Tag: State News

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Louisiana Lawmakers Try to Tighten Medicaid Cost Estimates

 
 

[ MM Curator Summary] Louisiana is trying to figure out a way to more accurately predict Medicaid spending.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

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BATON ROUGE (AP) — Louisiana lawmakers are trying a new approach to determine how much the state will spend on Medicaid services each year, as the program has ballooned to more than one-third of the state’s budget and added hundreds of thousands of people during the pandemic.

A Medicaid forecasting panel created by lawmakers last year held its first meeting Wednesday, to create a new process for estimating spending needs for a program that provides health care to 1.9 million people — about 41% of Louisiana’s population.

The Louisiana Department of Health currently does its own economic modeling and then seeks funding from state lawmakers to match the forecast, which often overestimates how much money will be needed to cover services. The Medicaid Estimating Conference will involve lawmakers, the Health Department, the governor’s chief budget adviser and an outside health care economist, along with financial advisers to the Legislature.

“This program is too big not to have adequate data,” said Sen. Sharon Hewitt, the Slidell Republican whose bill created the conference.

Louisiana’s Medicaid program is estimated to spend $16 billion in the current budget year on health care services, the large majority of it federally funded and much of it through managed care companies. Hewitt said the state’s putting up $1.8 billion of the cost from its general fund.

But estimating — and restraining — the program’s price tag can be difficult.

Many costs associated with Medicaid are out of the state’s control. To get federal Medicaid funding, states are required to provide certain services through the program, and they aren’t allowed to force people off the rolls if they took boosted Medicaid funds offered because of the coronavirus pandemic as Louisiana did.

Louisiana added more than 300,000 people to its Medicaid rolls since March 2020 when the coronavirus outbreak began.

Daniel Cocran, the state’s Medicaid deputy director, said about 70% of that growth was in the Medicaid expansion program. Democratic Gov. John Bel Edwards authorized the expansion when he took office in 2016, to cover working-age adults who don’t get health insurance through their employers. Nearly 700,000 people are currently enrolled in Medicaid through that expansion.

Many of those enrollees wouldn’t continue to qualify for Medicaid coverage because they now make too much money or stopped meeting other eligibility criteria. But Louisiana can’t kick them off the rolls because of the strings tied to the enhanced federal pandemic Medicaid financing.

Those people can be removed from Medicaid only when the federal public health emergency is lifted, Cocran said. It’s unclear when that will happen, and then federal regulations describe a lengthy process to bump someone from the program even after that, he said.

President Joe Biden’s social safety net expansion legislation pending in Congress also has further restrictions for removing people from Medicaid that would come into play if the measure passes, health officials said.

All of that will be considered as part of the new forecasting process, Hewitt said. She hopes to have the conference’s first forecast complete in December or January. The panel’s projections will be nonbinding but are expected to have a heavy influence on budgeting. The nonpartisan Legislative Fiscal Office hired a health care economist as part of the effort.

Sen. Gerald Boudreaux, a Lafayette Democrat on the conference, said he thinks the new approach can help lawmakers determine the true costs of the Medicaid program, but he also cautioned that he doesn’t want it to be used to try to limit access to health care services.

“It is very important to a lot of people, more people than some of us realize,” Boudreaux said.

 
 

Clipped from: https://www.bizneworleans.com/louisiana-lawmakers-try-to-tighten-medicaid-cost-estimates/

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Attempt to block $22 billion Medicaid contracts dismissed – Ohio Capital Journal

 
 

 
 

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Paramount has lost in court (again).

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

Appeal likely in dispute over managed care business

 
 

A judge on Tuesday dismissed an attempt to overturn more than $22 billion worth of managed-care business as the Ohio Department of Medicaid tries to reshape the way it works with 3 million low-income and disabled Ohioans.

However, questions remain about potential conflicts of interest on the part of some involved in awarding the business.

Franklin County Common Pleas Judge Julie M. Lynch dismissed an attempt by Paramount Advantage to stop the process by which the Medicaid department hopes to revamp the way it handles prescription drugs, coordinates care for kids with complex behavioral needs and delivers care to traditional Medicaid recipients. The new system is scheduled to go live next July.

Toledo-based Paramount claimed the procurement process was biased against it — and in favor of some of the country’s biggest corporations. Loss of the business will mean the loss of 600 jobs, the company’s lawyers said.

Judge Lynch said the company’s case didn’t pass legal muster.

“Paramount needed to show that the department of Medicaid abused its discretion” with clear and convincing evidence, Lynch said, later adding that Paramount “failed in every respect to meet that burden.”

In a little more than three days of testimony in late October and this week, Paramount’s attorneys entered evidence that they said showed the Medicaid department was biased against the managed-care company, which has worked with the department for more than 20 years.

For example, the Medicaid evaluators in some instances dinged relatively small Paramount for not working out of state, in contrast to huge bidders such as UnitedHealth, which works in many states.

Paramount also pointed out that while two of the successful bidders have been recently sued by the state on claims of fraud, they weren’t penalized, while Paramount got no credit for not being accused of such conduct.

And on Tuesday, the company called a statistician who testified that when they met, Medicaid evaluators lowered Paramount’s scores much more than any of the other applicants’ and in a way that was unlikely to be random.

But Lynch found the testimony and the other evidence unpersuasive, ruling that Paramount failed to show that the Medicaid department acted against it in a “conscious, intentional” way.

“While Paramount is disappointed with the court’s decision, we will continue to explore our strategic and legal options,” said a statement issued by Paramount after the ruling. “We remain committed to helping to ensure the best outcomes for our quarter of a million Medicaid members and our employees who have consistently provided them with the highest quality of service.”

An appeal of the ruling is likely, Paramount’s attorneys said.

Just before Judge Lynch read her ruling, attorney Kirstin R. Fraser complained of how slowly the Medicaid department turned over documents and other materials Paramount requested.

“We only became aware after the fact of the many conflicts of interest involved in this case,” she said.

