Quarterly Report:  4th Quarter 2002

Accepted January 17, 2003

This report of the Medicaid Managed Care Council is submitted to the General Assembly as required under CGS 17b-28.  This report is for the 4^th Quarter 2002, from October through December 2002.  The Medicaid Managed Care Council is a collaborative body established by the General Assembly in 1994 to advise the Department of social Services (DSS) on the development and implementation of Connecticut’s Medicaid Managed care Program.  Specifically, the law charges the Council with “advising the Commissioner of Social Services on the planning and implementation of a system of Medicaid Managed Care and shall monitor such planning and implementation and shall advise … on matters including, but not limited to, eligibility standards, benefits, access and quality assurance”.  The Council consists of legislators, consumers, advocates, health care providers, representatives of managed care plans and state agencies.  The Council has several working subcommittees: Consumer Access, Public Health, Behavioral Health and Quality Assurance.

The Council met monthly during this fourth quarter with continued focus on future program configuration changes, received administrative reports and reviewed the drug formulary processes, received program quality and HUSKY enrollment reports as well as a summary of the 2001 CT Uninsured Survey provided by the Office of Health Care Access.

HUSKY Program Changes

Medicaid Optional Service reductions for Medicaid clients 21 years and older will impact HUSKY A adult members (these service cuts do not apply to Medicaid clients < 21 years of age). Pursuant to 2002 legislation, the Medicaid program will no longer pay for certain services as of January 1, 2003.  The projected savings associated with these service eliminations is $2.5M. In a notice sent to Medicaid and state medical assistance (SAGA) clients from David Parrella, dated December 13, clients were informed that the DSS would no longer pay for services for the following providers:

• Medicaid clients:  podiatrists, chiropractors, naturopaths and independent physical therapists, speech pathologists, audiologists, psychologists.   
• SAGA & GA clients:  podiatrists, chiropractors, naturopaths, physical therapists, audiologists, speech pathologists, psychologists, home health care providers, optometrist & opticians and optical hardware.

In response to Council members’ questions, the DSS stated:

• The new rules will have no effect on Medicare reimbursement, out-of-state treatment reimbursement or the Medicaid waiver that includes psychology evaluation services for DMR clients > age 21 years.
• Independent psychology services are eliminated only in outpatient services.
• The above services that are provided in health clinics would be reimbursed.  If a federally qualified health clinic (FQHC) has a mental health component, services provided through the clinic will be reimbursed.
• Implementation of the new rules for HUSKY A adults may not be implemented until March or April, 2003, allowing time for the health plans to incorporate the changes into their billing systems once further operational guidance by DSS is provided. (The notice to Medicaid clients stated that the new rule applies to those > 21 years enrolled in the four HUSKY plans.).
• Senator Harp expressed concern that the new rules will create significant confusion among clients, providers and State agencies. The DSS has met with OPM, DMR and DMHAS to review the implementation plan.

HUSKY Dental Service carve-out

The development of the dental carve-out and dental management administrative service organization (ASO) has been regularly discussed.  The Medicaid dental carve-out would include the HUSKY Part A and B programs, Medicaid fee-for-service (FFS) and the state medical assistance populations.  The State employee unions agreed to a linkage of the dental ASO procurement with Medicaid, with the caveat of a separate administrative process pending certain conditions being met.  The dental management ASO RFP was released mid-December.  The ASO will carry administrative risk, while the Medicaid services will be self-insured by the DSS. In response to the HUSKY dental and behavioral health (risk-based) subcontractor spending & revenue reports, in which the 2 dental subcontractors reported an average 16% positive margin for the first three quarters of 2002, the DSS noted that the margins could support the argument for a self-insured dental plan that would have more dollars spent on services while maintaining a positive administrative rate.  The expected start date of the dental service carve-out is July 1, 2003.

HUSKY Behavioral Health Service Carve-out

The Behavioral Health Partnership (BHP), which includes the Departments of Social Services, Children and Families and Mental Health and Addiction Services, goals provide overarching planning and policy development for mental health services to Medicaid FFS clients, HUSKY Part A and B adult and child members, HUSKY Plus clients and the SAGA population.  The BH ASO RFP was released 10/7/02, the successful bidder will be announced 1/31/03, contract negotiations will conclude in April and the current plans are to implement the carve-out of BH services beginning 10/1/03.

