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MAHAP General Session February 19, 2010

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Presentation on theme: "MAHAP General Session February 19, 2010"— Presentation transcript:

1 MAHAP General Session February 19, 2010
Managed Care 101 Kelly Partin MAHAP General Session February 19, 2010

2 MAHAP General Session February 19, 2010
Agenda Key Terms Types of Insurance Inside an Insurance Company Carve Outs (Pharmacy, Mental Health, Vision) MAHAP General Session February 19, 2010

3 MAHAP General Session February 19, 2010
Key Terms - Network Provider Network – The list of providers who are contracted or enrolled with a Health Insurance Company or Government Agency to provide care for a given set of people. Participating – (Par Provider / Contracted Provider) The term used to describe providers that are part of a Provider Network. MAHAP General Session February 19, 2010

4 Key Terms Insurance Types
Show me the money. Risk – Who ultimately has to pay for the claim. The group who pays the provider is frequently not the one who has to budget for the cost of medical care! Upside Risk – A method used in contracting to provide incentives the providers to keep health care costs low. Risk Pool – An account of funds set aside that are designated for one or multiple purposes MAHAP General Session February 19, 2010

5 MAHAP General Session February 19, 2010
Key Terms - Claims HCFA 1500 – The Standard Claim form for a Professional Claim UB 04 – the Standard Claim Form for a Facility Adjudication – The process of entering the claim information into a claims processing software program, reviewing the claim, and paying or denying a claim Auto Adjudicate – Adjudicating a claim without a person looking at the individual claim using a rules based software system MAHAP General Session February 19, 2010

6 Types of Health Insurances (Product Lines)
MAHAP General Session February 19, 2010

7 Types of Insurances Overview
Traditional Insurance (Blue Cross Blue Shield) Health Maintenance Organizations (HMO) Preferred Provider Organizations (PPO) Government Programs (traditional Medicare, Medicaid, Tri-Care) Odds and Ends: Worker’s Compensation, Motor Vehicle, Gap Plans for Medicare MAHAP General Session February 19, 2010

8 Types of Insurances Traditional Insurance
Origin: 1929, Physician groups began offering medical care to groups of people at a flat rate (per member per month) Example: Blue Cross Blue Shield Insurance Company is at Risk MAHAP General Session February 19, 2010

9 Types of Insurances Traditional Insurance, cont
Mostly Group Coverage Deductibles and % co-pays Very little if any medical management Large Enrolled Network MAHAP General Session February 19, 2010

10 MAHAP General Session February 19, 2010
Key Terms PPO – Preferred Provider Organization – A company that contracts with health care providers to create a network. They then lease the network to employer groups (via TPAs) health plans. Sometimes they can be owned / operated by a TPA (Aetna, Cigna) or operate independently (Great West Life, Multiplan) Third Party Administrator – An entity that provides Member Services & Claims Processing (examples Meritain Health, CAM Administrators, Pharmacare) MAHAP General Session February 19, 2010

11 Types of Insurances PPO
Employer / Group based insurance Employer is generally at risk Benefits are dependent upon individual group – Vary GREATLY Look to a Plan Document for benefit coverage Governed by ERISA - Federal MAHAP General Session February 19, 2010

12 MAHAP General Session February 19, 2010
Process PPOs Employer group contracts for a network ( PPO) and a TPA to manage the benefit PPO prices the claim and forwards onto the TPA (from time to time the TPA will receive the claim and forward to multiple PPOs to price and pick which is best) TPA pays the claim and bills the employer for the cost of the claim + a fee TPA prints the ID Card MAHAP General Session February 19, 2010

13 Types of Insurances PPO cont.
Some to no Medical Management Network larger than HMO and smaller than Indemnity Some provider credentialing MAHAP General Session February 19, 2010

14 MAHAP General Session February 19, 2010
Silent PPOs Silent PPO does not have the logo on the card. Rarely drives business to the provider, just allows the payer to take a discount after the fact Modify Contract language to require logo on card Example: Beech Street MAHAP General Session February 19, 2010

15 MAHAP General Session February 19, 2010
Wrap Around Networks Wrap Around Network – A health care provider Network used as a second option to a primary, more preferred health care provider. Used for many reasons, which can include: Filling in holes, such as creating a National Network for traveling members Provide a more comprehensive network while directing patients to a more cost effective network. MAHAP General Session February 19, 2010

