If you search the term “value-based care” on the internet you will find over 2.5 million hits on that term alone. No one would disagree with the need to provide value to patients and purchasers, but how we define value differs based on where we sit. Value is paying for outcomes, not volume of services. Value is ensuring that patients get the right care at the right time. Value is ensuring that purchasers pay a reasonable cost for the highest possible quality. Value is ensuring that healthcare is provided equitably and sustainably. Implementing value is even trickier than defining it, given the complexity of who pays for care and the challenges of measuring the outcomes we seek to reward.
From the top office of HHS to the back office of a health center and everywhere in between, HMA leaders have been part of our collective journey to value: advancing policy and regulatory change, calculating risk and setting prices, crafting alternative payment models, integrating social services and behavioral health, and coaching industry leaders to make important changes to their business models to adapt to a more sustainable approach to American healthcare. These experiences – both successes and challenges – provide a unique perspective from which to advise clients on transformation of healthcare.
The HMA 2023 fall conference, scheduled for October 30-31, 2023, has thoughtfully curated several discussions to educate, enlighten and motivate attendees on industry standards and navigating the practicality of providing value in care, coverage, and patient experience in publicly funded healthcare:
Leading the Charge on Value, Equity and Growth: The Future of Publicly Sponsored Healthcare: Discuss how these public programs came to be the industry standard bearers and what this shift means for outcomes, affordability, policy, and the overall direction of U.S. healthcare.
Positive Change and the Growing Importance of Managed Care in Publicly Sponsored Healthcare: Discuss the future of publicly sponsored healthcare, outline promising initiatives aimed at improving coverage and care, and address key concerns over funding, policy, equity, and coordination between government, plans, providers, and members.
The Future of Delivery Systems: Achieving Operational and Financial Sustainability: Discuss a wide range of practical approaches to prepare for the future, including managing cash flow, optimizing the workforce, developing long-term reimbursement plans, improving operational efficiency, and addressing changes in government policy.
Real Talk from the Trenches of Value-based Payments: Learn about the advantages and pitfalls of value-based payments, with important insights from organizations that have made it work.
Navigating Change in Medicare Advantage: A Roadmap for Success: Discuss what Medicare Advantage plans must do to meet the demanding, new requirements – all against a backdrop of continued efforts to improve equity, access, outcomes, and cost.
In addition, a pre-conference workshop on behavioral health will be held the afternoon of October 29th, prior to the official start of the conference. This workshop will highlight the integral role of behavioral healthcare in improving patient outcomes across the continuum of publicly sponsored healthcare programs.
We are excited to engage with industry experts throughout these discussions about value-based care and forge a better path forward toward a more sustainable and equitable system of care.
On May 31, the House passed H.R. 3746 – the Fiscal Responsibility Act of 2023, otherwise known as the “debt ceiling” bill, which increased the federal debt limit, established new discretionary spending limits, rescinded unused funds, and expanded work requirements for federal programs. It was passed by the Senate on June 1 and will soon be signed into law. What does all this have to do with healthcare workforce? Well, part of the rescindment plan comes from $28 billion in unused pandemic funding, with a substantial portion of those funds that were allocated for healthcare workforce efforts. This includes funds set to be used for mental health and substance use disorder training, grants to improve mental health and burnout in the healthcare workforce, and additional educational and training grants for promoting future workforce. Overall, part of $28 billion specifically includes removal of $1.7 billion from the Centers for Disease Control and Prevention (CDC) and $13.4 billion from the Department of Health and Human Services (DHHS), including $10.4 billion from public health and social services emergency funds.
So, what does this mean for the healthcare workforce? It means healthcare organizations will need to continue to optimize their current and future workforce plans, without additional funding that could provide some relief.
At Health Management Associates (HMA), our healthcare workforce experts have not only partnered with health system leaders to identify real-world solutions, we have directly experienced the same challenges, because our team includes physicians, nurses, advanced practice providers, and former health system operations and financial executives who share the same lived experiences.
HMA offers a number of workforce solutions to healthcare communities across the spectrum. We cannot fill all your staffing gaps tomorrow, however, we can give you an innovative, model-of-care plan designed to lower costs, increase revenue, and position organizations for long-term financial success and operational sustainability.
An experienced team of health system leaders, bedside clinicians, and workforce subject matter experts with real-world experience and modern health care delivery solutions
A thorough quantitative and qualitative assessment including:
Workforce capacity, needs, and gap analysis.
Leadership and governance structure evaluation.
Key regulatory and policy gap analysis.
Compensation and benefits review.
Clinical and/or non-clinical workflow evaluation.
Provider billing practices and quality metric capture.
Provider and staff utilization analysis.
What organizations receive is:
A customized, comprehensive phased implementation plan that:
Improves cash flow and maximizes revenue.
Reduces turnover, increases retention, and improves health system culture.
Optimizes the ‘Model of Care’ delivery while still maintaining quality and safety.
Provides solutions for long-term financial success and operational sustainability.
Offers on-going executive and leader coaching services to help provide support through the change management process.
