Managed Care

Driving change in healthcare delivery: payment models and managing risk at HMA Spring Workshop on value-based care

Is the concept of value-based care (VBC) still relevant in today’s healthcare landscape or just a buzzword? Some argue that the financial challenges brought about by the pandemic have steered our healthcare delivery systems away from prioritizing value. However, many experts remain optimistic that value-based care is the key to achieving our overarching objectives of a more equitable, sustainable, high-quality healthcare system.

Kelsey Stevens, a principal at Wakely, an HMA Company, led a session on value-based care at the HMA Fall Conference. Her panelists felt strongly that value is critical to a functional and patient-focused healthcare system because the alternative is out of control spending and poor health outcomes. In fact, value-based care is flourishing in new ways as we look to integrate behavioral health and address health related social needs. There are lessons to be learned from early experiments, new models being built, and new models to be designed.  Both public and private payers are pursuing new ways to take financial risk to deliver improved healthcare outcomes, focusing on solutions for higher risk populations or circumstances where quality of outcomes are indefensibly poor (i.e., maternal outcomes).

This enthusiasm felt by the wide variety of executives present at that fall meeting has inspired HMA to focus an entire conference on value. But not just another conference on value. Our internal experts felt strongly about hosting a forum for healthcare organizations to truly tackle the end-to-end challenges of VBC… so we are doing that.

Those who join us March 5-6 in Chicago will experience a workshop designed to “get real” about transforming healthcare quality and value. We are convening participants from all parts of the healthcare industry who have the collective experience to pinpoint common challenges and to build a path forward.

The workshop is organized into four cohorts:

  1. Payment and Risk Management Models,
  2. Policy and Strategy Frameworks,
  3. Data and Technology, and
  4. Care Delivery Frameworks

Each will produce concrete recommendations for action, as well as building new relationships among peers to sustain this change. In the cohort on Payment and Risk management, discussion will be focused on existing and new models for payment, pricing and attribution methodologies, risk mitigation levers along the value continuum, and approaches to engage employees in focusing on patient-centered value in the care they provide.

One of our fall panelists, Eric Mattelson, chief actuary at Zing Health, said “I’m still convinced that value-based care is the future of healthcare and the Sisyphean struggle to get there will ultimately be worthwhile.” We echo this sentiment wholeheartedly, and if you share this conviction, we encourage you to secure your spot today and become a part of this exciting and transformative event.

Our sessions and networking events offer an opportunity to delve into approaches to develop and manage risk-based contracting across sectors, establish effective partnerships with safety net providers and community-based organizations, apply a value lens to deployment of technology and data analytics, and develop health equity plans aligned with value principles and policies.

Future blogs in this series will touch on elements from the other 3 cohorts on VBC that make up the balance of the workshop. To learn more and register go to HMA’s 2024 Spring Workshop page.

Discover the challenges and opportunities associated with implementing value-based care at the HMA Spring 2024 workshop

Policymakers have been working to move the U.S. healthcare system away from the costly and inefficient framework of fee-for-service to patient-centered structures focused on value and quality. Financial pressures, government regulation, and improvements in managed care all contribute to the drive toward value-based care, and that creates challenges for providers, payers, manufacturers, government, and others supporting the industry. Though some stakeholders are hanging on to the old ways of doing things, others are rightly moving toward putting their emphasis on value, changing their payment and workforce structures, and improving quality.  

Health Management Associates will host the spring workshop, Getting Real About Transforming Healthcare Quality and Value, March 5−6, 2024, at the Fairmont Chicago Millennium Park Hotel in Chicago. The workshop starts with a kickoff event the evening of March 5 designed to foster meaningful connections for attendees, regardless of their role as a government official, provider, health system representative, payer, or vendor in public or private healthcare markets.  

The full-day program on March 6 will feature a compelling keynote speaker and include multiple interactive workshop sessions focused on four key pillars of value-based care: Policy & Strategy Frameworks, Payment & Risk Management, Data & Technology, and Care Delivery Measures. HMA has expertise in working with commercial payers; primary, specialty, and behavioral healthcare providers; and publicly sponsored health plans at the local, state, and federal levels. Session discussions will help participants adapt to the new value-based market and are designed to provide a comprehensive exploration of the intricacies involved in healthcare transformation. Attendees will discuss what to expect during the early phases of transformation, as well as strategies, collaborations, and actions that have moved them closer to adding value on the ground.  

