Medicaid initiative pays up front

Practices paid a per-patient fee for coordinating care

Since last fall, dozens of public and private healthcare clinics around the state have been getting extra payments from Medicare, Medicaid and private insurance companies to better coordinate patient care.

Starting in October, Medicaid officials hope to enroll dozens more clinics in a similar program.

The programs, part ofthe state’s patient-centered medical-home initiative, put doctors in charge of teams responsible for coordinating a patient’s care.

In exchange for quarterly payments, the doctors agree to take steps such as making sure patients get preventive health screens, coordinating care among providers and providing around-the-clock phone access to a medical professional.

Starting in 2015, both programs also will include additional payments for clinics that meet targets for keeping patients’ overall health-care costs low.

One of the first participants is the SAMA Health-Care Services, an El Dorado clinic that expects to receive $493,000 in payments this year under the federal Comprehensive Primary Care Initiative, which started last fall.

The clinic has used themoney to hire more staff, including four nurses who act as care coordinators.

Clinic administrator Pete Atkinson said that when a patient makes an appointment, the care coordinator is “looking at that person and seeing, do they need vaccination, do they need a mammogram, do they need a colonoscopy?”

As a result, he said, “When a patient walks in the door, we already know what all they need, and a lot of times we’ve even scheduled some of that or started to prepare for that.”

The initiatives are part of the state’s plan for curbing the growth of spending in the Medicaid program, which provides health coverage for about 680,000 Arkansans, including disabled people, the elderly poor and children from low-income families.

In the fiscal year that ended June 30, that spending totaled almost $4.7 billion.

About 30 percent of Medicaid’s costs in Arkansas are paid from state tax dollars, with the rest coming from the federal government.

The medical-home initiative began last fall when 69 practices in Arkansas began receiving the quarterly payments under the Comprehensive Primary Care Initiative.

Led by the Centers for Medicare and Medicaid Services’ Innovation Center, which was created by the 2010 federal health-care overhaul law, the pilot project also includes practices in Colorado, New Jersey, Oregon, New York, Ohio, Kentucky and Oklahoma.

Medicare’s payments to the practices under that program average $20 per month for each Medicare recipient served by the practices, including 54,000 Medicare recipients in Arkansas.

In Arkansas, the Medicaid program, Arkansas Blue Cross and Blue Shield, Qual-Choice Health Insurance and Humana also contribute quarterly payments to the participating practices.

Medicaid’s payments are $3 per month for each patient younger than 21 and $7 for older patients. The 41,000 Medicaid recipients include about 33,000 children and 7,800 adults, said Amy Webb, spokesman for the state Department of Human Services.

Since October, Medicare has made payments to the clinics totaling $13.1 million, and Medicaid has paid $1.7 million, according to the Centers for Medicare and Medicaid Services.

The state insurance plans for state and public-school employees will begin making payments under the program next year, said Doug Shackelford, interim director of the state Department of Finance and Administration’s Employee Benefits Division.

The plans have budgeted about $3 million for the program for next year, but the amount the plans will pay doctors on behalf of each enrollee hasn’t been decided, he said. Setting aside the money added about $3 to the premium of each enrollee under the rates approved by the State and Public School Life and Health Insurance Board last week, he said.

In October, Medicaid officials hope to begin enrolling about 40 additional practices serving about 100,000 Medicaid recipients in a similar program, described as the second wave of the patient-centered medical-home initiative.

Beginning next year, the practices will be paid an average of $4 per month for each Medicaid recipient they serve, with higher payments for patients who are older or have a history medical problems and lower payments for younger, healthier patients.

Practices that pay a company to help them implement changes will be eligible for an additional $1 per Medicaid recipient per month.

The payments are expected to total about $60 million through 2017.

Practices serving at least 5,000 Medicaid recipients and that meet targets for keeping the cost of their patients’ care low will also be eligible for extra payments that will start in 2015.

Up to two practices can team up to meet the 5,000-patient minimum. The performance-based payments are expected to total about $15 million over three years.

Practices with costs above the targets will not be penalized.

Eventually, state officials expect all of the state’s primary-care practices to enroll in the program.

Webb said the Human Services Department hopes Medicare and private insurance companies also will contribute payments to clinics in the program.

Starting in 2015, the quarterly payments will be mandatory for companies offering plans on the the state’s health-insurance exchange being set up under the 2010 Patient Protection and Affordable Care Act.

