MEDICAID FOR THE 21 ST CENTURY

Basic Principles

The current Medicaid program is fiscally unsustainable and does not properly address the needs of Missourians. To insure that the state can continue to provide Medicaid services, the legislature must move toward a reformed, effective Medicaid program. In its current structure, the Medicaid program is failing participants, providers and all of Missouri’s taxpayers. The newly reformed program will address the needs of Missourians, while spending the taxpayer’s money wisely. This transformation will focus on the Medicaid system but will also be a model for the private healthcare system as well.

As with any reform measure, the manner in which it is communicated can determine the outcome and success. Like the Three R’s of education ( Reading, Writing, and Arithmetic), healthcare boils down to the Three R’s: Risk, Responsibility, and Reward. Each Medicaid reform proposal should be put through the basic test of the Three R’s. Does the reform proposal reduce risk to the state and/or individuals? Does the reform proposal encourage the state, employees, and/or individuals to take responsibility? Does the reform proposal result in tangible rewards?

he new Medicaid program will continue to provide needed assistance to those with low incomes, the disabled, elderly, pregnant women and children. The reformed system, however, will provide this assistance in a more efficient, cost-effective manner. The recommendations in this report will address the three major components of reform: eligibility, access and delivery of care. The state must determine who is eligible for assistance, where participants can access that assistance and how it will be delivered. In the context of these three components, the report will address the following issues:

• Wellness, prevention and responsibility
• Provider participation and satisfaction
• Managed care
• Technology
• Mental health
• Long-term care
• Pharmacy
• Access to quality care
• Eligibility

Each of these issues will have specific recommendations for reform and a timeframe for implementation. By addressing these components, Missouri’s Medicaid program will be a model for other states as they look toward reform. Above all, Missouri will have a 21 st Century Medicaid program that will protect the most vulnerable in a careful and cost-effect manner.

WELLNESS, PREVENTION, AND RESPONSIBILITY

Recommendations

Missouri will have an infrastructure including a safety net that will support efforts to be the healthiest state (population) possible. Part of the vision must incorporate the creation of a culture of health. Missouri will become known for its dedication and passion for health with intended outcomes to include better health for each citizen, greater economic success for its businesses, more successful outcomes in education due to healthier children, creation of a “place” where people will want to live, work, play, learn and celebrate life. Therefore, the Commission recommends that the state do the following:

1. Implement a Medicaid program that emphasizes personal responsibility for individual behaviors and health status as identified by health risk appraisal or other instrument.
2. Create a program that provides basic level of services for each individual, including annual physical and preventive screenings (those identified as evidence based, cost-effective by age, etc.)
3. Develop mechanisms that increase understanding of our own health through improved health literacy.
4. Create structures to guide participants to become better consumers of healthcare. This new structure should include more transparency on the true costs of care and encourage participants to take responsibility for their own personal health.
5. Create self-guide charts for participants to use to better understand their personal health.
6. Develop and create nurse information and triage lines.
7. Provide health coaches to guide participants in their health maintenance and improvement process.
8. Create evidence based health promotion and education programs.
9. Include interventions that are consistent with our knowledge of the importance of maternal/child health.
10. Create policies and interventions that demonstrate population health as a priority for the greatest good of Missouri citizens.
11. Encourage participation in education programs and behavior modification prior to the authorization of services and pharmaceuticals for each illness and/or disease. This would exclude emergency treatment. For example, diabetes prevention/management/education program prior to treatment.
12. Encourage a balanced allocation of resources between prevention and the treatment of disease and illness. The state should invest in preventive service including evidence based “complimentary medicine.”
13. Establish and expand use of preventive services and evidence-based practice with chronically ill participants. This would include use of tools such as chronic care management, paying for care according to established standards of care and paying for tobacco cessation counseling.
14. Create data and automation systems that provide critical information about the population served, financial issues, critical management information and health outcomes to support decision making by factual information.
15. Implement technology that provides central point of entry for all state services. This technology should be a central database, single plan of care for each client that ensures that the prevention interventions are part of the coordinated care plan of each consumer.
16. Integrate prevention into the use of technology through electronic medical records to empower individual and community level health decisions and integration/coordination of care by providers.
17. Identify all state and federal health related expenditures in Missouri to ensure consistency with health goals of Missouri’s safety net plans. This identification should include food stamps, housing development, economic development, and public safety.