Today’s healthcare workforce challenges are unwavering, especially given the recent passage of the “debt ceiling” bill. From significant workforce shortages, to rising costs and competition, to decreasing employee engagement and burnout, today’s health systems face tremendous challenges. But by understanding workforce and health system needs and identifying gaps and inefficiencies, employers can fully utilize the employees they have to their highest potential and deliver care more effectively and efficiently. Here at HMA, our delivery system optimization team can help health care communities struggling with workforce challenges do just that.
Contact our healthcare delivery system experts, who can partner with your organization to design a custom workforce solution for you.
Roxane Townsend MD, Managing Director, Delivery Systems
Melinda Estep, Managing Director, Delivery Systems
Jennifer M. Orozco, DMSc, PA-C, DFAAPA, Principal, Delivery Systems
Innovations in Publicly Sponsored Healthcare: How Medicaid, Medicare, and Marketplaces Are Driving Value, Equity, and Growth
Pre-Conference Workshop: October 29, 2023 Conference: October 30−31, 2023 Location: Fairmont Chicago, Millennium Park
Health Management Associates has announced the preliminary lineup of speakers for its sixth annual conference, Innovations in Publicly Sponsored Healthcare: How Medicaid, Medicare, and Marketplaces Are Driving Value, Equity, and Growth.
Hundreds of executives from health plans, providers, state and federal government, investment firms, and community-based organizations will convene to enjoy top-notch content, make new connections, and garner fresh ideas and best practices.
A pre-conference workshop, Behavioral Health at the Intersection of General Health and Human Services, will take place Sunday, October 29.
Confirmed speakers to date include (in alphabetical order):
Jacey Cooper, State Medicaid Director, Chief Deputy Director, California Department of Health Care Services
Kelly Cunningham, Administrator, Division of Medical Programs, Illinois Department of Healthcare and Family Services
Karen Dale, Chief Diversity, Equity, and Inclusion Officer, AmeriHealth Caritas
Peter Lee, Health Care Policy Catalyst and former Executive Director, Covered California
John Lovelace, President, Government Programs, Individual Advantage, UPMC Health Plan
Julie Morita, MD, Executive Vice President, Robert Wood Johnson Foundation
Anne Rote, President, Medicaid, Health Care Service Corp.
Drew Snyder, Executive Director, Mississippi Division of Medicaid
Tim Spilker, CEO, UnitedHealthcare Community & State
Stacie Weeks, Administrator/Medicaid Director, Division of Health Care Financing and Policy, Nevada Department of Health and Human Services
Lisa Wright, President and CEO, Community Health Choice
Publicly sponsored programs like Medicare, Medicaid, and the Marketplaces are leading the charge in driving value, equity, and growth in the U.S. healthcare system. This year’s event will highlight the innovations, initiatives, emerging models, and growth strategies designed to drive improved patient outcomes, increased affordability, and expanded access.
Early bird registration ends July 31. Questions may be directed to Carl Mercurio. Group rates, government discounts, and sponsorships are available.
HMA is pleased to welcome new experts to our family of companies in April 2023.
Jed Abell – Consulting Actuary Wakely
Jed Abell is a professional health insurance actuary with over 20 years of experience focusing on Medicare Advantage, Part D, and commercial employer group plans.
Surah Alsawaf – Senior Consultant HMA
Surah Alsawaf is a senior consultant with experience in creating and implementing regulatory strategies and workflows, conducting reviews and audits, and leading cross-functional teams to complete complex deliverables.
Elrycc Berkman – Consulting Actuary Edrington
Elrycc Berkman is experienced in Medicaid managed care rate development including managed long-term services and supports (MLTSS) and program of all-inclusive care for the elderly (PACE) rate development.
Monica Bonds – Associate Principal HMA
Monica Bonds is an experienced managed care professional with over 15 years of experience working in large and diverse organizations.
Yucheng Feng – Senior Consulting Actuary Wakely
Yucheng Feng has over 15 years of experience providing actuarial support for Medicare Advantage clients, including bid preparation, reserve, actuarial analytics and providing strategic recommendations. Read more about Yucheng.
Melanie Hobbs – Associate Principal HMA
Melanie Hobbs is an accomplished healthcare executive, consultant, and thought leader specializing in Medicare, Medicaid, and Special Needs Plans (SNPs).
Daniel Katzman – Consulting Actuary Wakely
Daniel Katzman is experienced in Medicare Advantage bid pricing and modeling as well as claims trend analytics and affordability/cost-savings analysis. Read more about Daniel.
Supriya Laknidhi – Principal HMA
Supriya Laknidhi has over 20 years of experience in the healthcare industry and a proven track record in driving growth and innovation for companies.
Donald Larsen – Principal HMA
Dr. Donald Larsen is a C-suite physician executive with over 30 years of experience spanning complex academic medical centers, community health systems, acute care hospitals, and research institutes.
Ryan McEntee – Senior Consultant Wakely
Ryan McEntee is an experienced managed care executive specializing in strategic leadership within Medicare Advantage plans. Read more about Ryan.
Nicole Oishi – Principal HMA
Nicole Oishi has over 30 years of experience in senior leadership roles as a healthcare clinician and executive.
