payment systems (whose components are risk
assessment and risk adjustment). Their purpose is to match the
capitation rates paid to MCOs with the needs of their
enrollees, as measured by historic data on the enrollees'
health care utilization. If these systems are instituted when
a state Medicaid program first adopts full-risk managed care,
FFS data are used to assess the relative risks of MCO
enrollees and to determine the capitation rates that will be
paid to the MCOs. However, especially in states that require
managed care enrollment, this source of data quickly dries up,
and managed care encounter data have to be substituted. Often,
MCOs are not good at collecting and/or reporting such data
during the first several years of Medicaid managed care
programs; this requirement can therefore pose ad- ministrative
challenges.
Under
health-based payment systems, the MCOs that enroll persons
with the greatest health care needs receive the highest
capitation rates. Three health-based payment systems have been
adopted by public (and some private) payers in the United
States: Diagnostic Cost Groups (DCG), Adjusted Clinical Groups
(ACG, formerly known as Ambulatory Care Groups), and the
Disability Payment System (DPS). These systems differ from one
another in their methodologies, but all have the intent of
grouping together all enrollees with similar levels of health
care utilization for reimbursement purposes.
A
variant of the DCG method, known as DCG/HCC (Hierarchical
Condition Category), has been adopted by Medicare in response
to a congressional mandate that it initiate use of a
health-based payment methodology.[24] However, in state Medicaid programs, the
predominant methods used are DPS and ACG. The latter has been
in use in Maryland since 1997 and Minnesota since 2000.
DPS
was developed for use with disabled Medicaid enrollees.
However, the interest of state programs in providing
health-based payments also for persons enrolled in Medicaid
under TANF, few of whom are disabled, has led to the
development of an alternative method -- Chronic Illness and
Disability Payment System (CDPS).[25]
CDPS has supplanted DPS in Colorado (in 2002; DPS was adopted
there in 1997), Oregon (in 2001, after DPS was adopted in
1998), and New Jersey (in 2001, after DPS was adopted in
2000). DPS is still in operation in Michigan (where it was
first adopted in 2000) for children with special needs only.
CDPS has also been adopted in Delaware (2000), Utah (2001),
and Tennessee (2001), as well as in Washington State for
nondisabled populations (2001). Different health-based payment
methodologies yield more accurate payments (ie, closer to the
costs of care) for different categories of Medicaid
eligibility and under different scenarios, but several
simulations suggest that CDPS most closely matches payments
with costs over the broadest range of conditions.[25]
Early
adopters of global health-based payment systems -- Colorado,
Maryland, New Jersey, Michigan, and Minnesota -- used
state-specific rates. More recent implementers -- Oregon,
Pennsylvania, Oklahoma, Tennessee, and Utah -- have used
national weights; Colorado and New Jersey are considering
switching to them. CDPS weights may be recalibrated based on
newer data, and some think that the weights should be based
entirely on managed care utilization patterns rather than on
historic FFS data, because managed care may bring about
changes in the use of services.[3]
The
adoption of health-based payment methodologies can greatly
affect the revenue that flows to MCOs participating in a state
Medicaid program, and the prospect of this can instill fear in
MCOs. To ease the initial impact of the transition to such
methodologies, several states have established "risk
corridors" to limit the deviation of health-based
payments from historic capitation amounts. In the first years
of risk adjustment in Oregon and Michigan, these corridors
were set at 10%; in Minnesota, they were set at 5%. Another
way states can limit MCOs' risk is to provide stop loss
insurance against catastrophic per-enrollee losses. Maryland
initially offered such insurance for per capita expenditures
in excess of $61,000 per annum, but it has since discontinued
the program.
Carveouts
With
or without health-based payments, state Medicaid managed care
programs may further protect MCOs against adverse risk by
carving out coverage for certain drugs from capitation rates.
Several tests (such as for viral loads) and drug treatments
(such as protease inhibitors) were introduced for HIV care in
the mid 1990s, making it difficult for states to estimate the
financial burden these innovations would impose on MCOs.