Participants will be challenged to think critically about their organization’s cultural and operational readiness to create additional value for patients within the healthcare ecosystem. Drivers of policy, innovation, population health, risk management, IT, and data, as well as enablers and other stakeholders working in public and commercial markets, will meet in smaller groups to discuss and analyze scenarios, pose challenging questions, and identify tactical steps and solutions to thorny issues.  

Other groups focusing on value will address multi-sector issues and perspectives that affect value-based care, including behavioral health, primary, and specialty care. From navigating the complexities of employee insurance plans for businesses to advocating for the needs of individual consumers, this workshop will address the formidable challenge of reshaping the healthcare landscape.  

Don’t miss this opportunity to gain valuable insights and contribute to genuine and productive discussions that will shape the future of healthcare.  

Whether you attend on behalf of your organization or with a team of colleagues whose roles touch upon different links in the value-based chain, you will bring back ideas and strategies that can be implemented upon your return. Register today! 

Opportunities for local and regional managed care organizations with justice-involved services

Previously, HMA developed a comprehensive series of webinars reviewing the potential for using 1115 waivers to expand and improve health care services for the justice-involved population. With California becoming the first state earlier in 2023 to receive approval for the authority to provide a specific set of Medicaid services for up to 90 days in advance of release to youth and adults in state prisons, county jails, and youth correctional facilities, and many other states with pending waivers of a similar type, this blog post considers the implications of this emerging policy trend for local and regional managed care organizations (MCOs) in 2024.

The Opportunity

Delivering Medicaid services through MCOs has become the dominant strategy employed by states with 41 states (including the District of Columbia) using managed care for at least certain Medicaid populations. Local and regional MCOs represent a key component in this landscape across the country and often are deeply rooted in the states and communities they serve because of their specific focus on a single or limited number of markets.

With the precedent now in place for federal authority (and federal financial participation) to provide services such as reentry case management, behavioral health and physical health consultation services (in-person or via telehealth), laboratory and radiology services, medications as well as medication administration, medication assisted therapy inclusive of counseling, and community health worker services, states have a clear pathway toward pursuing the ability to provide services for the justice-involved population prior to release. Among the many important implementation questions states will need to consider as they continue to pursue the authority to provide these services is how the specific services will be delivered and financed. Given the dominance of Medicaid managed care, states will have to grapple with how MCOs can be leveraged to support a successful implementation of the delivery of services to the justice-involved population. The strong community presence of local and regional MCOs within the Medicaid managed care ecosystem makes these MCOs important entities for states to consider. Local and regional MCOs should consider what role they believe they can play as partners to states in these initiatives to serve justice-involved populations as successfully as they have served other Medicaid populations.

While the opportunities for local and regional MCOs will evolve over time, initial opportunities to contemplate are as follows:

  1. Serving as a Thought Partner: There is already significant interest across states in pursuing the ability to deliver services in advance of release but local and regional MCOs can support state officials looking to develop in greater detail the most viable path forward to do so. Local and regional MCOs can be well positioned serve as thought partners to states by educating themselves about California’s 1115 waiver approval and engaging state officials in their markets as partners to think through how the approach taken by California can be adapted to a given state’s goals and environment.
  2. Serving as the Lead Case Manager: Providing reentry case management to coordinate the reentry process for the justice-involved population is likely to be a key service in any service array from this population. To ensure the complex coordination related to this process occurs successfully across multiple organizations, local and regional MCOs can explore working with states to serve as the lead entity for case management as individuals are enrolled (or reenrolled) in managed care.
  3. Facilitating Enrollment Continuity and Continuity of Care: The process for transitioning to Medicaid coverage and care after these have been interrupted as a result of incarceration can be daunting for both the justice-involved population and well as state administrators and providers. Local and regional MCOs can play an intervening role here to provide support to all parties involved to produce a result where the enrollment process is as seamless as possible and critical care delivery is maintained specific to an individual’s health and social needs.
  4. Providing Infrastructure Funding: In partnership with states, local and regional MCOs can infrastructure funding to build capacity to support many of these entities who will be involved with the reentry process. Such entities can include, for example, behavioral health providers, community-based organizations, primary care providers, and social service providers. The type of capacity needed will likely include data sharing, technology changes, and workforce development.
  5. Providing Technical Assistance: In addition to supporting capacity-building, local and regional MCOs can provide technical assistance to entities involved with the reentry process. Complex operational, policy, and technology issues will arise during the reentry process that are specific to a given entity. Local and regional MCOs, because of their focused knowledge and experience in specific markets, are well positioned to provide expertise and guidance on issues ranging from care management to claims submission.

