Healthcare Reform and Changes in Medicaid

Atlanta—Medicaid is a low-income family health insurance program funded jointly by federal and state governments. It is administered by the Centers for Medicare & Medicaid Services for individuals who meet financial and category requirements.

At a Contemporary Issues session at the AMCP meeting, Cynthia Kirman, RPh, PharmD, of Molina Healthcare, presented a session titled Understanding the Changing Medicaid Landscape. Beginning with an overview of the pre-reform Medicaid program, Dr. Kirman reviewed the differences in managed care organizations (MCOs) and fee-for-service (FFS), as well as ways the Patient Protection and Affordable Care Act (ACA) has changed the 2 methods of delivery. The federal government mandates coverage, requires medical necessity, is the final recourse for payment, and installs 1 agency in each state to assist in administration of the program. The state upholds eligibility rules, exercises state-level flexibility to define benefit and service coverage, submits waivers, contracts provider payment rates, and employs 1 department to administer the plan. Financial eligibility is determined as a percentage of federal poverty level (FPL), which the Department of Health and Human Services calculates each year.

According to Dr. Kirman, this ranges from $10,890 for an individual to $22,350 for a family of 4 for 2011. Those with income levels at 100%, 133%, and 200% of FPL could qualify for Medicaid, depending on the individual state policy. The eligible income percentage rates are higher for pregnant women. Before the ACA, in order to be eligible an applicant had to meet both the financial and physical requirements (blind, disabled, pregnant, in long-term care, enrolled in Medicare, or families with children). The health reform bill will expand eligibility, therefore increasing enrollment; for example, uninsured parents and uninsured adults with no children may qualify if their income is ≤133% of FPL. Both federal and state governments anticipate a substantial increase in both enrollment and costs, according to Dr. Kirman.

Dr. Kirman continued her presentation with a discussion of the role of MCOs in managing pharmacy benefits, noting that an increasing number of states are beginning to enroll more Medicaid beneficiaries in MCOs, which contract with the state at the county level. MCOs differ from commercial FFS Medicaid and commercial coverage in several areas: formulary management and rebates, prescription channels including both retail and mail order pharmacies, and the role of the pharmacy benefit manager. Dr. Kirman concluded that patient care could be improved in an MCO through the collaboration of pharmacy with case management, disease management, provider relations, and the Healthcare Effectiveness Data and Information Set team. The health exchange will enable qualifying members of up to 400% FPL to have access to care. By 2019, 14 million to 16 million more adults/children will be eligible for Medicaid. The anticipated substantial increase in enrollment due to the ACA will necessitate a migration to the MCO for Medicaid, Dr. Kirman added. “Medicaid health plans will see enrollment grow as states move to mandatory managed care and decisions on health exchange coverage options” are made, she said.

The session continued with a presentation from Cynthia Pigg, BsPharm, MHA, FAMCP, senior vice president, pharmacy, Magellan Medicaid Administration, who began by stating that Medicaid is growing, Medicaid management is unique, the trends are significant, and there are opportunities for pharmacists experienced in managing care and managing costs. Medicaid is growing, she elaborated, due to changes brought about by healthcare reform. Medicaid management is unique due to a focus on fee-for-service utilization; trends in Medicaid prescription management include behavioral health pharmacy management, dual eligible rebates, long-term care management, health care exchanges, and comparative effectiveness research, she added. Finally she described some of the growing Medicaid management opportunities for pharmacists including an increasing population with chronic disease, fewer dollars to spend on Medicaid, a predicted shortage of physicians, the increasing prevalence of patient centered medical homes, and specialty health management, including specialty pharmacy.