Uneasy alliances: managed care plans formed by safety-net providers

A Leak in the Lifeboat: The effect of Medicaid managed care on the vitality of safety-net hospitals

States are increasingly adopting Medicaid managed care in efforts to address budgetary concerns. The intent is that by releasing Medicaid oversight to private organizations, competition will drive down healthcare expenditures so that savings may be passed to the state. Yet there are concerns that this competitive solution to cost savings might compromise safety-net hospitals. Managed care organizations cut costs by restricting the providers that enrollees are allowed to see. If movement in Medicaid patients disrupts safety-net hospitals' casemix, this could affect their ability to cross-subsidize care. This study estimates the impact of Medicaid managed care on safety-net hospitals by exploiting a Florida pilot program that required Medicaid recipients in five counties to enroll in managed care. The results suggest this mandate led to a small reduction in safety-net hospitals' average ratio of payment-to-cost. There is also some evidence that the effect on safety-net hospitals was disproportionate. This disproportionality was such that hospitals nearest the margin were pushed the furthest towards the edge.

Out-of-Network Emergency Department Use among Managed Medicaid Beneficiaries

OBJECTIVE

Out-of-network emergency department (ED) use, or use that occurs outside the contracted network, may lead to increased care fragmentation and cost. We examined factors associated with out-of-network ED use among Medicaid beneficiaries.

DATA SOURCES AND STUDY SETTING

Enrollment, claims, and encounter data for adult Medi-Cal health plan members with 1+ ED visits and complete Medicaid eligibility during the study period from 2013 to 2014.

STUDY DESIGN

We analyzed the data to identify factors associated with out-of-network ED use classified by mode of arrival (ambulance vs. nonambulance).

DATA EXTRACTION METHODS

We extracted encounter, ambulance, and ED census data and linked them together based on ED visit date.

PRINCIPAL FINDINGS

Of 11,143 ED visits, 6,808 (61.1 percent) were out-of-network. The number of hours the study ED was on ambulance diversion increased the odds of out-of-network visits for the 3,365 (30.2 percent) ED visits arriving by ambulance. For all visit types, assignment to a primary care clinic at the in-network hospital and having had any primary care visit during the study period decreased the odds of out-of-network ED care. Individuals were more likely to go out-of-network for ED care if they lived in neighborhoods containing out-of-network EDs.

CONCLUSIONS

There are a number of factors related to out-of-network ED use, including the proximity and density of out-of-network EDs, race and ethnicity, a prior history of out-of-network ED use, and individuals' connection to primary care. EDs that serve Medicaid beneficiaries may need to explore alternative sites and modalities of care as alternatives to the ED, and consider their ability to absorb large numbers of out-of-network visits given already limited capacity.

Transforming administrative and clinical practice in a public behavioral health system: an ethnographic assessment of the context of change

In July 2005, New Mexico placed all publicly funded behavioral health services under the management of one private corporation. This reform emphasized the provision of evidence-based, culturally competent services. Methods. Participant observation and semi-structured interviews with 189 administrators, staff, and providers were carried out in 14 behavioral health safety-net institutions (SNIs) during the transition period. Results. New administrative requirements led to substantial paperwork demands, payment problems, and financial stress within SNIs. Personnel at the SNIs often lacked knowledge about and training in evidence-based practices and culturally competent care, and viewed the costs of delivering such services as prohibitive. Discussion. Policymakers must account for the challenges that SNIs face as the reform continues to unfold. The financial stability of SNIs is of critical importance. Efforts are needed to increase training and development opportunities in evidence-based care and cultural competency; SNIs typically lack resources to pursue these opportunities on their own.

Political strategies of safety-net providers in response to medicaid managed care reforms

Safety-net providers play a central role in the U.S. health care system because they provide the bulk of services to the poor and the uninsured. The health policy literature focuses a great deal on the capacity of these institutions to provide services and the forces that shape these institutions and the services they provide, yet little is made of safety-net providers' potential role as advocates for the poor and for disadvantaged groups. In this article, we draw on findings from a case study of Medicaid policy making in Connecticut to explore efforts by safety-net providers and other nonprofit organizations to advocate around health care policy for the poor. Our findings illustrate how the capacity of nonprofit advocates to represent the poor can be compromised when the rules of the game change and nonprofit providers are asked to compete with for-profit organizations. We find that under a change in the contracting regime--from collaboration to competition--nonprofit service providers may increase political activity to secure a favorable role under the new regime, but these efforts may compromise their ability to act as representatives of the poor.