Through the BHP administrative integration there would be less fragmentation, more coordinated policies among the three agencies and improved utilization data. The latter would improve identification of spending trends and evaluation of service effectiveness, which would lead to more appropriate clinical practice and community-based care. 

The exercise of the rehab option for children and adults would both expand the array of services and access to these services while maximizing the federal match.  Child and adult rehab services would be converted to FFS with a phase-in timeline for services to be covered by Medicaid.  Mercer has performed an analysis of current costs and projected cost projections for SFY04-05.  The emphasis is on cost neutrality, in which the gross BH spending and anticipated federal match increase would be reorganized into spending within the trend lines.

The Council Chair, Senator Harp, expressed concern of destabilizing an existing fragmented system with service gaps during the system change.  The ASO would assess Community-Based Service (CBS) needs by geographic area, identify capacity problems and target the development of new resources within that area. The DCF is working with child guidance clinics to develop a three-year plan for the conversion of DCF grants to Medicaid FFS.

Karen Andersson (DCF) provided an overview of the KidCare Program that represents a shift in treatment philosophy toward a family and community-based focus of care.  Children enrolled in HUSKY Part A & B and the PLUS program, Medicaid FFS and the DCF Voluntary Services program are eligible for KidCare.  As the program develops, mechanisms will be considered to allow cost sharing with parents of children in the Voluntary Services program and commercially insured to access CBS   Key components of the KidCare system already in place were discussed:

• There are currently 25 Community Collaboratives (local systems of care) that cover over 150 towns throughout the state. These Collaboratives comprised of parents, behavioral health providers, community leaders and KidCare Care Coordinators, form the service network from which the Care Coordinators help families to develop a child’s Individualized Service Plan.  A statewide family advocacy organization (FAVOR) has been funded to work with families, educating them about the new service delivery system and available resources.  Eight specially trained family advocates are supported by FAVOR to assist specific families involved with their local Community Collaboratives.

·        Approximately $21M was allocated to DCF by the General Assembly that has been committed to new or enhanced statewide KidCare services that include Emergency Mobile Psychiatric Services (EMPS), Care Coordination (60 Coordinators), enhancement of Extended day treatment, crisis stabilization beds (awards pending), therapeutic mentoring (RFP pending) and short-term residential treatment (RFA pending).

·        Statewide data on the EMPS system was presented that describes the average client: 12 years old, 58% had no previous or current DCF involvement and 44% presented with depression or suicide.  Care coordination associated with the EMPS program averages 6 weeks, and 88% of the children remained with their families.  Few families (20%) allowed in-home therapy.  The DCF will work to reduce families concerns about DCF involvement.

Council discussion raised the following issues:

• There is a need for a statewide effort to recruit culturally diverse providers.  The DCF will be developing training programs over the next 6 months for non-traditional providers such as therapeutic mentors that will engage community minority participants. 

• The DCF will provide information on the changes in demand for state-funded services over the past 10 years. 
• The DCF is assessing data from the Collaboratives that identify risk factors of children in the system, allowing the State to more appropriately target prevention initiatives and funding.  Dr. Schaefer (DSS) stated there are evidence-based interventions for serious emotional disorders and those less serious, but acute disorders that can be successfully applied by BS/MA level practitioners.  The BHP is working with the CT Child Health & Development Institute to encourage the application of clinical models that lead to improvement.

HUSKY Administrative Reports

MCO Quarterly Claims Reports

The DSS reports on MCO “clean” claims inventory.  The percentage of adjudicated claims per quarter paid within 45 days range from 94-99% in the 2Q02.  Pharmacy, dental and vision (clean) claims all (100%) were paid within the 45 days. Mental health claims paid within 45 days range from 98-100%.  Health Net is only the MCO that subcontracts for home services.  The MCO has been working closely with the subcontractor to reduce the backlog of the claims inventory.

