1. Cabinet for Health and Family Services Kentucky’s Medicaid Overview Prepared for the LRC Medicaid Oversight and Advisory Committee Wednesday, June 17, 2015

2. 2 Medicaid Overview Federal/state partnership designed to provide healthcare to qualifying individuals Provides healthcare to over 1 million Kentuckians Continues to evolve to meet the healthcare needs of population served

3. 3 CY 2014 State Fund Expenditures Total: $1.99 billion * Excludes programmatic costs not tied directly to individual.

4. 4 Medicaid Enrollment as of 12/31/2014 Total: 1,268,481

5. 5 Medicaid enrollment since 2012

6. 6 In 2014 Medicaid paid for… 99,000 breast cancer screenings… 93,000 cervical cancer screenings… 59,000 colorectal cancer screenings… 394,000 annual wellness exams… 603,000 preventive dental services… 31,000 newborn deliveries… 734,000 immunizations and vaccinations… Nursing home care for 26,948 patients… Hospice care for 1,871 patients… 40,000 days of NICU care for 2,700 newborns… 45,530,854 unique claims to Medicaid providers…

7. 7 In 2014 Medicaid provided care for… 131,000 Kentuckians with COPD… 142,000 Kentuckians with depression… 110,000 Kentuckians with arthritis… 17,000 Kentuckians recovering from a stroke… 4,900 Kentuckians with breast cancer… 3,000 Kentuckians with colorectal cancer… 1,600 Kentuckians with prostate cancer… 13,000 Kentuckians sufferings from Alzheimer’s or dementia…

8. 8 All Medicaid payments to providers Payments made in CY 2014 Hospital $ 2,132,129,189 Pharmacy $ 934,986,349 Nursing Facility $ 930,701,639 Waiver Providers $ 719,223,142 Primary Care $ 811,919,281 Other $ 630,124,940 Behavioral health providers $ 259,748,549 ICF-IDD facilities $ 139,944,052 Dentists $ 132,763,677 Total $ 6,691,540,817 * Includes claim, DSH, and supplemental payments

9. 9 Update on Medicaid Expansion To see the update to the Medicaid Whitepaper regarding the Medicaid expansion in Kentucky after one year of implementation, go to: http://governor.ky.gov/Pages/default.aspx

10. 10 Preventive services for Medicaid Expansion 1 More Screenings = Better Health 17,000 screened for colorectal cancer 26,000 received mammograms 34,000 screened for cervical cancer 46,000 screened for diabetes 13,000 received treatment for substance abuse 80,000 had preventive dental visits 1 – Calendar Year 2014

11. 11 Medicaid Expansion payments to providers Payments from 1/2014 through 6/10/2015 Hospital $ 918,685,939 Pharmacy $ 487,054,134 Physician, FQHC, Primary Care, etc. $ 416,767,441 Other $ 119,947,655 Dental $ 44,605,246 Behavioral health $ 29,808,286 Medical equipment $ 24,810,524 Total $ 2,041,679,225

12. 12 Report findings and estimates Enrollees Uncompensated care Job creation Medicaid added 375,175 newly eligible enrollees by the end of calendar year (CY) 2014; the expansion population represents 8.5 percent of the total state population Compared with all other states, Kentucky experienced the second largest decrease in its uninsured rate; the uninsured rate dropped from 20.4 percent in 2013 to 11.9 percent in mid-2014 The net difference between expanding and not expanding is expected to be a positive $919.1 million from SFY2014 to SFY2021 Uninsured rate Avoided costs Uncompensated care costs for Kentucky hospitals were $1.15 billion lower during the first three quarters of CY2014 compared with the same period in CY2013 Medicaid expansion created more than 12,000 jobs in SFY2014 and is estimated to add more than 40,000 jobs by the end of SFY2021 Cumulative impact on state economy Between SFY2014 and SFY2021, Medicaid expansion is estimated to have a net positive cumulative impact of $30.1 billion on Kentucky’s economy

13. 13 Uninsured Rates by State, 2014

14. 14 Uninsured population per capita

15. 15 An explanation of DSH reductions DSH payments are not going away, they are only being reduced. The reductions are scheduled to begin in 2018. The 2018 reduction is approximately 12%. By 2024 the reduction will be 49% of current expenditures. As a matter of comparison, hospitals have been paid $918 million to date due to Medicaid expansion. Cumulative DSH reductions from 2018 – 2024 are expected to be $427 million.

