March 13, 2024
Federal Policymakers Consider Current and Future Spending Measures on Simultaneous Tracks
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Medicaid managed care spending in 2023
This week, our In Focus section analyzes preliminary 2023 Medicaid spending data collected in the annual CMS-64 Medicaid expenditure report. After submitting a Freedom of Information Act request to the Centers for Medicare & Medicaid Services (CMS), HMA received a draft version of the CMS-64 report that is based on preliminary estimates of Medicaid spending by state for federal fiscal year (FFY) 2023. Based on the preliminary estimates, Medicaid expenditures on medical services across all 50 states and six territories in FFY 2023 totaled nearly $852.9 billion, with 59.6 percent of that amount now flowing through Medicaid managed care programs. In addition, total Medicaid spending on administrative services was $33.8 billion, bringing total program expenditures to $886.7 billion.
Total Medicaid Managed Care Spending
Total Medicaid managed care spending (including the federal and state share) in FFY 2023 across all 50 states and six territories was $508.1 billion, up from $468.3 billion in FFY 2022. This figure includes spending on comprehensive risk-based managed care programs as well as prepaid inpatient health plans (PIHPs) and prepaid ambulatory health plans (PAHPs). PIHPs and PAHPs refer to prepaid health plans that provide only certain services, such as dental or behavioral health care. Fee-based programs such as primary care case management (PCCM) models are not included in this total. Following are some key observations.
- Total Medicaid managed care spending grew 8.5 percent in FFY 2023.
- Managed care spending growth has decreased in since the end of the COVID-19 pandemic, after peaking in FFY 2021.
- In terms of dollars, the increase in Medicaid managed care spending from FFY 2022 to FFY 2023 was $39.8 billion, compared with $47.8 billion from FFY 2021 to FFY 2022.
- Medicaid managed care spending has increased at a compounded annual growth rate (CAGR) of 14.2 percent since FFY 2007, compared with a 6.5 percent growth in total Medicaid spending.
- Compared with FFY 2022, Medicaid managed care spending as a percent of total Medicaid spending in FFY 2023 increased by 0.5 percentage points to 59.6 percent.
Table 1. Medicaid MCO Expenditures as a Percentage of Total Medicaid Expenditures, FFY 2007−2023 ($M)
As the table below indicates, 68.9 percent of FFY 2023 spending came from federal sources, which is 11.5 percentage points higher than the pre-Medicaid expansion share in FFY 2013 and 1.3 percentage points higher than FFY 2020.
Table 2. Federal versus State Share of Medicaid Expenditures, FFY 2013−2023 ($M)
State-Specific Growth Trends
A total of 44 states and territories report managed care organization (MCO) spending in the CMS-64 report. Average MCO spending during FFY 2023 increased 8.5 percent. On a percentage basis, Missouri experienced the highest year-over-year growth in Medicaid managed care spending at 51.7 percent, followed by Washington at 31.4 percent and Georgia at 29.3 percent.
The chart below provides additional detail on Medicaid managed care spending growth in states with risk-based managed care programs in FFY 2023.
Figure 1. Medicaid Managed Care Spending Growth on a Percentage Basis by State, FFY 2022-2023
Looking at year-over-year spending growth in terms of dollars, New York experienced the largest increase in Medicaid managed care spending at $5.9 billion. Other states with significant year-over-year spending increases included Washington ($4.1 billion), Illinois ($2.8 billion), and California ($2.4 billion). The chart below illustrates the year-over-year change in spending across the states.
Figure 2. Medicaid Managed Care Spending Growth on a Dollar Basis by State, FFY 2022−2023 ($M)
The percentage of Medicaid expenditures directed through risk-based Medicaid MCOs increased by more than one percentage point in 15 states from FFY 2022 to FFY 2023. The managed care spending penetration rate rose 6.7 percentage points in Missouri, 6.5 percentage points in Georgia, 6.3 percentage points in Louisiana, and 5.7 percentage points in Puerto Rico. In all, 22 states saw a decrease in managed care penetration from FFY 2022 to FFY 2023.