Council member have requested that future reports include the “large numbers of rejected claims and the percentage of these rejected claims that later paid” as a more timely, less costly resolution of outstanding claims.  The DSS stated that reports of the percentage of ‘clean’ versus rejected claims will be included in the July 2003 HUSKY procurement contract.  Implementation of the HIPAA regulations, which will require common claim rejection explanations, will allow easier tracking and correction of rejected claims.  Matching and tracking initially rejected claims paid at a later date cannot be done at this time as the two claims would have different claims numbers.  The DSS was asked to work with the MCOs to resolve two issues that lead to erroneous claim rejection:  Health Net’s use of the member SS number as an identifier rather than the Medicaid number and the 60-day lag time in EDS notification of member eligibility/plan change to the MCO, which results in claim denials during that lag period.

HUSKY A Dental & BH Expenditures

The DSS presented the first quarterly report, pursuant to PA 02-3, which requires HUSKY managed care organizations to report to DSS the revenue and medical/administrative expenses for their (risk-based) dental and BH subcontractors.  The Department provided information for behavioral health that includes 1) FirstChoice/Preferred One and CompCare, 2) Health Net/ValueOptions and dental financial reports from 1) Anthem/DBP and 2) Preferred One/BeneCare.  The reports for 1Q02-3Q02 were the average of the two risk-based subcontractors for each of the two services.  The behavioral health report did not include the Department’s reinsurance payments to the BH subcontractors; the Department will present these reports at the next meeting

There were significant differences in the medical and administrative loss ratio and margin between the dental and BH service reports:

In response to questions, the DSS noted that the average BH administrative ratio (range of 21-24% across quarters) and 16% dental margins (range 12-22% across quarters) support the argument for service carve-outs that would improve administrative efficiency and direct more dollars into (dental) services.  The addition of the BH reinsurance dollars into the reports may alter the BH margin.

HUSKY Program Administration:  Implementation of MCO Drug Formulary

The DSS had been asked to review the drug formulary process in HUSKY and the MCOs current formulary status.

• Health Net changes were effective 10/1/02.
• Anthem BCFP formulary changes were effective 11/15/02.  A revised date of January 1, 2003 for drugs deleted from the formulary was mailed to Anthem providers along with a notice that their patients would continue the medications now off formulary for another year without further action required by the prescribing practitioner.

The current DSS/MCO contract, section 3.15, outlines the DSS & MCO responsibilities in implementing a drug formulary.  These responsibilities are clearly defined; however there are patient access problems to drugs that are related, in part, to communication problems within the system.  Clients may not receive or understand the MCO letters about maintenance drug formulary changes, providers may not be aware of multiple managed care drug formulary changes and encounter burdensome administrative steps in obtaining Prior Authorization (PA), Pharmacies may not be familiar with the HUSKY 30-day temporary drug supply provisions when PA is not obtained or a client grievance is filed, and the DSS may not be informed of problem patterns that would allow the agency to take corrective action.  Communication about HUSKY formulary or other policy changes do not get to the clinical staff of State agencies, resulting in client access problems.

Senator Harp and Rep. Nardello suggested the Department:

ü     Convene a forum of health practitioners, MCOs and pharmacists together to identify the key barriers in HUSKY to medication access and steps to resolve the problem.

ü     Bring information to community-based (CB) groups on health care access, including medications.  Dr. Wilson (DPH) offered to work with DSS on identifying CB grass roots coalitions including faith-based groups that can inform Medicaid clients of program changes that impact access to care.

ü     Continue to closely monitor policy compliance within the system.  The DSS has a mechanism that requires the MCOs to report quarterly on the temporary drug supply dispensing, percentage of approved PA.  The Department will report on this at the January or February Council meeting. 

HUSKY Quality Reports

Quarterly data reports

The MCO data reports will be provided twice yearly in CY 2003. Highlights from the 1^st quarter 02:

• EPSDT screening ration remains at approximately 65% and the participation ratio at 57%.  EPSDT rates for youth aged 10-18 years remain the lowest, but there is a slight increase in this age group in 1Q02 compared to 1Q01.
• Access to ‘any dental service’ was 2% lower in the 1Q02, averaging 17% (the maximum preventive service rate would be 50% per quarter).
• Inpatient days per 1000 member months averaged 41% in 1Q02 compared to 38% under the Medicaid FFS program.  The average LOS has ranged from 3.3 to 3.8 since 1Q98, near or slightly above the FFS rate of 3.5).

The Council made recommendations to the DSS based on the data presented (see last page).

