CullmanTimes.com - Cullman, Alabama

April 6, 2013

Legislators start talking about changing Medicaid

By KATHY WINGARD
Associated Press

MONTGOMERY, Ala. — As the Alabama Legislature works to design a bill to help the State Medicaid Agency restructure the way it administers the $5.63 billion program, Jan Carlock worries about some of the proposals.

Carlock is a registered nurse and a quality care manager for the Care Network of East Alabama, a nonprofit agency that provides services to Medicaid recipients. Alabama has four patient care networks that serve as a bridge between sick patients and their doctors. The organization Carlock works with serves about 34,000 people over seven counties.  

A bill under consideration could change the present “fee-for-service” basis of Medicaid payments to a for-profit, managed care plan, or a combination of non-profit and for-profit companies. Carlock and others worry that implementing a managed care option could hurt patients.

When she worked for a large managed care corporation in Florida, she said it didn’t expand the numbers of patients.

“They have no incentive to expand. If we care for our own neighbors, our dollars stay here in our communities,” she said. “They can enroll elderly and sick people who do not understand what managed care is and they will not use the services. The company gets paid even if they do not provide medical care.”

Carlock gave an example of a patient, an elderly man who was not identified due to privacy laws. She said he can’t read. He is poor, lives alone and suffers from severe hypertension. He needs daily medication but had to guess his dosage, if he remembered at all. He had been going to the ER when he got too sick, but a nurse from the Care Network taught him how to divide his medications into daily containers. She stops by weekly to help him. That monitoring has saved the state money and improved the man’s health.

The Medicaid Advisory Committee commissioned by Gov. Robert Bentley does not want to use for-profit managed care companies, but lawmakers and others are trying to ease the financial burden that Medicaid places on the state budget.

Currently, the state agency pays providers and bears the administration costs. If the proposed shift is implemented, the costs should be contained or lowered for the state, lawmakers said.

By arming the state’s Medicaid Agency with a very flexible framework, lawmakers aim to permit officials to create fresh business models.

Choosing from scenarios submitted by the Medicaid Agency’s actuary, six to eight regions would be created under the remodeled system. Each region would host a central agency called a regional care organization. That RCO would be a risk-bearing entity capable of contracting with a commercial managed care organization. It could develop a community-based network of providers on its own.  

Some large health care corporations made presentations to the Medicaid Advisory Commission on behalf of their industry.

Ryan Sadler of Centene Corporation in Missouri was clear his company wants to provide managed care services.

“We provide services to governments in 21 states and we want to work with Alabama to serve its Medicaid agency. In South Carolina, they wasted a lot of money on patient care networks. They can save that money now by working with us.”

Trimming services to patients is not on the table. According to a Kaiser Foundation study, Alabama ranks third from the bottom when it comes to how much the state provides for each recipient’s care. The Medicaid Advisory Commission reported that decreasing services would not result in savings, as removal of some care would escalate the need for others. The cost savings would more likely come from the decentralization.

For some, the decisions made in Montgomery can mean life or death.

Carlock said a physician referral brought an immigrant family to the Care Network. Their baby boy had been born with serious heart malformations. The only person in the family who could speak English was his 8-year-old sister. When Carlock made a home visit, the family of five had no furniture, no beds, no food and no transportation. Their tiny son needed a cardiac specialist, but that doctor is in Birmingham, 100 hundred miles away. They live crisis to crisis.

Carlock arranged for a ride to the hospital in Birmingham. She was able to get mattresses, linens and food for them. She connected them to a social worker. Case workers from Care Network now visit to make sure the family has followed up on the baby’s doctor’s appointments and medicines and that they have translation services.

Other plans under consideration include an administrative service organization that could be selected to serve specific needs of the different regions, said David White, the governor’s health policy adviser. Or, an RCO could be local consortiums of doctors, dentists and others who feel they could use capitated state funding to provide services and have enough left over to turn a profit. If either of these types of businesses fails to break even, they would have to absorb the loss. That provision in the proposed bill limits financial risks for taxpayers.

The legislature is set to work on the bill again next week.