Hence, many states elected to reimburse MCOs for these tests
and medications on a FFS basis, over and above capitation
payments. Once states have a better sense of the use and costs
of these treatments, they can include them in capitation rates
(as Maryland has done).
Risk Pools
The
use of risk pools is a strategy that many states routinely
employ to cover the delivery and postnatal costs for new
mothers and their newborns. Tennessee and Pennsylvania both
established risk pools to reimburse MCOs experiencing adverse
selection as a result of disproportionate shares of enrollees
with high-cost conditions. The development of risk pools is
administratively less cumbersome for both states and MCOs than
global health-based payment systems, because the former
require MCOs to report encounter data only for enrollees with
high-cost conditions rather than for all enrollees.
To
protect MCOs against adverse selection, the risk pools must
have funds sufficient to make up for the cost difference
between high-cost enrollees and typical enrollees in the same
Medicaid eligibility category (eg, TANF or disabled).
Pennsylvania did not release information about the amount of
funds in its risk pool, but the funds in Tennessee's risk pool
did not begin to cover the differential between the cost of
HIV care and categorical reimbursement paid to MCOs.[12]
Tennessee abandoned its risk pool when it adopted a global
health-based payment system in 2000, and Pennsylvania will
reportedly adopt a health-based payment system in 2003.[3]
http://www.medscape.com/viewarticle/450515_4
Medicaid Program Policy Trends
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Improving Access to Care
In
addition to financial mechanisms to ensure the flow of
appropriate funding to MCOs caring for PLWH, there are several
other ways in which Medicaid programs can improve access to
care for this population. These include optional medically
needy programs, waivers to expand Medicaid coverage to persons
with early-stage HIV disease, HCBS waivers, disease management
programs, and ticket-to-work programs that allow those who
work to maintain Medicaid eligibility.
Medically Needy Programs
PLWH
in some states can receive Medicaid coverage through an
optional medically needy category. This allows persons who are
in eligible Medicaid coverage categories, such as those with
disabilities, but who exceed income ceilings to qualify for
coverage by counting their medical expenses against their
income to "spend down" to a qualifying income level.
Thirty-six states have medically needy programs, and 35 of
them are open to persons with disabilities.[26]
Income limits for these programs vary across the country; a
survey of 40 state Medicaid programs found income limits
ranging from 15% to 87% of the federal poverty level (FPL).[27]
HIV-Specific Waivers
In
2000, Medicaid began awarding waivers to states for the
purpose of expanding coverage to PLWH in early stages of HIV.
Thus far, such waivers have been approved in Maine,
Massachusetts, and the District of Columbia. As with all
Medicaid waivers, these are required to demonstrate revenue
neutrality over a 5-year period. The first waiver was awarded
to Maine in February 2000, but its implementation was delayed
from October 2000 to July 2002. Program benefits include HAART
and other drugs, office visits, laboratory services, case
management, inpatient care, and mental health and substance
abuse services. Eligibility criteria include a diagnosis of
HIV infection and an income of less than 250% of the FPL.
Enrollment under the waiver was initially capped at 130
persons.
Massachusetts
received approval in 2001 for a modification to its existing
waiver in order to expand most Medicaid benefits to PLWH with
incomes of less than 200% of the FPL. For employed persons,
the state pays health insurance premiums to the individual,
insurer, or employer; it also provides wraparound benefits for
services not covered under an employee's health plan.[28]
The Massachusetts program began accepting applications in
April 2001 and during its first year enrolled 700 PLWH. A
program was also approved for implementation in the District
of Columbia in September 2002. The District's program has an
income cap of 100% of the FPL and an enrollment cap of 200 to
400 persons. Some of the savings in the District's program are
to be achieved through the use of the Federal Supply Schedule
to purchase antiretroviral drugs at rates substantially below
AIDS Drug Assistance Program and Medicaid program rates.[29]
Home and Community-Based Services Waivers
Section
1915 (c) of the HCBS waiver programs provide another avenue
for states to expand Medicaid eligibility to targeted
populations requiring intensive use of health services. These
waivers permit Medicaid coverage for services not normally
paid for if providing them prevents hospitalization or
long-term care and allows patients to remain in the community.
