In Spring of 2010 I was on a Georgetown student consulting team that worked on figuring out if it was possible to detect Medicaid fraud from #opendata in small, medium, and large states.
2. 2
Purpose
To provide an analysis of Medicaid
programs, focusing on selected states, policies,
and service cost areas in order to determine
consulting opportunities for Alvarez & Marsal.
3. 3
Outline
• Why Medicaid?
• State Selection
• Background
• Small State Analysis
• Medium State Analysis
• Large State Analysis
• Conclusion
5. 5
Spending
• Health care costs have been rising for several years
▫ Expenditures on health care surpassed $2.3 trillion in
2008
• Medicaid spending in the US (2007):
$319,676,945,585
• Starts are not well-positioned to withstand the loss
of revenue and increased cost of healthcare
associated with the economic downturn
• 1% rise in unemployment adds 1 million enrollees in
Medicaid and SCHIP
Source: KFF: Medicaid, SCHIP, and Economic Downturn: Policy Challenges and Policy Responses
6. 6
Fraud
• Medicare fraud ranges from 3 to 10 percent of
total expenditures
▫ Between $68 billion and $226 billion annually.
• Takes critical resources out of the health care
system
• Causes health care costs to rise
• Results in higher premiums for enrollees
Source: http://www.medicare.gov/Publications/Pubs/pdf/10050.pdf
7. 7
Recoveries
• Recoveries to the federal
government amounted to
$7.269 billion over the 2000–
2004 period
▫ Whistleblowers were
paid$627 million during this
time period
• Civil health care fraud
recoveries in FY 2004 were
$1.8 billion
Source: http://www.taf.org/FCA-2006report.pdf
9. 9
State Selection Process & Criteria
1. States were organized according to total
population
2. States were categorized by the number of
laws/criteria that were met (FCA, qui tam, and
DRA)
3. 11 categorically unique states were selected
ranging from large populations meeting all
criteria to small populations meeting no
criteria
10. 10
Selected States
Number of Medicaid Total Medicaid
Criteria Ordinal FMAP
State Size Residents Enrollment Spending
Met State Size (2007)
(2007-2008) (2007) (2007)
California Large 3 1 36,408,713 28.93% $35,967,973,808 50.0%
New Jersey Large 2 11 8,528,286 10.72% $8,917,247,008 50.0%
Ohio Large 0 7 11,328,525 17.97% $13,055,536,533 59.7%
Texas Large 3 2 23,881,064 17.45% $20,590,458,601 60.78%
Florida Large 2 4 18,016,995 16.75% $13,583,925,509 58.76%
Wisconsin Medium 3 20 5,502,934 17.78% $4,937,145,634 57.5%
Minnesota Medium 2 21 5,149,317 14.98% $6,191,584,929 50.0%
Maryland Medium 0 19 5,534,528 13.73% $5,435,635,386 50.0%
Nevada Small 3 35 2,571,148 11.00% $1,243,947,007 54.0%
Delaware Small 2 45 859,761 21.54% $990,917,350 50.0%
Vermont Small 0 49 611,672 25.60% $904,331,790 58.9%
Sources: Kaiser Family Foundation
11. 11
Federal Matching Assistance Percentage (FMAP)
State Size 2007 2008 2009 2010
California Large 50.0% 50.0% 61.6% 61.6%
New Jersey Large 50.0% 50.0% 58.8% 61.6%
Ohio Large 59.7% 60.8% 70.3% 73.5%
Texas Large 60.78% 60.53% 68.76% 70.94%
Florida Large 58.76% 56.83% 67.64% 67.64%
Wisconsin Medium 57.5% 57.6% 65.6% 70.6%
Minnesota Medium 50.0% 50.0% 60.2% 61.6%
Maryland Medium 50.0% 50.0% 58.8% 61.6%
Nevada Small 54.0% 52.6% 63.9% 63.9%
Delaware Small 50.0% 50.0% 60.2% 61.8%
Vermont Small 58.9% 59.0% 67.7% 70.0%
Sources: Kaiser Family Foundation
13. 13
State Policy and Fraud
• False Claims Act (FCA)
