November 20, 2014
As the State of Illinois nears its deadline for moving Medicaid recipients into managed care, three managed care organizations have been disciplined for providing poor quality medical care or failing to comply with operational requirements.
The Illinois Department of Healthcare and Family Services (HFS) announced on November 14, 2014 that Harmony Health Plan, Family Health Network and Illinois Partnership for Health had been suspended from receiving new Medicaid clients through automatic enrollment. The announcement was made at a meeting of the Medicaid Advisory Committee, which advises the State’s main Medicaid agency on policy development and program administration.
HFS Director Julie Hamos told participants at the meeting that the disciplinary actions were a “loud message” to managed care plans that the agency intends to enforce quality, performance and functionality standards in the organizations’ contracts with the State. With the advent of managed care, the agency’s main responsibility will be supervising managed care plans, the Director said.
A State law enacted in January 2011 requires that at least half of Medicaid recipients be enrolled in managed care (also known as coordinated care) by January 2015. The legislation defines coordinated care as integrated health care delivery systems in which health care providers are at financial risk for the cost of patients’ care. This represents a major change for Illinois, which has lagged most other states in the use of managed care in its Medicaid program.
States have increasingly turned to managed care in an effort to control Medicaid costs and improve patient care. Doctors and hospitals have traditionally been paid on a fee-for-service basis, in which payment depends on the volume of services provided. In contrast, managed care is designed to reward health care organizations for keeping patients healthy and avoiding unnecessary tests and procedures. Health maintenance organizations (HMOs), for example, receive a fixed monthly fee, known as a capitation rate, for each Medicaid enrollee.
HFS plans to enroll at least 60% of the approximately 3 million Medicaid recipients in managed care by early 2015. The agency designated five mandatory managed care regions—Rockford, Central Illinois, Metro East, Quad Cities and Greater Chicago (Cook and Collar Counties)—and five different kinds of managed care organizations, including HMOs and new networks organized by healthcare providers called Accountable Care Entities (ACEs). As of October 1, 2014, 645,936 recipients had signed up for managed care.
The total includes approximately 90,000 members of CountyCare, the managed care plan run by Cook County’s public health system that got a year’s head start on enrolling low-income adults who became eligible for Medicaid in January 2014 under the federal Affordable Care Act. The total also includes seniors and disabled persons who began to be covered by managed care under a pilot program starting in May 2011.
HFS began mailing packets to other recipients last summer asking them to select managed care plans. If individuals do not select a plan in 60 days, they are automatically enrolled in a plan that includes their primary care doctor—if they have one—and serves their area. For example, Medicaid recipients in Cook County began getting the mailings in late September, according to HFS’ website. Parents and children in Cook County have a choice of as many as 15 plans.
Harmony Health Plan and Family Health Network were suspended from receiving new Medicaid clients through automatic enrollment for not meeting required minimum standards of care. Harmony serves the Greater Chicago and Metro East areas, while Family Health Network serves Greater Chicago. Both plans previously had Medicaid members who participated in managed care voluntarily.
In letters sent during the week of November 10, HFS wrote that the two plans scored lower than 90% of national health care plans in 2013 on more than a dozen quality measures, including children’s and adolescents’ access to primary care doctors, diabetes care and timeliness of prenatal care and postpartum care. The Healthcare Effectiveness Data and Information Set (HEDIS) scores are posted on the HFS website.
The problems persisted despite repeated warnings, according to the letters. HFS gave the organizations until December 15, 2014 to present corrective action plans and stated that the automatic enrollment suspensions would be lifted after services improved.
Illinois Partnership for Health, based in Urbana, is an ACE that serves Central Illinois and the Quad Cities and Rockford areas. In a letter sent on November 10, HFS wrote that it was suspending automatic enrollment because the plan had not addressed problems with staffing, training and call center capacity and reporting.
According to the letter, HFS received complaints about Illinois Partnership for Health’s call center from Medicaid recipients and healthcare providers. The letter stated that automatic enrollment would be resumed after the problems were fixed.