PROVIDER PARTICIPATION AND SATISFACTION

Recommendations

As noted above, provider satisfaction and participation with the Medicaid program is low. Countless comments from providers and surveys reveal certain recurring themes and complaints with the current Medicaid system. Therefore, the Commission recommends that the state do the following:

1. Increase provider reimbursement rates.
2. Establish a review board to evaluate special needs cases.
3. Eliminate mandatory second opinions, limit the use of prior authorization, streamline the claims payment process, and make greater use of electronic transaction to ease the burden.
4. Implement a tiered level of co-pays to assist with patient compliance and empowerment.
5. Explore a system whereby emergency room physicians are allowed to screen patients and send the patients home if the visit is not an emergency. If a patient visits an emergency room for non-emergencies, the patient should be held accountable in some manner.
6. Explore mechanisms to prevent fraudulent providers from doing business in Missouri. Further, the state needs to centralize and integrate claims systems as to prevent unwitting provider fraud.

COORDINATED CARE

Recommendations

The Medicaid Reform Commission acknowledges that the Coordinated Care model can be expanded to other areas and Medicaid population groups throughout the state but understands that some of these populations require a high level of specialized care. Therefore, the Commission recommends that the state do the following:

1. Expand coordinated care to children and families in the St. Joseph area.
2. Expand coordinated care to children and families in the Springfield area.
3. Expand coordinated care to children and families in the counties contiguous to the current I-70 corridor, particularly in suburban rings around the St. Louis and Kansas City area.
4. Expand coordinated care to the Aged, Blind, and Disabled in existing managed care areas through a pilot program.
5. Put a medical loss ratio in any new contract, which would require the MCO to operate at a predetermined percentage of funding for direct patient care (or looked at the other way, no more than a certain percentage of the contract can be used for administration, overhead, and profit).
6. Establish an administrative services organization (ASO) to run the coordinated care for the ABD population through a pilot program in existing coordinated care areas.
7. Require the CCO to maintain a high level of customer satisfaction and protections for the ABD population within the pilot program.

TECHNOLOGY

Recommendations

There are continuing advancements in technology and the state must pursue those aggressively. The state must also continue to track innovative ideas even after reform takes place. Therefore, the state must create a Medicaid program that is able to adapt to innovative ideas and advancements.

The Commission believes that the new Medicaid program must include new healthcare technology. This can be used to improve patient care, decrease administrative burdens, and increase patient and provider satisfaction. The state must encourage providers to implement electronic medical records, community health records, personal health records, and E-prescribing, telemonitoring and telemedicine. Therefore, the Commission recommends that the state do the following:

1. Increase reimbursements to providers that implement EMRs, CHRs, personal health records and E-prescribing.
2. Emphasize that all Medicaid providers should have E-prescribing capabilities in their offices within five years.
3. Require all Medicaid providers to have electronic medical records within ten years.
4. Encourage providers to invest in telemonitoring and telemedicine
5. Offer technical assistance for implementation of EMRs, CHRs, telemonitoring and telemedicine.
6. Enforce and stiffen penalties for individuals who violate privacy laws.

MENTAL HEALTH

Recommendations

The Medicaid Program is complex with multiple eligibility categories, and a variety of programs and service mandates and options. Moreover, within eligibility categories there are subgroups with specialized needs, and the availability of waivers further complicates the picture. This is also true within mental health.

There are three broad populations that require services from the public mental health system:

• Individuals with developmental disabilities, including mental retardation, autism, cerebral palsy, etc.

