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Bar News - June 18, 2014

Municipal & Governmental Law: Medicaid Expansion and the Move to Managed Care


Exciting Times at the NH Department of Health and Human Services

The last several years have brought numerous important changes to the New Hampshire Medicaid program, some driven by federal mandates and some by state directives. The convergence of these mandates and directives has made for interesting work at the NH Department of Health and Human Services, which administers the joint federal- and state-funded program.

First, the basic facts: Medicaid currently provides health coverage to poor families, children, pregnant women, disabled people and seniors. Medicaid offers a robust array of services and benefits designed to meet the needs of its beneficiaries, aimed at either improving their health status or maintaining sufficient autonomy to live in the community.

Medicaid is typically the second-largest component of the state budget, following education funding. As of April 30, there were some 130,000 Granite Staters covered by Medicaid, the vast majority of them children. Medicaid also is the public payor of nursing home services when Medicare’s coverage of up to 100 days ends.
Implementation of Managed Care
In December 2013, New Hampshire Medicaid commenced its long-awaited Care Management program, joining the majority of other jurisdictions in administering Medicaid under a managed care model, rather than the traditional “fee-for-service,” which is criticized for rewarding quantity, not quality.

Under managed care, Medicaid contracts with managed care organizations (MCOs) that oversee and coordinate care for Medicaid beneficiaries while achieving certain quality expectations articulated in the contract. New Hampshire has three MCOs: Meridian Health Plan, New Hampshire Healthy Families, and the nonprofit Well Sense Health Plan.

A managed care model affords states budget predictability because, instead of paying providers for every service rendered, states pay the MCOs a capitated rate, per member per month, determined by actuaries based on prior rates of payment and utilization. The MCOs must manage care and pay providers; if their expenses exceed what the state pays them, they cannot ask for additional funds.

Administration of the Care Management program has redeployed many staff at DHHS into vendor managers/compliance officials. However, given that there is still a fee-for-service program (though smaller), the same tasks that needed to be performed prior to Care Management’s start are still being performed today.

Another benefit of Care Management is that the Medicaid program has essentially purchased the ability to provide better management of complex cases while building capacity to achieve greater quality outcomes. While Medicaid previously used many tools of managed care, the program was more fragmented and staffing insufficient to reach the goal of “whole person management,” which the MCOs are required to maintain under the contract.

Whole person management requires working across acute care and long-term care silos to craft a plan of care that is integrated and ensures the right care, at the right time, in the right place. It also means applying evidence-based clinical judgment in managing care for those unique individuals whose needs are highly specialized. MCOs extend the reach of the Medicaid program, an important achievement given the dramatic reduction in DHHS staff over the last several years.

New Hampshire Medicaid’s evolution to a fully managed care offering is being staged. In December, most acute care services were migrated into Care Management, leaving long-term care services, such as those provided under Home and Community Based Care waivers or in nursing facilities, out of Care Management for the time being. Most Medicaid beneficiaries are mandatory participants in Care Management; however, federal law allows select groups to opt-in to Care Management.

The voluntary participants include Medicare beneficiaries (the so-called “dually eligible”), foster children, most disabled children, and Native Americans. A complete list can be seen at 42 USC 1396u-2(a)(2). The voluntary populations and long-term care services will transition into Care Management at a future date.
NH Health Protection Program
The other major change in New Hampshire Medicaid arises out of this legislative session with the passage of SB 413, dubbed the New Hampshire Health Protection Program (NHHPP).

The NHHPP is a New Hampshire model for expanding Medicaid to low-income adults as authorized by the Patient Protection and Affordable Care Act of 2010 (ACA). Under the NHHPP, Medicaid will expand to offer essential health benefit coverage to adults under 133 percent of federal poverty (roughly $16,000 for a single person). The coverage must include substance use disorder services in order to comply with the ACA, though this is not presently available to current Medicaid beneficiaries.

DHHS is hopeful that these services will be extended to traditionally eligible beneficiaries in the next biennial budget. Essential health benefit coverage will not include access to long-term care services, such as Home and Community Based Care or nursing facility services, unless the beneficiary meets the definition of “medically frail.” Specifics for the definition and process for determining medical frailty were still being ironed out at press time.

Administrative Rules necessary to implement this expansion of eligibility and launch the new benefits were expected to be heard at the Joint Legislative Committee on Administrative Rules on June 20. Drafts of these rules can be found on the DHHS website.

Coverage under the NHHPP is set to begin July 1, “or as soon thereafter as is practicable.” The NHHPP coverage will sunset if not reauthorized by Dec. 31, 2015, when the full federal funding ends and federal funding for Medicaid expansion programs is reduced from 100 percent to 97 percent. It is anticipated that on Jan. 1, 2016, individuals covered by the NHHPP Medicaid expansion will instead have commercial coverage from the Federal Marketplace and use Medicaid funds to pay for their premiums. This model will require approval from the Federal Centers on Medicare and Medicaid Services.

In conclusion, every day brings new policy development at the NH Medicaid program in our ongoing effort to bring quality health coverage to low-income citizens of the Granite State. Moving into the future, additional Medicaid-sourced funds will be infused into the New Hampshire health care system, with the hopes of greater stabilization and better health outcomes for all.

Lisabritt Solsky is a 14-year veteran of the NH Department of Health and Human Services where she serves as the deputy Medicaid director. She is a 1996 graduate of the University of the District of Columbia School of Law.

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