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Auto-Assignment and Enrollment in Medicaid Managed Care Programs

Published online by Cambridge University Press:  01 January 2021

Extract

In the face of escalating Medicaid costs and anticipated reductions in federal Medicaid spending, states are increasingly converting from fee-for-service (FFS) to managed health care systems. The interrelated issues of enrollment and auto-assignment are fundamental to the overall success or failure of Medicaid managed care programs. The purpose of this article is to suggest how policy makers, consumer advocates, and providers should address these issues. My major premise is that implementation of managed care will proceed more smoothly if states adopt enrollment strategies that promote voluntary selection of health plans by Medicaid consumers, minimize the likelihood of auto-assignment, and mitigate the negative consequences of mandatory assignment of consumers to managed care organizations (MCOs).

States seeking to implement Medicaid managed care must apply for a waiver from the secretary of the Department of Health and Human Services (DHHS). Two different types of waivers are available to implement Medicaid managed care.

Type
Article
Copyright
Copyright © American Society of Law, Medicine and Ethics 1996

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References

Regarding the financial pressure on state governments brought about by the growth of Medicaid expenditures, see, for example, Freund, D. Hurley, R., “Medicaid Managed Care: Contribution to Issues of Health Reform,” Annual Review Public Health, 16 (1995): At 474. For a discussion of the impact of proposed federal spending reductions on state Medicaid programs, see Holohan, J. Liska, D., The Impact of the “Medigrant” Plan on Federal Medicaid Payments to States (Washington, D.C.: Kaiser Commission on the Future of Medicaid, Dec. 1995).Google Scholar
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Managed care has changed the traditional relationship between physician and patient. The physician can no longer function entirely as the patient's advocate; he/she must also serve the MCO's goal of controlling costs. Physicians may be contractually bound to financial arrangements that discourage them from providing care, or to “gag” rules that prohibit them from saying anything negative about the plan and may prevent them from informing patients about their medical needs. See, for example, Kreier, R., “New York Suit Fights Increasingly Common HMO “Gap Rules.”” American Medical News. Dec. 1, 1995, at 5.Google Scholar
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The Rhode Island Medicaid managed care program, RIteCare, developed an algorithm that cost over $100,000 to develop, but then the state manually auto-assigned recipients to the lowest bidding plan, United Health Care. Notably, this health plan had the most non-English-speaking members but no materials printed in any language other than English. Recipients enrolled in this plan experienced delays in primary care appointments of up to twenty months. The Rhode Island program also proposed to conduct auto-assignments of mailed applications if a choice had not been made within five days. The Rhode Island auto-assignment proposal was rejected by HCFA in response to consumer opposition. Rhode Island then revised the process to allow for two scheduled face-to-face appointments within a month, a mailed application, and a thirty day turn around time. See Perkins, J., “Memorandum to Persons Interested in Managed Care,” Aug. 17, 1995, at 11 (available from National Health Law Program, Washington, D.C.); and Presentation of Jane Perkins at “Evolving Medicaid: State Child Health Advocacy,” July 24, 1995, Washington, D.C.Google Scholar
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Enrollment materials should be made available in alternative formats, such as braille, when necessary to meet the special needs of Medicaid recipients.Google Scholar
For example, enrollees in some Tennessee Medicaid MCOs were offered inducements such as life insurance and secured credit cards, while some plans directed potential clients with costly diseases, such as AIDS, to other MCOs. Mirvis, supra note 13, at 1239.Google Scholar
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Id. HCFA does not mandate a set percentage of voluntary enrollment.Google Scholar
