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Advocates Urge More Government Oversight Of Medicaid Managed Care

WebMD News from Kaiser Health News

By Jenni Bergal

Wed, Jul 03 2013

When the federal government recently gave Florida the green light to vastly expand its experiment with privatizing Medicaid, patient advocates quickly raised an alarm.

They cited serious problems with the state’s five-county pilot managed care program and urged close monitoring of the companies that run private Medicaid plans to ensure that they don’t scrimp on care.

Advocates and experts say that the need for oversight is growing nationally as states have increasingly contracted out the huge state-federal program for the poor to insurance companies, aiming to control costs and improve quality through close management of patient care. About 30 million people are in these plans now. Under the federal health law that 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 monitor their compliance, but there’s no uniformity. This has resulted in a patchwork of contract requirements and data collection that experts say makes it difficult to compare states and assess whether patients' health has actually improved. 

“The quality of the monitoring and the quality of the managed care really varies from state to state,” said Joan Alker, a co-executive director of the Center on Children and Families at Georgetown University who studies health policy. “This is important because we want to have accountability for our taxpayer dollars. These are very vulnerable populations and sometimes not getting the services they need is a matter of huge import.”

Advocates are particularly worried that more than 20 states are moving frail elderly, mentally ill and people with disabilities into managed care for long-term services.  They 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’s needed to oversee the plans.

Thirty-six states and the District of Columbia have enrolled some or all of their Medicaid population in private health plans. The states give the plans a fixed amount per member each month. Last year, the states and federal government paid managed care plans about $108 billion out of the $435 billion spent on Medicaid.

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. But how they each go about doing it is up to them.

For example, federal rules don’t say how many doctors a plan must contract with or how often state officials need to review the adequacy of the plan’s network of doctors.

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