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Sir medicaid opportunity presentation


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Sir medicaid opportunity presentation

  1. 1. Society of Insurance Research Conference: The Business Opportunity that Health Reform created in Medicaid Managed Care November 16, 2010 1
  2. 2. How to Get Excited about the Medicaid Opportunity • Half of the formerly uninsured will be insured through Medicaid – Estimate of 15 of the 32 million newly insured • Medicaid will be 17% of the national insurance market – Individual commercial insured will be 10.7% and Small Employer group will be 13% • Medicaid and Individual commercial plans will be linked in the exchange and through eligibility – Today’s fully subsidized individual may be tomorrow's Medicaid eligible • States are looking for Medicaid Managed Care plans to take the membership and the risk • Provides additional patients and dollars for delivery system initiatives around medical home, ACO’s, and other care transformation – Funds future R&D Source: McKinsey and AHIP 2
  3. 3. Florida’s response to the Medicaid Opportunity As costs rise, lawmakers eye HMOs Posted on Sunday, 02.28.10 Some legislators are pushing to put the growing number of Medicaid recipients into HMOs to save money, but others say the change might not reduce costs. BY MARC CAPUTO Herald/Times Tallahassee Bureau This is the year of big talk about healthcare. And potentially bigger profits for HMOs. As Medicaid swells in cost and number of recipients, some Republican legislative leaders are increasingly interested in putting more of the program's patients into HMOs, giving the private companies more control over the state-federal program for the poor. Read more: lawmakers-eye-hmos.html?story_link=email_msg#ixzz13ZselGgU 3
  4. 4. Medicaid Landscape and Definitions Maintenance of Effort clause is the source of the state’s complaints about budget impact • Federal Poverty Level (FPL): 100% Federal Poverty Level is currently $10,830 for the lower 48 states. Eligibility will be increased to 133% Federal Poverty Level which is $14,404 for a single individual. • Federal Matching Funds (FMAP): matching funds that the federal government provides for every dollar spent by the state. On average, the federal government covers 57% of funding. • American Recovery and Investment Act Impact: Increased FMAP to states from 50%-76% to 61%-84% through December 2010, 100% in 2014-2016 and then phases down. • Maintenance of Effort (MOE) clause: Effective 3/23/2010 when reform was passed, states are prohibited from reducing Medicaid eligibility. As a result, states can no longer use Medicaid eligibility as a lever to balance budgets. • CHIP: Children’s Health Insurance Program extended to 2015 and for children up to 200% Federal Poverty Level. • New eligibles: 13 million adults (2.9 million parents and 10.1 million non-custodial adults). 4
  5. 5. Medicaid Timeline Below are the start and end dates that provide funding for new opportunities 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Funding available for Medicaid Medical Homes (90% FMAP for first 2 years) Integrated Care Around Hospitalization Demonstration Grant Program for Chronic Disease Prevention Pediatric Accountable Care Demonstration Project FMAP bonus for new Home Community-Based Services (options start in 2010) PCP's paid 100% Medicare with 100% Federal Match Reduction DSH payments for hospitals Federal Matching funds phase to 90% by 2020 100% Federal Matching Funds to states (FMAP) State Option to expand Medicaid coverage to 133% FPL Mandatory expansion of Medicaid coverage to 133% FPL Source: AHIP 5
  6. 6. Expansion Opportunity by State Opportunity combination of existing eligibility and state population State New Medicaid Eligibles California, Texas, Florida 1 million+ Georgia, North Carolina, Illinois, Michigan, Ohio, Pennsylvania 500,000-1 million Washington, Missouri, Louisiana, Indiana, Tennessee, Alabama, South Carolina, Virginia, New Jersey 300,000-500,000 Oregon, Nevada, Utah, Colorado, New Mexico, Nebraska, Kansas, Oklahoma, Arkansas, Iowa, Minnesota, Wisconsin, Kentucky, Mississippi, West Virginia, Maryland, Connecticut 100,000-300,000 Idaho, Arizona, Wyoming, Montana, North Dakota, South Dakota, New York, Delaware, Massachusetts, Rhode Island, Vermont, New Hampshire, Maine, Alaska, Hawaii 100,000 or less Source: Ingenix Consulting/Lewin Group 6
  7. 7. State-by-State Impact Impact will vary based on state’s current eligibility requirements for adults Eligibility* State Impact Limited coverage for adults: Eligibility for parents is below 100% Federal Poverty Level Alabama, Arkansas, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, Texas, Utah, Virginia, Washington, West Virginia, Wyoming • Decrease uninsured adults by 48%-53% • Increase in state spending by 3%-3.6% from 2014- 2019 Broader coverage for Adults: Parents at or greater than 100% FPL are eligible. Childless adults are not eligible. California, Connecticut, DC, Illinois, Maryland, Minnesota, New Jersey, Rhode Island, Tennessee, Wisconsin • Decrease uninsured adults by 41%-45% • Increase in state spending by 1%-1.5% from 2014- 2019 Expansion states: currently all adults up to 100% FPL (parents and childless adults) Arizona, Delaware, Hawaii, Massachusetts, Maine, New York, and Vermont • Decrease uninsured adults by 10%-15% • Decrease in state spending by 0%-2% Source: Kaiser Family Foundation * For Medicaid programs only. Does not include state-sponsored premium assistance programs for working adults or limited insurance programs in Connecticut, DC, Indiana, Iowa, Maryland, Michigan, Minnesota, New Mexico Oregon, Pennsylvania, Utah, Washington, or Wisconsin since these are outside of the scope of reform 7