Among possible conflicts is if Mercer, the consultant that facilitated the procurement, had clients among the companies that were selected for Medicaid contracts. The Medicaid department eventually turned over a memo addressing the matter, but the names of client companies were redacted.

Lynch on Tuesday declined to admit an unredacted version of the memo into evidence.

Another possible conflict is that Medicaid Director Maureen Corcoran seems to own stock in two of the parent companies that won business as part of the massive procurement. 

Corcoran reported owning at least $1,000 worth of each company’s stock last year as part of her regular ethics disclosure. But Medicaid lawyers conceded that Corcoran hadn’t filed an affidavit disclosing exactly how much stock she owned as she contracted with the companies.

Such a disclosure appears to be required by law. But in a court filing, Medicaid attorneys claimed that Corcoran didn’t have a conflict of interest because her investments were with parent corporations UnitedHealth Group and CVS Health, not their Ohio subsidiaries with which the Medicaid department is doing billions worth of business.

Corcoran was expected to testify about such matters, but Judge Lynch so sharply limited what Paramount’s lawyers could ask the Medicaid director that Corcoran ultimately never took the stand.

Foreshadowing issues that could be raised on appeal, Paramount attorney Shawn J. Organ listed some of the things he’d have asked Corcoran had he been allowed. Among them were questions about Corcoran’s stock holdings in managed-care companies, whether she communicated with any bidders during the procurement process and why she decided to restart contract negotiations with Buckeye Health Plan, which had just paid Ohio $88 million to settle claims of fraud.

It’s unclear whether any of these issues will matter legally, but they will likely come up before the Tenth District Court of Appeals.

Clipped from: https://ohiocapitaljournal.com/2021/11/10/attempt-to-block-huge-medicaid-contracts-dismissed/

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Medicaid managed care company sues outgoing corporate co-owner, alleging ‘sabotage’

 
 

 
 

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An Arkansas provider-led BH organization is claiming Beacon Health has been working to destroy it from the inside.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

LITTLE ROCK — Empower Healthcare Solutions, a managed care organization that serves almost 20,000 Arkansas Medicaid beneficiaries with complex health needs, filed a lawsuit in federal court on Tuesday against a Boston-based company that owns a portion of Empower but is planning to leave by the end of the year.

The suit accuses Beacon Health Options of “seeking to destroy Empower … from within” to benefit one of Empower’s competitors.

Meanwhile, a letter obtained by the Arkansas Nonprofit News Network shows state Medicaid officials have concerns about Empower’s ability to operate after Beacon’s departure is finalized. The Arkansas Department of Human Services (DHS) said in its Nov. 2 letter to Empower that it has until Nov. 24 to complete a “readiness review” ordered by DHS, which oversees Arkansas’s Medicaid program.

 
 

Empower is one of four managed care organizations that contract with DHS to pay for and coordinate care for Medicaid beneficiaries with severe behavioral health disorders, intellectual or developmental disabilities, or both. Known as Provider-led Arkansas Shared Savings Entities, or PASSEs, they were created by a 2017 state law that promised to both control spending and provide better services to this high-need, high-cost group of patients. PASSEs basically play the role of insurance companies but must be partly owned by health care providers; it also provide “care coordinators” who act as case managers for beneficiaries.

Beacon, one of the nation’s largest behavioral health companies, has owned a 16.66 percent stake in Empower since the PASSE was formed in 2017. (The rest of Empower is owned by several health care entities based in Arkansas.) Beacon also contracts with Empower to provide administrative services and has played a critical role in Empower’s day-to-day operations.

 
 

But in 2020, Beacon was acquired by insurance giant Anthem. Anthem also owns a stake in another Arkansas PASSE, Summit Community Care, a rival of Empower. A state law passed earlier this year prohibited ownership in more than one PASSE, and Beacon began separating itself from Empower.

Now, Empower’s lawsuit says Beacon has been “intentionally attempting to sabotage Empower” on its way out the door.

“Since the merger, Beacon has engaged in conduct that suggests that it is functioning as a Trojan-horse for Anthem,” Empower’s complaint says. Empower claims Beacon has refused to turn over phone numbers, email accounts and critical databases and documents as the two companies finalize their divorce.

A representative for Beacon did not respond to a request for comment on the lawsuit. But a letter Beacon sent to DHS Aug. 26 show Beacon has had its own complaints about the separation.

The Aug. 26 letter, obtained from DHS with a public records request, described a dispute over Empower’s adoption of new policies for credentialing health care providers in its network after Beacon leaves. Beacon has been responsible for provider credentialing as part of its management services to Empower. The letter indicated Beacon considers the fruits of that work to belong to it alone – not Empower – and suggested Empower’s board was attempting to “negate Beacon’s credentialing of its own network.”

“The proposed Credentialing policy could have the effect of invalidating the credentialing decisions of our existing network,” wrote Melissa Ortega, a vice president of Beacon based in Little Rock. “Beacon obviously cannot agree to any policy that will have this result. Empower has been combative and non-cooperative in addressing these concerns.”

In its lawsuit, Empower cites this episode as further evidence of Beacon’s alleged attempts to sabotage Empower. “Beacon made false representations about Empower to DHS, which representations (if believed by DHS) could jeopardize Empower’s future participation in the PASSE program,” the complaint says.

The Department of Human Services pays each PASSE a fixed monthly amount per beneficiary enrolled. PASSEs must then cover the cost of care for those members, which can include costly services such as inpatient treatment or at-home help for disabled people. In 2020, the cost to Medicaid for the roughly 50,000 PASSE beneficiaries in Arkansas was almost $1.3 billion, according to documents provided to a legislative committee in June. (Empower’s revenues for 2020 were over $460 million, according to the lawsuit.)

Empower’s complaint says that Beacon was “essentially the operations manager” for the PASSE. Under the terms of a service agreement between the two companies, Beacon provided all “services required for [Empower’s] performance of the PASSE Contract [including] all staffing and administrative services.” Beacon was “compensated handsomely” for these services, the complaint says, receiving “more than $52 million in 2020 alone.”

But because Beacon has played such a large role in Empower’s day-to-day operations, the impending breakup raises questions about what comes next for the PASSE and the beneficiaries who rely on it.

