At issue is a bill for legislative consideration,
SB 109
by state Sen. Ronnie Johns, that would
put into law efforts being made by Louisiana’s Department of Health and
Hospitals to report information relative to the state’s Medicaid program. This
bill, which is making its way smoothly through the process, specifically
addresses making comparisons between the state’s prior use of a fee-for-service
model that paid regardless of need or quality of service provided and its new
model for the past three years, a managed capitation system called Bayou Health
that has third party administrators making decisions about the suitability of a
procedure and whether it would qualify for reimbursement.
DHH produces numbers that show
quality of care, in terms of things such as patient access, is improving as a
result. But last fall a Legislative Auditor’s report
revealed that some of the data used were incomplete or were not independently
audited, making such comparisons less certain. The difficulties came from the
data for legacy Medicaid that could work for better comparisons just didn’t
exist, and that insufficient resources were allocated for independent
verification or even accurate reporting of some data-based conclusions, the latter
of these DHH now has instituted protocols to address.
Yet one fact is indisputable: while
nationally
Medicaid costs increased 6.1 percent in 2013, the per-patient/per-month
metric for Louisiana dropped nearly 9 percent. These aren’t entirely comparable
figures because Bayou Health does not include the elderly or disabled Medicaid
populations, although plans
are to expand to that, and slightly overstates on a PMPM basis because
these are aggregate totals with a nationally expanding Medicaid population but
it seems unlikely that removing those numbers from the national figures would
wipe out the 15 percent gap. The reality is the Bayou Health plan saves the
state on the order of $293
million on an annualized basis over what the previous baseline suggested.
And that probably comes in part as
a result of more efficient apportionment of costs. In a Baton Rouge Advocate piece
about the issue, it quotes one doctor saying he thinks the savings came out of
his pocket, because of a practice becoming widely adopted in all states, bundled
payments, or providing a single payment for all services associated with a
specific episode of care, rather than a payment for each individual service or
procedure, which creates incentives for the provision of appropriate services,
coordination and communication among providers, efficient care delivery, and
positive health outcomes.
Just so. Why should taxpayers pony
up for a less-efficient care model just to keep income rolling in for doctors
(in fact, some doctors essentially specialize in Medicaid patients, who provide
a high-volume, steady clientele)? If it’s a question of reimbursement rates,
that’s an issue separate from Bayou Health (which also exposes a prime weakness
in the argument for Medicaid expansion: shoving more people into a program that
continues to lose provider participants over reimbursement levels isn’t going
to make for better care for otherwise-uninsured individuals, much less save on
costs when they jam emergency rooms as a result). Nobody forces a doctor to
participate in Medicaid; if you don’t like that Bayou Health could cut your
flow of money from the government and (with the introduction of multiple third
party administrators instead of always billing the state) and increase your
paperwork, just don’t participate.
Of course, if quality drops along
with costs, then that could be an issue, which is where the real value of these
reports come in. The unverified data indicates quality is improving, as theory and
experience would suggest: create incentives to contain costs and to improve
quality, which a FFS model at best only clumsily does if at all, and this
should become reality.
Hopefully, implementation of a data
collection system that inspires greater confidence about improved quality of service
delivery in Medicaid will occur for succeeding annual reports about Bayou
Health – especially with the new administrator contracts beginning earlier this
year coming into place. This would confirm that, as the state grapples with
budget difficulties, Bayou Health has helped both clients and taxpayers in
preventing that fiscal situation from going from bad to disastrous.
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