Table 3. Medicaid MCO Expenditures as a Percentage of Total Medicaid Expenditures in States with a One percent or Greater Increase from FFY 2022 to FFY 2023 ($M)
The table below ranks the states and territories by the percentage of total Medicaid spending through Medicaid MCOs. Iowa reported the highest percentage at 100 percent, followed by Puerto Rico at 97.5 percent and Kansas at 94.5 percent.
In many states, certain payment mechanisms may never be directed through managed care, such as supplemental funding sources for institutional providers and spending on retroactively eligible beneficiaries. As a result, the maximum achievable penetration rate in each state will vary and may be below the amount achieved in other states. The Medicaid managed care spending penetration rate is greatly influenced by the degree to which states have implemented managed long-term services and supports (MLTSS) programs.
Table 4. Medicaid MCO Expenditures as a Percent of Total Medicaid Expenditures, FFY 2016-2023
Note: Washington was excluded from the data table.
If you’re interested in becoming an HMAIS subscriber and for access to the CMS-64 data, contact our expert below.
Privacy and Security Assessment and Support Services
One of the most important challenges for a health data organization is ensuring that its policies and procedures remain compliant with the dynamic landscape of federal and state privacy and security statutes, regulations, and industry standards.
HMA brings applicable experience and expertise to assist state agencies, non-profit organizations, and other entities that are responsible for all-payer claims databases, hospital discharge databases, and other datasets containing confidential and sensitive health data with:
Reviewing existing policies and procedures to identify gaps and needed updates to ensure compliance with regulations and adherence to best practices and industry standards.
Recommending revisions based on the assessment review and helping prioritize changes based on risk analysis.
Updating policies and procedures based on the approved recommendations.
Developing a training program for staff regarding the updated privacy and security policies and procedures via in person training, virtual training, and/or creating training videos.
HMA’s privacy and security assessment and support services capabilities include the following qualifications and expertise:
Holding leadership roles at state health data organizations and on the National Association of Health Data Organizations Board
Coordinating health information technology (HIT) for state Medicaid agencies
Leading state value-based purchasing agencies
Founding HIT strategic consulting firms
Experience with the National Association of County and City Health Officials
Project management and strategic planning support for multiple state agencies and data organizations
Privacy and security legal expertise
In addition, HMA offers the knowledge and experience of more than 700 consultants to supplement our privacy and security expertise with local healthcare knowledge and support to comprehensively address an organization’s needs.
Contact our experts:
Craig Schneider
Principal
Craig Schneider is a leader in developing and implementing payment reform strategies, promoting all-payer claims databases, and engaging stakeholders across … Read more
HMA presents at 2024 Opioid & Fentanyl Abuse Management Forum in New Orleans
On February 15, 2024, HMA Principals Teresa Garate, PhD and Anika Alvanzo, MD, MS presented at the 2024 Opioid & Fentanyl Abuse Management Forum sponsored by the World Conference Forum. Their presentation focused on enhancing outreach strategies for reaching and engaging people suffering from opioid use disorder in their communities. Participants were able to learn about public health approaches, harm reduction and low-barrier treatment, as well as an understanding of the considerations needed when building community driven strategies that are person-centered.
Dr. Garate also served as chairperson for the two-day event, providing opening remarks on the first day, engaged panelists in provocative conversations, and closed out the gathering with a summary of the presentations. With a deep understanding that addiction is a disease of the brain, the presentations focused on biopsychosocial approaches and highlighted the use of multiple and diverse interventions. The compilation of the event’s presentations resulted in robust discussions on research, model programs, model strategies, and the critical role of policy, funding, innovation, and data sharing. The overarching message was that as a collective group of advocates, we must continue to use every resource we have at our disposal to push the envelope and challenge the status quo so that we can stop the increase in overdoses and overdose deaths.
At HMA, consultants on our opioid team have unique expertise and more than 30 years of experience tackling every part of the substance use disorder system. They have led the development of comprehensive prevention, evidence-based treatment, and recovery solutions at the state, county and community level. We have experience working with states and community organizations to develop impactful, sustainable responses to opioid crisis issues. Our team is ready to help clients create actionable and sustainable programs to address the opioid epidemic and addiction treatment.
Contact us to learn more about how we can help your organization develop programs to help combat the opioid crisis.
