Jon Courtney, PhD Program Evaluation Manager, Legislative Finance Committee Presentation to the Legislative Health & Human Services Committee September 21, 2015 1
Various LFC staff contributed to this evaluation: Maria Griego, Program Evaluator Cody Cravens, Program Evaluator Pam Galbraith, Program Evaluator Jenny Felmley, PhD, Program Evaluator Shane Sharif, Intern 2
LFC program evaluation looking at Centennial Care Waiver and Managed Care. Three themes emerged in this evaluation. ◦ Cos ost. t. Cost containment initiatives are at risk and the reliance of Medicaid on the general fund will increase significantly. ◦ Care. e. The amount and quality of utilization data has deteriorated leaving the question of whether enrollees are receiving more or less care. ◦ Cont ntrol. rol. Additional controls are needed to ensure that rates are appropriately low and to better position the Legislature to take a more active role in the setting of financial priorities for Medicaid. 3
New Mexico Managed Care Medicaid Total Capitation Payments By Program Area (in millions) $ 3,712 $4,000 $3,500 Medicaid Expansion=$973 Million $3,000 $ 2,493 $ 2,394 $ 2,381 $ 2.390 $2,500 $2,000 $1,500 $1,000 $500 $0 CY10 CY11 CY12 CY13 CY14 Behavioral Health Physical Health State Coverage Initiative Coordination of Long Term Services Behavioral Health Medicaid Expansion Physical Health Medicaid Expansion Source: HSD Capitation Payments by Plan by Cohort Report Note: According to HSD, CY14 managed care payments includes costs associated with retro eligibility previously recorded as FFS expenditures that will be reconciled. 4
LFC estimates a Estimated Medicaid Managed Care Enrollment growing Medicaid 800,000 budget for the 700,000 foreseeable future due 600,000 500,000 to: 400,000 ◦ Increased enrollment and 300,000 ◦ Phasing down of federal 200,000 matching funds between 100,000 2017 and 2020 for 0 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 expansion. Source: HSD Aug 2015 Projection Managed care enrollment will The GF need for Medicaid will grow beyond $1 billion by FY18 approach 800K by FY18 5
Actual and Projected General Fund Impact From Medicaid FY12 to FY20 (in millions) $1,400 Total General Fund (in millions) $1,164 $1,200 $1,111 $1,076 $977 $912 $1,000 $891 $891 $867 $849 $800 $600 $400 $200 $0 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 Projected Source: LFC 2015 Post Session Review and HSD Medicaid Projection Note: FY12-FY14 are actuals, FY15 is operating budget In FY97, Medicaid accounted for In FY15, Medicaid accounted for about 6% of GF Appropriations about 15% of GF Appropriations 6
Centennial Care was originally estimated to bend the cost curve by up to 4% or $670 million over 5 years. ◦ Subsequent estimates revised savings to a total of $257 million. Implementation of cost savings components have been problematic. Waiver r Savings gs Total Impleme mentat ntatio ion n Status Initiati tives ves Projecte cted Savings ngs Care Coordination $31 million 47% of enrollees reached in first year Health Homes $37 million Delayed 2 years and number of planned Health Homes cut in half ER Copay $3 million Not implemented Total $71 million 7
Care Coordinators: Reasons for Incomplete Care ◦ Assess health risks and Coordination Tasks needs; Client ◦ ID services and develop care Refused 9% plans; and ◦ Consult with member’s providers and assist with Not Yet access. Contacted Unreachable by MCO 65% 26% HSD stated care coordination would save $31 million over five years by providing efficient and appropriate care. Source: MCO Q4 CY14 Care Coordination Reports 8
Health homes are a key component of Centennial Care-expected to reduce costs by $36.6 million. Originally health homes and payment reform projects were performance metrics for contract incentives, but were later removed. The number of planned health homes was cut from four to two and implementation delayed by at least two years. 9