What’s Next?

As more states with pending 1115 waivers for reentry services for the justice-involved population gain approval, local and regional MCOs should anticipate engagement from states on planning and implementation in in 2024. Given this, taking action early to engage state partners and prepare your organization to serve this population is a prudent step to consider now.

For More Information

If you have questions about how HMA can support your efforts related to the Medicaid services for justice-involved populations and local and regional MCOs, please contact Michael Engelhard, managing director, Linda Follenweider, managing director, or Patrick Tigue, managing director.

Future-Ready: Is Your MCO Equipped for Change?

Government Funded Programs and Readiness

As a local or regional managed care organization (LRMCO), being “ready” means proactively addressing all the areas where your organization can get tripped up, or worse, lose your contract with a state Medicaid agency. LRMCOs are heavily reliant upon government funded programs. These include Medicaid, Medicare, and Marketplace business. Most LRMCOs are not as heavily involved in the commercial market, either on a fully insured or self-insured basis, and even when they are, these areas comprise smaller parts of their overall product offerings. National MCOs have looked to Medicaid managed care to fuel growth, strengthen relationships with government partners, and leverage infrastructure.

In any government program, “readiness” is a critical capability that often gets overlooked due to the daily pressures of running the organization. It’s often said that “you should always be audit ready.” The meaning of this is that you and your organization should always be prepared to undergo an outside audit from your regulator, financial auditor, or other entity such as the National Committee for Quality Assurance. Having a well-run organization allows you to not only be ready to respond to regulators or auditors but also to be able to demonstrate stable financial, operational, and compliance performance.  Having this stable base of performance allows for more meaningful strategic planning, innovation, and state and federal partnership.

In Medicaid and other government programs, where public purchasers follow stringent purchasing rules, perhaps another way to think of your MCO’s operations is to always be “procurement ready.” But what does it mean to be “procurement ready” for your MCO? Today, managed care is the primary Medicaid delivery system vehicle for most states across the country. While some states procure all Medicaid managed care services in single, comprehensive contracts, many states procure for services via specific programs. Managed long-term services and supports, behavioral health, dental, and other programs are examples of specific programs that states procure alongside those that states have procured historically including low-income children and their parents, pregnant women, people with disabilities, people aged 65 and older, and, with advent of the Affordable Care Act, low-income adults without dependent children. State Medicaid managed care contracts are typically three to five years in duration, often with single or multiple year optional extensions. What this means is that in any given year there are approximately 10 Medicaid managed care program procurements. Moreover, these procurements are now among the largest contracts awarded by states, often exceeding billions of dollars per year. As a result, the importance of being ready for these events has grown substantially over the years.

Being “Ready” Means Being Prepared and Planning in Advance

A critical element of being “procurement ready” is not to rely upon fixing issues when a Medicaid request for proposal (RFP) appears likely; it is to be on top of requirements on an ongoing basis, address issues quickly, and capture success stories as they happen. Too often, LRMCOs don’t look to begin this process until it is too late—a small issue has become a big problem and remediation is expensive, time-consuming, and painful. Even the best proposal will struggle to win in the face of a record of real or perceived suboptimal performance.

The reality is that states are asking for MCO results (Healthcare Effectiveness Data and Information Set scores, state audit findings, Health Insurance Portability and Accountability Act breaches, etc.) as part of RFPs. These data points are hard to hide even with great writing and presentation. States are also more frequently including member or case “scenarios” in RFPs, which are specific in nature and are designed to have the MCO describe exact steps, processes, and outcomes. It is therefore important to monitor and measure for performance year-round.

For incumbent LRMCOs, the best way to maximize your chances of winning a renewal is to deliver effectively—and to be seen as delivering effectively—on your existing contract. A well performing incumbent LRMCO has tremendous advantages because:

  1. Switching vendors is risky and painful for states, even under the best of circumstances.
  2. Competitors are less likely to bid when they know the incumbent is well-regarded by the state.
  3. The key to delivering effectively is continuous assessment and adjustment, so LRMCOs identify potential issues early and can address them before they mushroom into bigger problems.