February 28, 2024
Driving Change in Healthcare Delivery: HMA Spring Workshop Builds Towards Policy and Strategy Frameworks Necessary to Implement Value-based Care
Helping Clients Succeed in Value Based Payments
As Medicare, state Medicaid agencies, Medicare Advantage plans, Medicaid managed care organizations, and commercial insurers increasingly adopt alternative payment models (APMs), Health Management Associates (HMA) provides a range of innovative and successful approaches to value-based care (VBC).
Our subject matter experts can help you succeed with
value-based payments (VBP).
WHAT WE DO
Offer insights for transforming the care delivery model to efficiently deliver optimal patient and population-level health outcomes while successfully managing total cost of care
Ensure quality is the primary goal of VBP program design and implementation
Develop payment models that align the incentives of payers and providers
Integrate physical and behavioral healthcare, and close gaps related to social determinants of health and health equity
Help clients successfully transition from fee-for-service to value-based payments by providing expertise in change management, analytics, network engagement, and IT infrastructure
Improve the patient and provider experience
Qualify, manage, and monitor health insurance risk
Prepare for and succeed in accreditation for VBP capabilities
ORGANIZATIONS WE SUPPORT
Those engaged in VBP or interested in engaging in VBP
Payers
Providers
Purchasers
Those interested in advancing the broader movement to value
Federal, State & Local Governments
Associations
Foundations
Investment Firms
HMA Can Support You Through All Phases of Value-Based Care
From contract to care plan, we have the experience and guidance tools to support your organization’s move to value-based care and risk-based contracting.
This graphic showcases the capabilities needed to address the complexities of risk-based contracting and deliver value-based care. As your organization moves from left-to-right along the glidepath to risk, additional strategies and capabilities must be developed. For example, utilizing Institute for Healthcare Improvement frameworks for quality improvement, regulatory and credentialing needs, and specialty access within a clinically integrated network. NEJM Catalyst. (2017). What is value-based healthcare?
Our philosophy involves applying a health equity model to close social determinant gaps and health disparities. Value-based healthcare is all about the care delivery model. Under value-based care agreements, providers are rewarded for helping patients improve their health, reduce the effects of emerging/rising risks and incidence of chronic disease, and live healthier lives in an evidence-based way.
Our Comprehensive Approach
Our collaborative approach will be tailored and customized to your needs to help you successfully implement VBP.
Our integrated process is based on the following model:
WHAT HMA PROVIDES
Determine readiness across key building blocks for moving to value-based payments and achieving continuous improvement across healthcare organizations.
Implementation that includes benchmarks and measurements of success. We facilitate stakeholder input to capture and analyze data from these interactions through surveys, focus groups, and interviews.
Aligning incentives with providers is key to successful value-based care strategies. Understanding methods for identifying and closing gaps in care pathways for common chronic conditions or addressing rising/emergent risks as well as how to create buy-in among providers and other members of the care team.
Including actuarial expertise required for contracting in key areas such as financial projections, reserves, total cost of care analysis, and benchmarking. We provide an assessment of third-party software to support APMs.
Including methods for incorporating whole-person care into clinical algorithms that apply to every interaction with the patient and their families. Integrating behavioral health with physical health and addressing social determinants of health/health-related social needs into VBC programs.
Assist with identifying key performance indicators (KPIs) and quality measurement incentives
for pay-for-performance or pay-for- value to support population health outcomes and support total cost of care in various VBP arrangements.
Provide support and consultation on scope of requirements to ensure VBC contract meets delegation requirements for operational, state, CMS regulatory and accreditation requirements.
OUR EXPERTS INCLUDE
Former CEOs, COOs, CFOs, and chief medical officers and other physician executives as well as executive quality leaders of the following organizations:
Providers including hospitals, academic medical centers, physician practices, community health centers, rural health centers, and federally qualified health centers
Medicaid, Medicare, Marketplace and Commercial MCOs
State and federal agencies
In addition, HMA offers expert actuaries, coders, analytic staff, and clinicians to support your transformation.
