Challenges for Medicaid as Membership Volume Swells

San Francisco—The passing of the Patient Protection and Affordable Care Act (ACA) is presenting increasing challenges for managed Medicaid programs, which have already experienced steady growth decade by decade, according to information presented by Chris Chan, PharmD, director of pharmaceutical services for Inland Empire Health Plan, and William Francis, MBA, RPh, director of pharmacy for The University of Arizona Health Plans.

In a Contemporary Issues session at the AMCP meeting titled Medicaid Strategies Update, attendees were given an overview of ways states are moving more of their Medicaid populations to managed care arrangements.

Effective January 1, 2014, Medicaid eligibility requirements will expand from the current 100% to include individuals with incomes up to 133% of the federal poverty level (FPL), with a standard 5% income disregard and removal of the asset test. Medicaid members who had previously lost eligibility (due to 1115 waivers) will become re-eligible in 2014.

“Medicaid growth has been steady over the past 30+ years,” noted both Dr. Chan and Mr. Francis. In 1980, there were 22 million Medicare beneficiaries and by 1990, that number had grown to 25 million (+14%). By the year 2000, Medicaid membership reached 45 million, a growth of 80% for that decade, and by 2010, there were 71 million (+58%). The passing of the ACA means an influx of even more members, with projections indicating a growth of 32% over the next 10 years. Without the ACA, growth had been expected to rise 4%.

The increase of the FPL to 133% will not only expand the Medicaid populations, but cause them to become more complex, driving cost and dividing them into 4 groups.

Dr. Chan called these groups traditional, aged/blind/disabled, childless adults, and the new poor. Those in the traditional group tend to be transient, twice as sick than those in commercial plans, more likely to have chronic conditions, and visit the emergency department (ED) more frequently. The traditional group usually includes pregnant mothers and children.

Comprising 20% of the Medicaid population and accounting for >60% of spending are the aged/blind/disabled, a group with complex bio-psycho-social-medical needs with half of the top diagnoses psychiatric or cardiovascular in nature. The majority (87%) have ≥3 chronic conditions.

“The remaining 2 groups are newer. A large influx of childless adults is expected when they become eligible for Medicaid in 2014. This group has been uninsured for a long time, has multiple comorbidities, and it is believed this group will cost 3 and a half times more than the traditional population for the first 18 months,” Dr. Chan told the attendees.

The new poor includes individuals who had good jobs and insurance, but have been unemployed for an extensive length of time because of the economic downturn. Generally, people this group are considered to be technically savvy and sophisticated consumers.

This imminent expansion and the unprecedented growth rate of the past 2 years will result in numerous challenges, particularly with regard to staffing, system support, and provider networks. Mr. Francis indicated that achieving the triple aim of care, quality, and efficiency during austere times will not be easy and having the proper staffing and infrastructure in place to support the growth of the program will be essential.

The necessary strategies to face these challenges include those related to medical services, such as the identification of high-risk areas, namely diabetes/cardiovascular, psychiatric, and narcotics. Both presenters agreed that medical services units and interactions between departments will need to be strengthened (care management, behavioral health, pharmaceutical services, utilization management, quality management, health education, and health management).

Strategies related to pharmacy include the implementation of programs to enhance intervention at the point-of-care and point-of-service levels (rather than retrospectively). Such programs include specialty pharmacy (drug therapy management), pilot programs (knowmymeds.com), and distribution of member-specific reports and alerts via a physician portal.

Drug therapy management can be useful by identifying members earlier (via recent ED visits or hospitalizations), allowing therapy to be readjusted based on status/survey, and providing feedback to providers, thus avoiding the need to review static reports.