16. 16 Comparison of Expansion and DSH Payments in 2014 16

17. 17 Billed charges for uncompensated care

18. 18 Managed Care Overview Implemented November 1, 2011 5 MCOs Serving Medicaid Members –Anthem –Coventry/Aetna –Humana –Passport –WellCare Must provide medically necessary services as outlined in Medicaid regulations with approvals from CMS (federal) Flexibility regarding prior authorizations, rates and structure of contracts Flexibility to create value-added services Does not serve Medicaid members in long term care facilities or 1915(c) waivers

19. 19 Medicaid MCO Oversight Contract with Department of Insurance to investigate timely payment complaints Rector and Associates – Market Conduct Survey and Financial Review External Quality Review Organization (EQRO) Island Peer Review Organization (IPRO) Performance Improvement Plans (PIP) EQRO Studies Website for Program Quality and Outcomes http://chfs.ky.gov/dms/pqomcoqbreports.htm 19

20. 20 Monthly Contractual Compliance Monitoring EXAMPLE……not inclusive AnthemCoventryHumanaPassportWellCare Prompt Payment of Claims 90% paid in 30 Days 99.94%99.91%94.63%98.62%99.60% 99% paid in 90 Days 100% 98.73%100%99.85% Member Calls 5% or fewer abandoned calls 0.48%3.46%0.95%0.99%1.43% Average time to answer (30 second limit) 83420258 Provider Calls 5% or fewer abandoned calls 0.69%1.46%0.64%1.26%2.08% Average time to answer (30 second limit) 1928192518 Behavioral Calls 7% or fewer abandoned calls 0.77%0.12%2.35%0.26%3.19% Average time to answer (30 second limit) 613 89 99% answered by 4th ring 100% Calls receivng busy signal 0% 80% answered within 30 seconds 96.00%99.50%85.89%91.00% Average call length under 10 minutes 84351 All Calls 5% or fewer abandoned calls 0.58%2.68%0.86%1.08%1.64% 20

21. 21 Medicaid MCO Oversight Monthly Operational Meetings Reporting Monthly Quarterly Annual Actions Taken in 2014 and 2015 20 Inquiry Letters 44 Letters of Concern 84 Corrective Action Plans (CAP) 21

22. 22 Medicaid MCO Oversight Encounter Claims Submission Penalties Withholds TOTAL ALL MCOS DecemberJanuaryFebruaryTotal Capitation $563,211,146.25$574,732,213.45$600,455,225.03$1,738,398,584.73 - Penalties Assessed $94,500.00$106,000.00$81,500.00$282,000.00 - Withhold Assessed $6,160,552.37$16,045,715.30$6,556,661.72$28,762,929.39 Total Withhold released $6,160,552.37$16,045,715.30$6,556,661.72$28,762,929.39 Total Penalty/Withhold remaining $94,500.00$106,000.00$81,500.00$282,000.00 Total Percentage of cap 1.11%2.79%1.11%1.67%

23. 23 Waivers: Defined  Waivers provide states with flexibility to deliver and pay for health care services in Medicaid  There are 4 types of waivers:  Section 1115 Research and Demonstration Projects: States can apply for program flexibility to test new or existing approaches to financing and delivering Medicaid and CHIP.  Section 1915(b) Managed Care Waivers: States can apply for waivers to provide services through managed care delivery systems or otherwise limit people's choice of providers.  Section 1915(c) Home and Community-Based Service Waivers: States can apply for waivers to provide long-term care services in home and community settings rather than institutional settings.  Concurrent Section 1915(b) and 1915 (c) Waivers: States can apply to simultaneously implement two types of waivers to provide a continuum of services to the elderly and people with disabilities, as long as all Federal requirements for both programs are met.

24. 24 Kentucky’s Waiver Programs Kentucky has six waiver programs which include:  Home and Community Based (HCBW)  Supports for Community Living (SCL)  Michelle P. (MPW)  Model Waiver II (MWII)  Acquired Brain Injury – Acute Care (ABI)  Acquired Brain Injury/Long Term Care (ABI/LTC)

25. 25  Case Management  Community Access  Community Guide  Community Transition  Consultative Clinical and Therapeutic Service  Day Training  Occupational Therapy  Person Centered Coach  Personal Assistance  Physical Therapy  Residential Support Services  Respite  Specialized Medical Equipment  Speech Therapy  Supported Employment  Community Access  Community Guide  Day Training  Environmental Accessibility  Financial Management  Goods and Services  Natural Supports Training  Personal Assistance  Respite  Shared Living  Supported Employment  Transportation  Vehicle Adaptation Waiver Services

26. 26 Kentucky’s Waiver Programs

27. 27 2008 2014 Cost of Waiver Programs Over Time Enrollees20082014 ABI170200 ABI-LTC-234 HCB14,06111,221 Model II6870 Michelle P-10,250 SCL3,1574,469

28. 28 HCBS Federal Final Rules Overview The Centers for Medicare & Medicaid Services (CMS) implemented new regulations for Medicaid’s 1915(c) Home and Community-Based Services (HCBS) waivers on March 17, 2014. Key elements of the rule include: ‏ PERSON-CENTERED SERVICE PLAN PROVIDER SETTINGS PERSON-CENTERED PLANNING CONFLICT-FREE CASE MANAGEMENT Providers of HCBS waiver services for the individual must not provide case management for that same individual, except if they are the only willing and qualified provider within 30 miles of the participant’s residence The service plan must reflect the needs identified through an assessment, as well as the individual's strengths, preferences, identified goals, and desired outcomes Individual leads the process to the maximum extent possible and is provided information and support to make informed choices regarding his/her services, as well as choice of providers The setting is integrated in and supports full access of individuals receiving HCBS to the greater community, giving the individual initiative and independence in making life choices

29. 29 Cabinet for Health and Family Services Questions? Thank you