• Individuals with serious mental disorders, including children with serious emotional disorders, and adults with serious mental illnesses, including schizophrenia, bi-polar disorder, major depression, etc.

• Individuals with no, or a limited, ability to pay for basic behavioral health services ( It is important to note that basic behavioral health services are nevertheless specialty services in the general health care delivery system.)

The Medicaid Reform Commission acknowledges that the systems of care for these populations must reflect their unique needs, and therefore the Commission recommends that the state do the following:

1. As the State Mental Health Authority, the Department of Mental Health (DMH) leads the initiative to identify and evaluate the mental health responsibilities and resources scattered across state agencies with the goal of identifying efficiencies and additional federal resources that could be gained through collaboration and/or integration.
2. Continued collaboration between the Department of Social Services (DSS) and DMH in support of Medicaid waivers to assure that an appropriate array of services and supports are available for individuals with (1) developmental disabilities and (2) serious mental illnesses or emotional disorders who are eligible through the PTD category.
3. DMH continues to promote local investment in services and supports by county developmental disabilities mill tax boards.
4. DMH develops provider profiling approaches that give consumers and their families’ adequate information to make informed decisions in selecting providers.
5. The state departments collaborate to assure that evidenced based practices are readily incorporated in Medicaid behavioral health programs.
6. The state continues to employ care management technologies that promote efficiency and consumer choice without inappropriately restricting access.
7. Implementation of a pilot coordinated care program for individuals with serious mental illnesses.
8. Support approaches to strengthening the linkages between federally qualified health centers and community mental health centers.
9. Support a public health approach that emphasizes prevention, early intervention and integration of primary care with basic behavioral health services.
10. Support local investment in mental health services and supports, and to develop mechanisms that reduces fragmentation at the local level and appropriately balance state and local control.
11. Promote the use of new technologies, such as telemedicine and electronic medical records, as appropriate for mental health services.
12. The state departments collaborate to assure that the health promotion initiatives of the MC+ plans are coordinated with the state’s overall initiative to create a culture of health and that specialty mental health services are readily accessible to MC+ enrollees who require them.
13. Ensure that DMH is responsible for establishing appropriate standards of care.
14. Incentives are developed to promote expansion of employer sponsored benefit plans that include coverage of basic behavioral health care.

LONG-TERM CARE

Recommendations

The number of elderly who may be in need of long-term care is expected to increase dramatically, and the costs of providing long-term care to Medicaid recipients will continue to increase exponentially. The Medicaid Reform Commission was charged with examining strategies for controlling the increasing cost of providing long-term care for Medicaid’s elderly participants. Therefore, the Commission recommends that the state do the following:

1. Increase education and outreach efforts to encourage the purchase of long-term care insurance, particularly for younger consumers.
2. Examine opportunities to participate in the federal long-term care partnership pilot project.
3. Create incentives or requirements for individuals to try in-home care before seeking care in a nursing home.
4. Create a mechanism that educates and informs consumers about all of their options for receiving long-term care.
5. Examine new community-based options, such as expanding the PACE model to other sites in the state and encouraging cooperative agreements between all long-term care providers to encourage and promote appropriate options for consumers.
6. Allow residents to stay in residential care facilities longer.
7. Examine the use of division of assets for in-home care for individuals under the age of 63.
8. Establish a single point of entry that includes a statewide-standardized assessment, evaluates the needs of the individuals and provides information about all long-term care options that are available.
9. Review licensure and oversight requirements for all types of long-term care providers.
10. Utilize technology to better manage information about long-term care consumers and plan for future needs.
11. Require licensed Home and Community Based Care providers to have reporting requirements comparable to the Long-Term Care facilities.
12. Revise the Medicaid nursing home reimbursement system to take into account the acuity of the residents in the facility.
13. Offer and educate state employees on the importance of obtaining Long-Term Care insurance.