Arkansas Blue Cross and Blue Shield, the Chicago-based Blue Cross and Blue Shield Association, St. Louis-based Centene Corp.’s Celtic Insurance Co. and Little Rock-based QualChoice Health Insurance have applied to offer plans on the exchange for coverage that will begin in January.

More than 500,000 Arkansans are expected to be eligible for subsidized coverage through the exchange, including about 250,000 adults who will be eligible to have their premiums paid by Medicaid under the Medicaid expansion law passed by the Legislature this year.

Paying doctors up front to better coordinate care will lead to healthier patients and reduce costs in the long run, Arkansas Surgeon General Joe Thompson said.

“The fee-for-service system is upside down,” Thompson said at a meeting with doctors and other healthcare providers earlier this month. “What we want to do is right-side it, so that the clinicians whoare managing the care in the best way at the local level are receiving the most financial gain.”

Medicaid Director Andy Allison added that, in the past, “we really have not paid for total patient care. We have paid for minutes in an office.”

The state Medicaid program applied to the Centers for Medicare and Medicaid Services for approval of the initiative on Aug. 15, when it also published proposed rules for the program.

The Human Services Department will accept written comments on the proposal through Sept. 13. A public hearing on the program will be held at 5 p.m. Sept. 10 in the auditorium of the University of Arkansas Cooperative Extension Service, 2301 S. University Avenue in Little Rock.

The department expects to submit the program rules to the Legislative Council this fall.

Anthony Johnson, a Little Rock pediatrician, said he hopes the initiative will provide his practice with more money to coordinate patient care, but he noted that he would likely have to hiremore staff to keep up with the required documentation.

Noting that Medicaid recipients make up less than half of his patients, he said private insurance companies would need to contribute payments to make participation feasible.

“If it is just Medicaid, and the private payers do not participate in all of that, I don’t think it’s going to be enough money to do it,” he said.

Arkansas Blue Cross and Blue Shield plans to expand its participation in the medical-home initiative, but “possibly not on the same timelines as Medicaid,” company spokesman Max Greenwood said.

She said the company’s “resources are being pushed to the limit” by preparing for Oct. 1, when enrollment will begin in plans offered on the insurance exchange.

QualChoice Chief Executive Officer Mike Stock said his company supports the concept of patient-centered medical homes but hasn’t decided whether to participate in the expanded initiative.

“There are lots of different cost-containment models and strategies being developed around the country,” Stock said. “Some of the ones here in Arkansas are just an example of what the industry as a whole is trying to do.”

QualChoice and Arkansas Blue Cross are also participating in a Medicaid-led initiative that tracks the costs associated with providing certain “episodes of care,” such as hip replacement or treatment of congestive heart failure.

Under that initiative, providers are rewarded for keeping their average cost of treating an episode of care below a specified range or penalized for exceeding it.

Altogether, changes to Medicaid’s payment system, including the episodes-of-care and patient-centered medical-home initiatives, are expected to slow the growth of spending in the program by about 2 percent a year - adding up to more than $1 billion annual savings within a few years, Webb said.

Already, she said, theComprehensive Primary Care Initiative has brought about “dramatic changes” at some practices.

She pointed to SAMA HealthCare Services as an example.

Atkinson said his clinic has used the payments under the Comprehensive Care Initiative to hire eight nurses, including four licensed practical nurses who work as case coordinators, and plans to hire two more nurses in December.

After those hires are made, each of the clinic’s four physicians will be in charge of a team that includes a nurse practitioner, a care coordinator and three other licensed practical nurses.

The clinic has spent about $40,000 creating offices for each care coordinator. Nurses wear the uniforms of their team’s color - red, blue, orange or purple.

Nancy New, the clinic’s data coordinator, checks patient records to see who is due for a bone-density scan, pap smear or other screening. She gives the information to the care coordinators, who then contact the patients to remind them.

New said the clinic has already recorded improvements in measures of patients’ health, such as the number of diabetics whose blood glucose level is kept under control.

Wanda Ragsdale, 76, said her doctor at the clinic made wellness plans for her and her husband, Bob, that includes recommended dates for flu vaccines and health screenings.

She said she and her husband appreciate that the clinic has weekend hours and can fit them in quickly for an appointment when one of them is sick.

She added that her husband, who had heart surgery a few years ago, frequently communicates with his doctor about his appointments with specialists.

“It’s just an all around wonderful family clinic,” Ragsdale said. “You get the feeling that you’re part of the family.”

Front Section, Pages 1 on 08/25/2013

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