The same day Empower filed its lawsuit, Nov. 2, DHS sent it a letter warning the PASSE that it had yet to complete a mandatory “readiness review” in advance of Beacon’s exit on Dec. 31. DHS gave Empower until Nov. 24 to address a list of outstanding requirements. If the PASSE misses that deadline, the letter suggested, it could be in danger of losing its contract with the state – its sole source of business.

DHS is obligated “to ensure a smooth transition and continuation of services for any Medicaid enrollee of a managed care entity whose contract is terminated or dissolved for any reason,” wrote DHS Division of Medical Services Director Elizabeth Pitman in the letter. The agency “must be able to make a final decision” by Dec. 1, she added, so that beneficiaries “and their receiving PASSEs have adequate notice to ensure continued services and as smooth a transition as possible.”

A DHS spokeswoman did not respond to questions about steps DHS might take if the Nov. 24 deadline is not met or whether Empower’s members would be assigned to one of the other PASSEs.

Empower CEO Mitch Morris said in an email that the company was “prepared to demonstrate compliance to DHS and remain[ed] very confident that it will provide formal approval for Empower to continue operating as an Arkansas PASSE for calendar year 2022 and beyond.” Morris declined to comment on the lawsuit.

When provided with the Nov. 2 letter for review, Thomas Nichols, a lawyer with the advocacy organization Disability Rights Arkansas, said DHS was likely “covering their bases to make sure there’s not a gap in services” for beneficiaries.

PASSE members can’t afford any disruption in their coverage, Nichols said, because they are so deeply reliant on the services Medicaid pays for.

“Folks aren’t relying on this just for primary care appointments,” he said. “You have people who require 24/7 staff because they need that in order to live safely in a community setting. Folks rely on this sometimes for tube feedings … Some people rely on this for life-saving medication.”

“These are things that people have to have every single day. They have to be paid for every single day.”

Nichols said the uncertainty around Empower’s future illustrated the pitfalls of transferring responsibility for Medicaid to managed care companies.

“It is predictable that privatizing Medicaid services and feeding it to a for-profit world would result in the types of potential harms we now have,” he said. “It is inexcusable that individuals with significant developmental disabilities and mental illness are suddenly on the brink due to mergers and acquisitions.”

In addition to Beacon, Empower is co-owned by five other health care organizations. They are Arkansas Community Health Network, a consortium of four hospital systems; Statera, a long-term care company; Independent Case Management, a provider of home and community-based services for people with developmental disabilities; The Arkansas Healthcare Alliance, a group of providers for behavioral health and developmental disability services; and, ARcare, a network of clinics and other providers.

According to documents provided to a legislative committee in June, Empower has the largest share of beneficiaries among the four Arkansas PASSEs, with almost 20,000 members. Summit Community Care, the PASSE that is co-owned by Anthem, had more than 16,000 members. Arkansas Total Care, which is partially owned by health insurance company Centene, had over 13,000 members. The fourth PASSE is a newcomer to the state: CareSource PASSE, partially owned by an Ohio-based managed care company, was licensed earlier this year.

 
 

Clipped from: https://www.jonesborosun.com/news/medicaid-managed-care-company-sues-outgoing-corporate-co-owner-alleging-sabotage/article_bdf459e8-031e-5b4a-8360-72d21cfcbc52.html

 
 

 
 

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South Dakotans will vote on Medicaid expansion in 2022, pending petition validation

MM Curator summary

The state hospital association has gathered enough signatures for its version of the voter Medicaid expansion ballot initiative.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

PBS NewsHour

Voters will decide whether to expand Medicaid to more low-income South Dakotans as long as the secretary of state verifies enough petition signatures were turned in on Monday.

South Dakotans Decide Healthcare said it turned in 46,119 signatures from registered South Dakota voters. That’s more than the 33,921-signature threshold needed for initiated constitutional amendments to be placed on the November 2022 ballot.

The number “really shows the grassroots energy and excitement around this,” said spokesman Zach Marcus.

South Dakotans Decide Healthcare was the only group to turn in its proposed ballot question ahead of Monday’s deadline for initiated constitutional amendments. Initiated measures have a later deadline.

Medicaid is a federal-state health insurance program for low-income people. South Dakota is one of 12 states that has not accepted federal incentives to expand Medicaid eligibility, according to the Kaiser Family Foundation.

Medicaid expansion has only failed once when put before voters, according to Health Affairs. Voters in Maine, Idaho, Utah, Nebraska, Oklahoma and Missouri approved expansion. Montanans rejected expansion — which would have been covered through a tobacco tax increase — but lawmakers later approved it.

 
 

The South Dakota amendment would expand Medicaid to people between 18 and 65 who earn 133% or less of the federal poverty level.

Expansion would make Medicaid available to 42,500 additional South Dakotans in its first year, according to the non-partisan Legislative Research Council.

Studies show Medicaid expansion improves healthcare outcomes while producing economic benefits for recipients, healthcare systems and the overall economy.

Medicaid expansion faces a challenge after the Legislature voted in 2020 to refer a constitutional amendment to the voters during the June 2022 election — before the Medicaid vote in November 2022.

The proposed amendment says any ballot question that raises taxes or spends at least $10 million — such as the Medicaid expansion question — must be approved by 60%, not 50%, of the voters.

Sen. Lee Schoenbeck, R-Watertown, supports the amendment.

 
 

Schoenbeck “acknowledged that his expedited push was motivated by the Medicaid expansion campaign, but argued the vote threshold should apply to all ballot initiatives that levy taxes or spend significant state funds,” according to the Associated Press.

Expansion supporters are concerned about voter turnout in the June election since it’s a primary election without a presidential race. Just 26% of South Dakota voters participated in the June 2018 election compared to 65% in November.

“When we educate voters on why this is going to be helpful for South Dakota, when we educate voters on why this matters and will help them and their families, South Dakota voters respond to this,” Marcus said. “So if we need to get 60% of the vote for this to pass, that’s what we’ll do.”