Services available under HCBS waiver programs may include case
management, homemaker/home health aides, personal care
services, adult day health, rehabilitation, and respite care.[30]
Because the provision of these services theoretically saves
hospital and/or nursing home costs, HCBS waivers also offer
states the option of expanding eligibility to people with
incomes of up to 300% of the SSI payment level, approximately
$1639 per month in 2002. Fifteen states have HCBS programs for
PLWH, and these play a critical role in providing access to
services for PLWH in these states (Table
3).[31]
Disease Management Programs
These
initiatives offer state Medicaid programs a potential
cost-containment strategy that may also improve the quality of
care. A number of states are experimenting with such programs
for a variety of disease conditions. In 1999, Florida
implemented in its PCCMprogram the first disease management
program specifically designed for Medicaid beneficiaries with
AIDS. The aim is to control unnecessary service utilization
(and associated costs) and improve the quality of care.
Services include patient and provider education, case
management and care coordination, provider and beneficiary
profiling, claims analysis, and chart audits. Nurse care
managers check in with providers and beneficiaries to ensure
that patients are receiving the standard of HIV care,
including appropriate drug regimens.
The
disease management organization (DMO) is expected to realize a
certain percentage of savings over historical FFS costs for
this population. After this level of savings is achieved,
there is a profit-sharing arrangement between the DMO and the
state Medicaid program. Florida has also implemented Medicaid
disease management programs for asthma, diabetes, and
hemophilia.
Two
other states have approached disease management in different
ways. With support from the Robert Wood Johnson Foundation,
Tennessee has created a network of Centers of Excellence that
share HIV knowledge and expertise among Medicaid providers at
8 facilities in various parts of the state, including several
rural areas. New York has developed a SNP for HIV and AIDS
whose MCO participants are to receive enhanced reimbursement
rates for HIV/AIDS care, ranging from $255 to $2932 (see Table
1). In turn, MCOs participating in the SNP provide an
enhanced level of care for PLWH. Benefits include clinical
coordination and medical case management in consultation with
the enrollee's primary care physician, utilization management,
quality assurance and continuous quality improvement,
nonintensive psychosocial case management, treatment adherence
services, and HIV prevention and risk-reduction education.[13]
Ticket-to-Work Programs
The
Ticket to Work and Work Incentives Improvement Act (TWWIIA),
passed in 1999, allows states to expand Medicaid eligibility
to 2 groups:
- Persons
who would qualify for the SSI program if their earned
income was not counted (known as the basic coverage
group).
- Persons between the ages of 16 and 64 who (in the
absence of TWWIIA) would lose Medicaid coverage because
their condition improves to the point that they no longer
meet disability criteria (known as the medical improvement
group).[32]
If
persons choose to participate in the TWWIIA program, states
must cover the basic coverage group and may choose to cover
the medical improvement group. As of late 2002, 22 states had
TWWIIA programs (Table
4), which expanded Medicaid to individuals with annual
incomes ranging from $8860 in several states up to $75,000 in
Connecticut. New York plans to implement a TWWIIA program in
spring 2003.