16 MAHAP General Session February 19, 2010
Wrap Around Networks Examples: Botsford’s PPO network – Botsford is the preferred provider with Blue Cross as a wrap Health Plus uses a large PPO for out of state coverage Humana’s Commercial Product Line uses Cofinity as a wrap MAHAP General Session February 19, 2010

17 High Deductible Health Plan
a.k.a. Consumer Driven Health Plan (CDHP) is a benefit design that allows for high deductibles that encourages ownership of medical care Idea: Consumers will shop around to get the least expensive and medically necessary medical care MAHAP General Session February 19, 2010

18 High Deductible Health Plan cont
Employers or employees can put money in a Health Savings Account (not MSA) that rolls over year to year to be used toward medical expenses Year Min Deductible (Single) Min Deductible (Family) Max Out of Pocket Expense (Single) Max Out of Pocket Expense (Family) 07 $1,100 $2,200 $5,500 $11,000 08 $5,600 $11,200 09 $1,150 $2,300 $5,800 $11,600 10 $1,200 $2,400 $5,950 $11,900 MAHAP General Session February 19, 2010 From IRS Publications

19 Key Terms – Medical Management
Referral – A written document from one provider to another (Family Physician refers a patient to an ENT) Authorization – An approval from a Insurance Company that the services are considered medically necessary and therefore a covered benefit HEDIS – Health Employer Data Information Set – Established by NCQA, a set of data elements to score a Health Plan on the quality of care members receive MAHAP General Session February 19, 2010

20 Types of Insurances HMO
Insurance Company is at Risk May share risk with providers, but generally limited to upside risk May share risk with Employer Group Licensed by Office of Financial and Insurance Regulation – offers the HMO consumer guide (http://www.michigan.gov/dleg/0,1607, _13222_ ,00.html) MAHAP General Session February 19, 2010

21 Types of Insurances HMO, Cont.
Benefits are generally more comprehensive with flat co-pays and low deductibles (regulated) May now offer CDHPs – not as common Heavy Medical Management including PCPs Smaller networks Provider credentialing (requirement of NCQA) MAHAP General Session February 19, 2010

22 MAHAP General Session February 19, 2010
Staff Model HMO Was the original design of an HMO The physician group is at risk One stop shop for comprehensive care Sometimes called Clinic System Difficult to sustain because of low numbers of membership MAHAP General Session February 19, 2010

23 MAHAP General Session February 19, 2010
PACE Program Members / Patients go to a center for medical care, coordinated by an employed physician (PCP) and receive coordinated comprehensive medical care Covered services include: all medical care (including hospital, home health, specialty), DME, home modifications, many meals, social services, medical transportation, therapy, personal care attendants, hospice care, prescriptions, adult day care, & nursing home care (if needed). MAHAP General Session February 19, 2010

24 Qualify for PACE Program
Live in the service area Be 55 years or older Medically qualify for skilled nursing care Qualify for Medicare Capitated benefit funded by Medicare and Medicaid MAHAP General Session February 19, 2010

25 PACE Programs in Michigan
Henry Ford Health System-Center for Senior Independence Care Resources (Grand Rapids) If we have a PACE patient at Botsford – Call the appropriate PACE program for approval – they will be the one paying the bill! MAHAP General Session February 19, 2010

26 MAHAP General Session February 19, 2010
Indemnity PPO HMO Who is at Risk? Insurance Company Employer Group (ERISA) Who has the insurance? Group Coverage, Some individual Almost all group coverage Benefit Structure deductibles, % co-pay Ranges greatly Generally Flat $ co-pays, comprehensive coverage Medical Management No Medical Management Some medical management Heavy Medically Mgmt & (PCP) Network Purely Enrolled, Large network Some preferred providers, some provider credentialing Many preferred providers, provider credentialing Accreditation None Some, usually URAC Many are NCQA, some are JCAHO MAHAP General Session February 19, 2010

27 MAHAP General Session February 19, 2010
Medicare Wiki: 7/1965: President Johnson signing the Medicare amendment. Harry Truman and his wife, Bess, are on the far right. Traditional Medicare ID Card MAHAP General Session February 19, 2010