PHARMACY

Recommendations

The enhancements already in place have helped to maintain Missouri Medicaid pharmacy program growth to about a 10.5% annual increase as opposed to the national pharmacy trend of about 13.5%. Individual prescription prices have been held to less than a 4.5% increase as opposed to the national trend, which currently exceeds 7%. Additional efforts focused on coordination of care emphasizing prevention of disease progression, and efforts to assist providers with improved patient care and medication prescribing, should contribute to even greater success in holding or diminishing healthcare cost increase trends. Therefore, the Commission recommends that the state do the following:

1. Continue and enhance the collaborative efforts of the Division of Medical Services and the Department of Mental Health through their common partner Comprehensive NeuroScience.
2. Continue to expand and update preferred drug and supplemental rebate opportunities.
3. Enhance current and develop additional clinical and fiscal on-line edits.
4. Improve and expand step therapies as supported by best practice and current medical evidence.
5. Update and expand MAC pricing of generically available products.
6. Expand cost avoidance through required third party billing.
7. Support targeted prior authorization with as much transparency as possible.
8. Support the inclusion of new technology as it becomes available especially in the areas of electronic prescribing and electronic medical records.
9. Continue maximizing other processes already in place that ensure maximum cost containment and appropriate drug usage based on best practices and current medical evidence.

All of these program management and reimbursement limitations are geared toward maximizing state savings while ensuring appropriate medication prescribing and usage, and attempting to avoid unnecessary bureaucratic burden for providers. As the technology has become available, automated processes have been put in place to allow providers greater ease in prescribing appropriately for their patients.

IMPROVING ACCESS TO QUALITY CARE

Recommendations

Improving access to quality care for Missourians encompasses the dual concepts of both the delivery of care and the need to provide healthcare for vulnerable populations. The vulnerable populations include those individuals who are low-income and are high-risk individuals with no real opportunities for access to care. Therefore, the Commission recommends that the state do the following:

1. Assist communities in starting or expanding FQHCs through technical assistance for the grant process.
2. Ensure that all Medicaid participants have access to a Medical Home where a primary care case manager will be available to assist in their healthcare decisions.
3. Fund and/or facilitate public-private partnerships to promote access to care, such as the examples stated above.
4. Legislate a dental care carve-out program from the managed care program.
5. L ook into expanding employer-based coverage by providing affordable coverage to small businesses and the employees.
6. Continue to explore allowing small business and uninsured employees to buy into the state-employee health plan, Missouri Consolidated Health Plan.
7. Institute a combination of individual healthcare tax credits and tax credits for small employers.
8. Offering a high deductible individual health insurance plan at an affordable rate but with a certain level of benefits.
9. Recommend providing leadership by requiring Missouri Consolidated Health Care Plan to offer HSAs to state employees.
10. 10. Require the Division of Medical Services to participate in the Missouri Quality Award process.

ELIGIBILITY

Recommendations

The state should consider the needs of the individual before giving assistance to ensure that the best care is given at the right time and at the right cost. Therefore the Commission recommends the state do the following:

1. Establish a tiered benefit package based on the healthcare needs and category of the participant.
2. Maintain flexibility to allow for the appropriate use of state funds to meet the healthcare needs of Missourians.
3. Establish the new Disabled Employee’s Health Assistance Program (DEHAP).

TIMELINE FOR REFORM

Top Ten Executables

1. Expand the MC+ coordinated care program to Northwest Missouri.
2. Implement a Chronic Care Improvement Program.
3. Implement and expand the MedStat program to reduce waste, fraud and abuse.
4. Upgrade the MMIS program.
5. Begin a pilot program for e-prescribing to reduce prior authorization concerns.
6. Evaluate and analyze ways to decrease ER over utilization.
7. Require the Division of Medical Services to participate in the Missouri Quality Award process.
8. Implement technological tools that will link the provider to Pharmacy Claim data.
9. Encourage the Missouri Consolidated Health Care Plan to offer optional long-term care insurance.
10. Develop an educational program for participants with an emphasis on health literacy and proper utilization of services.

