State eyes ways to reduce churn among 880,000 MassHealth enrollees

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STATE HOUSE, BOSTON, JULY 16, 2015….State Medicaid officials are looking at ways to reduce “churn” among members of the six main managed care organizations that serve MassHealth patients, potentially limiting members’ flexibility to switch insurance carriers whenever they want in order to provide the plans with stability and keep patients connected with their doctors.

Health and Human Services Secretary Marylou Sudders on Thursday told an advisory group assembled by House Speaker Robert DeLeo that Massachusetts is “seemingly unique” among states in allowing MCO members to switch plans on a daily basis.

“We intend to make changes while ensuring continuity of care,” Sudders said, explaining that in 2014 churn among MCO plans was 36 percent, with only 6 percent of the patients switching between plans doing so on a voluntary basis. Much of the churn, according to Sudders, had to do with changing eligibility circumstances.

House Majority Leader Ronald Mariano said the numbers offered by Sudders illustrated a problem “not as great” as what he was previously led to believe. “We want to help you extend that window and keep people connected to their doctor,” he said.

DeLeo in June announced the creation of an advisory group to study managed care organizations and the cost-drivers and potential opportunities for savings that might ensure the long-term stability of the plans.

Sudders said that 880,000 of the 1.8 million residents in MassHealth, or Medicaid, are enrolled in MCOs accounting for $5.3 billion in state spending in fiscal year 2015. Five of the six traditional MCOs are “profitable or at break-even,” and starting in October MassHealth will begin to implement new risk adjustments and rates for certain services to address disparities in payments for some services, including behavioral health.

Rep. Jeffery Sanchez, co-chair of the Health Care Financing Committee and the leader of the speaker’s advisory group, said the goal is to produce a set of recommendations for DeLeo by Oct. 1.

“Let’s try to present some real solid solutions so we can make sure we help the folks in these programs who are there for defined reasons,” Sanchez told those gathered for the public hearing on Thursday, calling those enrolled in MassHealth MCOs “among the most frail in the Commonwealth.”

Dan Tsai, assistant secretary for MassHealth, said the administration is also considering a more competitive bidding process for MCOs, auto-enrollment and ways to move MassHealth away from fee-for-service payment structures. The agency hopes to develop a strategy over the next six to 12 months to change payment structures to focus on primary care and reducing unnecessary hospitalizations.

Auditor Suzanne Bump said reducing “churn” would reduce administrative costs, improve the continuity of care and prevent members from evading limits on care. Bump also recommended that MassHealth develop a policy to deny fee for service payments for services performed on an MCO member and refer those bills to the managed care plan, putting the onus on the MCO to determine who should pay the provide.

Bump said an audit her office released last November found $233 million in payments that had been made by MassHealth on a fee for service basis that should have been paid by an MCO. She said auditors found a lack of clarity among the MCOs and MassHealth about what types of services should be covered by an MCO.

“There is not an appropriate system of edits within their claims administration process to identify claims that should not be paid or paid by someone else,” Bump said, describing the problem as one of the “significant management deficiencies” impacting MassHealth’s ability to achieve savings that might be expected from managed care cost controls.

CeltiCare CEO Jay Gonzalez, former Gov. Deval Patrick’s long-time budget chief, said he felt his MCO understood the types of services it covered under its contract with MassHealth, but said he could not be sure whether providers were also mistakenly billing MassHealth for services the MCO should cover.

Gonzalez said CeltiCare, whose participation as an MCO in MassHealth is limited to the CarePlus program for low-income, childless adults aged 21 to 64, has had success by targeting the highest risk 5 percent to 10 percent of its member population for intervention services that has resulted in a drop in emergency room visits.

One of CeltiCare’s biggest cost drivers, according to Gonzalez, is the inpatient admissions for substance abuse disorders, which account for 23 percent of the plan’s hospital stays. The insurer’s highest drug costs are for Saboxone, he said.

Health Care for All Executive Director Amy Whitcomb Slemmer said $4.5 billion annually is spent on prescription drugs. The consumer health group is backing legislation (S 1084) filed by Sen. Mark Montigny that requires drug manufacturers to disclose their actual expenses related to the research, development and production of medications.

Under the bill, the Health Policy Commission would be empowered to set a “fair maximum price” at which drugs can be sold in Massachusetts for those prescriptions that appear to be disproportionately expensive compared to their development costs.

“This legislation is not a complete solution, but like other transparency requirements that have been enacted in other parts of Massachusetts legal codes, it will make a difference and change the current pricing dynamic that threatens patients’ health and the financial stability of our MCOs,” Slemmer said.

Health Care For All also criticized DeLeo for failing to appoint any MassHealth members or patient advocates to the advisory group.

The group is chaired by Sanchez and made up by Mariano, Rep. Garrett Bradley, Rep. Lori Ehrlich, Rep. Paul Brodeur, Rep. Jay Barrows, Rep. Matthew Muratore, Massachusetts Council of Community Hospitals Executive Director Steve Walsh, Massachusetts Hospital Association Executive Vice President Timothy Gens, Steward Health Care Executive Vice President David Morales, Massachusetts Biotechnology Council President Robert Coughlin, Network Health President Christopher Gorton, and Boston Medical Center HealthNet President Susan Coakley.

Copyright 2015 State House News Service

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