▫ Empowers the United States, and private plaintiffs suing on
its behalf, to bring lawsuits against individuals and
companies suspected of defrauding the government
• Qui Tam Action
▫ Cases brought about by a private plaintiff (whistleblower)
• Deficit Reduction Act of 2005
▫ Shift costs to beneficiaries and have the effect of limiting
health care coverage and access to services for low- income
beneficiaries; states meeting regulations increase federal
funding for Medicaid by as much at 10%
14. 14
Institutional Long-Term Care
Four types of institutional and long-term inpatient
care covered by Medicaid:
1. Nursing facility services (NF) for Medicaid enrollees
ages 55 and over
2. Intermediate care facilities for mentally retarded and
developmentally disabled individuals (ICF/MR)
3. Mental hospital services for enrollees who are 65 or
older (MH Aged)
4. Inpatient psychiatric care for enrollees younger than 21
years of age (IP-Psych <21)
Source: 2007 MAX Chartbook, CMS
15. 15
Other Service Definitions
• Durable medical equipment (DME)
▫ Includes the cost to rent, purchase, repair, or
replace medical equipment, supplies, home
improvement, and emergency response systems
• Prescription drugs
▫ Outpatient prescription drug payments
Source: 2007 MAX Chartbook, CMS
16. 16
Cost Measures
• States can elect the levels at which they provide
ILTC
▫ Complete, conditional, or none
• As such, the variable nature of their programs is
reflected within our statistics
• To help mitigate this issue, average payments
were utilized
Source: 2007 MAX Chartbook, CMS
18. 18
Spending
Federal and State Spending
(in thousands)
$1,400,000
Total Spending (In Thousands)
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0
Delaware Nevada Vermont
Small
FMAP (FY07) 50.00% 54.00% 58.93%
State Spending (FY07) $495,458 $573,086 $371,409
Federal Spending (FY07) $495,458 $670,860 $532,922
Source: Kaiser Family Foundation
19. 19
ILTC Service Costs
Average Per ILTC User
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
MH Aged IP Psych < 21 ICF/MR NF
FFS
Delaware $8,449 $58,382 $139,496 $44,155
Nevada $3,249 $26,538 $126,946 $32,020
Vermont $1,044 $0 $135,092 $29,405
Differences in IP Psych<21, can be attributed to Nevada having a cost based
negotiated rate. Delaware’s IP Psych is per diem based.
Source: MAX 2005, Kaiser Medicaid Database
20. 20
Other Service Costs
Average Payment Per User ILTC
$2,500
$2,000
$1,500
$1,000
$500
$0
Drugs DME ILTC Drug
FFS MC
Nevada $2,292 $721 $8 $19
Delaware $2,285 $716 $23 $584
Vermont $1,491 $447 $0 $0
Further exploration of differences in FFS drug costs, as well as MC costs, may be
beneficial . Vermont’s managed care plans only include MCOs, thereby eliminating
the need to pay for ILTC and drug costs individually.
Source: MAX FY 2003-2005
21. 21
Fraud and Recoveries (2007)
Legislative Criteria Total
Total Total Total
Recovered
Expenditure for Overpayments Recoveries
from ALL
State Qui Medicaid Discovered as a from ROI
FCA DRA Medicaid
Tam Integrity Result of Provider
Integrity
Activities Provider Audits Audits
Activities
Delaware Yes Yes No 1,054,000 5,168 N/A 5,302,402 503.1%
Nevada Yes Yes Yes 2,311,606 121,720 1,802,838 1,802,838 78%
Vermont No No No N/A 206,529 206,529 206,529 N/A
The Return On Investment data suggests that the most risk averse
Medicaid recovery opportunities exist in Delaware due to a lack of data in
Vermont and a poor recovery rate in Nevada.
