Wednesday, February 7, 2018

Bigger Pie Forum: Medicaid Primer Part 2.

Medicaid is and will be for many years to come a critical issue for Mississippi and its government. There a BPF View - Medicaid 101: Part IIwill be considerable discussion about Medicaid managed care during the current Mississippi Legislative Session. Medicaid managed care has been in the news since last summer when the Mississippi Division of Medicaid re-competed and awarded new Medicaid managed care contracts to two existing vendors, Magnolia Health and United Healthcare Community Plan and a new vendor, Molina Healthcare. Seven vendors vied for three slots in the open competition. Two of the loosing vendors, Amerigroup and Mississippi True (a provider sponsored plan backed by over 60 hospitals and the Mississippi Hospital Association) filed protests and then lawsuits for rebid of the contracts. Amerigroup subsequently withdrew its protest and lawsuit. Mississippi True is still pursuing theirs.


Why all the fuss, and what is Medicaid managed care and how does it work?

Remember from Part I, the Medicaid program is health insurance intended for those of limited means based on the federal poverty level. As such, when applicants qualify for Medicaid and become Medicaid beneficiaries, their healthcare expenses are covered by Medicaid. In other words, Medicaid is their health insurer and pays the expenses of their healthcare visits. There are two ways for this to happen. One way is fee-for-service (FFS) Medicaid and the other is Medicaid managed care.

In FFS Medicaid, the healthcare visit is billed by the provider through a billing service known as the fiscal agent. The fiscal agent receives the bill for the service and the provider is reimbursed for the services rendered. In Medicaid managed care, the Medicaid beneficiary chooses a managed care plan and then the plan takes on the responsibility of reimbursing the provider for the healthcare services rendered. On the surface that doesn’t sound much different, but when you delve into the matter further there are differences for the Medicaid beneficiary as well as the Medicaid program.

In Medicaid managed care, the beneficiaries enrolling in the program are divided into groups based on age, health status and health risk. These categories are then assigned “risk scores” based on how costly it is to satisfy the particular beneficiaries’ healthcare needs. For example, the healthcare needs of children are not as great as those with breast or cervical cancer (which by the way is a category of eligibility for Medicaid). Therefore, the risk score for the children’s category is much less than the risk score for beneficiaries with breast or cervical cancer.

Risk scores are the bases for how the managed care companies are reimbursed by Medicaid for the healthcare needs of the Medicaid beneficiaries enrolled in their programs. Children have lower risk scores and therefore, lower cost profiles, which means their expenses for healthcare are much less than someone with cancer. An uncomplicated pregnancy has a different cost profile than a disabled child living at home or the cost profile of a disabled adult and so on. Each risk category has a different cost profile set by Medicaid with input from actuarial firms with expertise in the area. For the Mississippi Division of Medicaid that actuarial firm is Milliman.

Medicaid sets the cost of care for each risk category and pays the managed care companies this cost per beneficiary on a monthly basis. For a child, the cost of care per month, known as the per member per month rate (PMPM), might be $215. The monthly cost for a beneficiary with breast or cervical cancer might be closer to $4,500. The risk scores, and therefore, the PMPM for each category are reset every year based on the actual cost of care occurring in the previous year.

The above information is necessary in understanding a key element of Medicaid managed care. When Medicaid pays the managed care companies the PMPM for the care of the beneficiary, that is all they pay. The managed care companies have the responsibility to provide access for, and payment of the healthcare needs of that beneficiary within the amount they have received. If the cost of care goes above the monthly rate, the managed care companies are responsible for the extra cost. Likewise, if the cost is less, the savings are available to provide care for more expensive beneficiaries. This incentivizes the managed care companies to guide the beneficiary to the most appropriate location to receive their healthcare (think of clinics not emergency rooms) to ensure the beneficiary is receiving preventive care, and to ensure that whatever medication may be prescribed is being taken as directed. The healthier the beneficiary, the lower the cost of care and the lower the cost of the Medicaid program.

Another key element of Medicaid managed care that results from the above is cost predictability. In the FFS Medicaid environment there are several cost-driving variables in play, including the number of beneficiaries enrolled in the program, and the number of times they seek access to healthcare resources. In the Medicaid managed care environment, the key variable is the number of beneficiaries enrolled in the program. Medicaid knows exactly what it is going to pay the managed care companies to provide for the healthcare needs of the beneficiaries. So, an important unknown cost driver is the number of individuals participating in the Medicaid program. Cost predictability is a distinct factor when asking the Legislature for funding for the program. Resources are always limited, so narrowing that window of uncertainty is significant.

Read earlier post, A Medicaid Primer.

 This post is sponsored content provided by Bigger Pie Forum.

4 comments:

Anonymous said...

The failure to expand Medicaid and to put together a comprehensive healthcare plan years ago results in a lot of the high cost Medcaid patients today with cancer and other problems. I would add that I do hope Mississippi True does get some percentage of Medicaid patients in the future as they may be able to do a better job than many of these out of state companies.

Anonymous said...

Nice try, 5:45. Mississippi True is an out-of-state company. Do your homework and then come back.

Anonymous said...

crazy that such a major part of our state gov. budget receives very few comments

Anonymous said...

crazy that such a major part of our state gov. budget receives very few comments

Crazy how? Be specific.

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Trollfest '09

Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).


Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.

Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".

In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.


In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.

Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.

Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!

This is definitely a Beaver production.


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Trollfest '07

Jackson Jambalaya is the home of Trollfest '07. Catch this great event which promises to leave NE Jackson & Fondren in flames. Sonjay Poontang and his band headline the night with a special steel cage, no time limit "loser must leave town" bout between Alan Lange and "Big Cat"Donna Ladd following afterwards. Kamikaze will perform his new song F*** Bush, he's still a _____. Did I mention there was no referee? Dr. Heddy Matthias and Lori Gregory will face off in the undercard dueling with dangling participles and other um, devices. Robbie Bell will perform Her two latest songs: My Best Friends are in the Media and Mama's, Don't Let Your Babies Grow up to be George Bell. Sid Salter of The Clarion-Ledger will host "Pin the Tail on the Trial Lawyer", sponsored by State Farm.

There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

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