Join us on Monday, March 6, 2023, at the Fairmont Chicago, Millennium Park, for “Healthcare Quality Conference: A Deep Dive on What’s Next for Providers, Payers, and Policymakers,” where Lee Fleisher, MD, chief medical officer and director of CMS’ Center for Clinical Standards and Quality, will deliver the keynote titled A Vision for Healthcare Quality: How Policy Can Drive Improved Outcomes.
HMA’s first annual quality conference will provide organizations the opportunity to “Focus on Quality to Improve Patients’ Lives.” Attendees will hear from industry leaders and policy makers about evolving health care quality initiatives and participate in substantive workshops where they will learn about and discuss solutions that are using quality frameworks to create a more equitable health system.
In addition to Fleisher, featured speakers will executives from ANCOR, CareOregon, Commonwealth Care Alliance, Council on Quality and Leadership, Intermountain Healthcare, NCQA, Reema Health, Kaiser Permanente, United Hospital Fund, and others.
Working sessions will provide expert-led discussions about how quality is driving federal and state policy, behavioral health integration, approaches to improving equity and measuring the social determinants of health, integration of disability support services, stronger Medicaid core measures, strategies for Medicare Star Ratings, value-based payments, and digital measures and measurement tools. Speakers will provide case studies and innovative approaches to ensuring quality efforts result in lasting improvements in health outcomes.
“What’s different about this conference is that participants will engage in working sessions that provide healthcare executives tools and models for directly impacting quality at their organizations,” said Carl Mercurio, Principal and Publisher, HMA Information Services.
View the Full Agenda
Early Bird registration ends January 30. Visit the conference website for complete details or contact Carl Mercurio at 212-575-5929/[email protected]. Group rates and sponsorships are available.
The holiday season is grounded in gratitude. At HMA, we are grateful for successful partnerships that have fueled change to improve lives.
We are proud to be trusted advisors to our clients and partners. Their success is our success. In 2022 our clients and partners made significant strides tackling the biggest healthcare challenges, seizing opportunities for growth and innovation, and shaping the healthcare landscape in a way that improves the health and wellness of individuals and communities.
HMA partnered with the Colorado Department of Human Services to support the planning and implementation of a new Behavioral Health Administration (BHA). HMA provided technical research and extensive stakeholder engagement, drafted models for forming and implementing the BHA, employed an extensive change management approach, and created a detailed implementation plan with ongoing support. Today the BHA is a cabinet member-led agency that collaborates across agencies and sectors to drive a comprehensive and coordinated strategic approach to behavioral health.
Wakely Consulting Group, an HMA Company, was engaged to support the launch of a Medicare Advantage (MA) joint venture partnership between a health plan and a provider system. Wakely was responsible for preparing and certifying MA and Medicare Part D (PD) bids, a highly complex, exacting, and iterative effort. The Wakely team quickly became a trusted advisor and go-to resource for the joint venture decision makers. The joint venture has driven significant market growth over its initial years, fueled by a competitive benefit package determined by the client product team.
In 2021 Indiana Governor Eric Holcomb appointed a 15-member commission to assess Indiana’s public health system and make recommendations for improvements. The Indiana Department of Health (IDOH) engaged HMA to provide extensive project management and support for six workstreams. HMA prepared a draft report summarizing public input as well as research findings and recommendations. The commission’s final report will form the basis of proposed 2023 legislation, including proposals to substantially increase public health service and funding across the state.
In early 2022 HMA and Wakely Consulting Group, an HMA Company, assisted multiple clients with their applications to participate in the new CMS ACO REACH model. The purpose of this model is to improve quality of care for Medicare beneficiaries through better care coordination and increased engagement between providers and patients including those who are underserved. The team tailored their support depending on each client’s needs. The application selection process was highly competitive. Of the 271 applications received, CMS accepted just under 50 percent. Notably, nine out of the 10 organizations HMA and Wakely supported were accepted into the model.
HMA, and subsidiaries The Moran Company and Leavitt Partners, were selected by a large pharmaceutical manufacturer to analyze the current pipeline of innovative therapies, examine reimbursement policies to assess long-term compatibility with the adoption of innovative therapies and novel delivery mechanisms, and make policy recommendations to address any challenges identified through the process. The project equipped the client with a holistic understanding of future potential impacts and actions to address challenges in a detailed pipeline analysis of innovative therapies.
This week, our In Focus section reviews highlights and shares key takeaways from the 22nd annual Medicaid Budget Survey conducted by The Kaiser Family Foundation (KFF) and Health Management Associates (HMA). Survey results were released on October 25, 2022, in two new reports: How the Pandemic Continues to Shape Medicaid Priorities: Results from an Annual Medicaid Budget Survey for State Fiscal Years 2022 and 2023 and Medicaid Enrollment & Spending Growth: FY 2022 & 2023. The report was prepared by Elizabeth Hinton, Madeline Guth, Jada Raphael, Sweta Haldar, and Robin Rudowitz from the Kaiser Family Foundation and by Kathleen Gifford, Aimee Lashbrook, and Matt Wimmer from HMA; and Mike Nardone. The survey was conducted in collaboration with the National Association of Medicaid Directors (NAMD).