South Dakotans Decide Healthcare is a statewide ballot question committee that raised $21,639 by the start of 2021, records show. Donors include the AARP, Farmers Union, healthcare organizations and the Fairness Project, a D.C.-based social and economic justice nonprofit.

Proposed initiated amendments that won’t be on the ballot addressed redistricting and elections. Those groups did not turn in petitions Monday, according to the secretary of state. A proposed initiated measure for recreational marijuana and an initiated measure that also addresses Medicaid expansion have a May 3 deadline.

 
 

Clipped from: https://listen.sdpb.org/healthcare/2021-11-08/sd-medicaid-expansion-to-appear-on-2022-election-ballot-pending-validation

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Delaware- State auditor presses for Medicaid information

 
 

 
 

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The state auditor is being refused data needed to confirm the state has followed Medicaid eligibility determination laws.

 
 

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

State Auditor Kathy McGuiness is seeking Medicaid information for a performance audit after the Department of Health and Social Services went to court to quash her request. FILE PHOTO

State Auditor Kathy McGuiness took on the Department of Health and Human Services Nov. 2 in her months-long attempt to audit Delaware’s Medicaid program.

“We have been doing performance audits for decades,” McGuiness said during a hearing in Superior Court in opposition to DHSS’s attempt to avoid a Medicaid audit. “By limiting information, it hinders the auditor’s ability to do the job.”

In May, McGuiness began seeking information from DHSS to determine the eligibility of people who are receiving Medicaid. DHSS has pushed back, saying the auditor has no right to personal identifiable information, and it went to court to quash the auditor’s request.

McGuiness appealed the motion to quash, and both sides were heard by Superior Court Judge Jan Jurden.

Deputy Attorney General Annie Cordo said McGuiness is seeking to do an audit that is beyond the realm of her duties, even though McGuiness said previous auditors have conducted performance audits.

“Just because something happened once and one state administrator permitted it to happen does not necessarily mean it falls legally within the authority of what the auditor is permitted to do,” Cordo said. “We need to look at what is in the Delaware Code, which is a post audit of financial transactions, not a performance audit of how the program is in fact run, looking for efficiencies and weaknesses.”

McGuiness said her office is not seeking the entire Medicaid database, but income information would be needed to determine the eligibility of Medicaid recipients.

In a June 30 audit conducted by independent auditor CliftonLarsonAllen, the audit found DHSS’s Medicaid program did not consistently follow procedures to determine and monitor provider eligibility. The audit also found the program is unable to support provider eligibility, which may result in un-allowed costs.

Jurden will decide whether the state auditor can proceed with a performance audit with access to Medicaid information.

 
 

Clipped from: https://www.capegazette.com/article/state-auditor-presses-medicaid-information/229980

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Illinois’ $16 billion health program is riddled with industry ties and potential conflicts of interest

 
 

 
 

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An extensive system of interconnected contracts and agency roles is investigated in this expose.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

 
 

DAVID JACKSON Better Government Association

The upper echelon of the state agency charged with overseeing Medicaid is peppered with representatives of the for-profit insurance industry state officials are supposed to be policing, a Better Government Association investigation has found.

An examination of state contracts, salary data, pension statements, court records and internal correspondence identified more than a dozen top-level Medicaid officials in Illinois who have current or recent financial ties to the giant insurance companies now managing the $16 billion per year taxpayers spend to provide medical care to people who cannot afford health coverage.

Officials such as the state deputy administrator who runs Medicaid after a 20-year career as an Aetna senior executive, or the state’s “expert adviser” on Medicaid policy, who is also an Aetna lobbyist, or the consultant who advises state officials while taking fees from the insurance companies.

The BGA disclosures about potential dual loyalties come at a time when struggling health care providers complain the state’s faulty oversight of Medicaid brings record-level profits to insurance companies, even as they deny and delay claims.

The state’s top health care official rejects the suggestion that taxpayer money is being mismanaged or that conflicts of interest are undermining the agency’s objectivity at a time when the COVID-19 pandemic is putting the state’s health care system under stress.

Illinois Department of Healthcare and Family Services Director Theresa Eagleson said all potential conflicts are disclosed and vetted, and officials with dual financial interests are required to recuse themselves from agency decisions that affect their bottom line.

“This is a really big, complex agency, and we’re proud to employ a diverse array of people who bring a lot of experience with Medicaid, with clinical care, with finance, with insurance,” Eagleson said. “We are very careful to follow all the rules.”

HFS officials told the BGA they talk to a wide array of stakeholders, including lawmakers, frontline medical providers and consultants from every industry that is involved in Medicaid. In some cases, they said, state statute requires HFS to talk to industry representatives and their private consultants.

While public records reveal no overt acts where these conflicts led to personal financial gain, ethics experts said a bigger concern centers on how the insurance companies have access at the highest levels of government when Medicaid patients do not.

State ethics laws require a one-year “cooling-off period” before former state employees can procure state contracts. But in general, the walls preventing ethical conflicts or their appearance are flimsy, experts say.

“When the relationships between the government and industry are so cozy, when there are so many financial entanglements, that necessary wall starts to look like Swiss cheese,” said Alisa Kaplan, executive director of the watchdog group Reform for Illinois. “How is the public supposed to look at that and trust that the government is putting their interests first?”

Lawmaker blasts ‘interbreeding’

Revolving doors and conflicts of interest have emerged at virtually every level of American government, from municipal offices to federal agencies. State governments, including Illinois, impose an array of financial disclosure rules and cooling-off periods to stop private interests from co-opting the public sector.

The Illinois Medicaid merry-go-round has been whirling under three successive governors — Democrat Pat Quinn, Republican Bruce Rauner and current Gov. J.B. Pritzker, a Democrat.

“It’s like interbreeding here,” said state Rep. Fred Crespo, a Democrat from Hoffman Estates. “How can they have their hands out to the insurance companies and at the same time be making Medicaid policy?”

In the Illinois Medicaid program, officials and industry executives say they carefully vet potential conflicts through frank, top-level discussions. But the BGA found little public disclosure as program leaders toggle between government appointments and top jobs at the for-profit insurance firms.