TWWIIA
also has a modestly funded demonstration program that allows
states to apply for funds to expand Medicaid coverage to
targeted populations for whom coverage under Medicaid would
delay or prevent the onset of disability. As part of the
demonstration program, Mississippi and the District of
Columbia have received grants to expand Medicaid eligibility
to PLWH before they become disabled with AIDS. Mississippi
proposed to cover 500 PLWH aged between 16 and 64 years,
limiting participants' unearned income to 135% of the FPL and
earned income to 150% of the FPL.[33] The District of Columbia's proposed Medicaid expansion is capped
at 500 enrollees.[34]
http://www.medscape.com/viewarticle/450515_5
Medicaid Program Policy Trends
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Medicaid Changes in Response to Tightening State Budgets
As
states continue to grapple with strategies to provide health
care to persons with complex disease conditions, they are also
working to contain spiraling costs associated with the
Medicaid program, which is frequently the second-largest item
in state budgets. In a survey sponsored by the Kaiser
Commission on Medicaid and the Uninsured, virtually all states
reported having acted to reduce the growth in their Medicaid
program costs.[35]
According to the survey, more than half the states are
changing or have changed prescription drug policies by
requiring prior authorization, developing preferred drug
lists, and mandating use of generic drugs. In addition, a
number of states are beginning to implement limits on the
number of prescriptions per month that a Medicaid beneficiary
may fill. States are also limiting or eliminating some
optional services, especially adult dental care, and are
implementing or increasing copayments for a variety of
services from pharmacy to doctor visits.
The
survey found that 29 states plan to cut or freeze provider
payments in this fiscal year, notwithstanding the fact that
low reimbursement rates already make it difficult to find
adequate numbers of medical providers willing to participate
in the program. It may be some time before the impact of these
cost-containment measures is clear, but it is likely that
persons with high-cost illnesses will be most adversely
affected. In addition, copayments are onerous for those
beneficiaries who require a variety of health care services on
a regular basis, causing an accumulation of out-of-pocket
costs that will burden low-income households and may trigger
health care rationing as beneficiaries must choose between
prescriptions and physician visits.
Tennessee's
Medicaid program provides an example of the sorts of changes
taking place in response to budgetary constraints. TennCare
was a pioneer in 1994 in expanding Medicaid eligibility to
uninsured and uninsurable state residents. However, it is
currently back-pedaling from its earlier attempts to move
toward universal health care coverage. TennCare has begun to
restrict eligibility and benefits under a revised Section 1115
waiver approved by CMS in May 2002; all recipients are
required to reapply for certification. Notification letters
were sent in July 2002 to 235,000 enrollees, and 130,000 of
them (most of whom failed to respond to the letter) were
disenrolled at the end of October. Another 200,000 enrollees
(of the 325,000 sent notices in August and September) could be
disenrolled by January 2003. Benefits coverage changes were
implemented in January 2003, with coverage for the uninsurable
(including many PLWH) being reduced from previous levels.
Prescription copayments between $1 and $3 were instituted,
physician visit copays increased from $5 to $10, and the
prescription copay cap was raised to $25 for enrollees with
incomes above the FPL. During an 18-month transition period,
MCOs are to be freed from medical cost risks.[36]
At
the other end of the spectrum is Maryland, which instituted
its Medicaid managed care program, HealthChoice, in 1997. In
addition to adopting health-based payments across the board,
Maryland developed special AIDS reimbursement rates based on
historic Medicaid utilization data. Those rates were $2161 for
residents of Baltimore and $1812 for persons living in the
rest of the state. Care for HIV patients was reimbursed on the
basis of the more general ACG health-based mechanism used for
other Medicaid enrollees. That mechanism established 9 tiers
or rate categories for families with children, with monthly
reimbursement rates of $45 to $721, and 9 tiers for persons
with disabilities, with rates of $95 to $1102.2 Those rates
did not include payment for HAART, for which the state paid on
a FFS basis.
Since
that time, Maryland's reimbursement strategy for HIV and AIDS
care has undergone several changes. The most recent
HealthChoice capitation rates from 2001 to 2003 are shown in Table
2. One difference from the 1997 rates is that starting in
2001, they include HAART, which costs between $800 and $1000
per month per enrollee.[37]
Exclusive of HAART, the costs of care for people with AIDS
receiving the therapies are similar to the 1997 reimbursement
rates. Changes in the reimbursement rates for persons with HIV
infection (non-AIDS) suggest the rates that HealthChoice
initially paid for HIV patients were well below the costs of
care. Recognition of this fact has led to the second major
change in Maryland's reimbursement for HIV/AIDS care, namely,
the establishment of separate reimbursement categories for HIV
care for both disabled enrollees and families with children.
