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Advocates Urge More Government Oversight of Medicaid Managed Care

Spotlight is on how regulators monitor performance of privately run plans (July 5)

According to a report from the Kaiser Family Foundation, advocates and experts say that the need for oversight of privatized Medicaid programs is growing nationally as states have increasingly contracted out the huge state and federal program for the poor to insurance companies, aiming to control costs and to improve quality through close management of patient care.

About 30 million people are currently in these plans. Under the Patient Protection and Affordable Care Act, which launches Jan. 1, eligibility will be expanded, and about 7 million more will be covered by Medicaid. Many will be placed in managed care.

States are required by the federal government to establish quality standards for Medicaid plans and to monitor their compliance, but there is no uniformity, the report says. This has resulted in a patchwork of contract requirements and data collection that makes it difficult to compare states and to assess whether patients’ health has actually improved.

Advocates are especially worried that more than 20 states are moving frail elderly, the mentally ill, and people with disabilities into managed care for long-term services. These individuals have especially complex needs.

Some states have also cut back staffing of their Medicaid offices, raising concerns about their ability to hold plans accountable. The federal government, in turn, has been criticized for failing to fulfill its duty: ensuring that states do what is needed to oversee the plans.

States are supposed to set rates, monitor contracts and enrollment practices, make sure that plans have sufficient networks of doctors, oversee quality and performance, and ensure consumer protections for members, the report says. But how they each go about doing it is up to them.

States also must arrange for an external group to monitor independently the plans’ quality of care every year. But the federal requirement doesn’t specify how that monitoring should be done, either.

According to the new report, a July 2012 Urban Institute study of Medicaid managed care in 20 states found “tremendous variation” in the kind of quality monitoring conducted by states and health plans and in how they ensure that the plans’ networks of doctors are adequate. The maximum number of patients per doctor, for example, varied from 750 in Michigan to 2,500 in Tennessee. In rural areas, primary care doctors had to be located within 10 miles of patients in California, but within 45 miles in Ohio.

While states are responsible for keeping an eye on Medicaid managed care plans, the Centers for Medicare & Medicaid Services (CMS) is required to monitor how well the states are doing that. But CMS, too, has had its problems with oversight, according to reports by the Department of Health and Human Services Inspector General’s office and the U.S. Government Accountability Office.

Source: Kaiser Family Foundation; July 5, 2013.

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