Medicaid managed care for mental health services: the survival of safety net institutions in rural settings

Few accounts document the rural context of mental health safety net institutions (SNIs), especially as they respond to changing public policies. Embedded in wider processes of welfare state restructuring, privatization has transformed state Medicaid systems nationwide. We carried out an ethnographic study in two rural, culturally distinct regions of New Mexico to assess the effects of Medicaid managed care (MMC) and the implications for future reform. After 160 interviews and participant observation at SNIs, we analyzed data through iterative coding procedures. SNIs responded to MMC by nonparticipation, partnering, downsizing, and tapping into alternative funding sources. Numerous barriers impaired access under MMC: service fragmentation, transportation, lack of cultural and linguistic competency, Medicaid enrollment, stigma, and immigration status. By privatizing Medicaid and contracting with for-profit managed care organizations, the state placed additional responsibilities on "disciplined" providers and clients. Managed care models might compromise the rural mental health safety net unless the serious gaps and limitations are addressed in existing services and funding.

State Medicaid managed care enrollment: understanding the political calculus that drives Medicaid managed care reforms

The objective of this article is to understand the political motivations underlying Medicaid managed care reforms by examining the determinants of enrollment of beneficiaries in managed care plans in the fifty states. To highlight the role of the model variables, including measures of the political environment, public interest, and special interests, a distinction is made between capitated and fee-for-service managed care enrollment. The results show that cost containment within the context of the Medicaid program is perceived as strongly favored by voters. Accordingly, the relative cost and tax price of providing Medicaid services are important factors in states' decision to enroll Medicaid beneficiaries in managed care plans, particularly capitated ones. The results also indicate a surprisingly significant influence by labor unions that generally oppose managed care enrollment for fears of lost jobs. The recipient population and provider groups also play an important role in shaping the Medicaid managed care landscape. The influence of variables measuring states' ability and willingness to pay and median voter preferences suggest that, within the context of Medicaid managed care enrollment, the public's interests are being served; however, the results also point toward inequities within the program and implications concerning financing arrangements between states and the federal government.

Uncompensated Care Provided by Emergency Physicians in Florida Emergency Departments

Uncompensated emergency department (ED) visits can negatively affect patients, clinicians, and hospitals, particularly as overcrowding occurs. Florida provides a unique market to analyze uncompensated ED care due to the high percent of for-profit hospitals, which typically provide significantly less uncompensated care, coupled with the older population that is more likely to be insured through Medicare. A survey of 188 Florida hospital emergency physician groups was conducted to estimate the level of uncompensated care provided by each ED physician group in 1998. The response rate was 44 percent (eighty-three ED physician groups). All ED physician groups provided substantial uncompensated care regardless of hospital ownership type. Uncompensated care averaged 46.8 percent and ranged from 25.8 to 79.4 percent. A model was developed to predict the amount of uncompensated care using ED volume and payer mix. A rise in the percent of self-pay patients causes a disproportionate increase in uncompensated care, such that EDs with high levels of self-pay visits have markedly higher uncompensated care rates. The results suggest the need for a uniform reporting method of ED physician uncompensated care cost.

The Safety Net of the Safety Net: How Federally Qualified Health Centers "Subsidize" Medicaid Managed Care

In this article, I examine the impact of neoliberalism and welfare reform on the delivery of Medicaid, specifically how the advent of Medicaid managed care (MMC) has been wrought with contradictions, placing increased burdens on primary safety-net organizations and impacting the many communities they serve. I argue that federally qualified health centers (FQHCs) operate as a primary safety net among safety-net providers, supporting and subsidizing New Mexico's MMC program financially and administratively. By presenting ethnographic data, I will demonstrate how FQHCs pay many of the hidden financial and institutional costs of the shift to managed care. Such findings uncover paradoxes inherent to neoliberal ideologies and privatization, raising questions about the efficacy of a managed care system for Medicaid as well as the future of the health care safety net and access to health care for the diverse populations it serves.