Contact our experts:
Craig Schneider
Principal
Craig Schneider is a leader in developing and implementing payment reform strategies, promoting all-payer claims databases, and engaging stakeholders across … Read more
North Carolina releases foster care specialty plan program RFP
This week, our In Focus section reviews the statewide North Carolina request for proposals (RFP) for the new Children and Families Specialty Plan (CFSP), which the North Carolina Department of Health and Human Services (DHHS) released on February 7, 2024. The plan will provide physical health, behavioral health, intellectual and developmental disability, long-term care, and pharmacy services to children, youth, and families that the child welfare system serves. Implementation is scheduled for December 1.
Background
North Carolina implemented Medicaid managed care on July 1, 2021, after working on a plan to transition individuals from fee-for-service to managed care since 2015. CFSP is one of the four types of integrated Medicaid managed care plans the state will contract with to serve Medicaid beneficiaries. The other three are Standard Plans, the Behavioral Health and Intellectual/Developmental Disability (BH IDD) Tailored Plans, and the Eastern Band of Cherokee Indians Tribal Option.
Standard Plans are operated by one of two types of Medicaid managed care organizations (MCOs): statewide commercial plans (CPs) or regional provider-led entities (PLEs). The state awarded contracts to four CPs, the maximum allowed under the procurement, and one PLE. AmeriHealth Caritas North Carolina, Blue Cross and Blue Shield of North Carolina, UnitedHealthcare of North Carolina, and WellCare of North Carolina serve beneficiaries across six Medicaid managed care regions. A regional contract with provider-led Carolina Complete Health, a partnership between the North Carolina Medical Society and Centene, covers Regions 3, 4, and 5. The total value of the contracts is approximately $6.4 billion. The plans serve more than 2 million members as of year-end 2023.
The state plans to implement BH IDD Tailored Plans July 1. Tailored plans will be provided through the awarded local management entity-managed care organizations (LME-MCOs): Alliance Health, Partners Health Management, Trillium Health Resources, and Vaya Health. Implementation has been delayed multiple times since 2022. As a result, the state issued a directive last year to dissolve the Sandhills Center and consolidate Eastpointe and Trillium Health Resources to hasten the delayed rollout. The tailored plans are expected to cover approximately 160,000 beneficiaries.
Details about the CFSP
The following populations will be enrolled automatically in CFSP:
- Beneficiaries who are in foster care
- Beneficiaries who are receiving adoption assistance
- Beneficiaries enrolled in the former foster youth eligibility group
- The minor children of enrolled parents
The following populations will be eligible for enrollment in CFSP during contract year two:
- Parents, caretaker relatives, guardians and custodians with children in foster care
- Minor siblings of beneficiaries in foster care
- Adults identified on an open Child Protective Services (CPS) In-Home Family Services Agreement case and any minor children living in the same household
- Adults identified in an open Eastern Band of Cherokee Indians Department of Public Health and Human Services Family Safety program case and any children living in the same household
- Any other beneficiary that has been involved with the child welfare system who could benefit from enrollment
RFP
The state will award the contract to a single statewide managed care plan. Applicant MCOs will need to develop strategies for engaging with historically marginalized populations, addressing health disparities, and incorporating health equity. Technical proposals will be evaluated based on the following criteria:
- Medicaid Managed Care Qualifications and Experience
- Medicaid Managed Care Program Administration
- Administration and management
- Program operations
- Claims and encounter management
- Financial requirements
- Compliance
- Technical specifications
- Historically underutilized businesses
- Diversity, equity, and inclusion
- Integrated and Coordinated Delivery of Services
- Members and recipients
- Benefits and services
- Providers
- Stakeholder engagement
- Comprehensive Care Management
- Care management
- Quality and value
Timeline
The CFSP data book and capitation rate methodology will be released March 1, with an overview for presentation at a pre-proposal conference on March 7. Proposals are due May 1 and awards are expected to be announced August 15. Contracts are scheduled to run December 1, 2024, through June 30, 2028, with one additional option year. The RFP indicates that the Department will work with awardee to establish an appropriate launch date.
Driving change in healthcare delivery: HMA Spring Workshop shapes policy and strategy frameworks for value-based care implementation
Federal policy frameworks establishing alternative payment models in Medicare and Medicaid have been the kick-starter of value-based care (VBC) innovation in healthcare delivery. However, employers provide health insurance to most Americans, and very few employers – with the exception of jumbo, self-insured employers – have leaned heavily into VBC. Small- and medium-sized firms rely on brokers to find an affordable health insurance plan, and often lack the resources required to negotiate more. Though the tide has been changing, our fragmented payment system has yielded only a subset voluntarily taking substantial risk for patient outcomes.