Sources: SPIA 2007, Kaiser Family Foundation
22. 22
Problem Statement
• Cost of drugs per enrollee in DE differs
significantly when compared to other
comparable states
▫ Twice as much as VT in FFS program
▫ More than 30 times as much as NV in MC
program
• Nationwide, drug prices have been on the rise
with brand-name drug prices averaging an
increase of 9% while generic drug prices
decreased 10.6% between 2008-2009
Source: MSIS FY 2005, AARP Bulletin Today, 2009
23. 23
Existing Solutions
DE NV VT
Think DRA will reduce Not likely, but Not likely, but
N/A
outpatient Medicaid costs determined determined
Flexibility given to Medicaid Data not available and state No MCO-model
All drugs carved out of
Managed Care organizations has MCO-model Medicaid Medicaid managed
managed care
to Develop Pharmacy Policies managed care care
Rx Drug Purchasing Pool Top$ N/A SSDC
Comparative Effectiveness
Yes N/A Yes
Reviews Useful
Collection of rebates on
Physician-Administered Some N/A All
Drugs
Medicaid Claims Processing
Currently working on
Systems that Allow for the N/A Yes, system in place
upgrades
Billing of NDCs
Medicaid Medication
Yes N/A No
Management Programs
Source: National 2006
24. 24
Further Analysis
• According to OIG in 2008, the Drug Rebate
program had a difference between debits and
credits of over $98 million
▫ Further investigation of this issue with reporting
and record-keeping could reveal fraudulent
practices
• Based on the drastic differences in drug costs in
similar states, it would be beneficial to
investigate the potential for fraud within the
state of Delaware
Source: OIG 2008
25. 25
A&M Opportunities
• Assist in the restructuring of DE’s maximum allowable
limits, particularly for generic drugs and reimbursement
formulas
• Provide an analysis on the benefits of enrolling in a
different interstate bulk-purchasing program
• Develop a process that will assist Delaware with
collecting all rebates from physicians’ offices
• Advise DE regarding the advantages and disadvantages
of instituting co-payments for patients purchasing
medications
27. 27
Spending
Federal and State Spending
(in thousands)
$7,000,000
Total Spending (In Thousands)
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
Maryland Minnesota Wisconsin
Medium
FMAP (FY07) 50.00% 50.00% 57.47%
State Spending (FY07) $2,717,817 $3,095,792 $2,099,768
Federal Spending (FY07) $2,717,817 $3,095,792 $2,837,377
Source: MAX FY 2003-2005
28. 28
ILTC Service Cost
Average Paid Per ILTC User
$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
MH Aged IP Psych < 21 ICF/MR NF
FFS
Maryland $114,425 $77,398 $169,694 $38,281
Minnesota $18,558 $25,214 $59,583 $20,561
Wisconsin $17,793 $14,148 $86,626 $24,558
Maryland’s rates are far greater than similar states. Differences between ICF/MR
and NF may be attributed to MD’s use of a cost-based reimbursement method for
these services. Sources: MAX 2005, Kaiser Medicaid Database
29. 29
Other Service Cost
Average Paid Per User
$4,000
$3,500
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$0
Drugs DME ILTC Drug
FFS MC
Maryland $3,539 $1,033 $82 $224
Minnesota $3,161 $1,841 $1,245 $65
Wisconsin $2,420 $468 $9 $38
Differences in MC ILTC costs in Minnesota require further analysis. These differences
may be attributed to an increased case mix in their MC population.
Additionally, differences in average cost of DMEs would benefit from further analysis.