The time to begin preparing for your next procurement is while you begin to deliver under the existing procurement, not three months before a new procurement.

Best practice is to begin RFP planning 18 months to 24 months in advance of the anticipated issuance date. That planning should include developing “win strategies,” competitive assessments, and proposal logistics. Putting remediation initiatives on top of these areas adds unnecessary stress and strain on the LRMCO and the teams responsible for delivering a winning proposal. Therefore, being “procurement ready” is an important and often critical element in ultimately preparing winning proposals.

States look for “partners” not just contractors. LRMCOs can serve as invaluable thought partners to help inform how states can meet their stated policy aims. This not only puts LRMCOs in good standing with state leaders, but it also means they are well informed about state thinking so they won’t be caught by surprise if new requirements appear in the next RFP.

States frequently provide vague guidance on when RFPs will be released (“early next year,” “in the second quarter”, etc.) Some states have published concrete schedules for their multiple RFPs, but this is the exception. The implication for LRMCOs is that it is very difficult to “time” when to get your operations optimally ready for a forthcoming RFP. A wiser approach is to always be ready for an RFP to drop (again, like being audit ready). Some operational, performance, or compliance issues can be addressed in fairly short time frames. Other areas, such as quality reporting, require about a two-year lead time to fix any problems, gather the data, and exhibit optimal performance due to data/reporting lag. Other areas that require longer lead times are claims, encounter data reporting, risk adjustment, delegation oversight, and many others. Due to the lead times required, to be always “procurement ready,” LRMCOs need to have robust operational readiness and monitoring programs established as part of daily operations.

Strategies for Achieving and Maintaining Audit Readiness and Contract Compliance

As noted earlier, strong performance on audits and a consistent record of impressive compliance is an advantage when participating in RFP processes. States prefer to contract with MCOs that have a robust track record of compliance and can persuasively demonstrate their ability to consistently meet the needs of members. Strategies that LRMCOs can employ to develop such a track record include:

  1. Develop Robust Compliance Programs: LRMCOs should establish comprehensive compliance programs that include policies and procedures, training, monitoring, and auditing. These programs should address all aspects of contract compliance and the specific requirements of the state’s program.
  2. Internal Controls and Documentation: LRMCOs should implement internal controls to monitor and measure contract compliance regularly. In addition, organizations should maintain thorough documentation of all activities, decisions, and communication. This documentation serves as evidence during audits and demonstrates a commitment to compliance.
  3. Regular Audits and Self-Assessments: LRMCOs should conduct regular self-assessments and internal audits to identify and rectify potential compliance issues before external audits occur. This proactive approach helps mitigate risks and ensures continuous improvement.
  4. Data Management and Reporting: LRMCOs should develop robust data management systems to collect, store, and report the necessary data. Accurate and timely reporting is essential for demonstrating compliance with performance measures and outcomes.
  5. Staff Training and Awareness: LRMCOs should ensure that staff members are well-trained and aware of their roles in maintaining contract compliance. Regular training sessions can keep employees updated on changing regulations and requirements.
  6. External Auditors and Consultants: LRMCOs should consider engaging external auditors and consultants with expertise in compliance to conduct independent reviews and provide recommendations for improvement.
  7. Continuous Quality Improvement: LRMCOs should implement continuous quality improvement processes to enhance the quality of care delivered to members. This demonstrates a commitment to improving health outcomes and can positively influence contract awards.

The Value of a Proactive Approach

To be continuously “procurement ready,” LRMCOs must be forward-thinking and adaptive. Embracing change, data-driven decision making, quality improvement, building strong provider networks, investing in technology, engaging stakeholders, and maintaining financial stability are all essential steps to ensure the sustainability and success of these organizations in the intervening years between state-issued RFPs. By taking a proactive approach to addressing these needs, LRMCOs can position themselves as leaders in providing high-quality health care services for the members they serve.

For More Information

If you have questions about how HMA can support your efforts to be ready, please contact Michael Engelhard, Managing Director or Patrick Tigue, Managing Director.

The role of specialized managed care in addressing the intersection of child welfare reform and behavioral health transformation

This week, our In Focus section highlights the efforts of Health Management Associates (HMA) and partner organizations to better coordinate services for children in foster care and for children with behavioral health needs.