This survey reports on policies in place or planned for FY 2022 and FY 2023, including state experiences with policies adopted in response to the COVID-19 pandemic. The conclusions are based on information provided by the nation’s state Medicaid Directors.
Key Report Highlights
In the following sections, we highlight a few of the major findings from the reports. This is a fraction of what is covered in the 50-state survey reports, which include significant detail and findings on policy changes and initiatives related to delivery systems, health equity, benefits, telehealth, provider rates and taxes, and pharmacy. The reports also look at the opportunities, challenges, and priorities facing Medicaid programs.
Medicaid Enrollment and Spending Growth
The COVID-19 pandemic created significant implications for Medicaid. During this time, Medicaid enrollment has reached record highs due to the Families First Coronavirus Response Act (FFCRA), enacted in March 2020, which authorized a 6.2 percentage point increase in the federal match rate, or Federal Medical Assistance Percentage (FMAP), retroactive to January 1, 2020, and until the Public Health Emergency (PHE) ends. The increase was available to states that meet certain “maintenance of eligibility” (MOE) requirements. Since the survey, the PHE was extended to mid-January 2023, somewhat delaying the anticipated effects described in survey.
Medicaid enrollment growth slowed to 8.4 percent in FY 2022, after a sharp increase in FY 2021 (11.2 percent). Almost all responding states reported that the MOE continuous enrollment requirement was the most significant factor driving FY 2022 enrollment growth. Responding states expect Medicaid enrollment growth to decline (-0.4 percent) in FY 2023, based largely on the assumption that the PHE and the related MOE requirements would end by mid-FY 2023. States anticipate larger declines as Medicaid redeterminations and renewals resume.
In FY 2022, total Medicaid spending is expected to reach a peak growth of 12.5 percent, with enrollment growth as the primary driver. For FY 2023, total spending growth is expected to slow to 4.2 percent, assuming slower enrollment growth after the unwinding of the PHE. State Medicaid spending grew by 9.9 percent in FY 2022 and is projected to increase by 16.3 percent in FY 2023 once enhanced federal fiscal relief expires. If the PHE is extended, state spending increases and enrollment decreases that states anticipated for FY 2023 could occur later.
Figure 1 – Percent Change in Medicaid Spending and Enrollment, FY 1998-23
SOURCE: FY 2022-2023 spending data and FY 2023 enrollment data are derived from the KFF survey of Medicaid officials in 50 states and DC conducted by Health Management Associates, October 2022. 49 states submitted survey responses by Oct. 2022; state response rates varied across questions. Historic data reflects growth across all 50 states and DC and comes from various sources.
Delivery Systems
Capitated managed care remains the predominant delivery system for Medicaid in most states. Forty-six states operated some form of Medicaid managed care (managed care organizations (MCOs) and/or primary care case management (PCCM)). Forty-one states contracted with risk-based MCOs. Of these, only Colorado and Nevada did not offer MCOs statewide. Only five states – Alaska, Connecticut, Maine, Vermont, and Wyoming – lacked a comprehensive Medicaid managed care model.
Thirty-four states, including Distrct of Columbia, operate MCOs only, five states operate PCCM programs only, and seven states operate both MCOs and a PCCM program.
Twenty-seven states contracted with one or more PHPs to provide Medicaid benefits, including behavioral health care, dental care, vision care, non-emergency medical transportation (NEMT), and long-term services and supports (LTSS).
Of the forty-one states that contracted with MCOs, 35 reported that 75 percent or more of their Medicaid beneficiaries were enrolled in MCOs as of July 1, 2022.
Figure 2 – MCO Managed Care Penetration Rates for Select Groups of Medicaid Beneficiaries as of July 1, 2022
SOURCE: KFF survey of Medicaid officials in 50 states and DC conducted by HMA, October 2022.
Medicaid Managed Care and Delivery System Changes
California, Missouri, Nevada, New Jersey, and New York reported expanding mandatory MCO enrollment for targeted populations.
Missouri and Ohio reported introducing specialized managed care programs for children with complex needs.
California, Nevada, and Tennessee indicated that they were carving in certain long-term services and supports (LTSS) into their managed care programs.
California and Ohio reported carving out pharmacy services in FY 2022 or FY 2023, respectively. The District of Columbia carved out emergency medical transportation from its MCO contracts in FY 2022.
Maine, North Carolina, Oregon, and Washington reported changes to their PCCM programs.
Virginia plans to implement Cardinal Care in FY 2023, merging the state’s two existing managed care programs: Medallion 4.0 (serving children, pregnant individuals, and adults) and Commonwealth Coordinated Care Plus (CCC Plus) (serving seniors, children and adults with disabilities, and individuals who require LTSS).
Forty-one states reported at least one specified delivery system and payment reform initiative (e.g. Patient-Centered Medical Home (PCMH), ACA Health Homes, Accountable Care Organization (ACO), Episode of Care Initiatives, All-Payer Claims Database (APCD)).