Sources: MAX 2005, Kaiser Medicaid Database
30. 30
Fraud and Recoveries (2007)
Legislative Criteria Total Total
Total Total
Overpayments Recovered
Expenditure Recoveries
Discovered as from ALL
State for Medicaid from ROI
FCA Qui Tam DRA a Result of Medicaid
Integrity Provider
Provider Integrity
Activities Audits
Audits Activities
Wisconsin Yes Yes Yes N/A 6,248,872 N/A 10,353,053 N/A
Minnesota Yes Yes No N/A 7,891,716 9,323,000 N/A N/A
Maryland* No No No 3,989,120 21,228,872 21,228,872 22,936,011 575%
*Maryland passed a FCA on April 9, 2010 allowing for penalties and damages for false
claims, as well as up to 30% of the proceeds to go to the whistleblower.
The Return On Investment data suggests that the most risk averse
Medicaid recovery opportunities exist in Maryland due to a lack of data in
Wisconsin and Minnesota.
Sources: SPIA 2007, Kaiser Family Foundation, MD Chamber of Commerce
31. 31
Problem Statement
• MD spends 6x more for MH aged, 3x more for IP Psych<21,
and 2x more for ICF/MR than next analyzed state
• State spends 49.6% of its budget for ILTC costs on nursing
facilities
• Residents aged 85 and older are projected to nearly double by
2030
• Patients prefer to receive LTC at home, but MD spends almost
90% of the state’s Medicaid funds on institutional care
32. 32
Existing Solutions
• Move institutionalized patients into the
community
• Home and Community Based Services (HCBS)
Waivers (FFS based)
▫ Offered to older adults, persons with disabilities,
and children with chronic illnesses
▫ MD spends 11% of its Medicaid LTC HCBS money
for older people and adults with physical
disabilities ranking it at 39th in spending on home
care services for this population
Sources: MD DHMH
33. 33
Existing Solutions cont’d
• Managed Care Programs
▫ Program for All-Inclusive Care for the Elderly (PACE)
Allows them to receive long-term care from home
Only for those in the Baltimore area
▫ HealthChoice
Coordinates care among a variety of services
Contractor is responsible for this coordination
Offer HCBS
• New Directions
▫ Allows enrollees to manage their own care
34. 34
Further Analysis
• MD is issuing more waivers, but would be
beneficial to determine if the number of
available beds is decreasing in these institutions
• Determine why cost setting commission does not
lower reimbursement rates
• Further investigation on the role fraud is playing
on high costs may be warranted
35. 35
A&M Opportunities
• Further explore who exactly is being left in institutions
and determine ways to assist them in a less expensive
manner within those facilities
• Develop solutions that will increase the number of
waivers awarded
• Assist in the expansion of managed care programs
• Review rate setting commission practices
37. 37
Spending
Federal and State Spending
$40,000,000
$35,000,000
Total Spending (In Thousands)
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
California New Jersey Ohio
FMAP (FY07) 50.00% 50.00% 59.66%
State Spending (FY07) $17,983,986 $4,458,623 $5,266,603
Federal Spending (FY07) $17,983,986 $4,458,623 $7,788,933
Source: Kaiser Family Foundation
38. 38
Spending
Federal and State Spending
$40,000,000
$35,000,000
Total Spending (in Thousands)
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$-
California Florida Texas
FMAP (FY 2007) 50% 60.78% 58.76%
State Spending (FY 2007) $17,983,986 $8,075,577 $5,596,577
Federal Spending (FY 2007) $17,983,986 $12,514,800 $7,987,348
Source: Kaiser Family Foundation
39. 39
ILTC Service Cost
Average Paid Per ILTC User
$200,000
$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
MH Aged IP Psych < 21 ICF/MR NF
FFS
California $126,827 $20,719 $78,626 $29,328
New Jersey $57,971 $78,234 $181,632 $39,765
Ohio $7,299 $5,225 $89,042 $31,520
The high costs of ICF/MR in New Jersey requires further analysis.
Source: MAX 2005
40. 40
ILTC Service Cost
Average Paid Per ILTC User
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
MH Aged IP Psych <21 ICF/MR NF
California $126,827 $20,719 $78,626 $29,328
Florida $35,367 $- $94,972 $28,848
Texas $13,800 $8,730 $66,775 $18,755
The high costs of MH Aged in CA requires further analysis.