First, HMA released an issue brief on November 6, 2023, as part of a partnership between HMA and the National Association of State Mental Health Program Directors (NASMHPD) Technical Assistance Coalition. Together HMA and NASMHPD experts wrote a series of five briefs on children’s behavioral health.

The brief released last month, “The Role of Specialized Managed Care,” written by HMA experts Heidi Arthur and Angela Bergefurd, with input from Caitlin Thomas-Henkel and Uma Ahluwalia, centered on the intersection of child welfare reform and behavioral health transformation. More specifically, it described how specialized Medicaid managed care plans can ensure better alignment between child welfare and behavioral healthcare services.

The paper emphasizes the role of state-level special needs plans (SNPs) in the delivery of coordinated care and examines the opportunities afforded to states seeking to leverage specialty managed care plans.

Specialized managed care plans can help fill the void by incentivizing the provision of services for children in foster care and specialty services for children with behavioral health needs. Plans in three states — Washington, Arizona, and Ohio — are highlighted, and can serve as examples of how state Medicaid SNPs can be implemented.

Link to Issue Brief

This paper is part of a larger effort that HMA and several partner organizations are supporting. Stakeholders include:

  • NASMHPD
  • The Annie E. Casey Foundation
  • Casey Family Programs
  • MITRE
  • National Association of Medicaid Directors (NAMD)
  • Child Welfare League of America (CWLA)
  • Administration for Children and Families
  • Substance Abuse and Mental Health Services Administration

The goal of these collaborations is to foster dialog between state agencies and stakeholders working to improve the well-being of children and youth with complex needs.

Most recently, HMA hosted a webinar December 12, 2023, featuring speakers from the partner organizations to discuss insights from a federal meeting that took place in November. Webinar speakers also informed participants about plans for a multistate policy lab scheduled for February 2024, where representatives of up to eight state child welfare agencies will participate in a two-day workshop on improving the children’s behavioral health continuum of care in their states. The webinar focused on the overall effort and provided a forum for states to hear from this partnership on the importance of collaborating to strengthen the children’s behavioral health system. Watch the webinar here.

For questions about the brief, please contact Heidi Arthur or Angela Bergefurd. For questions about the webinar or the larger effort, please contact Caitlin Thomas-Henkel or Uma Ahluwalia.

Proposed rule changes for mental health parity requirements and impacts on local and regional MCOs

Previously, Wakely Consulting Group, an HMA company, reviewed aspects of the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) requirements proposed rule published by the Internal Revenue Service (IRS), Employee Benefits Security Administration (EBSA), and Centers for Medicare & Medicaid Services (CMS) on August 3, 2023. The agencies accepted comments on the proposed rule through October 17, 2023. Because the proposed rule, if finalized as put forward, will have a significant impact on the compliance obligations of managed care organizations (MCOs) related to mental health parity requirements for the 2025 plan year in the group market and 2026 plan year in the individual market, MCOs will need to ensure, as they enter 2024, that they are in a position undertake any necessary steps to meet such obligations. This blog post outlines three specific requirements in the proposed the rule related to non-quantitative treatment limitations (NQTL) and their implications for a subset of MCOs: regional and local MCOs.

No More Restrictive Requirement

In the proposed rule, the IRS, EBSA, and CMS restate that MCOs may not apply any NQTL to mental health/substance use disorder (MH/SUD) benefits in any classification that is more restrictive, in policy or practice, than the predominant NQTL that applies to substantially all medical/surgical benefits in the same classification. To ensure compliance with this requirement, the proposed rule specifies exactly how an MCO must determine if the requirement is met.

First, the proposed rule outlines in detail how an MCO must complete a quantitative calculation to determine whether an NQTL applies to substantially all medical/surgical benefits in the classification at issue. If the NQTL does apply to substantially all medical/surgical benefits in the classification, the proposed rule then outlines exactly how the MCO must determine what version of the NQTL counts as the predominant one within the classification as well. Finally, once the predominant variation of the NQTL is established for an NQTL that applies to substantially all medical/surgical benefits in the classification, an MCO would have to use the proposed rule’s definition of “restrictive” (i.e., “imposes conditions, terms, or requirements that limit access to benefits under the terms of the plan,”) to determine if the NQTL applied to the relevant MH/SUD benefit is no more restrictive than the applicable medical/surgical benefit NQTL.