Health Equity
Twenty-five states reported using at least one specified strategy to improve race, ethnicity, and language (REL) data completeness. Of the 45 responding states, 16 states reported requiring MCOs and other applicable contractors to collect REL data, 12 states reported that eligibility, renewal materials, and/or applications explain how REL data will be used and/or why reporting these data are important, nine states reported linking Medicaid enrollment data with public health department vital records data, and eight states reported partnering with one or more health information exchanges (HIEs) to obtain additional REL data for Medicaid enrollees.
Twelve of 44 responding states reported at least one financial incentive tied to health equity in place in FY 2022. The vast majority of these incentives were in place in managed care arrangements (11 of 13). Within managed care arrangements, states most commonly reported linking or planning to link capitation withholds, pay for performance incentives, and/or state-directed provider payments to health equity-related quality measures. Only two states (Connecticut and Minnesota), reported a FFS financial incentive in FY 2022. Five additional states report plans to implement financial incentives linked to health equity in FY 2023.
Sixteen of 37 responding MCO states reported at least one specified health equity MCO requirement in place in FY 2022. The number of MCO states with at least one specified health equity MCO requirement in place is expected to grow significantly in FY 2023, from 16 to 25 states. Examples of MCO requirements to address health equity include having a health equity plan, designating a Health Equity Officer, and staff training on health equity and/or implicit bias.
Figure 3 – MCO Requirements to Address Health Equity, FYs 2022-23
SOURCE: KFF survey of Medicaid officials conducted by HMA, October 2022; n=37 states.
Benefits
Thirty-three states reported new or enhanced benefits in FY 2022 and 34 states are adding or enhancing benefits in FY 2023. Two states reported benefit cuts or limitations in FY 2022 and no states reported cuts or limitations in FY 2023.
Figure 4 – Select Categories of Benefit Enhancements or Additions, FYs 2022-23
SOURCE: KFF survey of Medicaid officials conducted by HMA, October 2022; Arkansas and Georgia did not respond.
Behavioral Health Services. States reported service expansions across the behavioral health care continuum, including institutional, intensive, outpatient, home and community-based, and crisis services. States reported addressing SUD outcomes, including coverage of opioid treatment programs, peer supports, and enhanced care management. At least ten states are expanding coverage of crisis services, which aim to connect Medicaid enrollees experiencing behavioral health crises to appropriate community-based care, including mobile crisis response services and crisis stabilization centers.
Pregnancy and Postpartum Services. In April 2022, a temporary option under ARPA to extend Medicaid postpartum coverage from 60 days to 12 months took effect. In addition to the states that took advantage of this eligibility change, some states are enhancing coverage of pregnancy and post-partum services. Nine states (California, District of Columbia, Illinois, Maryland, Michigan, New Mexico, Nevada, Rhode Island, and Virginia) are adding coverage of services provided by doulas and seven states (Alabama, Delaware, Illinois, Maryland, Ohio, Oregon, and Vermont) are investing in the implementation or expansion of home visiting programs.
Preventive Services. Sixteen states reported expansions of preventive care in FY 2022 or FY 2023. For example, seven states are expanding services to prevent and/or manage diabetes, such as continuous glucose monitoring. Other reported preventive benefit enhancements relate to asthma services, vaccinations, and genetic testing and/or counseling.
Services Targeting Social Determinants of Health. Many states reported new and expanded benefits targeting social determinants of health. Twelve states reported new or expanded housing-related supports, as well as other services and programs tailored for individuals experiencing homelessness or at risk of being homeless.
Dental Services. Nine states are adding comprehensive adult dental coverage, while additional states report expanding specific dental services for adults.
Telehealth
Most states have or plan to adopt permanent Medicaid FFS telehealth expansions that will remain in place even after the pandemic, though some are considering guardrails on such policies. Nearly all responding states that contract MCOs reported that changes to FFS telehealth policies would also apply to MCOs.
Figure 5 – Changes to FFS Medicaid Telehealth Policy, FY 2022 or FY 2023
SOURCE: KFF survey of Medicaid officials conducted by HMA, October 2022; n=48 states.
Nearly all responding states added or expanded audio-only telehealth coverage in Medicaid in response to the COVID-19 pandemic. Twenty-eight states reported that they newly added audio-only coverage while 19 states expanded existing coverage. Nearly all states reported audio-only coverage of mental health and substance use disorder (SUD) services. States least frequently reported audio-only coverage of home and community-based services (HCBS) and dental services. Two states (Mississippi and Wyoming) reported no coverage of audio-only telehealth for the services in question.
Telehealth utilization by Medicaid enrollees has been high during the pandemic but has decreased and/or leveled off more recently. States noted that telehealth utilization trends over time correspond to COVID-19 outbreaks, with higher utilization during COVID-19 surges and lower utilization when case counts are lower. In general, states reported that telehealth utilization was projected to continue at higher levels than before the pandemic, at least for some service categories.
Thirty-seven states (out of 47 responding) reported that behavioral health services were among those with the highest utilization. Additionally, a majority of states reported high utilization of evaluation and management (E/M) services and/or other physician/qualified health care professional office/outpatient services, including primary care.