28 Types of Government Coverage Medicare
To qualify you must Be 65 years or older OR disabled for 24 months OR have end stage renal failure AND have worked and paid FICA taxes for 40 quarters (prorated for disabled) or have a spouse who has worked and paid FICA taxes No Financial requirements No requirement to reside in the U.S. MAHAP General Session February 19, 2010

29 Types of Government Coverage Medicare, cont.
Funded by the Federal Government Coverage is not medically managed Providers simply enroll (no credentialing) No Accreditation Large Deductibles and co-insurance Entitlement Program MAHAP General Session February 19, 2010

30 Types of Government Coverage Medicare Parts
Part A – Hospital and Facility Coverage – Usually free (UB claims) Part B - Physician Services and other professional (ambulance, physician, HCFA claims) Part C – Simply funds the Medicare Advantage Plan Part D – Prescription Plans – All coordinated through a Carve Out Pharmacy Benefit Manager (PBM) MAHAP General Session February 19, 2010

31 Types of Government Coverage Medicare Gap Plans - Medigap
Because Medicare covers very little –Medigap is born Follows Medicare Primary Payor Rules (if Medicare says Ok, I’ll pay..) Plans are required to follow a certain benefit design determined by OFIS – Plans A through J MAHAP General Session February 19, 2010

32 Medicare Advantage Plans
Pays like Medicare (except bad debt) About 20% of Medicare enrollees are in a Medicare Advantage Plan Many times offer richer benefits (lower co-pays, deductibles) and additional coverage such payment for gyms Businesses are offered tax incentives to enroll retirees. MAHAP General Session February 19, 2010

33 MAHAP General Session February 19, 2010
Traditional Medicare Medicare Private Fee for Service (Deemed) Medicare PPO Who is at Risk? Federal Government Insurance Company Benefit Structure deductibles, % co-pay Ranges greatly, Better than Medicare Medical Management No Medical Management Some medical management More Medical Management Network Purely Enrolled, Large network Any provider who is willing to see that patient for Medicare services - NOT CONTRACTED Some preferred providers, some provider credentialing Accreditation None Many are NCQA, some are JCAHO MAHAP General Session February 19, 2010

34 Types of Government Coverage Medicaid
Multiple Programs Some for Disabled or elderly Others for low income dependents with children Must have financial need (MedicAID) Requirements for residency, citizenship, etc. Mostly administered by State (SSI administered by Social Security Admin.) MAHAP General Session February 19, 2010

35 Types of Government Coverage Medicaid cont.
Funded by the Federal Government and State Government Coverage is not medically managed Providers simply enroll (no credentialing) No Accreditation Low co-pays if any Payor of Last Resort MAHAP General Session February 19, 2010

36 MAHAP General Session February 19, 2010
Traditional Medicaid Medicaid Managed Care Who is at Risk? State Government (some Federal match) Insurance Company Benefit Structure Comprehensive Coverage and low co-pays Medical Management No Medical Management Heavy Medical Management (PCPs are REQUIRED) Network Purely Enrolled, Large network Contracted Credentialed Providers Accreditation None Many are NCQA, some are JCAHO MAHAP General Session February 19, 2010

37 Children’s Special Health Care Services (CSHCS)
A program through the State of Michigan (available in all states) that offers Case Management services to children who are disabled. May also offer additional coverage based upon financial need. (camps, ramps, medical care, etc.) Does not need to qualify financially, however, may cost a nominal fee if not on Medicaid. MAHAP General Session February 19, 2010

38 Children’s Special Health Care Services (CSHCS), cont.
To qualify Michigan Resident US citizen or documented non-citizen admitted for permanent residence or a non-citizen legally admitted migrant farm worker (i.e. seasonal agricultural worker). Age:   Children must have a qualifying medical condition and be 20 years old or under.  Person 21 and older with cystic fibrosis or certain hereditary blood coagulation disorders commonly known as hemophilia may also qualify. Qualifying Medical condition:   A MDCH medical consultant reviews each case to determine eligibility.  Severity and chronicity of the person's condition as well as the need for treatment by a specialist are factors considered.  More than 2,500 diagnoses are potentially eligible.  Click here for a list of these diagnoses CSHCS Family Phone Line at MAHAP General Session February 19, 2010