“The revolving door and apparent conflicts of interest raise ethical concerns about corruption that damage the public’s support for state government in general and the state’s Medicaid program,” said Kent Redfield, a professor emeritus of political science at the University of Illinois at Springfield, who reviewed the BGA’s findings.

“Clearly, the appearance of bias is there, and that reduces the effectiveness of the Medicaid program,” Redfield said. “The overall picture assembled by the BGA is that the state’s process for managing Medicaid payments is heavily influenced by people and organizations with an insurance industry perspective.”

Consider:

Howard A. Peters III

 
 

Since 2017, Howard A. Peters III has earned $105,000 per year through the state Office of Medicaid Innovation as an “expert adviser” to HFS. He also sits on the HFS Medicaid Advisory Committee, as well as the Illinois Medicaid Telemedicine Task Force.

At the same time, Peters lobbied the agency and lawmakers on behalf of insurance giant Aetna, one of the four companies hired by the state to run the Medicaid program.

His lobbying firm, HAP Inc., which counts Aetna among its handful of clients, also contributed $70,000 to state politicians since Peters joined the state payroll.

Contacted by the BGA, Peters said his dual roles were fully disclosed and discussed with former HFS Director Felicia Norwood and current director Eagleson before he accepted the state job.

“They understood that I had Aetna as a client,” Peters said. “There is no secret here.”

“I wouldn’t say (it was) what you might call a formal process, but it certainly was a very conscious discussion and a conscious decision about how this would work and the importance of not mixing and mingling, if you will — not having conflicts,” Peters said. “The department certainly doesn’t want the very issue that you’re raising, and I don’t, either.”

Peters said he sees no conflict between his dual roles. State officials are scrupulous about guarding against potential conflicts, he said.

“I don’t think there’s a revolving-door concern,” Peters said. “I think that the state has stringent regulations about what you can do when you leave state government. From what I see in terms of how they conduct their business and what I know about the leadership and their character, I don’t have a reason to be concerned as a citizen and as a person who cares about the quality of the government.”

Eagleson, in a separate interview, said Peters is deliberately excluded from discussions involving the four MCOs, including Aetna.

Eagleson said Peters’ longtime involvement in state government, including Cabinet posts, make him “eminently qualified to be a senior adviser” at her agency.

“Everybody is transparent, following the rules,” she said. “He never participates in any meeting that has anything to do with regulating the managed care companies.”

“The work that I advise the department on is not involved with Aetna or the managed care organizations,” Peters said, adding that he advises HFS on a long-term project called health care transformation and on the department’s effort to increase staffing and improve conditions in nursing homes.

Peters said he has not been paid in his roles as current member and former chairman of the Illinois Medicaid Advisory Committee, a panel that includes insurance industry leaders and counsels HFS with respect to Medicaid policy and planning. Rauner in 2018 appointed Peters as the unpaid co-chair of the state’s Medicaid telehealth task force.

Peters’ state salary is paid through the University of Illinois’ Office of Medicaid Innovation, or OMI, an organizational unit within the university that is funded by HFS.

The university office operates under HFS’ direct guidance and through HFS Project Orders, according to records provided to the BGA by the university.

Peters was hired at OMI when it was run by Eagleson, who served as OMI’s $198,000-per-year executive director at the time.

“Theresa was head of the Office of Medicaid Innovations, Director Norwood was director of the Department of Healthcare and Family Services at the time, so they both were aware of my work, and asked me if I was willing to serve them as part-time capacity,” Peters told the BGA.

Peters declined to provide details about his lobbying for Aetna.

“I care about my reputation, and I care about the reputations of the people I’m working with,” Peters told the BGA. “If there’s an issue that remotely looks like I can have an interest that’s not theirs, I’m not involved in that issue.”

Robert Mendonsa Jr.

As deputy administrator at HFS, Robert Mendonsa Jr. has been in charge of managing the state’s Medicaid contracts with the MCOs since 2015. That state appointment came after his 20-year career as a senior executive at the insurance company Aetna.

Mendonsa’s wife, Kelli, is also a senior project coordinator at Blue Cross, and has held similar positions at two other MCOs.

“I’m responsible for managing the MCO contracts,” Mendonsa said in a court deposition last year. “It’s making sure they are complying with the contract, and we are monitoring their performance, and we are driving continual quality improvement.”

Mendonsa was the CEO of Aetna Better Health, the company’s Illinois MCO, until November 2012, records show. Before that, he was president of the company’s 16-state region that included Illinois.

Mendonsa declined comment, but in the deposition, he explained why he left his lucrative corporate job for state government service.

“I was just very intrigued by what I could do working for the state. And I did very well in my prior life, so I was able to not care about the money and do what I really wanted to do,” he testified. “I believe in managed care. And I think that we can improve quality and improve the quality of life and save money at the same time.”

Mendonsa also for several years was president of the board of the Illinois Association of Health Plans, an insurance industry advocacy group.

Mendonsa first joined the state payroll at HFS in March 2013, records show. Two years later, he was appointed to manage the MCO contracts, his current job.

Redfield said Mendonsa’s extensive background with Aetna prior to joining HFS creates the appearance of “a professional bias,” and Mendonsa’s wife working for the MCOs while Mendonsa oversaw the MCO program “would appear to create a personal conflict of interest for Mendonsa.”

HFS officials told the BGA that Mendonsa’s insurance industry tenure gives him unique expertise and helps HFS hold the MCOs accountable for meeting their contract requirements. He disclosed his wife’s current MCO position to the HFS ethics officer, agency officials said, and she does not directly interact with HFS and did not help negotiate the state’s current contracts.

Through an HFS spokesman, Mendonsa told the BGA he emptied his Aetna retirement account before joining the state agency, taking half as a lump sum and placing half in an account unaffected by Aetna’s bottom line. Those funds were later divided with a family member, court records show.

Eagleson told the BGA she was the Medicaid administrator when Mendonsa was hired. “It was my understanding, when Robert was hired, that he had no retirement benefits that were contingent on the performance of Aetna,” she said.