States reported ACA expansion adults as one of the groups most likely to use telehealth (about one-third of responding states), followed by children and individuals with disabilities (each identified by about one-sixth of responding states).
Concerns regarding services delivered via telehealth included the quality of diagnoses, whether audio-only telehealth may be less effective, and inadequate access.
Key issues that may influence future Medicaid telehealth policy decisions include analysis of data, state legislation and federal guidance, and cost concerns.
Provider Rates and Taxes
In FY 2022, all 49 responding states reported implementing rate increases for at least one category of provider and 19 states reported implementing rate restrictions. In FY 2023, 48 states reported at least one planned rate increase and the number of states planning to restrict rates increased to 25 states.
States reported rate increases for nursing facilities and home and community-based services (HCBS) providers more often than other provider categories. The survey also found an increased focus on dental rates with about half of reporting states (20 in FY 2022 and 25 in FY 2023) reporting implementing or plans to implement a dental rate increase
Figure 6 – FFS Provider Rate Changes Implemented in FY 2022 and Adopted for FY 2023
SOURCE: KFF survey of Medicaid officials in 50 states and DC conducted by HMA, October 2022.
States continue to rely on provider taxes and fees to fund a portion of the non-federal share of Medicaid costs. All states but Alaska have at least one provider tax or fee in place. Thirty-eight states had three or more provider taxes in place in FY 2022 and eight other states had two provider taxes in place.
The most common Medicaid provider taxes in place in FY 2022 were taxes on nursing facilities (46 states), followed by taxes on hospitals (44 states), intermediate care facilities for individuals with intellectual disabilities (33 states), and MCOs (18 states).
Three states (Alabama, Mississippi, and Wyoming) reported plans to add new ambulance taxes in FY 2023.
Pharmacy
Most states that contract with MCOs report that the pharmacy benefit is carved into managed care (34 out of 41 states that contract with MCOs). Six states (California, Missouri, North Dakota, Tennessee, Wisconsin, and West Virginia) report that pharmacy benefits are carved out of MCO contracts as of July 1, 2022. California was the latest to carve out pharmacy benefits as of January 1, 2022. Two states (New York and Ohio) report plans to carve out pharmacy from MCO contracts in state FY 2023 or later.
In FY 2022, Kentucky began contracting with a single PBM for the managed care population. Louisiana and Mississippi report that they will require MCOs to contract with a single PBM designated by the state in FY 2023 and FY 2024, respectively.
Seven states (Alabama, Arizona, Colorado, Massachusetts, Michigan, Oklahoma, and Washington) have value-based arrangements (VBAs) in place with one or more drug manufacturers.
More than half of responding states reported newly implementing or expanding at least one initiative to contain prescription drug costs in FY 2022 or FY 2023.
Six states (Florida, Kentucky, Massachusetts, Maryland, Nebraska, Nevada) reported recently implemented or planned policies to prohibit spread pricing or require pass through pricing in MCO contracts with PBMs.
Key Opportunities, Challenges, and Priorities in FY 2023 and Beyond
When asked to identify the top challenges for FY 2023 and beyond, Medicaid directors listed the following:
The unwinding of PHE emergency measures and the resumption of redeterminations.
Expiration of emergency authorities.
Lasting focus on COVID-19, including vaccinations, long-COVID, decreased utilization of preventive care services, and future emergency preparedness.
Medicaid directors stated that future priorities shaped by COVID-19 include:
Health equity.
Specific populations and service categories, including behavioral health, long-term services and supports, and maternal and child health.
Health care workforce challenges.
Payment and delivery system initiatives and operations.
IT system modernization.
Social determinants of health.
Medicaid directors note that COVID-19 has presented both new opportunities and challenges and has also shifted and shaped ongoing Medicaid priorities.
Health Management Associates (HMA) has a rich history of serving the healthcare infrastructure needs of Native American and Alaska Native communities – through healthcare IT support, clinical governance for change management, culturally competent stakeholder engagement, and revenue cycle management that implements an approach that is tailored to the provider and payer entities that deliver care in Native American and Alaska Native communities.
American Indian and Alaska Native (AI/AN) people experience disproportionately poorer health status compared to Americans as a whole. AI/ANs born today have a life expectancy that is 5.5 years less than the national average for all races. HMA has expertise with healthcare issues that uniquely impact American Indian and Alaska Native populations and is experienced in addressing these issues through American Indian and Alaska Native leadership engagement that is culturally sensitive and respectful.
Case Studies
Examples of HMA’s work with tribal health providers include:
HMA provided training and technical assistance to Skokomish Indian Tribal Health Center in Skokomish, Washington. This support includes the provision of clinical oversight services by one of HMA’s clinicians as Interim Medical Director.
HMA: (1) assessed the Tribal Health Center’s billing practices and assisted in the development of a procurement and contract with a new third-party billing vendor; (2) developed a screening and intervention program for medications for addiction treatment (MAT) of opioid and alcohol use disorders, including training for providers and administrative and medical staff; (3) established policies and procedures to support the clinic to move to a primary care medical home model of care, including development of a back office manual and trainings to clinic staff and providers; and (4) provided technical assistance to the Tribal Health Center as it developed telehealth programs for both video visits and remote patient monitoring (RPM), including development of policies and procedures for maintaining operations during emergencies, procedures and workflow approaches for working with IT vendors and potential purchase and implementation of a new electronic health record.