39 Other Government Programs
Tri-Care Government program for Military Offers a PPO network and a smaller HMO network (based upon Need) Enrollment based only MAHAP General Session February 19, 2010

40 Odds and Ends Worker’s Compensation A requirement for most businesses
Some companies use a PPO network (First Health) State Fee Schedule MAHAP General Session February 19, 2010

41 Odds and Ends Motor Vehicle Coverage
Most policies in Michigan have a caveat that the other Health Insurance Coverage is PRIMARY (keeps cost of auto insurance lower) Many use Cofinity (a.k.a. PPOM) as a network when necessary MAHAP General Session February 19, 2010

42 MAHAP General Session February 19, 2010
Internal Structures MAHAP General Session February 19, 2010

43 Internal Structures for Traditional Insurances and HMOs
Provider Contracting & Provider Relations Claims Department Member Services Medical Management Information Technology (no slide) Underwriting (in Commercial) (no slide) MAHAP General Session February 19, 2010

44 Provider Contracting & Provider Relations
HMOs and PPOs contract with Providers to create a network. Provider Relations create a Provider Manual that explains policies and procedures Responsible for provider communications, often a requirement of Accreditation MAHAP General Session February 19, 2010

45 MAHAP General Session February 19, 2010
Claims Department Enters a claim (electronically, OCR, data entry) into a software program Requests additional information from Provider, denies, or pays the claim In many organization, large number of claims (80% and more) are auto adjudicated – Never to be seen by a human. MAHAP General Session February 19, 2010

46 MAHAP General Session February 19, 2010
Member Services Member is anyone covered under the insurance Many times resolves complaints and grievances Member Services is responsible for all member communications Newsletters (requirement for Accreditation) Member Handbook Call Center – outgoing MAHAP General Session February 19, 2010

47 MAHAP General Session February 19, 2010
Medical Management GOAL: Improve member health thus reducing medical care Will track HEDIS Measures and Bed Days / # of admissions Medical Director (MD / DO) Nurses will review high dollar services (inpatient admissions, some surgeries, etc.) and provide a prior authorization for care Develop policies regarding what is considered “medically necessary” May use an Imaging Service (AIM) to review radiology services for prior authorizations MAHAP General Session February 19, 2010

48 Medical Management Quality
80 20 Rule: 80% of your costs come from 20% of the members Improve the care members receive by reducing barriers Increase the number of members who receive HEDIS measures tracked Patients may be eligible for added benefit MAHAP General Session February 19, 2010

49 Medical Management Case Management
80 20 Rule: 80% of your costs come from 20% of the members Telephonic Case Management Typically manage Cardiac, some Asthma, Cancer, Transplant, and other chronic patients Patients may be eligible for added benefit MAHAP General Session February 19, 2010

50 MAHAP General Session February 19, 2010
WHY ? Reduce costs! Improve Medical Care US News Top 10 Commercial in MI 09-10 Grand Valley Health Plan – 89.4 Priority Health 86.9 HealthPlus of MI 86.1 Physicians Health Plan of Mid Michigan 85.7 HAP 85.4 BCN 84.5 Newsweek, Sunday, November 9th MAHAP General Session February 19, 2010

51 MAHAP General Session February 19, 2010
Carve Outs HMOs and employer groups will contract for specialty health care with a Carve Out organization in addition to the traditional Medical Care Mental Health (Value Options) Pharmacy Benefit Management (PBM) Transportation for Medicaid MAHAP General Session February 19, 2010

52 MAHAP General Session February 19, 2010
Carve Outs PBMs Used because Unique Network Codes and costs of drugs change weekly 99.9% of claims auto adjudicated Benefit Structures are challenging MAHAP General Session February 19, 2010

53 Carve Outs Formularies
Step Formularies Take this medication before you take the more costly medication Open Formularies Patient can take whatever is prescribed, but the cost is different: $15 generic, $30 brand, $45 non-preferred brand MAHAP General Session February 19, 2010

54 MAHAP General Session February 19, 2010
Contact Kelly Partin Financial Managed Care Analyst (248) MAHAP General Session February 19, 2010


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