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States Making Changes to Medicaid: User Fees and Expansion Among Proposals

Earlier this month, the Florida Legislature passed legislation overhauling the Medicaid program. In addition to increasing oversight of managed care plans and requiring plans to return a portion of profits in excess of five percent, the initiative eliminates the traditional fee-for-service (FFS) option for most recipients. The reform also mandates enrollment in long-term managed care programs for seniors.

Other states are following suit and expanding or implementing managed care programs. Louisiana is in the midst of an implementation that will move its approximately 1.2 million FFS members into managed care. The State of Kentucky released an RFP early last month to expand their managed care program from the Louisville area throughout the state. While, the Governor of Illinois signed legislation that places half of the state’s Medicaid caseload into managed care by 2015; this comes less than a year after the state commenced a mandatory managed-care program for the aged, blind and disabled population.

As states continue to struggle with growing budget deficits, we’re seeing Medicaid agencies turn to managed care to help rein in costs and utilization of populations that have traditionally been thought of as too vulnerable or fragile to enroll in managed care. As with federal health reform, Medicaid agencies are demanding that managed care organizations (MCOs) provide high-quality, cost-effective care to their members. States are increasingly going the route of pay-for performance, quality bonuses and withholds, and quality based auto-assignment for its managed care programs.

Just as we’ve seen innovation on the quality front, we’re also seeing some other interesting proposals floating around. Times are tough. As budgets shrink and Medicaid enrollment increases, states are struggling to provide coverage to individuals without breaking the bank. Health reform has somewhat limited states by prohibiting them from relaxing enrollment criteria or increasing premiums beyond inflation for existing Medicaid members prior to 2014. So, states are turning to other ideas to find funding and change utilization patterns and behaviors for Medicaid enrollees in their programs.

In Texas, lawmakers are considering legislation for a waiver that would consolidate five-years of Medicaid funding and allow the state to run its own Medicaid program. Through vouchers, health savings accounts and other mechanisms, the state believes it can cover more people and do so more cost-efficiently without having to cut existing benefits. The Governor of Arizona has proposed to charge childless, unmarried adult Medicaid patients $50 a year if they smoke, have diabetes or are overweight. The same legislation that mandates a long-term care program in Florida, also proposes to seek a waiver to charge members a $100 fee for accessing non-emergency care in the emergency room.

Marc Ryan

Marc S. Ryan serves as MedHOK’s Chief Strategy and Compliance Officer. During his career, Marc has served a number of health plans in executive-level regulatory, compliance, business development, and operations roles. He has launched and operated plans with Medicare, Medicaid, Commercial and Exchange lines of business. Marc was the Secretary of Policy and Management and State Budget Director of Connecticut, where he oversaw all aspects of state budgeting and management. In this role, Marc created the state’s Medicaid and SCHIP managed care programs and oversaw its state employee and retiree health plans. He also created the state’s long-term care continuum program. Marc was nominated by then HHS Secretary Tommy Thompson to serve on a panel of state program experts to advise CMS on aspects of Medicare Part D implementation. He also was nominated by Florida’s Medicaid Secretary to serve on the state’s Medicaid Reform advisory panel.

Marc graduated cum laude from the Edmund A. Walsh School of Foreign Service at Georgetown University with a Bachelor of Science in Foreign Service. He received a Master of Public Administration, specializing in local government management and managed healthcare, from the University of New Haven. He was inducted into Sigma Beta Delta, a national honor society for business, management, and administration.

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