Source: MAX 2005
41. 41
Other Service Cost
Average Paid Per User
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$0
Drug DME ILTC Drug
FFS MC
California $2,574 $264 $62 $74
Florida $2,166 $639 $32 $71
Texas $1,116 $519 $11 $351
While the number of enrollees in Florida and Texas are closer in number to California’s
enrollees, their per user payments do not contribute an explanation to California’s cost
discrepancies. In a FFS Drug cost comparison, California’s high rates in comparison to FL
and TX can be explained by their 18% AWP rate and high dispensing fees.
Source: MAX 2005, Kaiser Medicaid Databse
42. 42
Other Service Cost
Average Paid Per User
$5,000
$4,500
$4,000
$3,500
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$0
Drugs DME ILTC Drug
FFS MC
California $2,574 $264 $62 $74
New Jersey $4,561 $696 $56 $320
Ohio $2,114 $202 $4 $79
In regards to the high FFS drug payments in NJ, the high payments may be related to the low
percentage of Third Party Liability Payments and lack of required Copays. Since this
time, New Jersey has begun to require copays for their prescription drug coverage, as
such, this trend should decrease in coming years.
Source: MAX 2005, Kaiser Medicaid Databse
43. 43
Fraud and Recoveries (2007)
Legislative Criteria Total
Total Total
Total Recovered
Expenditure for Overpayments
Recoveries from ALL
State Qui Medicaid Discovered as a ROI
FCA DRA from Provider Medicaid
Tam Integrity Result of Provider
Audits Integrity
Activities Audits
Activities
California Yes Yes Yes 80,869,196 61,551,360 162,455,640 162,455,640 200%
Florida Yes Yes No 7,650,000 17,176,208 35,731,280 84,000,000 1098%
New Jersey Yes Yes No N/A 1,727,481 N/A 4,494,019 N/A
Ohio No No No N/A 7,655,831 320,440 1,152,188 N/A
Texas Yes Yes Yes 2,692,267 125,185,173 N/A 418,079,369 15530%
The Return On Investment data suggests that the most risk averse
Medicaid recovery opportunities exist in Texas and Florida. ROI data
in New Jersey and Ohio were unavailable.
Sources: SPIA 2007, Kaiser Family Foundation
44. 44
Problem Statements
• California MH Aged:
▫ Of the states considered, California has the lowest per claim payment for
Medicaid. At the same time, their 2005 MH Aged payments are 55% higher than
the other large states.
▫ The population of California residents aged 85 and older is projected to grow 98%
over the next 20 years. Furthermore, they still spend 49% of their long term care
dollars on institutional care.
• New Jersey ICF/MR:
▫ New Jersey’s ICF/MR per user expenditures are almost twice that of any other
large state.
▫ 40% of 2300 ICF/MR eligible individuals are in continuing placement status due
to a lack of appropriate facilities
▫ Prior to 2003 data was skewed due to several ICF/MR facilities inaccurately
reporting recipients
Sources: MAX 2005, AARP 2009, Wenzlow 2002, Smith 2007
45. 45
Existing Solutions: California ILTC
▫ Phase out ILTC and implement Community Based Care.
▫ Encouraging residents to purchase their own ILTC
insurance which prevents dependence on Medi-Cal
▫ Created “Medi-Cal Asset Protection” which allows seniors
to take out ILTC insurance policies to protect their assets
for their heirs. These policies are vetted by the State for
proffered benefits.