  8. 8. New Medicaid Enrollees: Similarities and Differences Medicaid enrollee characteristics have already started to shift Current Enrollees New Enrollees Average age is 30-50 Younger More complicated chronic conditions Combination of lower utilizers of care and complicated medical issues Typically access care through the Emergency Room Have experience with using primary care and managing chronic conditions Typically unable to work due to FPL threshold or other reasons Working Poor Children, TANF, pregnant women, Medicare/ Medicaid Duals Adults 50%-60% Mental Health Conditions Ethnically and Culturally Diverse Phone-based disease management will not be effective due to lack of consistent phone number Mobile and move often Source: Health Plan Week, Atlantic Information Services, Sept 20, 2010 8
  9. 9. Health Plan Opportunity Assessment: The questions a health plan needs to ask (and hopefully answer) before entering or expanding • What will the new class of eligibles be like in terms of utilization, how they access services, and how they select a plan? – Not like the current Medicaid population in terms of ER utilization – Answers will vary by zip code • Where will they come from? – Formerly uninsured or formerly from commercial group? • What will the State Medicaid Departments require to play? – Participation in the Exchange – Benefit requirements – Managed care participation – Speed of implementation and level of interest • What are the products or benefits? – Benefits are typically mandated – Main decisions will be to partner or build in-house (Integration opportunity for carved out benefits) • How do I ensure provider capacity and the right providers to serve new eligibles? – This requires another slide Source: Ingenix 9
  10. 10. Provider Partnerships The Medicaid membership opportunity can provide an additional incentive to invest in new financing partnerships that are likely future methodologies • Reimbursement models that reward phone and mid-level practitioner (nurse and social worker) care and aren’t dependent on a physician visit – Full Capitation – Primary care capitation – FFS with quality or other incentives – Risk sharing model can help with any future MLR requirements • Reimbursement model can drive creation of team-based care – Nurse Case Management – Panel managers for outreach and appointment scheduling – Carriers can provide grants to encourage these models • Tap into other models that health reform is funding – Section 3022 of PPACA created Accountable Care Organizations (ACO’s) – Funding for Medical Homes • Risk Adjustment is a possible future funding mechanism 10
  11. 11. Federally Qualified Health Centers (FQHC) The role of the low income primary care infrastructure will grow and possibly compete with private providers • $11 billion available to double current FQHC capacity – Currently 1,080 FQHC’s serve 17.2 million patients with 66 million visits annually. This is expected to double – Lessons from Massachusetts, build the primary care infrastructure before expanding eligibility • FQHC’s bill at cost for Medicaid visits – Payment is FFS rate + wraparound payment for covered physician visit – Medicaid is their best payer • Formerly uninsured patients will become either Medicaid or subsidized individual commercial insured • Will start competing with private providers for patients with their expertise in chronic and complex care management – Build their own niche based on skills in culturally competent care, homeless, migrant farm worker population, or other special areas • Opportunities to contract for other lines of business such as Medicare Advantage, SNP, or high utilizing commercial groups 11
  12. 12. How to start an FQHC in your community An option to buying Independent Physician Associations (IPA’s) • Apply for grant with Bureau of Primary Health Care • Locate a Medically Underserved Area (MUA) • Provide required medical and enabling service including preventive, dental, case management, behavioral health, radiology, lab, prenatal care, transportation, interpretation, and medication • Service available regardless of ability to pay and maintain certain percentage of uninsured patients • Annual reporting requirements • Community Governance Board – This is the most difficult requirement for large health care organization to comply with 12
  13. 13. Top 20 Managed Medicaid Companies by Enrollment Enrollment is less consolidated than Medicare Advantage. Company Enrollment Company Enrollment United Healthcare 2,562,687 Aetna, Inc. 648,727 AMERIGROUP Community Care 1,604,741 Fallon Community Health Plan 617,000 WellPoint, Inc. 1,387,000 Blue Cross Blue Shield Tennessee 492,751 AmeriHealth Mercy/ Independence Blue Cross 1,360,100 Horizon Blue Cross Blue Shield 419,978 Molina Healthcare, Inc. 1,232,562 Fidelis Cares, Inc. 369,711 WellCare Group of Companies 1,164,000 Inland Empire Health Plan 356,297 Centene Corporation 1,074,433 Healthfirst, Inc. 355,024 HealthNet Inc. 878,000 CalOptima 344,982 LA Care Health Plan 754,907 MetroPlus Health Plan, Inc. 317,769 CareSource 737,415 MDWise 316,053 Source: Health Plan Week, Atlantic Information Services, Sept 20, 2010 Enrollment through end of 2009 13