For local and regional MCOs, while the no more restrictive standard is not new, the steps required to ensure compliance likely represent—at the very least—an area where materially more intensive and sophisticated capabilities will need to be brought to bear. Completing the steps outlined above will require a cross-functional approach that leverages such areas as actuarial, behavioral health, clinical, compliance, financial analytics, and legal. The necessary people and processes will need to be deployed not only to accomplish the work effort but to do so in a way that is intelligible to federal and state regulators.

Design Requirement

In the proposed rule, the IRS, EBSA, and CMS seek to make explicit a requirement which mandates that MCOs cannot impose an NQTL on MH/SUD benefits in any classification unless the factors used in designing and applying the NQTL to MH/SUD benefits in the classification are comparable to, and are applied no more stringently than, the factors used in designing and applying the NQTL to medical/surgical benefits in the classification. The agencies note that the regulatory revisions offered only seek to codify what has been a longstanding position of the agencies on this issue.

The most notable and innovative provision put forward by the agencies for purposes of determining comparability is one that would prohibit MCOs from relying on any factor in the design or application of an NQTL if the information on which the factor is based discriminates against MH/SUD benefits when compared to medical/surgical benefits. In this context, the proposed rule makes clear that discriminating against MH/SUD benefits means being biased or not objective, in a manner that results in less favorable treatment of MH/SUD benefits, based on all the relevant facts and circumstances.

For local and regional MCOs, it is advisable, given both the prudence of mitigating forthcoming potential compliance risks and likely limitations on the resources that can be devoted to compliance efforts in a discrete time period, to begin to evaluate upon entering 2024, whether NQTLs imposed on MH/SUD benefits have been designed and applied in a way that comports with this proposal by the agencies. For example, an MCO should evaluate whether factors currently employed rely on historical data or other historical information from a time when coverage was not subject to MHPAEA or was in violation of MHPAEA’s requirements where the use of such data results in less favorable treatment of MH/SUD benefits, as this would be prohibited. To this point, the agencies specifically note that MCOs would not be permitted to calculate reimbursement rates based on historical data on total spending for each specialty that is divided between MH/SUD providers and medical/surgical providers, when the total spending was based on a time period when coverage was not subject to MHPAEA or was in violation of MHPAEA, if the data results in less favorable treatment of MH/SUD benefits.

Outcomes Data Use Requirement

In the proposed rule, the IRS, EBSA, and CMS note that substantially disparate results are often a red flag that an MCO may be imposing an NQTL in a manner that does not comply with MHPAEA and so the agencies have included a proposal to add a requirement that, when designing and applying an NQTL, an MCO must collect and evaluate relevant outcome data in a manner reasonably designed to assess the impact of the NQTL on access to MH/SUD benefits and medical/surgical benefits as well as consider the impact as part of the MCO’s analysis of whether such NQTL complies with MHPAEA.

At minimum, MCOs would have to collect and evaluate data for all NQTLs that includes, but is not limited to, the number and percentage of relevant claims denials, as well as any other data relevant to the NQTLs as required by state law or private accreditation standards. Furthermore, due a specific concern of the agencies about network composition, the proposed rule would mandate that MCOs also collect additional applicable data for NQTLs that relate to network composition such as in-network and out-of-network utilization rates, network adequacy metrics (i.e., time and distance data and data on providers accepting new patients), and provider reimbursement rates. To the extent that data collected and analyzed demonstrates significant differences in access to MH/SUD benefits when compared to medical/surgical benefits, the MCO would be required to take reasonable action to address these differences in access as necessary to ensure compliance with MHPAEA.

For local and regional MCOs, beginning in 2024 to inventory readily available data sources that would be able to be leveraged to comply with this proposal is an important step in order to be prepared to comply during the 2025 plan year in the group market and 2026 plan year in the individual market. Additionally, assessing analytic capabilities to determine the level of readiness to be able to complete the evaluation based on the data collected is also an important component of preparing for this proposed new compliance obligation.

For More Information

If you have questions about how HMA can support your efforts related to the proposed rule’s implications for local and regional MCOs, please contact Michael Engelhard, Managing Director or Patrick Tigue, Managing Director.