FirstChoice/Preferred One Asthma Disease Management (DM) Program

Over the previous quarter, the HUSKY MCOs described their  asthma DM programs. Preferred One voluntary DM program enrolls members with one or more asthma related inpatient stay , two or more ED visits or upon request by the Primary care provider (PCP).  The key components of the DM program are intensive case management, in-home assessments by contracted VNAs with feedback to the PCP, which included identification of asthma triggers, family education, assessment of treatment compliance and communication of an asthma management plan with the school nurses.  The MCO outcomes measurement of the program demonstrated annual cost savings ranging from $79,000 for 28 members to $31,000 for 10 members.  During the most recent period there were no inpatient charges for high-risk patients enrolled in the asthma DM program.  The MCO tracks utilization rates for ED visits, hospital admissions, pulmoaide authorizations and specialty referrals for both high and low-risk patients.  Preferred One works closely with the PCP in monthly reviews of the Asthma DM member’s asthma management status and families with asthmatic children are encouraged to use the Asthma Action Plan.

Births to Mothers in HUSKY A CY 2000:  Children’s Health Council

The Medicaid Council and the Quality Assurance Subcommittee have in the past requested and supported the assessment of HUSKY women’s prenatal care prior to and including enrollment in HUSKY.  Approximately 42-48% of women who give birth while enrolled in HUSKY were actually enrolled in managed care during the first trimester.  The Children’s Health Council worked with DPH to link Connecticut birth data with the HUSKY A data. The data match provided the following information:

• 76% of HUSKY A women had 1^st trimester care compared to 88.2% of other CT pregnant women.
• HUSKY A births represent 22% of CT births in 2000.
• HUSKY A teen birth rates were 7 times (22.8%) that of CT teen births (3.3%)

Teen Birth Percentages by Race/Ethnicity

• Low Birth Weight (<2500 GM) represented 9.6% of HUSKY A births compared to 6.8% of CT births.  In HUSKY A 13.2% all births were pre-term (<37 weeks) compared to 11.1% of CT births.
• 30% of white mothers smoked during pregnancy in HUSKY A compared to <10% in the CT population.

The DPH/DSS Memorandum of Understanding to continue data linkage between the departments is under final review.  The Council supports similar DSS reporting for the CY 2001 birth data and other data outlined in 2002 legislation that will allow other questions to be answered about the HUSKY population.

CT Uninsured Survey:  Office of Health Care Access (OHCA)

The CT uninsured survey was sponsored by a HRSA State Planning Grant and conducted by the UCONN Center for Survey Research and Analysis (the report and additional information can be found on the OHCA web site:  www.ohca.ct.us).  Connecticut is usually in the top 5 states with the lowest uninsured rates. This data, collected by random digit dial, provides a useful baseline for the State since the data was collected prior to the 2002 recession and the impact of the events of 9/11.  Highlights of the survey:

• 92% of adults and 93% of children were continuously insured during the past 12 months.
  • 64% of adults and 77% of children had employer-based insurance, 26% of adults and 13% of children had public insurance coverage.
  • Family income was the factor most strongly related to insurance coverage in that 21% of the uninsured had incomes <$10K.  More than 70% of the uninsured adults were permanent full-time employees.
• There were significant differences among the insured & uninsured in health care utilization, in that the uninsured were less apt to have a regular source of primary care and less apt to access primary care or the ED when they had an acute illness. 

The CT Business Quarterly survey done by CSRA on behalf of CT-DECD included health insurance coverage questions for employers about whether employers offer insurance coverage and if they do not, the primary reasons for this.  Overall 52% of CT employers offer health insurance to their employees.  Large employers (50+ employees) have the highest rate of employer-based insurance (94%); this drops to 26% of small employers (4 or fewer employees).  Of those employers that do not offer health insurance, the primary reasons were the cost of insurance and the small number of employees in the business.

The business survey, while more current than the uninsured survey, may over time reflect the emerging trends seen across the country of employers finding it increasingly more costly to provide health insurance to employees and may be able to do so only with added cost sharing to the employees.  The increase in public insurance enrollments may now represent the growing numbers of lower-income families that either no longer have employer insurance or cannot afford the co-pay increases. This comes at a time when state and federal budgets are in deficit and funding to public programs is being reduced.  Lack of insurance has an adverse impact on adults and children’s access to a source of primary care and earlier treatment for acute illness, which for some, will result in more costly medical care.

