Since 2007, and in the wake of the Great Recession, an additional 10 million Americans have enrolled in Medicaid, at the same time that states’ tax revenue declined.
But those long-plagued by Medicaid debt are starting to address their problems, several states are forging ahead with accountable care innovations and the consumer experience is becoming an increasingly important point of focus.
Indeed, states including Illinois, Colorado, Utah and Oregon, among others, are modernizing their systems to both embrace flavors of accountable care and drive patient empowerment.
Illinois
Medicaid issues in Illinois have been exacerbated by outdated Medicaid information systems, a lack of care coordination and long-running public financing problems.
Facing some $2.3 billion in unpaid Medicaid bills, on top of several billion in budget shortfalls and almost $100 billion in long-term unfunded public pension obligations, Illinois is perhaps the most striking example of Medicaid’s challenges — and the need for digital health technologies and consumer-focused services.
Although not as sweeping as state budget hawks would prefer, Illinois’ 2011 Medicaid reform law, in tandem with its budding statewide health information exchange, should go at least some way to crafting a more sustainable safety net program that reduces financial chaos for providers while improving patient experiences and outcomes.
By 2015, under the 2011 law, at least 50 percent of Illinois’ approximately 2.7 million Medicaid patients have to be in some form of integrated, managed or coordinated care, while the amount of year-over-year Medicaid carry-over debt is being limited to $700 million this year and $100 million in 2014. By June 30, 2014, Governor Pat Quinn is proposing to have all of the state’s current Medicaid debt paid off.
In the long-term, the Illinois Health Information Exchange (ILHIE) is going to be one of the main tools making that all possible by empowering clinical care teams and helping reduce administrative waste. Led by Ivan Handler, CTO of the Illinois Office of Health Information Technology, ILHIE is being developed as a quasi-public utility that will offer providers cloud-based exchange and care management solutions.
“Significant numbers of providers have already converted and are beginning to explore inter-connectivity outside their walls,” Handler said. “This process needs to continue and accelerate. After information is digital, everything else can begin to happen. Population health and preventive disease management should be an ultimate goal to strive for.”
The recent wave of Medicaid IT modernizations “represent a tremendous opportunity to avoid paving the cow path,” without considering new efficiencies and improvements.
Bruce Caswell, president of healthcare services at Maximus
As ILHIE gradually builds to scale, the Illinois Department of Healthcare and Family Services (DHFS) is transitioning Medicaid from fee-for-services to managed and integrated care in several phases, starting with Medicaid-eligible seniors and people with disabilities and now including beneficiaries in four regions across the state, with Chicago Medicaid members being transitioned to managed care at the beginning of 2014.
The state is expecting to save $200 million over five years from the managed care transition — not much, but a step in the direction of savings that should accrue over time when paired with a fraud-reduction program that state recently started.
Bringing accountable care to Medicaid
In addition to saving state funds, Illinois’ managed care transition is aimed at helping Medicaid recipients better prevent disease and manage chronic conditions and also introducing greater accountability into the healthcare system.
Illinois’ Medicaid program is not following an accountable care organization model, per se, but accountability is one of the goals of using capitated full-risk contracts, and other states are trying to craft Medicaid ACOs to go along with broader health reforms.
The first state to use Medicaid ACOs, Colorado created the Accountable Care Collaborative program in 2011, using a patient-centered medical home model that had enrolled about 132,000 of the state’s 620,000 Medicaid recipients by the middle of 2012.
In its first year, the program reduced ER rates, hospital readmissions and high-cost imaging services, lowered rates of asthma and diabetes and brought between $9 million and $30 million in savings, according to the Colorado Department of Health Care Policy and Financing.
The program includes seven regional collaborative care organizations (RCCOs) working with primary care providers, which all report to a data and analytics contractor. The state does reimburse primary providers with fee-for-service, but pays them a monthly per-member fee for home services and pays the RCCOs a monthly-per member fee, along with quality-based incentive payments.
Utah, after using partial- and no-risk Medicaid contracts in the 2000s, is now largely following Colorado’s model, starting its Medicaid ACO program in January.
Four ACOs, including Intermountain Healthcare’s managed care subsidiary Select Health and the University of Utah Health Care, are covering about 70 percent of the state’s 245,000 Medicaid beneficiaries, employing direct incentive payments to patients as a way to encourage cost-effective care — going to a clinic for non-emergency care as opposed to the ER — and improve self-management.
Among other states adopting or considering Medicaid ACO models, Oregon’s may be the most ambitious in scope. The Oregon Health Authority is using a global payment model to pay consortiums of providers and managed care plans to serve Medicaid and CHIP beneficiaries — with a required 2 percent reduction in the rate of growth in per capita Medicaid spending, from a 2011 baseline of 5.4 percent, by the end of their second year.
Of Oregon’s 600,000 Medicaid and CHIP members, 90 percent are enrolled in 15 coordinated care organizations (CCOs), and state health officials are hoping the program leads to a critical mass that will allow public workers, Medicare beneficiaries and even commercial health plan members to join the greater accountable care pool.
In Oregon and elsewhere, Medicaid ACOs may show stumbles and successes, which should help inform ACO models in general.