Source: Doty 2000, AARP 2009, ca.gov 2009
46. 46
Existing Solutions: New Jersey ILTC
▫ Current Legislation: New Jersey Protection &
Advocacy v. Davy
NJP&A asserts Department of Human Services
Commissioner has used Conditional Extension
Pending Placement (CEPP) status and confine
persons to state psychiatric hospitals without
creating further plans for placement
▫ May 2007 “Path to Progress” plan to transition
1,850 transitional developmental center
residents to community over next 8 years
Source: Smith 2007
47. 47
Further Analysis
• Any major discrepancy in average payments may
indicate fraud. One way to detect these discrepancies is
to look for states who have failed to report data.
• Look at the sample size of populations to ensure that
these trends are accurate. Due to the phasing out of
ILTC, only 10 people are enrolled in MH Aged ILTC in
California.
Source: MAX 2005, Wenzlow 2002
48. 48
A&M Opportunities
• Look at states who have committed to shifting from ILTC to
Community Based care. Evaluate how effective these plans
have been in transforming ILTC populations.
• Create evidence based strategies to assist states with ILTC to
Community Based care transitions based on a comparative
state by state analysis.
• Research Medicaid suits in Texas and Florida to investigate
possible patterns that lead to large ROI
50. 50
Conclusion
Findings
• ILTC
▫ Average payments were higher for service types which were cost
based rather than prospective or negotiated
• Drugs
▫ Several states with higher than average managed care drug costs
do not require enrollees to pay copayments
• DME
▫ Due to the state-by-state differences in coverage, assertions are
difficult to make regarding DME trends
▫ Large cost variations between states more closely represent
differences between reimbursement regulations and mechanisms
rather than the false claims legal climate
51. 51
Conclusion
Alvarez & Marsal Opportunities
• Assist in the restructuring of prescription drug maximum
allowable limits
• Conduct performance assessments of ILTC to HCBS
programs
• Develop strategies that will allow states to expand HCBS
programs
• Determine solutions to de-institutionalize long-term care
• Assist in the expansion of managed care programs
53. 53
Sources: All States
• 2003-2007 MAX Data
The Medicaid Analytic eXtract (MAX) data system produced by Centers for Medicare & Medicaid Services enables
much more detailed analyses of long-term care utilization and expenditures at the person level.
http://www.cms.hhs.gov/medicaiddatasourcesgeninfo/downloads/MAXVal_2003_2005.zip
• 2007 SPIA Data
The State Program Integrity Data. (SPIA) represents the first CMS approach to annually collect standardized,
national data on State Medicaid program integrity activities for the purposes of program evaluation and technical
assistance support.
http://www.cms.hhs.gov/FraudAbuseforProfs/Downloads/spiaffy2007reports.zip
• Kaiser Family Foundation: State Facts Database
http://www.statehealthfacts.org/
• Kaiser Family Foundation: Medicaid Database
http://medicaidbenefits.kff.org/
• KFF: Medicaid, SCHIP, and Economic Downturn: Policy
Challenges and Policy Responses
54. 54
Sources: Small States
• Arbamson, Richard G., et al. Generic drug cost containment in Medicaid: lessons
from five State MAC programs
• Basler, Barbara. “Drug prices soar.” AARP Bulletin Today. 16 Apr 2009.
• Medicaid prescription reimbursement rates by state. Retrieved from:
http://drugtopics.modernmedicine.com/drugtopics/data/articlestandard/drugtopics
/142005/154195/article.pdf.
• National Association of State Medicaid Directors. State Perspectives on Emerging
Medicaid Pharmacy Policies and Practices, November 2006
• Office of the Inspector General. Follow-up Audit of the Medicaid Drug Rebate
Program in Delaware. Jul 2008.
• Qualters, Sheri. Pharmacy groups sue Delaware over Medicaid drug reimbursement
rate cuts. National Law Journal: 13 Jul 2009.
