Kaiser: Transitioning Medicaid Population to Mandatory Managed Care

A new study examining California's shift to mandatory managed care for Medicaid beneficiaries with complex care needs found that adequate time and planning to minimize the disruption of care are essential to a successful transition.

As one of the first states to shift Medicaid beneficiaries from a fee-for-service structure to mandatory Medicaid managed care (MMC), the study's authors believe the state of California may yield valuable lessons for other states that may soon be following suit. The state moved approximately 240,000 of its seniors and persons with disabilities (SPDs) in its California Medicaid program (Medi-Cal) to mandatory managed care between June 2011 and May 2012 in an effort to increase provider and plan accountability, improve access to care, and create more predictable healthcare costs. Beneficiaries who are dually eligible for both Medi-Cal and Medicare were excluded from the shift.

A new study released from the Henry J. Kaiser Family Foundation assessed how this transition effected health service providers, plan administrators, and community-based organizations (CBOs) in 3 California counties (Contra Costa, Kern, and Los Angeles) to identify challenges and strategies to overcome those challenges. The study is titled Transitioning Beneficiaries with Complex Care Needs to Medicaid Managed Care: Insights from California.

When moving beneficiaries from a fee-for-service structure to MMC, sharing data and information efficiently between stakeholders such as the state, beneficiaries, MMC health plans, providers, and CBOs is an important step in the process.

Authors of the study found that 1 difficulty in the transition to MMC was the ability to notify SPDs of the shift due to incomplete or out-of-date contact information. Incomplete contact information also made it difficult to complete state-required Health Risk Assessments by phone; however, some plans that enlisted the help of CBOs to complete the assessments reported better results.

The study also noted that privacy considerations often slowed the transfer of health and prescription history information to health plans and providers, typically arriving from the state 8 to 10 days after the beneficiaries began using the plan. This delay made it more difficult for healthcare professionals to provide effective care. Key stakeholders suggested either a period of delay between the time the beneficiary is assigned a plan and the effective date, working directly with county social services, or using pharmacy data.

As part of the transition, California and the Centers for Medicare & Medicaid Services required an expansion of the provider network; however, this posed some challenges. According to the study, some clinics reported difficulty recruiting primary care providers who had experience treating patients needing complex care management. In addition, some clinics reported that some fee-for-service providers would not join their plan networks. To overcome these challenges, key stakeholders suggested improving marketing efforts, offering higher reimbursement rates for treating SPDs, or reducing paperwork.

One of the primary goals of moving more patients to a managed care program was improving care coordination for patients, however, this shift also meant new responsibilities and expectations for primary care providers. In California, study researchers found that primary care providers felt unprepared or untrained to coordinate care for this complex group of patients and reported spending more time getting authorizations or appealing denials than standard care coordination. They also reported that carving out mental health services from a managed care plan's responsibilities presented additional challenges to care coordination. Possible ways to overcome these challenges could include creating care coordination teams, additional and ongoing training, and utilizing CBOs to help in coordination efforts.

Finally, to successfully move a large patient population into managed care there needs to be sufficient organizational structures and resources in place, according to the report’s authors. In California, healthcare professionals reported providing unreimbursed care and said the transition also caused an increase in uncompensated staff hours. Health plans also reported that the Medi-Cal payment rates did not reflect the increased healthcare utilization for the patient group. According to the study, 1 option to ensure that the necessary resources are in place to support the move is to work with CBO.