State Nears End of Extensive Review of Medicaid Managed Care Proposals
Albany, April 1 -- State Health Commissioner Barbara A. DeBuono, M.D., announced today that 37 plans have met the medical and fiscal standards to provide managed care to Medicaid patients in New York State. This is the culmination of a three-month review by the Department of Health of proposals for Medicaid managed care in 31 counties and New York City. The cost of caring for these patients will be nearly 13 percent less statewide under this managed care arrangement than under fee-for-service payments.
"This fulfills Governor Pataki's promise to provide Medicaid recipients with better health care through a medical home," Commissioner DeBuono said. "It also fulfills his promise to taxpayers that he would lower Medicaid costs without compromising quality. In fact, his Administration has raised the standards for Medicaid managed care above the level we found when he took office. The result is a compassionate, medically sound and cost-effective way to provide health care to Medicaid recipients."
Dr. DeBuono said the State has successfully incorporated higher standards of quality of care, access to care and health outcome measurements into Medicaid managed care. In its evaluation, the Department of Health required plans to provide services such as wheelchair access, 24-hour-a-day phone coverage, evening and weekend appointment hours, multi-lingual staff, AIDS Institute standards for adult and pediatric care, federal standards for substance abuse treatment, and locations close to where Medicaid patients live. Extra weight was given to plans that use traditional health care providers, such as county health departments, school-based and rural health clinics, family planning centers, federally qualified health centers and mental health and substance abuse providers already in the county.
"We evaluated plans to see whether they could meet the unique health needs of the Medicaid population -- such as prenatal care, HIV care, special care to chronically ill children, and access to a primary care doctor on a regular basis," Dr. DeBuono said. "Plans that passed the program evaluation had to pass our fiscal test, as well. These 37 plans had to agree to the rates we were willing to pay. We structured our Medicaid managed care dollars to be spent on health care, with less on administration and profit, yielding significant savings to taxpayers."
"Just as many large corporations bid out their health coverage," she said. "New York State government, as the largest purchaser of health care in the State, sought proposals to provide health care to Medicaid recipients under managed care. The outcome shows that managed care organizations in New York are up to the task of treating the particular needs of the Medicaid population." The results were positive:
- 1.1 million Medicaid recipients in New York City and the 31 counties that joined this effort will have medical homes. "Under managed care, Medicaid recipients will no longer have to rely on hospital emergency rooms for routine care," Dr. DeBuono said. "No more searching for a doctor. And with routine medical care, the health of the Medicaid population will improve." Overall, there will be sufficient options to offer every Medicaid recipient a choice of plans and primary care providers in the participating areas.
- Managed care services for Medicaid recipients will be standardized. Under the current program, counties have individual contracts with managed care plans, resulting in different services from one plan to another and from one county to another. "While certain areas, such as New York City, have particular health care needs, all will benefit from the standards we set," Dr. DeBuono said. "And we set those standards at a lower cost than counties pay now."
- The cost will be 11.1 percent less than Medicaid fee-for-service for upstate counties, and 13.66 percent less for downstate counties -- a statewide savings of 12.8 percent, or as much as $17 million a year once all eligible patients are enrolled. The average cost statewide per Medicaid enrollee will be $123 per month, $13 less than the average paid now under fee-for-service.
Dr. DeBuono's staff will spend the next several weeks on-site at the plans performing "readiness reviews." She explained, "These readiness reviews will ensure that everything plans told us about their services and capability of adding to their patient population is true." Once reviews are completed, counties will be free to enter into contracts with these plans.
"New York is ready for mandatory Medicaid managed care," Dr. DeBuono said. "We are awaiting federal approval of our application to waive certain federal rules so that we can shift non-elderly Medicaid clients into mandatory managed care." Until the waiver is approved, Medicaid recipients in the participating 31 counties and New York City will continue to voluntarily enroll into managed care plans.
"We expect that the lowered costs and higher quality we set for our program will encourage additional counties to join us," Dr. DeBuono said. However, she acknowledged that some counties will have difficult decisions to make about whether they want to continue toward a mandatory program, because not every plan currently providing Medicaid managed care met State standards.
"This has been a cooperative effort with the social service departments in New York City and the counties, as we strive to achieve the best services for needy people at the best price for taxpayers. As always, the best interests of clients will have to come first in every county's decision," she said. "We set our standards high for accountability, medical quality and cost-effectiveness, keeping in mind that Medicaid recipients have particular health care problems that often require services not often needed by the average New Yorker."
Dr. DeBuono said her announcement today does not mean that evaluation of Medicaid managed care plans is complete. "We are at a significant milestone," she said. "More than three dozen plans agreed to the rates we are willing to pay. Still, we continue to work with plans that need to improve their provider networks, and will review on-site all plans that have come this far in the process. And our oversight of quality will be constant and thorough." In addition, the Health Department's Office of Managed Care will continue work to develop specialized managed care plans for Medicaid recipients with HIV/AIDS and mental illness.
"The Pataki Administration is committed to quality health care at a more-affordable price in the Medicaid program," Commissioner DeBuono said. "The work to implement high standards statewide for Medicaid managed care is a great achievement of this Governor and his vision that government can do more for people without spending more."
4/01/96-37 OPAContact: Claudia Hutton, Director, Public Affairs (518) 474-7354
New York State Department of Health Posted 4/11/96