HUSKY Enrollment

From December 2001 through December 2002:

• Total HUSKY A enrollment increased by 30,473 (10.6%) with significant escalating monthly enrollments (averaging 4-5000) in 12/01-1/02 and in March-June 2002.
  • <19 years enrollment increased by 17,916 (9%).
  • Adult enrollment increased by 12,557 (15%).
  • In HUSKY A adults represent 30% of the enrollees, <19 are 70% of the total enrollment.
• HUSKY B enrollment increased by 3357, a 24% increase over the past 12 months.

Council Subcommittee Reports

• Behavioral Health: received reports on the BHP and KidCare, the Anthem PC integrative pilot and will continue to identify steps that can be taken to ensure integration of BH and other HUSKY services, and more immediate steps to improve outpatient access.
• Consumer Access:  the SC met in December; will request clarification from DSS on the State program policy on sharing HUSKY member address changes, member documentation required for eligibility for HUSKY A or B, and the member and health facility responsibility for the HUSKY member’s outstanding medical bills, in particular those related to retroactive Medicaid FFS payments. The focus of the SC will be on local problem resolution of health care access.
• Public Health: the focus has been on the proposed dental carve-out and State Employee linkage, discussions with the DPH on existing public health dental programs and opportunities for public health service costs for HUSKY members be addressed by the HUSKY dental subcontractors.
• Quality Assurance: the final report from the Adolescent EPSDT work group will be sent to the SC in February and with approval from the SC, to the Council.  A time-limited work group will meet to clarify and identify the access process for obesity-related services in the HUSKY A & B program, beginning January 15^th, 5:30 PM at CHA, Wallingford.

Council Recommendations to the Department of Social Services

The Medicaid Council made recommendations to the Department of Social Services in keeping with the legislative mandate to advise the DSS on the administrative and service components of the HUSKY Part A & B program.  The Council, while recognizing the erosion of agency administrative resources and the challenges of increasing program costs, made the following recommendations:

• As the Agency responsible for the improvement of EPSDT service utilization, it was recommended the DSS:
  • Consider the past Council recommendation that DSS and the MCOs develop specific action plans for the incremental, sustained increases in EPSDT ratios across age groups.
  • Partner with the CT Chapter of American Academy of Pediatrics, Family Practice, other provider associations, the DPH and Education to identify interventions that will improve the utilization of preventive EPSDT visits.
  • Identify and report on a regular basis patterns of health care utilization among HUSKY member that do not have EPSDT screens compared to those that receive EPSDT screens, focusing on the use of more costly services.
• Present prenatal care data on a regular reporting schedule in order to track the potential impact of funding changes to the statewide Healthy Start programs.
• Continue to link DPH and HUSKY birth data, with annual reports to the Council that may include questions raised by the Council/subcommittees.
• The Department, if possible, make BH utilization reports available earlier than the 180 day reporting lag in order to have more timely identification of improvements/problems.
• The DCF would welcome the collaboration of DSS and MCOs in implementing the new DCF initiative to reduce the incidence of ‘shaken 'baby syndrome' in the HUSKY program.
• In the MCO financial reports, the DSS is requested to:
  • Include the percentage of rejected versus adjudicated claims in future claims inventory reports.  This report would be part of the HUSKY MCO July 2003 contract provisions.
  • Include BH reinsurance dollars in the subcontractor expense/revenue reports.
  • The DSS work with the MCOs to resolve non-uniform HUSKY identifies and reduce the EDS lag time from 60 days in notifying MCOs of member eligibility or plan changes.

• While prescription costs continue to escalate in the Medicaid programs, implementation of HUSKY formulary and quarterly changes in these formularies are complicated by communication problems among the MCO & their Pharmacy Benefit Managers (PBM), clients, health practitioners, local pharmacies and the State agencies that have HUSKY members.  Suggestions to DSS included: 1) convening a forum of practitioners, MCOs (& their PBMs) and pharmacies to identify and resolve barriers to medication access, 2) work with DPH to involve community-based grass roots organizations in informing members of the process to obtain medication, and 3) the DSS continue to closely monitor policy compliance and contractual provisions related to formularies in the HUSKY programs.