Michigan releases Medicaid Managed Care RFP

This week, our In Focus section reviews the Michigan Medicaid Managed Care Comprehensive Health Care Program (CHCP) request for proposals (RFP), which the Michigan Department of Health and Human Services released on October 30, 2023. CHCP covers 2.2 million Medicaid members and is worth approximately $15 billion.

MIHealthyLife

The rebid is part of MIHealthyLife, an initiative that the department launched in 2022 to strengthen Medicaid services through new Medicaid health plan contracts. At that time, Michigan Medicaid sought input from nearly 10,000 stakeholders in an effort to strengthen Medicaid managed care contracts and create a more equitable, coordinated, and person-centered system of care. Based on the feedback, the department designed the RFP with a focus on five strategic pillars:

• Serve the Whole Person, Coordinating Health and Health-Related Needs
• Give All Kids a Healthy Start
• Promote Health Equity and Reduce Racial and Ethnic Disparities
• Drive Innovation and Operational Excellence
• Engage Members, Families and Communities

RFP

Medicaid managed care organizations (MCOs) serve 10 regions, each consisting of multiple counties. MCOs will bid on one or more of the regions throughout the state. Each region requires at least two plans, with the exception of Region 1, a rural area that includes Michigan’s Upper Peninsula, where members are enrolled in a single plan.

As part of the MIHealthyLife initiative, the RFP will include the following changes:

• Prioritizing health equity by requiring Medicaid health plans to achieve National Committee for Quality Assurance Health Equity Accreditation
• Addressing social determinants of health through investment in and engagement with community-based organizations
• Increasing childhood immunization rates, including greater provider participation in the Vaccines for Children program
• Adopting a more person-centered approach to mental health coverage
• Ensuring access to health care providers by strengthening network requirements
• Increasing Medicaid Health Plan accountability and clarifying expectations to advance state priorities

Timeline

Proposals are due January 16, 2024, and implementation is anticipated to begin October 1, 2024. Contracts will run through September 30, 2029, with three one-year optional periods.

Current Market

Michigan currently has nine plans, which serve more than 2.2 million Medicaid and expansion members. The table below provides a breakdown of the plan market share by enrollment.

Link to RFP

Florida releases procurement for statewide Medicaid prepaid dental program

This week, our In Focus section reviews the Florida Statewide Medicaid Prepaid Dental Program invitation to negotiate (ITN) released October 6, 2023, by the Florida Agency for Health Care Administration (AHCA). Contracts will serve 4.4 million Statewide Medicaid Managed Care (SMMC) members.

Background

The Florida Statewide Medicaid Prepaid Dental Program is a full-risk capitated dental program, which began rolling out by groups of regions in December 2018. The incumbent statewide Medicaid dental plans are DentaQuest, Liberty, and MCNA Dental.

Florida also is reprocuring its traditional managed medical assistance (MMA) program and managed long-term care program under SMMC. Awards for Medicaid managed care organizations (MCOs) are expected in February 2024.

ITN

Florida intends to award contracts to at least two plans. One of AHCA’s goals is to contract with plans that will support the HOPE Florida: Pathways to Prosperity initiative, which focuses on community collaboration between the private sector, faith-based community, not-for-profits, and government entities to break down traditional community silos. Through this program, AHCA seeks to:

  • Improve oral health outcomes by implementing a quality continuum
  • Enable personalized oral healthcare, particularly for people with special needs
  • Strengthen the network of dental providers
  • Integrate medical and dental care

In addition to the services currently provided, dental plans will cover authorized hospital outpatient and ambulatory surgery center (ASC) services as part of the new contracts. Plans will cover ancillary medical services provided secondarily to dental care in an ASC or outpatient hospital setting when medically necessary.

Dental plans will continue to operate statewide across all regions. Capitation rates for Medicaid and dually eligible members, however, are set regionally. Rates for medically necessary procedures are set at a statewide level. The new contracts will consolidate the 11 regions into nine as shown in the table below.

Timeline

Responses are due January 5, 2024, and notification of intent to award is anticipated to be released on March 29, 2024. Contracts will run from the execution date in 2024 through 2030.

Evaluation

Technical proposals will be scored using a total weighted score of 6,600, as shown in the table below.