It has been said that to truly transform our American healthcare system to pay for value – improved outcomes for lower cost – it would require better alignment across public and commercial payers to support care providers in shifting their business models to take risk.
Quality and cost information are critical to implement VBC payment and delivery systems. Federal initiatives in Medicare and Medicaid have opened the door for providers, payers, and innovators to use health information to improve outcomes, with patients more engaged and more in control; the “Universal Foundation” announced by the Centers for Medicare and Medicaid Services (CMS) in 2023 seeks to align quality measures across the more than 20 CMS quality initiatives; and policies included in the 21st Century Cures Act and CMS Interoperability and Patient Access rule are creating more transparency on price and quality.
By enabling an infrastructure to measure, digitize, and share cost and quality information, federal and state governments have set the stage for greater collaboration among all purchasers – including employers – and the healthcare delivery system to redesign care that addresses health related social needs and behavioral health, ensuring that healthcare is provided equitably and sustainably. As the care delivery system is better able to deliver high value care, more employers will demand this for their workforce to provide a better benefit to their workers.
These issues, and more, will be a part of the expert-led conversation on VBC at HMA’s 2024 Spring Workshop March 5-6, in Chicago. This workshop offers a unique opportunity for payers, government officials, community organizations, vendors, and providers to have an unvarnished conversation about the challenges, lessons, and opportunities in implementing VBC. The meeting is designed to share insights, change-oriented strategies and actions that advance VBC from top industry experts, health plan executives, state and federal leaders, and policy experts.
Our working sessions will feature solutions-focused conversations among peers:
- Care delivery measures that drive outcomes, equity, population health
- Payment & risk management models for payment, pricing, attribution
- Data that is interoperable, consumer focused, deploying technology that is aligned to deliver on strategic objectives
- Policy & Strategy Frameworks at federal, state, and local levels that incentivize VBC
The closing panel will look at ways to take action through policy and collaboration to move our industry toward more sustainable approaches to healthcare payment and delivery.
To learn more and register for this unique event, please visit HMA’s 2024 Spring Workshop page. Act fast – online registration ends Wednesday, February 28!
Expanding Access to High Quality Sexual Health Care and STI Prevention
In 2022, more than 2.5 million cases of syphilis, gonorrhea, and chlamydia were reported in the United States. There were alarming increases in syphilis cases in particular – there has been an 80% rise in syphilis cases since 2016 and in 2022, there were 3,755 cases of syphilis among newborns reported (163% increase since 2018). While sexually transmitted infections (STIs) occur in all populations, some groups are more affected, including young people, gay and bisexual men, transgender individuals, and pregnant people. There are deep inequities in the rates of STIs including disproportionate rates among racial and ethnic minorities which are the result of longstanding social and economic structural inequities.
Sexual health services are being threatened and have inequitable resources which further complicates care for those individuals with lived experience with STIs, HIV, and viral hepatitis. They often experience additional and intersecting sexual health, behavioral health, and social needs that must be addressed concurrently.
HMA brings together experts from a full spectrum of sexual health services including policy, clinical, operations, and research.
Our experts have significant experience with conducting needs assessments and gap analyses, supporting syndemic (HIV/STI/Hepatitis) planning, centering health equity, and leveraging policy and research findings to maximize impact and access. A syndemic is a situation in which two or more interrelated biological factors work together to make a disease or health crisis worse.
Illustration from the Centers for Disease Control and Prevention (CDC)
We work with clients to reach shared goals of supporting sexual health, expanding access to screening, vaccines and other preventative services, reducing high rates of STIs including HIV, and addressing deep and persistent racial disparities in STI rates and the inequities that drive them.
We can help organizations including:
State and municipal departments of health and public health
Health plans
Community-based organizations (CBOs)
Behavioral Health Service Organizations
Federally Qualified Health Centers
Title X Clinics
Planned Parenthood affiliates and other free-standing women’s health centers
Foundations
Associations and Coalitions
Our sexual health experts include:
Former senior officials from the Health Resources and Services Administration and the Center for Disease Control and Prevention.