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To put additional pressure on the state, the St. Louis City Board of Aldermen passed a resolution condemning the state's enrollment process and recommending postponement of auto-assignment until sufficient opportunities for voluntary enrollment had occurred. The Board of Aldermen found that “the plan for enrollment may lead to our residents becoming assigned to an HMO because the process is too confusing and limited in scope, or because citizens cannot find help or information in time to choose a doctor and a health plan.” St. Louis, Mo., Res. No. 67, 1995–96 Sess. (July 21, 1995). Furthermore, because of problems with enrollment, the St. Louis Department of Health and Hospitals used its own outreach workers to inform the community, thus filling the gaps in information and outreach. The health plan providers themselves, in violation of program requirements, also aggressively instructed clients to select a particular managed care plan, and, in some cases, filled out enrollment forms for Medicaid recipients. At the same time, advocates put pressure on HCFA and the state agency to extend the auto-assignment date. See, for example, Letter from Missouri Consumer Health Care WATCH to Checkett, Donna, Director, Missouri Medicaid, June 28, 1995; and Letter from Missouri Consumer Health Care WATCH to Johnson-Mills, Rita, Director, Medicaid Managed Care Team, Health Care Financing Organization, Aug. 25, 1995.Google Scholar
Managed Care and Low-Income Populations, supra note 30, at 20–23. Many states now use enrollment brokers to increase the percentage of voluntary enrollment. Enrollment brokers are often paid only for each person they enroll. While this provides an incentive to increase the number of voluntary enrollments, it does not ensure that the enrollment process guarantees any level of quality in that consumers actually know what they are choosing or what it means to be in capitated managed care, particularly if most of the enrollments are conducted by mail or by telephone.Google Scholar
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HCFA has asked state Medicaid agencies whether they planned to take into account zip codes in auto-assigning recipients. Letter from Cain, S.V., Acting Associate Regional Administrator for Medicaid, Health Care Financing Administration, to Stangler, Gary J., Director, Missouri Department of Social Services, July 13, 1995, at 2 (enclosure). As indicated, assignment using geographical criterion does not resolve the auto-assignment problem for consumers. When Haitian Medicaid recipients were assigned by geography rather than by prior primary care provider, they were assigned away from the Haitian providers with whom they had a primary care relationship. Telephone interview with Sherry, , supra note 18.Google Scholar
See North Carolina Division of Medical Assistance, Algorithm Z1 Through Z4 (1995). North Carolina Division of Medical Assistance has developed a simplified version of the algorithm that takes into account zip codes and previous plan enrollment. See North Carolina Division of Medical Assistance, HealthCare Connection Auto-Assignment Algorithm (1996); and Telephone interview with Hunter, Jill, Risk Contracts Specialist, North Carolina Division of Medical Assistance, Sept. 5, 1996.Google Scholar
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Department of Health Services, State of California, “Extension of the Medicaid Managed Care Program: The Two Plan Model, Section 1915(b) Capitated Waiver Request,” submitted June 1995, App. A.22, at 6.Google Scholar
One may question at what point the patient bears responsibility for continuing to remain assigned to an inaccessible plan. Too often, however, the lack of outreach and education combined with recipients' poor understanding of the enrollment process are the reasons why auto-assignments occurred in the first place. Furthermore, regardless of who is at fault for an inappropriate auto-assignment, neither the state, the recipient, nor the health care system is served in the long run by the continued enrollment of auto-assigned recipients in inaccessible managed care plans.Google Scholar
Telephone interview with Peed, , supra note 34.Google Scholar
If one can disenroll only “for cause” when health plans are inaccessible, the burden is placed on the recipient to convince the health plan and/or the state agency that such “good cause” exists. The recipient may be required to petition for a formal grievance procedure or even a fair hearing, thereby disrupting the continuity of health care and defeating the purposes of managed care.Google Scholar
“Change of Plan” forms should be provided to all enrollees with their member handbooks when they enroll, and the forms should be made available throughout the community.Google Scholar
Department of Health Services, supra note 51.Google Scholar
States may provide behavioral health care through a system separate from the managed care program that provides for recipients' physical health care, thereby creating the potential for confusion as individuals go between two different systems for their various health needs.Google Scholar
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