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The Transition to Medicaid Managed Care in Illinois December 12, 2013 Presented by: Sharon R. Miller.

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Presentation on theme: "The Transition to Medicaid Managed Care in Illinois December 12, 2013 Presented by: Sharon R. Miller."— Presentation transcript:

1 The Transition to Medicaid Managed Care in Illinois December 12, 2013 Presented by: Sharon R. Miller

2 Transition to Medicaid Managed Care Welcome Who Am I ? –30 yrs. Experience in Managed Care –Adjunct Professor at Benedictine University teaching Managed Care and Business of Health Care Classes (MPH program)

3 What We Will Cover

4 The Basics of Managed Care Medicaid Now Taking You “Inside” the Payer World Different Departments and “Rules” Managed Care Reimbursements Capitation Reimbursement vs. Risk Medicaid Managed Care: Shifting Roles

5 Why are We Covering This ???? Managed Care programs are not just unique to Illinois…this is a nationwide movement. “I Heard that Managed Care Does Not Work”….not true What does this have to do with me and my job ? A “Shift” in levels of patient responsibility.

6 The Basics of Managed Care (HMO model) Managed Care is NOT “new”….been around since the 1920’s; then became popular in the late ‘70s. Health Insurance Companies establish “networks” of providers Patient selects a “Health Plan” Patient selects a “Primary Care Provider (PCP)” All medical services approved through this PCP Other rules: referrals, pre-cert needed for ER visits and certain medical procedures Tight controls over services

7 The Basics of Managed Care Our Focus HMO style

8 Medicaid Now State contracts with provider Contract pays based on a “fee for service” Eligibility and “need” determined thru Case Mgmt. Pt. “sees” provider Provider bills IDoA IDoA reimburses provider IDoA sends claim to State

9 Taking You “Inside” the Payer World State Contracts with Insurance Companies to Manage all aspects of the Patient’s Experience

10 Working with Payers – the “new” Medicaid configuration State contracts with insurance company State still handles “eligibility” Insurance company accepts a fixed “rate” to manage patient This is called a “Risk Contract” Patient is “managed” through insurance company State oversees compliance

11 Review of Medicaid Changes to Managed Care Changing Patient Relationship –New: patient relationship is with the insurance company, not the State Changing: Claims Processing done by Insurance Companies –New: State pays “lump sum” to insurance company (more on this later) State keeps eligibility function and takes on oversight function –Day-to-day handled by insurance company

12 Taking You “Inside” the Payer World DEPARTMENTS AdministrationMarketing/SalesFinanceCustomer ServiceMIS Dept. *** Operations/Claims*** Medical Affairs*** Provider Relations*** UM/QA Insurance Company

13 Managed Care Reimbursement: Capitation Reimbursement Models How Do Providers Get Reimbursed with Managed Care?

14 Managed Care Reimbursement: Capitation Reimbursement Models Many Different Ways: FFSFee Schedules P4P (Pay for Performance) DRG Hospital Case RatesHospital Bed Type Volume RatesPrimary Care Capitation Full Capitation

15 Managed Care Reimbursement: Capitation Capitation This is a payment methodology where a fixed amount of money is paid in advance to the insurance company for the delivery of health care services. New term: PMPM – Per Member Per Month

16 Managed Care Reimbursement: Capitation Capitation Example 1,000 patients (members) Capitation rate = $ per month Total pre-paid per month to insurance company = $1,063,760 Sounds good, right ????

17 Managed Care Reimbursement: Capitation What Does the Insurance Company Need to Do for this Advance Payment ? Everything in their contract !!!! –Doctor Services –Hospital Services –Long Term Care Services –Ancillary Care Services –Anything/Everything Else

18 Managed Care Reimbursement: Capitation And…..the Insurance Company does NOT get 100% of the capitation because of something called a “Risk Pool” Insurers will get paid 80% capitation with 20% withheld. In order to collect on the “withhold”, the insurance company needs to meet certain quality measures set by the State. If they meet the measures, they get the 20% back at the end of the year.

19 Capitation vs. Risk RISK CONTRACTS This is what capitation is all about: RISK If the insurance company controls the risk, they profit. If the insurance company does not control the risk, they lose money.

20 Medicaid Managed Care: Your Shifting Roles Eligibility Confirmation !!! Know What’s Covered and What’s Not !!! Understand “Who” is Responsible for “What” !!!

21 Medicaid Managed Care: Your Shifting Roles OVERSIGHTOVERSIGHTOVERSIGHT

22 Questions

23 Contact Information: Sharon Miller


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