“It’s certain that some of these CCOs will succeed, and certain that some will not,” said Brian Ahier, a health IT evangelist at Mid-Columbia Medical Center in the Dalles, Oregon, who helped write the Oregon CCO law’s IT requirements.
“It’s an experiment in one of 50 states, but we’ve also got 15 different CCOs in Oregon that are really 15 little petri dishes,” Ahier added. “The ones that do well — those strategies then could either be adopted by other CCOs, or they can absorb other CCOs.”
"It goes beyond filling out a form for the Affordable Care Act provisions ... This isn’t rocket science, it could happen in the next two years.”
Jose Ramos, CTO and director of state health and human services, Northrop Grumman
A part of the ACO learning curve will be the use of IT tools like data analytics — and the integration of claims and clinical data that can offer a full view of patient health and care history, which has traditionally been unavailable to providers amid fragmented care, especially in Medicaid.
“If they’re under management and we have the claims data, we can identify and stratify them in risk, and prioritize how care teams manage,” said Philip Spinelli, senior sales VP at ikaSystems, a Southborough, Mass.-based firm offering cloud-based claims, billing and analytics services.
ikaSystems is working with a variety of commercial health plans, Medicaid programs and ACOs, including SCAN Health Care’s Medicaid-Medicare dual eligible members in California’s demonstration plan.
Amid the rise of shared savings and accountable care contracts, Spinelli said software needs are changing — requiring both health management tools and financial tools for determining payments, such as between Medicaid and Medicare in dual eligible demonstrations.
And the pressure is mounting: “Where people before were comfortable with 18 to 24 month windows, everyone has a shorter consolidated timeframe — a 6 month, 8 month entry to the market. Software-as-a-Service ends up enabling that,” he said.
Meeting the consumer in Medicaid information management
Amid the rise of consumer technology and online commerce, the healthcare industry as a whole is also facing pressure to redesign the consumer-patient experience.
Medicaid’s administration and policy, in addition to its underfunding in some states, has at times boded ill for patients — some unable to find primary care doctors because of low reimbursement rates in states like Illinois (a problem the Affordable Care Act is trying to fix by raising rates to Medicare levels for 2014 and 2015), and some struggling to navigate the healthcare system in general.
As states set up or start using new Medicaid information management systems, they should take a “very consumer-centric view,” said Bruce Caswell, president of healthcare services at the Reston, Va.-based firm Maximus, which operates as the Medicaid enrollment broker in 18 states plus Washington D.C. and provides a variety of government health services, including insurance exchange customer service.
Caswell, who worked at IBM before joining Maximus in 2004, said that the automated business processes that have emerged over the past decade can really help compliment Medicaid information management systems and improve the consumer experience — if the processes themselves are consumer-centered.
The recent wave of Medicaid IT modernizations “represent a tremendous opportunity to avoid paving the cow path,” or automating current processes as they are, without considering new efficiencies and improvements, Caswell said.
There’s the trend toward greater self-service — online or kiosk-based applications and benefits explanations — and there’s also a variety of IT tools for improving consumer service that does require human assistance.
“The less time you spend in a call-center establishing why an individual is calling, the better service you can provide,” Caswell said. “We’ve been able to mine the data in the system to see, for example, that that consumer had a letter mailed to them seven days ago, so they likely have received that letter and they’re calling with a question.”
Toward that same end, Northrop Grumman at HIMSS13 demonstrated Smart Navigator and SADIE, new software designed to address state’s communication needs for outreach and education, help citizens enroll in Medicaid and, ultimately, has the potential to serve as a personal health assistant, according to Jose Ramos, CTO and director of state health and human services at Northrop Grumman Information Systems.
Podcast: Medicaid ACOs, consumer service and HIE
Associate Editor Anthony Brino speaks with ILHIE CTO Ivan Handler about how the state's HIE is developing, then Maximus president Bruce Caswell on fitting iT with consumer services. And Colorado health officials weigh in on providing integrated care to Medicaid members.
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“SAdIE is a cognitive processing engine based on artificial intelligence,” Ramos explained, the same AI and technology that Northrup Grumman developed for the military and intelligence communities. SAdIE can interface with citizens and fill out Medicaid eligibility forms for them to lower the barriers to enrollment, particularly for the millions of Americans who qualify but either are unaware or do not know how to sign up.
“But it goes beyond filling out a form for the Affordable Care Act provisions,” Ramos added. Once people are in the system, SAdIE can then serve as a personal health assistant. Ramos envisions the day when people will interface with SAdIE via an array of mobile devices, TVs, computers to access health information including their EHR. “This isn’t rocket science, it could happen in the next two years.”
Whether tools from the likes of ikaSystems, Maximus, Northrop Grumman and others catch on that quickly or not remains to be seen. But there’s little doubt that states’ Medicaid services will be considerably more consumer-centric as they modernize IT systems.
And with the Obama Administration hoping to insure an estimated 32 million Americans through Medicaid and subsidized private insurance, focusing on the consumer experience may also be an avenue for state and federal health officials to increase patient engagement and empowerment — both of which are necessary for reforming Medicaid and the rest of American healthcare.