HMA conducted a feasibility assessment to determine how best Fort Belknap Tribal Health Department could take over administration of behavioral health services through a 638 contract with the Indian Health Service (IHS) agency. To do this, HMA conducted a review of select documentation, contracts, and data sets, including clinical and financial data. Through site visits, HMA conducted focus groups and interviews with tribal, IHS, and community stakeholders. HMA also provided research of other tribal behavioral health programs and interviews with tribes successfully delivering comprehensive behavioral health services.
HMA provided consultation regarding integration of behavioral health into primary care sites, sharing expertise and advice on privacy and confidentiality regulations and integrated care, how to manage during the transition from traditional behavioral health to integrated care, ideas for including medical family therapy more broadly in patient care, and the implementation of patient assessments.
The Montana Healthcare Foundation (MHCF) convened tribal health care leaders to develop shared priorities to jointly pursue with the Montana Department of Public Health and Human Services (DPHHS) and the Legislature. HMA was engaged by MHCF to help the group assess implementation options related to the Centers for Medicare and Medicaid Services’ (CMS) revised interpretation of the 100 percent federal match for state Medicaid programs for American Indian Medicaid enrollees for services. HMA proposed options for how DPHHS can use the new match funding to support IHS and tribal health facilities as they implement these new processes and support shared priorities. Priorities identified by the tribal health leaders included operational and policy issues such as improving health information technology capacity; identifying opportunities to compact aspects of health care delivery from IHS; and improving clinic operations through business management training.
HMA served as the independent evaluator for Montana Office of Public Instruction (OPI) Substance Use and Mental Health Services Administration (SAMHSA) Tribal Systems of Care Evaluation. The five-year evaluation assesses the impact of High-Fidelity Wraparound services being provided to American Indian students in schools on six tribal reservations throughout the state. Evaluation activities include tracking quantitative data to measure progress toward grant goals and tracking qualitative data to assess impact of wraparound activities through key informant interviews, small group listening sessions, and site visits. Evaluation findings are regularly reported to SAMHSA and presented locally to key stakeholders.
Montana Tribally Operated Substance Use Disorder (SUD) Continuum of Care Concept Brief
HMA worked in coordination with the American Indian Health Leaders (AIHL) workgroup, a group made up of leadership from Montana’s seven tribes representing tribal health departments and urban Indian health centers, to develop a SUD Continuum of Care Concept brief, describing potential approaches for design and financing of a jointly tribally operated SUD treatment facilities. This work was conducted through a contract with Montana Healthcare Foundation.
Montana Tribally Operated Substance Use Disorder Continuum of Care
HMA provides technical assistance and facilitation and consulting expertise to support the development of a statewide joint tribally operated SUD Continuum of Care. HMA facilitated discussions with AIHL and Chemical Dependency Center (CD) directors. HMA provided subject matter expertise on the various design options available based on American Society of Addiction Medicine (ASAM) service needs criteria as well as analysis support. HMA is also providing consulting support on financial and operational planning for the development of new facilities. This work could include methods for short-term and long-term forecasting and scenario modeling, identification, and negotiation of capital and operational financing for construction and start-up phase, and technical assistance on revenue cycle best practices to ensure satisfactory patient experience and sustainable revenue. This work is being conducted through a contract with the MHCF.
Health Policy and Advocacy
HMA consultants have worked with the following organizations associated with American Indian health policy and advocacy issues:
A tribally driven non-profit organization with a mission of improving health outcomes for American Indians and Alaska Natives through a health policy focus at the Washington state level. AIHC works on behalf of the 29 federally recognized Indian tribes and two urban Indian health organizations.
An Alaska Native-owned, nonprofit health care delivery and advocacy organization serving nearly 65,000 Alaska Native and American Indian people living in Anchorage, Matanuska-Susitna Borough and 55 rural villages. Southcentral Foundation and the Alaska Native Tribal Health Consortium own and manage the Alaska Native Medical Center that serves the entire Alaska Native and American Indian population in the state.
Engaged in many areas of Indian health, including legislation, policy analysis, health promotion and disease prevention, as well as data surveillance and research. The Northwest Portland Area Indian Health Board (NPAIHB) is a non-profit tribal advisory organization serving the forty-three federally recognized tribes of Oregon, Washington, and Idaho.
A non-profit organization located on the Apsáalooke (Crow) Reservation in Montana whose mission is to improve the health of individuals on the Crow Indian Reservation and outlying areas through community-based projects that empower communities to assess and address their own unique health-related challenges.
For more information about HMA’s Native American and Alaska Native support services, contact [email protected].
Be sure to register for HMA’s 2022 Conference by Monday, July 11, to get the special early bird rate of $1,695 per person. After July 11, the rate is $1,895.
