The last of five companies that applied to provide health benefits for Medicaid recipients who are developmentally disabled or mentally ill has been approved to participate, Arkansas Insurance Commissioner Allen Kerr announced Monday.
Summit Community Care was formed by the Arkansas Provider Coalition, which is made up of more than 70 organizations that provide services to the developmentally disabled and mentally ill.
Amerigroup, a subsidiary of Indianapolis-based Anthem, is also an owner of the managed-care company.
"We're just excited to be able to be a part of this," Doug Stadter, president of the Arkansas Provider Coalition, said Monday.
Forevercare, Arkansas Advanced Care, Arkansas Total Care and Empower HealthCare Solutions have also been approved to participate in the initiative, designed to reduce the cost of caring for about 30,000 Medicaid recipients with expensive health needs.
Act 775, passed by the Arkansas Legislature this year, requires the managed-care companies to be at least 51 percent owned by health care providers, to contract with providers across the state and to have at least $6 million in reserves.
Under the first phase of the initiative, which starts in February, the companies will coordinate the care for Medicaid recipients in exchange for payments of $173.33 per patient each month.
In 2019, the companies will take over responsibility for covering all of the recipients' health care needs in exchange for larger payments from the Medicaid program.
Those payments, funded by federal and state money, will be subject to the state's 2.5 percent insurance premium tax, allowing the state to recoup some of what it pays out.
Medicaid recipients who will be assigned to the program include about 22,000 Arkansans with significant mental illnesses and 8,000 with developmental disabilities.
The state Medicaid program, which has a budget this year of about $7.6 billion in state and federal funds, spends about $1 billion a year on medical care and other services for those recipients, state Department of Human Services officials have said. The federal government pays about 70 percent of the cost for services for most recipients, with the state paying the rest.
The provider-led managed-care companies announced their participation plans in letters to the Insurance Department in June.
In his letter, Stadter, who is also chief executive of The Centers for Youth and Families in Little Rock, said the coalition formed in October 2016 to help the state develop the managed-care initiative.
The group's leaders "met regularly with [the Department of Human Services], legislators and the Governor's office to provide support and consultation toward the crafting of" Act 775, and also "designed a best practice standard for provider-led governance and ownership in the new model," Stadter wrote.
"Because of this seminal and substantial involvement, and under APC's leadership, the PASSE [Provider-led Arkansas Shared Savings Entity] is ideally positioned to contract with DHS to offer provider-led services with an emphasis on the governance and ownership priorities expressed by the Governor, the legislature, and DHS," Stadter wrote.
He said the coalition includes the Developmental Disabilities Provider Association, the Mental Health Council of Arkansas, the Arkansas Substance Abuse Treatment Providers Association, the Arkansas Behavioral Health Providers Association and the Inpatient Psychiatric Hospital Association.
Arkansas Advanced Care said in its letter that it is owned by the University of Arkansas for Medical Sciences, Little Rock; Arkansas Children's Hospital; Baptist Health; Arkansas Blue Cross and Blue Shield; and Fort Smith-based Bost Inc.
Arkansas Total Care is owned by the St. Louis-based Mercy health system; St. Louis-based Centene; and Life-Share, a Centene subsidiary that provides services to the developmentally disabled.
Empower Healthcare Solutions said its owners include Boston-based Beacon Health Options; companies owning more than 100 Arkansas nursing homes; several providers serving the developmentally disabled and mentally ill; and a coalition that includes Baxter Regional Health System, North Arkansas Medical System, Unity Health and White River Health System.
Forevercare is owned by a coalition of health care providers, including 11 of the state's federally funded community health centers, and Pittsburgh-based Gateway Health Plan.
Metro on 12/19/2017