PMPM costs are projected to be higher in FY16 compared to FY14 for all service areas except behavioral health. Managed care reporting includes fewer utilization categories, and categories are not comparable across years. Utilization data that can be compared indicates cause for concern for behavioral health. 10
Physical Health Capitation Average PMPM and MCO Average PMPM Expenditures CY10-CY14 $340 $322 $320 $300 $280 $278 $280 $265 $265 $277 $260 $240 $248 $236 $220 $231 $231 $200 2010 2011 2012 2013 2014 Capitation PMPM (Total HSD Capitation Payments/ Member Months) MCO Expenditure PMPM (Total MCO expenditures/ Member Months) Source: LFC Analysis of HSD 30A and CC Financial Reports Note: Capitation reported by MCOs do not tie to the actual cap rates because of revenue accruals (expected to receive as well as amount expected to pay back to HSD). 11
Multisystemic Therapy Spending Comprehensive Community and Clients Served Ages 0-18 Support Service Spending and Clients Served Ages 0-18 $2.50 500 HSD Suspends Unduplicated Clients Served 450 $2.00 4,000 HSD Suspends Total Spent (in millions) Payment to 15 Unduplicated Clients Served Total Spent (in millions) $1.80 $2.00 400 Payments to 15 3,500 Providers $1.60 350 Providers 3,000 $1.40 $1.50 300 2,500 $1.20 250 $1.00 2,000 $1.00 200 $0.80 1,500 150 $0.60 1,000 $0.50 100 $0.40 500 50 $0.20 $0.00 0 $0.00 0 Unique Members Served Unique Members Served Total Spent Total Spent Source: OptumHealth CI-09, CC Report 41 Source: OptumHealth CI-09, CC Report 41 Evidence-based treatment According to HSD, CMS says CCSS is “medically necessary” providing $3 to $1 ROI 12
SSI Recipients 0-1 Years of Age Male and Female (Cohort 006) Physical Health Capitation Rate CY14 $7,000.00 Rates set differently $6,800.00 within rate ranges for Weighted Average PMPM Rate $6,600.00 each MCO for the same Upper Bound $6,400.00 populations. Best Estimate $6,200.00 HSD could have saved $6,000.00 Lower Bound $28 million general $5,800.00 fund by setting rates at $5,600.00 the lower end of the $5,400.00 range. $5,200.00 MCOs sometimes $5,000.00 MCO A MCO B MCO C MCO D receive above the best Note: Revised rates retroactive to January 1, 2014 Source: CY14 MCO Payment Rates- Percentile Summary estimate and at the upper bound limit. Example of one MCO receiving a rate at the upper bound limit 13
Savings and Revenues Identified in Medicaid Expansion States Savings: Revenue Gains: SFY 2015 SFY 2015 Total Savings State (in millions) (in millions) and Revenues Arkansas $88.7 $29.7 $118.4 Colorado $160.3 $0.0 $160.3 Kentucky $83.1 $0.0 $83.1 Michigan $238.6 $26.0 $264.6 Oregon $137.5 $0.0 $137.5 Washington $318.6 $33.9 $352.5 Source: Robert Wood Johnson Foundation 14
For SFY16, NM’s $5.5 billion Medicaid budget was appropriated in two line items. In contrast other states ◦ Budget based on service population: AZ=26 line items CO=21 line items NV=51 line items ◦ Provide specific information on enrollment by type of client and cost. ◦ Have more transparent projection processes. For example, in WA the caseload forecast council, a small independent agency has ultimate authority for entitlement forecasts. 15
Strateg tegy Potent ntia ial l Savings gs Setting rates at the lower end of $28 million of general fund could actuarially sound rate ranges have been saved in CY14. Negotiating lower costs for high $70 million would equate to a 50% priced drugs such as those for reduction in costs estimated by Hepatitis C (e.g. IBAC negotiated a HSD actuary. 50% reduction) Implementing health homes $118 million over 2 years through targeting Medicaid patients with increased federal match. diabetes Examine whether the 85/15 A 1% reduction in MLR could save Medical Loss Ratio requirement is $37 million. appropriate as efficiencies are gained A forthco comin ing g LFC evaluati ation on will identify fy additional al Medicaid id leveragi raging ng and cost saving opportuni nities ies 16
Medicaid costs are growing and cost containment measures are falling short. Increased attention is needed for: ◦ Cost containment strategies, ◦ Utilization and performance data, and ◦ Legislative input for budgeting, program changes, and proposed expansions. 17
Recommend
More recommend