55. 55
Sources: Medium States
• http://dhmh.maryland.gov/mma/longtermcare/pdf/2009/2009_2010_HCBS_book
let.pdf
• http://www.hscrc.state.md.us/index.cfm
• AARP Long-Term Care in MD (2009)
56. 56
Sources: Large States
• AARP. “Long Term Care in California” 2009.
http://assets.aarp.org/rgcenter/health/state_ltcb_09_ca.pdf
• Ca.gov . California Partnership for Long Term Care. 2009.
http://www.dhcs.ca.gov/services/ltc/Pages/CPLTC.aspx
• Doty, P. “Cost-Effectiveness of Home and Community-Based Long-Term Care
Services” HHS. 2000. http://aspe.hhs.gov/daltcp/reports/costeff.htm
• Smith, G. “Home and Community Services Litigation Report.” 2007. Human Services
Research Institute. http://www.hsri.org/docs/litigation052307.DOC
• Wenzlow, A. “A Profile of Medicaid Institutional and Community-Based Long-Term
Care Service Use and Expenditures Among the Aged and Disabled Using MAX 2002:
Final Report.” HHS, 2008.
http://aspe.hhs.gov/daltcp/reports/2008/profileMAX.htm#data
Notes de l'éditeur
Net recoveries to the federal government $6.64 billion. the ratio of the federal government’s direct benefits from civil health care fraud enforcement to its costs is 15.0 to 1.
Institutional long-term care was the most expensive type of service among persons utilizing the service. Institutional care was used by only 5.8 percent of FFS enrollees but accounted for 31.4 percent of all FFS expenditures.
SPIA FY07
Maryland’s unique Health Services Cost Review Commission. Hospital rate regulation in Maryland was established by an act of the Maryland legislature in 1971. The law created the Health Services Cost Review Commission (HSCRC), an independent State agency with seven Commissioners appointed by the Governor. The law was strongly supported by the hospital industry. The HSCRC was given broad responsibility regarding the public disclosure of hospital data and operating performance and was authorized to establish hospital rates to promote cost containment, access to care, equity, financial stability and hospital accountability. The HSCRC has set rates for all payers, including Medicare and Medicaid, since 1977 and has largely achieved the key policy objectives established by the Maryland legislature. In recent years, the HSCRC has devoted considerable resources toward the development and implementation of payment-related initiatives designed to promote the overall quality of care in Maryland hospitals. Maryland remains the only state to retain such a system. The market for health care services in the United States has failed to produce results consistent with the Maryland legislature’s founding goals. The Maryland system shows that a “macro-oriented” approach to regulation, which seeks to correct only for the most obvious market failures, can assist policy-makers in controlling cost growth and, at the same time, enhancing access to care.
Maryland spending:3.1% ICF/MR; 9.6% MH; 49.6% NF; 37.7% HHNearly two-thirds of Medicaid recipients were enrolled in the HealthChoice Program. The remaining one-third tended to be either sicker (many institutionalized) or covered by Medicare. As a result, the distribution of MD's FFS claims may seem quite different from the distribution for other states.Maryland MH Aged and IP Psych < 21: Prospective cost set by rate commission
Majority of Medicaid enrollees are in the MC program.
Source: Maryland Healthcare Commission: Long Term Care. Long-Term Services and Supports in Maryland: Planning for 2010, 2020, 2030. December 1, 2007 (November 2007)
Maryland has 6000 aged, 1200 physical, and 1200 children waiting for waivers.Wisconsin has 13296 aged and disabled awaiting waivers.
HealthChoice is the name of the Maryland’s statewide mandatory managed care program which began in 1997. The HealthChoice Program provides health care to most Medicaid recipients. Eligible Medicaid recipients enroll in a Managed Care Organization (MCO) of their choice and select a Primary Care Provider (PCP) to oversee their medical care. The MCO enrollee selects a PCP who is part of their selected MCO’s provider panel either at the time of enrollment with the enrollment broker or once enrolled in their MCO.
§ NJ: IP Psych and ICF/MR both cost based instead of negotiated§ California high MH/Aged – no clue?! But CA isn’t in the top ten highest iltc pmts so ignore difference?
§ NJ: FFS Drugs high- again, only state without a copay