Mendonsa’s 2015 HFS promotion came when Norwood led the agency. Norwood headed Aetna before Rauner appointed her as the HFS director. As the HFS director, Norwood oversaw an acceleration in the privatization of Illinois’ Medicaid program.

A 2017 investigation by the state executive inspector general’s office found Norwood engaged in improper communication with a lobbyist when Norwood ran HFS. Norwood and Norwood’s deputy, Teresa Hursey, discussed a large Medicaid contract sought by one of the lobbyist’s clients, that report states.

Months later, in 2018, Norwood returned to the MCO industry and by last year earned nearly $8 million as executive vice president and president for insurance provider Anthem Inc.’s government business division. Hursey also joined Anthem.

Douglas Elwell

A former Illinois Medicaid administrator, Douglas Elwell remains an unpaid adviser to HFS Director Eagleson, even as he runs the for-profit national consulting firm Health Management Associates (HMA).

Elwell is one of at least 10 top Illinois Medicaid officials who have come from or gone to HMA in recent years.

Emails obtained under the Illinois Freedom of Information Act over a yearlong period reveal more than 50 conversations between Eagleson and Elwell ranging from Medicaid provider billing disputes to policy questions.

As CEO of HMA, Elwell heads one of the blurriest players in the Illinois Medicaid money game: HMA’s clients include the Medicaid MCOs, but it also holds its own state contracts for services to HFS and the state prison system, the BGA found.

The correspondence suggests familiarity and professional trust.

When Eagleson wanted to gather a team of dependable advisers in August 2020, she invited her chief of staff, a state Medicaid deputy and a top state researcher. Eagleson also included Elwell, according to emails obtained by the BGA through an open-records request.

“Doug and I were just talking. Could the five of us spend some socially distanced quality time together for a longer dinner and brainstorming in Springfield next Wednesday or Thursday evening?” Eagleson’s email began.

Eagleson suggested an upscale contemporary American restaurant with a Napa Valley-style tasting room.

“I honestly haven’t dined out inside yet but am willing to try to find the right place,” Eagleson wrote.

Elwell has been back and forth through Illinois’ revolving door. He spent 12 years as a principal, managing principal and interim CFO of HMA. Then Elwell led the Cook County Health and Hospital System from November 2014 through early 2019. He came to HFS for one year as state Medicaid administrator, then in February 2020 rejoined HMA, first as COO and now as CEO of the consulting firm.

HMA does not publicly disclose its industry clients, but the BGA found it has included some of the top MCOs operating in Illinois and nationally: Centene Corp., Blue Cross, Aetna Health and, in recent years, Molina Health.

In state contract filings, HMA reported that 45% of its corporate stock is owned by funds connected to the Chicago private equity firm Beecken Petty O’Keefe — also called BPOC — which offers health-care-focused investment funds. In Illinois contract disclosures HMA listed 2019 sales revenue of $94.7 million from all sources nationwide.

While serving for-profit clients and investors, HMA also wins government contracts in Illinois and numerous other states, as well as in Cook County. HMA since 2018 has held state of Illinois consulting contracts worth $1.3 million with HFS, the Department of Corrections and the Department of Human Services.

Redfield called it a “troublesome economic conflict of interest” that HMA had contracts with state MCO regulators and also with the individual MCOs.

Elwell told the BGA that HMA had a “very elaborate firewall system” to avoid ethical conflicts. “We basically train all of our people, we test them, and we are very transparent with the managed care companies, as well as with the Medicaid agencies,” Elwell said.

“We care very deeply about our reputation, and we care very deeply about the reputations of people who work with us. So I understand the appearance, but I can tell you, in fact, we spend a lot of time and a lot of money to make sure we’re avoiding that conflict and are very transparent.”

Elwell said HMA has a contract to help Illinois establish its health information exchange and simultaneously advises the MCOs on unrelated issues, such as how to meet quality assurance standards in Illinois or how to team up with local organizations that assist Medicaid patients.

“I don’t feel I have special status, other than as part of a sounding board,” he said. “These are pretty independent people. They’re good at it without me.”

“I care what happens to Medicaid in Illinois, and I’m always going to care, and sometimes I am sure I am giving them my advice when it’s not wanted and not followed,” Elwell said. “But I care enough that, when asked, I am going to give them my best idea.”

 
 

Clipped from: https://pantagraph.com/news/state-and-regional/illinois-16-billion-health-program-is-riddled-with-industry-ties-and-potential-conflicts-of-interest/article_66a01162-9b0f-5753-803e-ab6d34fe1180.html

 
 

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Oklahoma- Hospital officials don’t want to pay for Medicaid expansion

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Oklahoma hospitals are not as supportive of Medicaid expansion now that they won’t make as much money off of it.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

Oklahoma hospitals were among the most prominent supporters of State Question 802, which expanded the state’s Medicaid program to include many able-bodied adults starting July 2021.

But now, only months after the expansion took effect, hospital officials say they don’t want to pay the Supplemental Hospital Offset Payment Program (SHOPP) fee that partially covers the state cost of expansion, and instead urged state lawmakers to divert other tax collections away from other uses to subsidize hospitals.

“In the discussions we’ve had out here with many of you over the past two years, a lot has changed, and we always came to talking with you—in Medicaid-expansion terms—to say hospitals would like to be the payer of last resort,” said Patti Davis, president of the Oklahoma Hospital Association.

“Our whole purpose in asking for this was to say, ‘What can we do to help reduce that SHOPP assessment?'” said Jimmy Durant, director of government affairs for SSM St. Anthony.

Hospital officials made their pitch during a recent study conducted by members of the Senate Appropriations Committee.

Under the Medicaid expansion authorized by the federal Affordable Care Act, better known as “Obamacare,” the federal government matches $9 for every $1 in state tax funding provided to cover expansion.

Advocates of expansion, which included hospitals, argued the state cost was negligible and that “free” federal money would more than offset any state expense.