Link to RFP

Kansas releases KanCare, CHIP Medicaid managed care RFP

This week, our In Focus section reviews the KanCare Medicaid capitated managed care request for proposals (RFP), released October 2, 2023, by the Kansas Department of Health and Environment and Department for Aging and Disability Services. The program covers approximately 520,000 beneficiaries and is worth $4.1 billion. New contracts would begin January 2025.

KanCare Background

KanCare is the state’s Medicaid managed care program, covering both traditional Medicaid and Children’s Health Insurance Program (CHIP) members. In all, KanCare covers approximately 320,000 children, 79,000 parents and pregnant women, 59,000 individuals with disabilities, and 54,000 individuals ages 65 and older.

Managed care organizations (MCOs) provide statewide integrated physical health, behavioral health, and long-term services and supports. Covered services include nursing facility care and home and community-based services, as well as Medicaid-funded inpatient and outpatient mental health and substance use disorder services and seven Section 1915(c) HCBS waiver programs.

Kansas is not currently an expansion state. While the governor’s 2024 budget plan called for Medicaid expansion, lawmakers rejected the proposal during the last legislative session.

In 2022, the state legislature delayed the procurement until 2023 to ensure that it occurred after the gubernatorial election and extended current MCO contracts through 2024.

RFP

Kansas expects to select three MCOs. The RFP includes a renewed focus on integrated, whole-person care, workforce retention, and accountability measures for the MCOs. The state lists the main goals for the KanCare procurement as:

  • Improve member experience and satisfaction
  • Improve health outcomes by providing integrated, holistic care with a focus on the impacts of social determinants of health
  • Reduce healthcare disparities
  • Expand provider network and direct care workforce capacity and skill sets
  • Improve provider experience and encourage provider participation in Medicaid
  • Increase the use of cost-effective strategies to improve health outcomes and the service delivery system
  • Leverage data to promote continuous quality improvement

Timeline

A mandatory pre-bid conference will take place on October 16, 2023. Proposals are due January 4, 2024, with awards expected April 12, 2024. Contracts will be effective January 1, 2025, through December 31, 2027, with up to two one-year renewal options. Following is the timeline leading up to implementation.

Current Market

Incumbents are Centene, CVS/Aetna, and UnitedHealthcare. A breakdown of market share by enrollment as of June 2023 can be seen in the table below. Other insurers have already cited their interest in bidding for the new contracts.

Link to RFP

Arizona releases Medicaid ALTCS-EPD Program RFP

This week, our In Focus section reviews the Arizona Long Term Care System (ALTCS) Elderly and Physically Disabled (EPD) Program request for proposals (RFP), which the Arizona Health Care Cost Containment System (AHCCCS) released on August 1, 2023. The ALTCS-EPD program covers 26,000 individuals, representing approximately 38 percent of the ALTCS managed care population. The remaining ALTCS members are covered under a state-run model through the Department of Economic Security, Division of Developmental Disabilities (DES/DDD) health plans, which provide long-term care (LTC) to individuals with intellectual/developmental disabilities. Contracts for ALTCS-EPD are worth approximately $1.6 billion and will take effect October 1, 2024.

Background

ALTCS is one of the oldest Medicaid managed long-term services and supports (MLTSS) programs in the country, providing integrated physical health, behavioral health, and LTSS to individuals who are 65 years of age or older or who have a disability and require nursing facility level care. Beneficiaries may live in assisted living facilities or receive in-home services. The ALTCS-EPD program covers nearly all Arizonans who are dually eligible for Medicaid and Medicare statewide. Winning managed care organizations (MCOs) also will be required to implement companion Medicare Advantage Fully Integrated D-SNPs (FIDE SNPs) effective January 1, 2025.

Market

Members receive coverage through Banner-University Family Care, Mercy Care Plan, and UnitedHealthcare, depending on their geographic service area (GSA). MCOs will bid on all three GSAs and indicate their order of preference to be awarded. AHCCCS will not award the South GSA only or the North GSA only. At present, in the South region, Mercy Care Plan serves Pima County only. Under the new RFP, AHCCCS will not make an award specific to Pima County; rather the MCO will serve all seven counties within the South GSA.

Together, the plans cover 25,973 individuals (see below).

(United and Mercy administer DDD plans.)

Timeline

Intent to bid forms are due by August 31. Proposals are due October 2, and awards are expected to be announced December 13. As noted previously, implementation is scheduled to begin October 1, 2024.

RFP Link