The Affordable Care Act (ACA) opened the door to an improved Medicaid Managed Care system. However, while the health law fundamentally transformed the health insurance policy landscape, the Commonwealth Fund concludes that state Medicaid programs still carry a heavy burden, since the Medicaid population is poorer and faces high health risks. Because of these risks, the likelihood for challenges such as reaching medically underserved communities, unstable eligibility and enrollment, developing effective payment incentives, organizing coverage, aligning managed care with health, education, and social services, as well as those relating to information technology (IT) is likely. In this blog, we examine the impact of Medicaid Expansion in the state of Kentucky, its current reform initiatives (e.g. 1115 Waivers), and recommendations to resolve common challenges faced by MCOs across the country.
Kentucky implemented traditional Medicaid Expansion in 2014 under the ACA, which led to a substantial increase in Medicaid enrollment. According to the state, subsequent to this: additional Federal funding was allocated to federally qualified health centers; Medicaid reimbursement for primary care was increased; and major policy changes that were aimed at expanding the supply of behavioral health services were executed.
Coverage eligibility is available to children or pregnant women; aged, blind, or disabled people; or people who have income levels that fall below 138 percent of the federal poverty level (individuals that make less than $16,394/yr. and families of four with an annual household income below $33,534/yr). According to Kaiser Family Foundation, 91% of Medicaid enrollees, or nearly 1,205,548 enrollees, in Kentucky are currently enrolled in managed care – a program in which 5 managed care organizations (MCO) participate. This includes Aetna Better Health, Anthem Kentucky, Humana CareSource, Passport Health Plan, and WellCare of Kentucky.
While the health law fundamentally transformed the program, in December 2015 the state decided to pursue a Section 1115 waiver to alter the state’s traditional Medicaid following the election of Governor Bevin. On June 22, 2016, the state released a waiver which became known as Kentucky Helping to Engage and Achieve Long Term Health (HEALTH). By late August, Governor Bevin officially submitted the waiver application to the Centers for Medicare and Medicaid Services (CMS), where it is currently in a pending state. According to Medicaid experts in the state, the waiver is expected to be approved in the coming weeks.
On July 3, 2017, Kentucky submitted an amendment proposing several changes regarding its pending waiver application to the new Administration. These modifications would affect Medicaid expansion enrollees and traditional non-disabled Medicaid enrollees, Section 1931 low-income parents, pregnant women, and Medicaid and CHIP-eligible children. If approved, the state would move away from traditional expansion which covers more than 2 million people (22% of the total population to a waiver; this includes 194,100 (25%) of Kentucky’s Medicare enrollees who are also covered by Medicaid. This accounts for nearly one-third (31%) of Medicaid spending.
With over 74,550,529 Medicaid and CHIP beneficiaries across the country, Medicaid programs have evolved to become highly complex, multibillion-dollar enterprises. Today, some states are implementing a wide range of initiatives to coordinate and integrate care beyond traditional care. One such method is the 1115 Waiver, which focuses on improving care for populations with chronic and complex conditions, align payment incentives with goals, and drive accountability for quality care and coverage.
There are many changes on the horizon for Medicaid, including a proposal to allow people to “buy in” to Medicaid. While Medicaid buy-ins exist today, through the Family Opportunity Act, which allows families earning up to three times the poverty level to purchase Medicaid for their disabled children who are not eligible. Senator Brian Schatz (D-Hawaii) is currently pushing a federal Medicaid buy-in plan. If approved, his proposal would provide states with the option to allow people with incomes over the thresholds for eligibility to pay a premium to join the program. Additionally, his plan would help raise the amount Medicaid pays to doctors, hospitals, and other health care providers up to the amount it pays for Medicare patients.
Looking at the various approaches being discussed, the capabilities of MCOs around the country to handle such scenarios with existing technological investments, can pose real challenges because their systems were never intended to handle these processes. The ability to make quick business rule changes to accommodate new guidance and/or different programs to remain in compliance often becomes a critical yet daunting task. Leading enrollment and premium billing systems can solve for this gap, allowing MCOs to adapt to the new regulatory environment, generate invoices for members, and collect and manage member premium payments. Moreover, it allows MCOs to focus on processes that work toward improving the service and care offered to their beneficiaries.
If you are interested in this, consider reaching out to technology vendors that recognize the challenges that payers face in today’s consumer-driven environment, such as being able to deliver an intelligible financial management and payment platform to their members. As we’ve touched upon, outdated billing systems that are still in use today have restricted the efficiency of financial transactions in the healthcare industry. Look for PCI DSS 3.1 financial management and payment platforms that are both consolidated and user-friendly. To harmonize the billing and payment processes between the payer and their members, the solution should provide accounting oversight in an easy-to-use automated premium and offer subsidy reconciliation. Additionally, leading platforms are often combined with an enrollment and remediation solution. Together, they should help to significantly reduce administrative burdens, while also delivering payers with the ability to monitor the lifecycle of an enrollment transaction, resolve data exceptions, search historical records, and much more. To learn more, contact email@example.com.
The views and opinions expressed by the authors on this blog website and those providing comments are theirs alone, and do not reflect the opinions of Softheon, Inc. or any employee thereof.
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