Short-term implementation (Less than 2 years)

Wellness, Prevention and Responsibility

1. A program that emphasizes personal responsibility, health literacy, and creates a structure to guide participants to become better consumers of healthcare.
2. A program that encourages preventative care through health maintenance, evidence based health promotion and education programs.
3. A program that provides basic level of services for each individual, including annual physical and preventive screenings (those identified as evidence based, cost-effective by age, etc.)
4. Develop and create nurse information and triage lines.
5. Establish and expand use of preventative services and evidence-based practice with chronically ill participants. This would include use of tools such as chronic care management, paying for care according to established standards of care and paying for tobacco cessation counseling.

Provider Participation and Satisfaction

6. Explore a system whereby emergency room physicians are allowed to screen patients and send the patients home if the visit is not an emergency.
7. Explore mechanisms to prevent fraudulent providers from doing business in Missouri.
8. Incentivize provider performance and technological advancements.
9. Eliminate mandatory second opinions, limit the use of prior authorization, streamline the claims payment process, and make greater use of electronic transaction.

Provider Participation and Satisfaction

10. Explore a system whereby emergency room physicians are allowed to screen patients and send the patients home if the visit is not an emergency.
11. Explore mechanisms to prevent fraudulent providers from doing business in Missouri.
12. Incentivize provider performance and technological advancements.
13. Eliminate mandatory second opinions, limit the use of prior authorization, streamline the claims payment process, and make greater use of electronic transaction.

Technology

14. Increase reimbursements to providers that implement EMRs, CHRs, Personal Health Records and E-Prescribing
15. Encourage providers to invest in telemonitoring and telemedicine
16. Offer technical assistance for implementation of EMRs, CHRs, Personal Health Records, telemonitoring and telemedicine

Mental Health

17. Evaluate the mental health responsibilities and resources across state agencies to identify additional resources and efficiencies that can be gained.
18. Develop provider profiling that gives consumers adequate mental health information
19. Continue to promote local investment in services and supports by county developmental disabilities mill tax boards.
20. Continued collaboration among departments to assure that evidenced based practices is used in behavioral health programs and that care management technologies are used to promotes efficiency and consumer choice without inappropriate restricting of access.
21. Support a public health approach that emphasizes prevention, early intervention and integration of primary care with basic behavioral health services.
22. Ensure that DMH is responsible for establishing appropriate standards of care.

Long-Term Care

23. Increase education and outreach efforts to encourage the purchase of long-term care insurance, particularly for younger consumers
24. Examine opportunities to participate in the federal long-term care partnership pilot project.
25. Create incentives or requirements for individuals to try in-home care before seeking care in a nursing home.
26. Examine the use of division of assets for in-home care for individuals under the age of 63.
27. Review licensure and oversight requirements for all types of long-term care providers.
28. Require licensed Home and Community Based Care providers to have reporting requirements comparable to the Long-Term Care facilities.
29. Offer and educate state employees on the importance of obtaining Long-Term Care insurance.

Pharmacy

30. Continue and enhance the collaborative efforts of the Division of Medical Services and the Department of Mental Health through their common partner Comprehensive NeuroScience.
31. Continue to expand and update preferred drug and supplemental rebate opportunities.
32. Enhance current and develop additional clinical and fiscal on-line edits.
33. Improve and expand step therapies as supported by best practice and current medical evidence.
34. Update and expand MAC pricing of generically available products.
35. Expand cost avoidance through required third party billing.
36. Support targeted prior authorization with as much transparency as possible.
37. Continue maximizing other processes already in place that ensure maximum cost containment and appropriate drug usage based on best practices and current medical evidence.