Advocates and former senior leaders of community-based organizations, foundations, and other programs that support healthcare systems capacity to implement quality STI prevention, screening, diagnosis, surveillance, and treatment.
Clinicians with experience providing sexual health services and building programs at the intersection of sexual health, behavioral health, primary care and maternal and child health.
Social workers and behavioral health professionals working to integrate approaches that address social and behavioral health needs.
Program development, strategic planning, and technical assistance experts working to implement innovative solutions and evidence-based guidelines.
Researchers and evaluators with extensive experience examining the implementation and impact of policy and operational changes on sexual health services.
Our experts can support your work to expand equitable access to sexual health care.
With offices in more than 30 locations across the country and over 700 multidisciplinary consultants with a wide spectrum of industry experience, and longstanding expertise in all 50 states, HMA has experienced staff in syndemic needs assessments and planning, program evaluation, research and analysis, strategic/business planning, clinical services, stakeholder engagement, quality improvement, and workforce development. Our portfolio of companies also gives you access to actuarial, data analytics and communications expertise, and more.
OUR WORK
South Carolina Department of Health and Environmental Control (DHEC) contracted with HMA to conduct a statewide gap analysis to document the array of partner services and disease intervention STI inside and outside the department and identify gaps and duplication to improve services and strengthen the program. As part of this engagement, HMA conducted an analysis of South Carolina’s STI delivery system, staffing capacity and processes, and developed a service location map to highlight gaps and inequities. The final report summarized findings and included recommendations for closing gaps in service delivery, workforce development and improving the efficiency and effectiveness of service delivery.
HMA supported the Washington State Department of Health’s Office of Infectious Disease in taking a syndemic approach to ending the HIV, STI, and viral hepatitis epidemics. A key activity of this project included supporting the Office of Infectious Disease to establish a new planning body that reflects the populations served by transforming their Statewide HIV Planning Group and launching a new communicable disease (syndemic) planning group. This work included conducting research on other statewide planning group structures, collecting community and stakeholder input, developing and operating structure, charter, and bylaws; recruiting and onboarding a diverse membership; and creating organizational change management, all with a focus and commitment to advancing racial equity. Through this work, HMA also drafted the state’s integrated HIV Prevention and Care Plan and Requests for Applications to help distribute state funds to local intervention efforts that advance the goals of this plan.
As part of our extensive area of work in strategic planning with state and local agencies, providers of health and human services, community-based organizations and many more, HMA has worked with clients that provide sexual and reproductive health care services to assess potential opportunities and approaches for expansion, delivery, and financing of care to reach underserved communities.
HMA worked with the Wyoming State Department of Health to conduct their HIV needs assessment and developed their Integrated HIV Prevention and Care Plan. This work included collecting and analyzing data on HIV incidence and prevalence; developing HIV, STI, and viral hepatitis ecosystem maps; facilitating workgroup meetings; collecting additional community and stakeholder input through provider and community surveys and focus groups; and developing a written report of the assessment findings, all with a focus and commitment to advancing health equity.
HMA worked closely with the Boston Public Health Commission to conduct an extensive HIV needs assessment. Activities included key stakeholder interviews, focus groups, surveys and data collection and analysis. Emphasis was placed on the intersection of HIV and drug user health.
HMA team members developed and implemented professional development training series entitled “The Intersection of HIV and SUD” on behalf of the Minnesota Department of Health. The 12-hour curriculum was developed in partnership with several community organizations representing Tribal, African American, and LGBTQIA+ communities. The training is delivered virtually and includes topics such as: understanding HIV; HIV risk reduction; SUD harm reduction; chemsex; HIV and stigma, pregnancy and HIV; and cultural, racial and sexual identities.
Contact our experts:
Julie Rabinovitz
Principal
Julie Rabinovitz specializes in sexual and reproductive health policy, strategy, and operations. She assists healthcare organizations with program planning and … Read more
Charles Robbins
Principal
Charles Robbins has been transforming communities for the past three decades. His extensive community-based organization career spans healthcare, child welfare, … Read more