Nearly 40 industry speakers, including health plan executives, state Medicaid directors, and providers, are confirmed for HMA’s The New Normal: How Medicaid, Medicare, and Other Publicly Sponsored Programs Are Shaping the Future of Healthcare in a Time of Crisis conference, October 10-11, at the Fairmont Chicago, Millennium Park.
In addition to keynote sessions featuring some of the nation’s top Medicaid and Medicaid executives, attendees can choose from multiple breakout and plenary sessions on behavioral health, dual eligibles, healthcare investing, technology-enabled integrated care, social determinants of health, eligibility redeterminations, staffing, senior care, and more.
There will also be a Pre-Conference Workshop on The Future of Payment Reform: Delivering Value, Managing Risk in Medicare and Medicaid, on Sunday, October 9.
Visit our website for complete details: https://conference.healthmanagement.com/ or contact Carl Mercurio. Group rates and sponsorships are available. The last HMA conference attracted 500 attendees.
State Medicaid Speakers to Date (In alphabetical order)
Cristen Bates, Interim Medicaid Director, CO Department of Healthcare Policy & Financing
Jacey Cooper, Medicaid Director, Chief Deputy Director, California Department of Health Care Services
Kody Kinsley, Secretary, North Carolina Department of Health and Human Services
On June 3, 2022, the Centers for Medicare & Medicaid Services (CMS) notified states that they will have an additional year, until March 31, 2025, to use funding from the American Rescue Plan Act (ARPA) to strengthen their Medicaid home and community-based services (HCBS). CMS’ update extends important flexibility to ensure state Medicaid programs and stakeholders, including beneficiaries, realize maximum benefit from federal investments in expanding and enhancing HCBS services.
For over a decade, the Medicaid program has been leading transformations of state long-term services and supports systems (LTSS), including physical and behavioral health services and health-related social needs. These efforts primarily focus on broadening eligibility, making more significant Medicaid investments in HCBS, and improving beneficiaries’ access to HCBS programs. The COVID-19 pandemic heightened attention to beneficiaries’ disparate experiences with accessing HCBS and exacerbated pre-COVID challenges faced by the LTSS workforce.
Section 9817 of ARPA provides an increase for Medicaid-funded HCBS by offering states the option to claim an additional 10 percentage point increase in federal match (FMAP) for the one-year period from April 1, 2021, to March 31, 2022. To receive the higher federal funding, states cannot make changes to the amount, duration, and scope of covered HCBS; they cannot reduce HCBS provider payment rates; and they cannot make eligibility standards for HCBS programs or services stricter until all additional funds are expended. CMS also requires states to submit a spending plan and narrative that describes planned enhancement activities.
Notably, a state must reinvest the higher federal funding in Medicaid HCBS while maintaining the spending levels they had in place on April 1, 2021. According to CMS’s new guidance, states can now use the funds until March 31, 2025, rather than March 31, 2024, under the previous guidance.
Actions Stakeholders Can Take to Maximize the Extra Time
The updated spending deadline is grounded in a better understanding of the level of effort and time necessary for states to identify, build consensus, and implement specific actions to include in a state’s HCBS spending plan. HMA works with states, providers, health plans, and other stakeholders, including consumers, who will benefit from the additional time to make investments. Our work includes supporting states as they align the multitude of needs and priorities with the available funds and supporting robust stakeholder engagement efforts to inform the plans.
The following are some of the most impactful “next steps” that states and stakeholders can pursue to best utilize the additional time to reinvest in Medicaid HCBS programs:
States can communicate with stakeholders, including health plans, providers, community organizations, consumers, and others, to share how the extension impacts the state’s spending plan.
States and stakeholders can renew their engagement to consider potential changes to the spending plan activities, timelines, or both. Stakeholders may have additional opportunities to offer input to refine further and prioritize the design and delivery of augmented or new services, systems, and related initiatives.
State Medicaid, aging, and various other programs and providers have more time to strengthen their collaboration to meet the needs of individuals of all ages who are living with disabilities.
States, vendors, health plans, and providers can evaluate through evidence, analysis and stakeholder feedback, if the projects they are pursuing are effective and/or should be modified. For example, it may be beneficial to provide more flexibility in the deadlines for case management and referral systems builds and implementation of the training for workers on these new systems.
States and their stakeholder partners can refocus on workforce issues, including examining eligible provider types and scopes, evaluating provider network issues, considering the role of virtual services, conducting provider and managed care rate setting studies, and other changes to support the HCBS direct care workforce.
States can develop reasonable timeframes to strengthen existing efforts or pursue new initiatives to develop and implement managed long-term services and supports for certain groups of Medicaid beneficiaries.
Looking ahead, states and all stakeholders need to assess the impact of these investments. ARPA funds are a significant investment in strengthening Medicaid LTSS programs, but these transformative efforts require sustained commitment. There is continued uncertainty around additional federal Medicaid funding over the long term that are necessary to address ongoing needs and make further progress towards high-quality, accessible HCBS services. Understanding the extent to which the funds are achieving the desired structural transformations and the impact on Medicaid beneficiaries can guide future areas of federal and state focus and investments.