Improving Access to Quality Care

38. Assist communities in starting or expanding FQHCs through technical assistance for the grant process.
39. Legislate a dental care carve-out program from the managed care program.
40. Recommend providing leadership by requiring Missouri Consolidated Health Care Plan to offer HSAs to state employees.
41. Require the Division of Medical Services to participate in the Missouri Quality Award process.

Eligibility

42. Maintain flexibility to allow for the appropriate use of state funds to meet the healthcare needs of Missourians.

Long-term implementation (more than 2 years)

Wellness, Prevention and Responsibility

1. Create data and automation systems that provide critical information about the population served, financial issues, critical management information and health outcomes to support decision making by factual information.
2. Implement technology that provides central point of entry for all state services.
3. Integrate prevention into the use of technology through electronic medical records to empower individual and community level health decision and integrations/coordination of care by providers.

Provider Participation and Satisfaction

4. Explore mechanisms to prevent provider fraud.
5. Restructure provider reimbursement rates.
6. Implement a tiered level of co-pays to assist with patient compliance and empowerment.
7. Centralize and integrate claims systems as to prevent unwitting provider fraud.

Technology

8. All Medicaid providers should have E-Prescribing capabilities in their offices within five years.
9. All Medicaid providers should have Electronic Medical Records within ten years.

Mental Health

10. Seek Medicaid waivers to assure that an appropriate array of services and supports are available for individuals with (developmental disabilities and (2) serious mental illnesses or emotional disorders who are eligible through the PTD category.
11. Implement a pilot coordinated care program for individuals with serious mental illnesses.
12. Support approaches to strengthening the linkages between federally qualified health centers and community mental health centers.
13. Support local investment in mental health services and supports, and to develop mechanisms that reduces fragmentation at the local level and appropriately balance state and local control.
14. Promote the use of new technologies, such as telemedicine and electronic medical records
15. Incentives are developed to promote expansion of employer sponsored benefit plans that include coverage of basic behavioral health care.

Long-Term Care

16. Create a mechanism that educates and informs consumers about all of their options for receiving long-term care
17. Examine new community-based options, such as expanding the PACE model to other sites in the state and encouraging cooperative agreements between all long-term care providers to encourage and promote appropriate options for consumers
18. Allow residents to stay in residential care facilities longer.
19. Establish a single point of entry that includes a statewide-standardized assessment, evaluates the needs of the individuals and provides information about all long-term care options that are available.
20. Utilize technology to better manage information about long-term care consumers and plan for future needs.
21. Revise the Medicaid nursing home reimbursement system to take into account the acuity of the residents in the facility.

Pharmacy

22. Support the inclusion of new technology as it becomes available especially in the areas of electronic prescribing and electronic medical records.

Improving Access to Quality Care

23. Ensure that all Medicaid participants have access to a Medical Home where a primary care case manager will be available to assist in their health care decisions.
24. Fund and/or facilitate public-private partnerships to promote access to care, such as the examples stated above.
25. L ook into expanding employer-based coverage by providing affordable coverage to small businesses and the employees.
26. Continue to explore allowing small business and uninsured employees to buy into the state-employee health plan, Missouri Consolidated Health Plan.
27. Institute a combination of individual health care tax credits and tax credits for small employers.
28. Offering a high deductible individual health insurance plan at an affordable rate but with a certain level of benefits.

Eligibility

29. Establish a tiered benefit package based on the healthcare needs and category of the participant.
30. Establish the new Disabled Employee’s Health Assistance Program (DEHAP).

Conclusion

A transformed Medicaid program is necessary if we are to continue to provide for our most vulnerable citizens. This reform cannot be done in a vacuum and must take into consideration the entire healthcare industry, public and private. Reform will take place at all levels of government. Federal waivers must be issued, administrative changes must be instituted and statutory changes will be passed. There must also be efforts at the local and community level. Local officials are more inclined to know the needs of their citizens and what works for their communities. This report and its recommendations provide a structure for a reformed Medicaid program that will provide quality care while spending taxpayers’ money in an efficient cost-effective manner.