Hospital officials also lobbied the Oklahoma Legislature to enact the SHOPP fee in 2011. The fee, assessed on nearly 70 hospitals’ revenue, is used to generate federal matching funds and boost hospitals’ Medicaid payments.

The Oklahoma Hospital Association supported creation of the SHOPP fee in 2011, and even declared that the SHOPP fee would “diminish the need for cost shifting” and that, because of the federal matching funds generated by the fee, SHOPP would “actually increase the income to hospitals.”

To cover the state cost of Medicaid expansion imposed by SQ 802, the SHOPP fee is scheduled to increase. The SHOPP fee rate is capped at a maximum of 4 percent and is currently 2.5 percent.

Figures presented by the Oklahoma Hospital Association showed that Medicaid expansion will dump $1.3 billion into the coffers of health providers this year, but officials claimed that hospitals will nonetheless struggle to pay an additional $37 million for the half-point increase in the SHOPP fee rate scheduled to take effect in 2022.

Davis noted 68 hospitals will be paying higher SHOPP fees in the years ahead to partially fund the state government cost of Medicaid expansion.

“That’s $37 million for the first year. The next year that would double. And then the next year, it would be one-and-a-half times,” Davis said. “So, you can see why we’re interested in having this conversation.”

Durant said SSM officials anticipate paying $24 million to $25 million more in SHOPP fees over the next three years combined.

However, SSM hospitals are on pace to reap $36 million during that time via reduced write-offs because of Medicaid expansion, according to figures presented during the study. Durant said SSM’s three hospitals, which represent only a small share of all hospitals statewide, are seeing $1 million per month less in write-offs under expansion.

“Since expansion, have hospitals seen a benefit? And the answer to that, for our system, is absolutely,” Durant said. “We have seen less no-pay, write-offs.”

Hospital requests to offload their share of Medicaid-expansion costs come even as hospitals are seeing a huge inflow from federal COVID-bailout funding. Federal funding has provided certain hospitals between $50,000 and $77,000 per COVID-19 admission in the past year-and-a-half.

Davis conceded that Oklahoma hospitals “have received a lot of federal funding” for COVID expenses, but said “it has not been equal” so that “everyone was held harmless and no one has losses.”

“There’s a misnomer among the public that COVID, because hospitals are so full, that this has been a boon for hospitals,” Davis said. “Let me just say, first and foremost, COVID has been very hard on our members.”

She said some hospitals had “high COVID costs” and are now “in tough spots” financially despite the Medicaid expansion payments and federal COVID funding.

Durant said SSM requested the legislative study because SSM officials want state sales taxes collected on marijuana sales to be directed to cover the cost of Medicaid expansion instead of SHOPP fees.

In addition to the 7-percent excise tax on marijuana, which was part of the ballot measure that legalized the drug in Oklahoma, state government also collects sales tax on marijuana sales. Durant said much of the tax money generated by “medical” marijuana sales is not going to medical entities.

“Right now, the way it’s broken out, some of the money goes to the Education Reform Revolving Fund, teachers’ retirement, tourism-promotion fund,” Durant said. “If we’re going to address health care in the state of Oklahoma, and we’re going to have a tax on ‘medical’ marijuana, shouldn’t we use that money more for medical purposes than for maybe some of these other purposes?”

Durant said the state sales tax on marijuana would produce $35 million annually and that half of that amount could be used to replace hospital SHOPP fees. Senate staff indicated state sales-tax collections on marijuana may run as high as $42.5 million.

However, one lawmaker questioned whether the hospitals’ proposal would be popular with voters.

“Is your view that the designations that the people voted on — that specifically focused on common education — was solely for what was later interpreted as excise tax?” said Sen. Julia Kirt, D-Oklahoma City. “Because I sure know that when I was out meeting voters, they were very concerned about those funds going towards common education.”

The hospitals’ proposal also contrasts with promises those entities made when advocating for Medicaid expansion.

In a 2018 column, Davis declared, “The notion that expanding health care coverage would take money away from other areas, such as education, simply isn’t true.”

Ads for the “Yes on 802” campaign also promised that Medicaid expansion would result in a “more financially secure rural health care system” and “save rural hospitals.” But one rural lawmaker indicated the reality of Medicaid expansion has not lived up to the hype.

“After we redistrict, I’ll have almost 25 percent of the total state’s area. I’ve got more hospitals in my district than anyone,” said Sen. Casey Murdock, R-Felt. “And they’re all struggling.”

 
 

Clipped from: https://www.ocpathink.org/post/hospital-officials-dont-want-to-pay-for-medicaid-expansion

 
 

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Audit shows state Medicaid agency overpaid clinic by $4.7 million

MM Curator summary

 
 

TN Medicaid paid almost $5M for fake visits at a primary care clinic.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

A new audit from the State Comptroller’s Office says the state Medicaid agency overpaid a clinic by $4.7 million.
 

The audit says the Grove Primary Clinic in West Tennessee inaccurately reported patient reimbursements to the state through either mistakes or fraud.

Documents say the clinic inflated their patient count by more than 44,000 visits over a five-year period, from 2014-2019.

TennCare reimbursed the clinic for the overreported visits.

The audit says the clinic is obligated to return overpayments and could be subject to fines.

The clinic couldn’t be reached for comment because it closed just one day after auditors contacted the owners about their examinations.

This audit comes just one week after TennCare was named in a different federal audit.
 

That audit from the federal Office of the Inspector General found the state may owe hundreds of millions of dollars to the federal government due to mistakes, over-billing, and improper documentation.

The director of TennCare strongly refutes the federal audit, calling it frustrating and unreasonable.

“What the audit is claiming is that we overclaimed those federal dollars and of course we disagree with that,” Director Stephen Smith said. “We provided in our opinion completely acceptable and suitable information.

The federal investigation is still active, and TennCare is working to appeal the claims right now.

TennCare declined to comment on the audit on Grove Primary Clinic, referring Fox 17 News to the investigation documents.

 
 

Clipped from: https://fox17.com/news/local/audit-shows-state-medicaid-agency-overpaid-clinic-by-47-million

 
 

 
 

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Assembly Health Committee taking testimony on Medicaid effectiveness, sustainability

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NY is reviewing the effectiveness of cost savings measures put in place 10 years ago.