A Broader Vision For Managed Care, Part 3: The Scope And Determinants Of Community Benefits

Managed care plans have been encouraged to address the health of the communities in which they are located. This paper presents the first nationally representative portrait of health maintenance organizations' (HMOs') community benefit activities, based on survey data from 1999. We found that HMOs were engaged in a wider variety of community involvements than were identified in past legal decisions and legislation defining "community benefits" for health plans. The scope of community activities was broader for HMOs that enroll Medicaid recipients, are influenced by local business leaders, operate under nonprofit ownership, and are located in states with community benefit reporting laws.

Medicaid and managed care: a lasting relationship?

The Medicaid program made a major commitment to managed care during the past decade. Following turbulent early years, the marriage matured and stabilized because managed care models responded well to a number of the states' goals and Medicaid purchasers were willing to make key trade-offs on behalf of their beneficiaries that conformed to the designs of managed care products. The relative tranquility in Medicaid managed care contrasts sharply with turmoil in both the commercial and Medicare sectors. But continuing changes in the managed care marketplace and financial distress in state budgets present new challenges to the strength and durability of this relationship.

The evolving role and care management approaches of safety-net Medicaid managed care plans

This article provides new empirical data about the viability and the care management activities of Medicaid managed-care plans sponsored by provider organizations that serve Medicaid and other low-income populations. Using survey and case study methods, we studied these "safety-net" health plans in 1998 and 2000. Although the number of safety-net plans declined over this period, the surviving plans were larger and enjoying greater financial success than the plans we surveyed in 1998. We also found that, based on a partnership with providers, safety-net plans are moving toward more sophisticated efforts to manage the care of their enrollees. Our study suggests that, with supportive state policies, safety-net plans are capable of remaining viable. Contracting with safety-net plans may not be an efficient mechanism for enabling Medicaid recipients to "enter the mainstream of American health care," but it may provide states with an effective way to manage and coordinate the care of Medicaid recipients, while helping to maintain the health care safety-net for the uninsured.

Promising practices: how leading safety-net plans are managing the care of Medicaid clients

Health plans formed by safety-net providers serve large numbers of Medicaid beneficiaries. Through a series of case studies, we examined the care management tools used by leading safety-net plans. These plans do not rely on the coercive, command-style tools of managed care. They rely instead on tools that emphasize partnership with providers: sharing data about practice patterns, using provider profiles and financial bonuses to encourage particular practice patterns, and developing disease management programs that encourage patient compliance with treatment decisions that the plans make little effort to shape. The evidence suggests that these are promising practices but that even these leaders still have a long way to go.

Safety-net institutions buffer the impact of Medicaid managed care: a multi-method assessment in a rural state

OBJECTIVES

This project used a long-term, multi-method approach to study the impact of Medicaid managed care.

METHODS

Survey techniques measured impacts on individuals, and ethnographic methods assessed effects on safety-net providers in New Mexico.

RESULTS

After the first year of Medicaid managed care, uninsured adults reported less access and use (odds ratio [OR] = 0.46; 95% confidence interval [CI] = 0.34, 0.64) and worse barriers to care (OR = 6.60; 95% CI = 3.95, 11.54) than adults in other insurance categories. Medicaid children experienced greater access and use (OR = 2.11; 95% CI = 1.21, 3.72) and greater communication and satisfaction (OR = 3.64; 95% CI = 1.13, 12.54) than children in other insurance categories; uninsured children encountered greater barriers to care (OR = 6.29; 95% CI = 1.58, 42.21). There were no consistent changes in the major outcome variables over the period of transition to Medicaid managed care. Safety-net institutions experienced marked increases in workload and financial stress, especially in rural areas. Availability of mental health services declined sharply. Providers worked to buffer the impact of Medicaid managed care for patients.

CONCLUSIONS

In its first year, Medicaid managed care exerted major effects on safety-net providers but relatively few measurable effects on individuals. This reform did not address the problems of the uninsured.