How Georgia Administers Medicaid-Managed Care

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Just before Frank Berry stepped down as head of Georgia’s Medicaid agency this summer, he said the state will “seek the best value” in its next contract with private insurers to cover the most vulnerable. of State.

This story also appeared in Georgia Health News

But whether the state – and Medicaid patients – get the best deal on Medicaid is up for debate.

Georgia pays three insurance companies – CareSource, Peach State Health Plan, and Amerigroup – more than $ 4 billion in total each year to administer the federal health insurance program for low-income residents and people with disabilities. As a group, state insurers made an average of $ 189 million per year in combined profits in 2019 and 2020, according to insurer records registered by the National Association of Insurance Commissioners (NAIC). Yet Georgia lacks some of the financial safeguards used by other states.

“Compared to other states, the Georgia Medicaid market is an attractive business proposition for managed care companies,” said Andy Schneider, a research professor at the Center for Children and Families at Georgetown University.

Georgia is one of more than 40 states that have turned to managed care companies to control Medicaid costs. These contracts are typically among the largest in these states, with billions of government dollars going to insurance companies. Insurers assume the financial risk and administrative burden of providing member services in exchange for a fixed monthly fee paid for each member.

Health plans, however, have at times raised questions about both spending and the quality of care provided to Medicaid members.

“The transition to managed care was supposed to save states money, but it’s not clear that it did,” said Katherine hempstead, Senior Policy Advisor at the Robert Wood Johnson Foundation. (KHN receives financial support from the foundation.)

States can require Medicaid insurers to reimburse money if they do not meet a specified per patient spending threshold. This threshold is generally 85% of the amount paid to insurance companies, the remainder being spent on administration and profits.

But Georgia does not require its Medicaid insurers to meet a specific spending target for patient care, a report by the Federal Inspector General noted. Although Georgia tries to ‘recover’ $ 500 million paid to his Medicaid insurers, he could have lost recovery dollars, the report says.

And official documents show that Peach State, which now has the highest number of Medicaid registrations of the three insurers, did not hit the 85% mark from 2018 to 2020.

Overall, Medicaid’s “medical loss report” in Georgia, which assesses the amount spent on claims and patient expenses, was fifth from the nation’s bottom last year, behind Mississippi alone; Washington DC; Wisconsin; and Arkansas, according to data from the Association of Insurance Commissioners. Spending rate for patient care in the state increased from 82.9% to 80.8% in 2020. (The NAIC uses a different ratio calculation method than state and federal governments.)

“Georgia Medicaid’s HMO benefits are very healthy,” said Allan Baumgarten, analyst and independent consultant.

When asked if Georgia has a spending requirement in the new contract, Fiona Roberts, spokesperson for the Department of Community Health, who heads Medicaid, said “a number of considerations are being discussed.” She noted that the state with a low medical claims rate does not necessarily translate into “unreasonable profit” for insurers.

Insurers also make money through their management service companies. In 2020, insurer Peach State paid a subsidiary of its parent company, Centene Management Company, $ 114.7 million for administrative services. The nonprofit CareSource paid its management services company $ 86.5 million in 2020.

“Fees paid to subsidiaries represent another source of income for parent companies,” said Baumgarten. “And it’s done in a way that doesn’t allow the state to hold HMOs accountable.”

The states latest performance data, which covers 2019, shows that plans have done as well or better than the national median on many measures, including on access to a primary care provider.

But low birthweight rates appear to be on the rise despite the state’s goal of reducing them to 8.6% or less. Companies hovered on average around 9.8% in 2019, the latest data available.

“We continue to hear stories from families and health care providers about children in Medicaid-managed care who have considerable difficulty getting the services they need – whether it is drugs to control their health. asthma, to connect to behavioral health care after a mental health crisis in the emergency room, or a number of health issues, ”said Melissa Haberlen DeWolf, who leads research and policy at Voices for the Children of Georgia advocacy group.

Compared to other states, Georgia has a unbelievably low rate refer poor children to specialized Medicaid services, according to a recently released report Report of the National Health Law Program. DCH recently said it was investigating why the rate is so low.

And, currently, the state is reporting low Covid vaccination rates for those 12 and older covered by Medicaid managed care companies. A status display shows that the rates for the three companies are each less than 10%, well below the overall rate for Georgia.

The companies, when asked about profitability, quality of care and administrative costs, referred a reporter to Jesse Weathington, executive director of the Georgia Quality Healthcare Association business group. He said he could not comment on the financial performance of individual companies.

“Our goal is to continue to improve quality and achieve positive patient outcomes in the most cost-effective way for the taxpayers who fund Georgia Medicaid,” said Weathington.

Georgia is expected to open the high-stakes bidding process on a new Medicaid contract next year. The tendering process is generally fierce and the results often contested.

It is not known, however, when Georgia’s new contracting process will be completed, as deadlines have skyrocketed in several other states. North Carolina rolled out its managed care system on July 1 after two years of delay. It will spend $ 6 billion a year, the largest contract in the history of the state health agency.

Last year, Louisiana’s contracting process collapsed after losing insurers contested the results. And Centene and other companies are protest Pennsylvania’s decision not to award them contracts, which delays implementation.

Centene, based in St. Louis, has more Medicaid managed care business nationwide than any other company. Centene acquired WellCare, a Medicaid insurer in Georgia last year, then closed that operation in May.

Centene also faced questions about overcharging. Ohio Settled $ 88 Million Pharmacy Fraud Lawsuit Against Centene months before awarding him a contract, while the Mississippi settled with her for almost $ 56 million. Georgia is now expected to recover money under the billion dollars that Centene set aside to be settled with other states affected by overbilling pharmacies.

Consumer groups want the state to take stronger action to improve the health of those who depend on Medicaid and make agreements with insurers more transparent.

“Medicaid members are best served when they have easy access to providers, insurers are keen to meet their health care needs, and policymakers exercise close oversight to ensure health and safety. well-being of members takes priority over profits, ”said Laura Colbert, executive director of Georgians for a Healthy Future, a consumer advocacy group.

A bill that sought to bring more transparency and accountability to state health care plans was vetoed last year by Governor Brian Kemp. The legislation would have allowed a committee to review the files of health care providers and compel the state to answer questions about them. Kemp said the bill would violate the doctrine of the separation of powers between the executive and legislative branches of government.

This story available through a partnership with Georgia Health News.


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