Earlier this month Lt. Gov.-elect Nancy Wyman urged Department of Social Services Commissioner Michael Starkowski not to enter into any long-term contracts with three insurance companies that manage the state’s HUSKY program.
The letter essentially asks Gov. M. Jodi Rell’s administration to do no harm before leaving office Jan. 5, a goal the department said it shares.
Already the Department of Social Services and the Medicaid Managed Care Council which oversees the HUSKY contracts have admitted there’s no chance they will be able to follow a legislative mandate to save about $76 million by transitioning the Medicaid population from one model of care to another.
“I understand that, despite this legislative action, your department is in the midst of contract negotiations with the HUSKY plans, has already rescinded the important contract requirement that the plans pay providers at rates at least equal to the Medicaid fee-for-service rates, and intends to leave that requirement out of the new MCO contracts,“ Wyman wrote in her Dec. 6 letter to Starkowski. “That provision has been critical in recruiting providers to participate in the program so as to improve access to care for HUSKY families.”
The Medicaid Managed Care Council which oversees the contracts learned in November that the Department of Social Services renegotiated its rates with the three Managed Care Organizations in August, and made those contracts retroactive to July. Those negotiations are still ongoing and are expected to conclude before the end of December, but the Medicaid Managed Care Council has already learned that DSS allowed the three MCO’s to negotiate rates below the Medicaid fee-for-service floor.
The three Managed Care Organizations, Aetna Better Health, AmeriChoice by UnitedHealthcare, and Community Health Network, claimed at a Dec. 10 meeting that they aren’t seeking to pay doctors less under the new contracts. They told the council they’ve only negotiated lower rates with durable medical equipment providers and laboratory vendors.
“Primarily the removal of the floor means nothing to us,” Rita Paradis, CEO of Aetna Better Health told the council two weeks ago. She said Aetna renegotiated its contracts with half of its durable medical equipment vendors, but not doctors or hospitals.
“We’re not going there. That’s not our goal,” she added.
But health care advocates and Wyman worry it may be durable medical equipment vendors today and doctors tomorrow.
“I think it’s incredibly naive of the department to think that reducing rates or opening the door to reducing rates won’t impact access,” Ellen Andrews, executive director of the Connecticut Health Policy Project, said.
“We are not overpaying providers in this plan,“ Andrews said. “If you don’t have any intention to go below then what’s the problem with leaving it there?”
Since 2008, when the program was re-bid for the first time in a decade, it has had trouble holding onto doctors or getting doctors to participate because of its low reimbursement rates.
“You have to keep a certain number of doctors in the program to begin with, if you cut rates you’re going to lose some,” Andrews said in a phone interview last week.
Mark Schaefer, DSS’ director of medical care administration, said the department will monitor the change to make sure access and participation are not impacted.
In his Dec. 9 response to Wyman, Starkowski maintained that there were no negotiations underway to extend the current contracts with the MCO’s past the June 30, 2011 expiration date, however, he said the department is currently negotiating “capitation rate adjustments,” or the payment the MCO’s pay medical providers.
Starkwoski said achieving the budgeted savings Wyman called for in her letter, a change mandated by the legislature, “is more complicated than might be assumed, notwithstanding the fact that we are in negotiations to drive down current capitation rates.”
“This complex subject is also under review by the legislature’s Medicaid Care Management Oversight Council, which has asked the Connecticut Health Foundation for an analysis to assist in a recommendation about which particular direction to take. The analysis may also be helpful to the new administration in making a decision going forward about the structure of the program and delivery systems for other DSS health care programs,” Starkowski wrote.
Schaefer insisted that the contracts for the new capitation rates will need to be signed by the new administration.
Andrews said she knows the insurance companies denied lowering rates for doctors, however, she’s a little suspicious.
“They received permission to retroactively do something they said they’re not doing,” Andrews said last week in a phone interview. “It doesn’t make sense.”