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

ALBANY, NY (WRGB) — Assembly Health Committee Chair Richard N. Gottfried will take testimony Monday morning to examine the Medicaid program’s efficacy and sustainability.

In 2011, the Medicaid Redesign Team (MRT) was established to reduce costs to the state Medicaid program. The resulting changes shifted almost all the remaining benefits and beneficiaries not already in managed care into managed care plans.

MORE: Will booster shots change the definition of ‘full vaccinated’?

The Medicaid Global Spending Cap, also created in 2011, controls the overall Medicaid spending in the state budget. The Fiscal Year 2021 Budget reconstituted the MRT forming the MRT II to once again find solutions to contain spending growth.

Since the implementation of the initial MRT actions and budget actions in subsequent years, including the MRT II, advocates have cited numerous ways these changes are affecting the Medicaid program’s ability to provide an adequate safety net.

 
 

Clipped from: https://cbs6albany.com/news/local/assembly-health-committee-taking-testimony-on-medicaid-effectiveness-sustainability

 
 

 
 

 
 

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UnitedHealthcare to become first for-profit HMO in Minnesota’s Medicaid program

MM Curator summary

 
 

UHC is among the plans who recently won in MN after the state ended the 40+ year ban on for-profit MCOs.

 
 

 
 

The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.

 
 

 
 

Jim Mone, Associated Press

UnitedHealth Group, based in Minnetonka, operates Optum and UnitedHealthcare, the nation’s largest health insurer.

Minnesota’s health insurance program for lower-income residents is adding UnitedHealthcare as an option next year, a contract award announced Monday that makes the health insurance giant the first for-profit HMO in the managed care program.

The Legislature in 2017 passed a law allowing for-profit competition in the market for Medicaid health plans, which for 40 years had been reserved for Minnesota’s nonprofit health insurers.

With state contracts that cover just the seven-county metro announced Monday, beneficiaries across the Twin Cities area will be able to select Minnetonka-based UnitedHealthcare among multiple health plan options to provide their state-funded benefits. Health maintenance organizations (HMOs) are a type of health insurance.

“Minnesota was one of the last — if not the last — states in the nation to allow for for-profit health care plans,” Jodi Harpstead, the state’s Human Services commissioner, said in an interview.

“Interesting that UnitedHealth is a for-profit health plan that’s actually headquartered in the state of Minnesota, so [the company] certainly understands Minnesota in a lot of ways,” Harpstead said. “They’re very large. With that comes all kinds of data and other capacities, which could be beneficial.”

UnitedHealthcare has been making a push since 2017 to do more business in its home state. The company, which is the health benefits division of UnitedHealth Group, started by introducing its Medicare Advantage health plans and selling more types of coverage for employer groups.

“We are honored to have received a contract from the state of Minnesota, which will allow us to serve more people in our home state, many of whom are our friends and neighbors,” Victor Fields, the chief executive of UnitedHealthcare Community Plan of Minnesota, said in a statement.

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UnitedHealthcare will now have access to another portion of Minnesota’s health insurance market — one that was famously reserved for nonprofits. Before the 2017 law, for-profit insurance companies could not get an HMO license in Minnesota, and only HMOs could bid on the state’s managed-care business in Medicaid.

The state-federal Medicaid program primarily covers low-income people under age 65, although others can qualify in certain circumstances. At UnitedHealthcare, Medicaid enrollment has grown by about 30% over the past five years to just over 7.5 million people at the end of September.

Harpstead said the state Department of Human Services, in conjunction with leaders from seven metro counties, scored all bids submitted by HMOs to select winners. Health plans were asked, in particular, to described how their services could help eliminate disparities while increasing equitable health outcomes. UnitedHealthcare scored high enough through that process, she said, to become an option throughout the region.

Nonprofit carriers Blue Cross and Blue Shield of Minnesota, HealthPartners, Hennepin Health, Medica and UCare also were awarded contracts for anywhere from one to seven counties. Beneficiaries can select from at least three HMO options in each county.

“When a new player enters the field, normally they would be picking up new enrollees — not having people change,” Harpstead said. “People are allowed to change, and United is free to make the case that they should consider that, but most people don’t change their health plans.”

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In Hennepin County, Minnetonka-based Medica also will be a new option for 2022. In Ramsey and Scott counties, the HMO from Eagan-based Blue Cross will no longer be an option. That means about 75,000 people in those counties need to pick a new health plan, or they automatically will be enrolled in an HMO.

Altogether, the state in 2022 will pay the companies $3.87 billion, which they will use to cover medical expenses for some 600,000 adults and children in the program.

Minnesota’s ban on for-profit HMOs was adopted in the early 1970s and driven by consumer protection concerns. Lawmakers worried the profit motive would prompt companies to skimp on health care, and some DFLers raised those concerns again in 2017.

But Republicans in the Legislature argued for-profit competition would expand options in the state’s health insurance market. The ban was repealed at the time as part of a bill to create a state-funded reinsurance program to combat runaway premiums on health plans sold to individuals.

“If they’ve not experienced a for-profit health plan, some people are nervous about what that might mean,” Harpstead said on Monday. “I think it all remains to be seen as we get started here.”

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In 2018, Minnesota was one of 39 states that was hiring health insurers to manage care for Medicaid beneficiaries, according to Kaiser Family Foundation. The California-based group estimated that UnitedHealthcare at the time was the second-largest of six Fortune 500 companies in the Medicaid HMO market.

The contracts announced Monday cover the state’s MinnesotaCare and a large share of Minnesota’s Medicaid program, which is called Medical Assistance. Overall expenses in what’s known as the Prepaid Medical Assistance Program will grow by 9.7% next year, Harpstead said, due to a combination of growing health care costs and new benefits for enrollees.

 
 

Clipped from: https://www.startribune.com/unitedhealthcare-to-become-first-for-profit-health-insurer-in-minnesotas-medicaid-program/600112067/