Medicaid Health Plans Urge Adoption of Mandatory Managed Care to Improve Patient Care; Eliminate Unnecessary Spending

Date : 05/05/2005 @ 12:57PM
Source : PR Newswire
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Medicaid Health Plans Urge Adoption of Mandatory Managed Care to Improve Patient Care; Eliminate Unnecessary Spending

Medicaid Health Plans Urge Adoption of Mandatory Managed Care to Improve Patient Care; Eliminate Unnecessary Spending

SPRINGFIELD, Ill., May 5 /PRNewswire/ -- Citing lack of access and continuity of care with the current "broken" Medicaid system, Bryan Baier, Executive Director of the Illinois Association for Medicaid Health Plans, today urged a legislative commission to act on recommendations for Medicaid reform which were presented to members of the General Assembly earlier this week.

These recommendations were part of an independent report commissioned by the Illinois Commission on Government Forecasting and Accountability. The report provides a blueprint for how the Illinois Medicaid program could eliminate $1.5 billion in unnecessary spending over the next five years while improving health care access and quality for low-income citizens by implementing mandatory managed care.

Illinois' Medicaid system currently costs the State approximately $7 billion per year -- which is more than 25 percent of the General Revenue Fund for the current fiscal year -- leaving less funding for other state priorities such as education.

"The Illinois Medicaid system is broken. It does not work for taxpayers nor does it work as well as it should for those it is intended to serve. It is designed to pay claims, not coordinate care," said Baier in his testimony. "In the absence of a dramatic overhaul -- specifically, mandatory managed care -- it will continue to impose huge, unsustainable burdens on the state treasury."

Illinois lags far behind most states in its use of managed care to control Medicaid costs and improve health care for the 1.8 million residents in the program. With only about 10 percent of Medicaid participants enrolled in the state's voluntary program -- compared to the nationwide average of 60 percent -- Illinois ranks 47th among the 50 states in its use of managed care as a means of controlling costs and improving health care for Medicaid beneficiaries.

The only states ranking below Illinois are Alaska, Mississippi and Wyoming.

Dr. Art Jones, who is the CEO of Lawndale Christian Health Center in Chicago, and a Medicaid managed care provider, has seen the benefits of the managed care system firsthand and supports the implementation of mandatory managed care throughout the state.

"Medicaid patients in managed care plans receive a significantly superior level of care, service, and access to care than do the majority of Medicaid recipients who are left on their own to navigate the complex and often unfriendly Medicaid system," Dr. Jones said. "Managed care patients have a 'medical home;' many others are essentially left 'homeless.'

"Until the State mandates managed care, the majority of Medicaid recipients will remain lost and underserved," Dr. Jones said.

As an example of the way the current system fails to serve Illinois' Medicaid recipients, Baier shared the story of Gwendolyn Williams. Unable to find an obstetrician willing to accept her Medicaid card, Williams went through her entire pregnancy with inadequate prenatal care and delivered her baby in an emergency room, with a doctor who had no access to her medical records. Now, without a pediatrician nearby who will accept her Medicaid card, she again relies on the emergency room to deliver routine care -- such as immunizations -- to her son.

"It's clear the current system not only is too costly -- it fails to provide adequate care for our most vulnerable citizens. If the system is too expensive, unwieldy and lacks accountability -- and fails the people it is intended to serve -- the people of Illinois have every right to demand change," Baier said.

In his testimony, Baier also addressed the concerns raised by the Illinois Hospital Association (IHA), which is opposed to mandatory managed care because it would affect funding schemes utilized in the current system that generate revenues to its hospitals.

"The Illinois Association of Medicaid Health Plans wholeheartedly shares the belief that protecting hospitals that serve as a safety net is critical. But it is grossly misleading to suggest that an appropriately designed managed care model will put these financing mechanisms in harm's way," said Baier. "Frankly, the federal government's increased scrutiny of these mechanisms poses more of a threat to the funding schemes than does managed care."

The report, drafted by the Lewin Group, an independent national health care consulting firm, recommends a phased-in approach to address these concerns and provides a guideline for implementing managed care while preserving health care safety nets. Significant evidence around the country demonstrates how mandatory managed care and such funding mechanisms can co-exist: 25 states are successfully using both systems.

Summary of Lewin Report Recommendations

The Lewin Report found that "a well-designed expansion" of Medicaid managed care should improve the state's ability to both deliver and monitor these services to Medicaid-eligible children. It also found that Medicaid health plans would have a positive impact on access and continuity of care by providing a "medical home" for Medicaid recipients -- a medical professional to provide diagnoses, referrals for specialty care and generally guide patients through the medical system.

The Report recommends that this expansion be accomplished as follows:

-- Immediate implementation of a mandatory health plan model for Medicaid recipients in eight counties in the extended Metro East region and Southern Illinois (Franklin, Jackson, Madison, Monroe, Perry, Randolph, St. Clair and Williamson) and eleven counties in the northern part of the state (Boone, DeKalb, DuPage, Grundy, Kane, Kankakee, Kendall, Lake, McHenry, Will and Winnebago).

-- Immediate implementation of a mandatory health plan model in selected Cook County zip codes, with future implementation throughout the County. The State currently uses a complicated system of "intergovernmental transfers" to support Cook County Bureau of Health Services Hospitals (John H. Stroger, Jr. Hospital of Cook County, Oak Forest Hospital of Cook County and Provident Hospital of Cook County) and the University of Illinois Hospital and help the State leverage additional federal matching dollars. The report recommends that the State work to develop solutions to this issue, which is already being challenged at the federal level, to pave the way for future implementation of the mandatory managed care model throughout Cook County.

-- Implementation of a "Primary Care Case Management Model" (PCCM) in counties without mandatory health plans. In a PCCM, each Medicaid recipient is guaranteed a "medical home" through the designation of a primary care provider. The state still reimburses all providers on a fee-for-service arrangement, so that savings are not as great as with a health plan..

About the IAMHP

The Illinois Association of Medicaid Health Plans was created in January 2005 by the managed care companies serving Illinois' Medicaid beneficiaries: Harmony Health Plan, Amerigroup, United Healthcare, Family Health Network and Humana Health Plan. The organization serves as a resource to medical providers, legislators, state regulators, health plans and others to enhance the delivery of health care services to Illinois' Medicaid recipients.

DATASOURCE: Illinois Association of Medicaid Health Plans

CONTACT: Emily Hulburt, +1-312-573-5483, or Angela Wells,

+1-312-735-7008, both of Jasculca/Terman and Associates, for the Illinois

Association of Medicaid Health Plans

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