Recent
HIV capitation rates, particularly for disabled enrollees, are
higher than the highest rates available when Maryland first
instituted HealthChoice. The decrease in HIV capitation rates
scheduled to take place at the beginning of 2003 may reflect
changing medical strategies regarding the appropriate point in
HIV illness at which to begin administering HAART. When these
therapies first became available in 1996, the strategy of
choice was to use them early in the course of HIV infection,
and almost always when CD4 cell counts dropped below 500/µL.
As a result of the failure of these drugs to eradicate HIV,
the limited times for which they are effective, and their
sometimes serious (and even life-threatening) side effects,
physicians are being advised to delay administration of these
therapies in most cases until CD4 cell counts have dropped to
below 350/µL. Maryland has also explored the possibility of
adopting capitation rates for HIV and AIDS that vary with
enrollee comorbidities.[38]
However, the MCOs participating in the state's Medicaid
program found the prospect of getting accurate encounter data
from providers, including diagnosis codes for comorbidities,
to be daunting. Hence, the state adopted reimbursement rates
that do not depend on this information.
http://www.medscape.com/viewarticle/450515_6
Medicaid Program Policy Trends
from
Drug
Benefit Trends®
Implications of the HIV Experience for the Care of Other
Chronic Disease Populations
In
recent years, the federal government has allowed states to
increase the number of persons with health coverage through
Medicaid and the State Children's Health Insurance Program.
However, a new federal waiver program, the Health Insurance
Flexibility and Accountability (HIFA) demonstration
initiative, allows states more flexibility to reduce
eligibility levels and benefits for optional Medicaid
populations if they expand health care to previously uninsured
people.
While
a response to the large numbers of persons without insurance
in the United States is important, there are concerns about
the consequences of the HIFA approach for those who depend on
comprehensive Medicaid services to preserve their health. The
so-called optional Medicaid eligibility categories include 22%
of all beneficiaries who are disabled and qualify based on
medically needy status, as well as 56% of all elderly persons
enrolled in Medicaid.[39]
That the HIFA waiver process allows states to impose unlimited
cost-sharing and to stop providing key services to these
optional populations raises questions about both the scope and
quality of care. More generally, cost-containment strategies
that ration care through service limits or eliminations,
reimbursement rate reductions, or eligibility limitations are
likely to have the greatest impact on the beneficiaries who
are most in need of health care services because of
disability, chronic illness, or advanced age.
The
response of many state Medicaid programs to the special needs
posed by PLWH shows that other options that can contain costs
without compromising the quality of care are available. These
include HCBS waiver programs, HIV expansion waivers that
provide coverage earlier in the course of illness, and disease
management programs. The past several years have brought
remarkable changes in treatment patterns for PLWH, including
the widespread adoption of HAART, marked decreases in
inpatient hospitalizations, and declines in opportunistic
infections and mortality. The use of new practice guidelines
and treatment patterns can improve quality without increasing
costs. Thus, Medicaid programs should provide incentives for
providers and MCOs to adopt such new practice guidelines and
treatment patterns quickly.
As
noted above, this rapid evolution of standards of care and
treatment has been accompanied by changes in state Medicaid
program policies as states work to contain costs while also
meeting their obligations to offer comprehensive health care
to beneficiaries. Driven by cost containment, these changes in
state Medicaid policy have accelerated, and a number of the
strategies have a direct impact on some or all groups of
Medicaid beneficiaries. Especially in times of tightening
state budgets, beneficiaries with a wide range of chronic
illnesses and disabilities may face changes in Medicaid
benefits that simply do not meet their fundamental needs.
State and federal policy makers have an opportunity to balance
the need for fiscal health with the public duty to ensure that
Medicaid beneficiaries receive services that preserve and
promote health. Novel financing mechanisms, such as using
Medicaid funds to purchase private insurance and negotiating
drug price reductions from pharmaceutical companies, can help
contain costs while maintaining access to care.
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