Missouri hospitals sounding the alarm about new Medicaid reimbursement policy

The Missouri House Budget Committee has scheduled a hearing Tuesday morning which could include testimony from hospital administrators who have been chomping at the bit.

Many of these Missouri hospitals are sounding the alarm about a change in Medicaid reimbursements that could leave them struggling to keep their doors open.

The state converted to a managed care system for all adults, children and pregnant women who are Medicaid recipients last year.

A new policy implemented by the state Department of Social Services allows insurance plans to reimburse providers at 90% of the Medicaid managed care rate if the provider is not “in network” with the insurer.

Tim Wolters, director of reimbursement at Citizens Memorial Hospital in southwest Missouri’s Bolivar, says the insurance companies now have an unfair advantage in negotiations over a provider’s network status.

“It’s unfortunate that the state has gotten in between the two parties to the contract, the providers, and the insurance companies,” said Wolters.  “The state stepped in between and sort of tilted the negotiations in favor of the insurance companies.”

The new policy affects reimbursements to providers who care for adults, children and pregnant women who are Medicaid recipients.

A number of hospitals say they were blindsided by the arrangement that state lawmakers incorporated into the Department of Social Services portion of the state budget that was signed by Governor Parson June 29th.  The department held a meeting in the last few days of June to discuss its new policy that went into effect July 1st.

Steven D. Edwards is the President and CEO of CoxHealth, a group of nonprofit hospitals with six locations in southwest Missouri.  He suspects politics may have played a role in creating the new policy.  “There’s a lot of commercial insurance money funding that has gone to various political campaigns, and I can’t help but think that’s probably a factor,” said Edwards.

Three insurance companies have contracted with the state to cover managed care recipients, which before an expansion last year, only applied to individuals living in counties that straddled or were close to the I-70 corridor across Missouri.

Hospitals with a high percentage of patients on Medicaid say they’re feeling especially disadvantaged at the negotiating table.

As of June 29th, there were 712,335 individuals in the Medicaid managed care system in Missouri. All other eligible recipients – low income disabled and elderly people – still receive benefits through the traditional fee-for-service method.

In a managed care system, insurers receive a monthly fixed payment from the state for each person enrolled in their plans.  Edwards says the only beneficiaries of the policy that allows for lower reimbursements to out of network providers are insurance companies.

“It doesn’t save the state any money because they have a fixed amount they’ve already committed to, to the insurance companies,” said Edwards.  “So, all it really does is make the insurance companies more profitable, in my mind, at the cost of patients, doctors, and hospitals.”

The Department of Social Services says its new policy allowing 90% reimbursements to out of network providers is meant to encourage more providers to participate in the managed care plans.  But providers are quick to point out that every hospital in Missouri has a contract with at least one of the three insurance companies and all but 12 are signed-up with all three.

Hospitals say the policy will hurt their bottom line and cause more doctors to refuse treatment to Medicaid patients.  Dave Dillon with the Missouri Hospital Association says the absence of available physicians will leave managed care patients with few options in certain parts of the state.

“The only option to get care will be to get it in the emergency (room) department, which is for non-emergent care, one of the worst places that you can get health care that is consistent and will keep you out of needing more health care,” said Dillon.

Physicians already receive a much lower rate of pay from Medicaid than they do from traditional employer-provided insurance plans.  Dillon thinks cutting those already low reimbursements by 10 percent will only drive doctors away in bigger numbers.

“There’s nothing requiring that doctor to participate in the program,” Dillon said.  “They can easily walk away and say, ‘I’m not going to take any more Medicaid enrollees.”

Individuals under managed care have the option to choose from either Home State Health Plan (Centene), UnitedHealthcare or WellCare.

Most hospitals in Missouri are not-for-profit operations, and rural hospitals are especially susceptible to financial setbacks.  Wolters of Citizens Memorial in Bolivar says 70% of his rural hospital’s patients have some sort of government coverage such as Medicaid.

He contends the new reimbursement policy could put Citizens Memorial in a risky financial position.  “For our last year, our bottom line was only $1.6 million,” said Wolters.  “That’s a margin of about 1.2%, a minor, very modest margin.  But if we lost 10% of our Medicaid managed care money, that would be about $1 million, over half our bottom line.”

Four rural Missouri hospitals have closed in the past eight years, with one having done so last month. Twin Rivers Regional Medical Center in Kennett, which shut its doors on June 11th, joined Parkland Health Center-Weber Road (Farmington), Sac-Osage Hospital (Osceola), and SoutheastHealth Center of Reynolds County (Ellington) as rural hospitals in the state that have closed since 2010.  According to the North Carolina Rural Health Research Program at the University of North Carolina at Chapel Hill, 85 rural hospitals have closed nationally since 2010.

The new Medicaid reimbursement policy for out of network providers does not apply to local public health agency services and specialty pediatric hospital services.

Medicaid is a federal healthcare program for low-income individuals that states are also required to help subsidize.  The state contributions vary from state-to-state, but federal support is higher in those that have higher poverty levels.  The federal government covers 64.6% of Medicaid costs in Missouri, where roughly 1/6 of the state’s 6 million residents are on the program.

Missouri is also unique in that hospitals pay a tax that helps pay for the state’s portion of Medicaid costs.

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Tundra Suites Hotel Charged With Medicaid Fraud

The owner of Bethel’s Tundra Suites hotel has been charged with Medicaid fraud.

When Medicaid recipients fly to Bethel for medical appointments, they pay for their food, hotel rooms, and cab rides with vouchers in lieu of payment. Local companies then use those vouchers to bill Medicaid for reimbursements.

Tundra Suites’ owner, Chin S. Kim, 58, is accused of billing the government for Medicaid recipients who never actually stayed at his hotel. Alaska’s Office of Special Prosecutions has also charged Tundra Suites employee Mi Ae Young, 56, in the alleged scheme.

According to charging documents filed with the court last month, Tundra Suites’ Medicaid billing increased from an average of $4,000 a month to a high of $57,000 for December 2017. On several occasions, Kim and Young allegedly billed the government for more Medicaid recipients than there are rooms in their hotel.

Investigators claim that Mi Ae Young admitted to fraudulently billing Medicaid. According to the charging documents, Young says that she did it to help Kim when Tundra Suites started struggling financially. Kim allegedly didn’t know about the scheme for months.

Kim and Young are each charged with medical assistance fraud and scheme to defraud, both of which are felonies. They were arraigned in Bethel last week and their next hearings are scheduled for July 23.

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As Arkansas’ New Medicaid Requirements Go Into Effect, 7,000 Beneficiaries Fail To Report 80 Hours Of Work

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High opioid doses, concurrent sedative use are key factors for overdose risk in Medicaid recipients

Among Medicaid recipients taking prescription opioids, high opioid doses and concurrent treatment with benzodiazepine sedatives are among the key, potentially modifiable risk factors for fatal overdose, reports a study in the August issue of Medical Care. The journal is published in the Lippincott portfolio by Wolters Kluwer.

“Prescribers and state agencies should be aware of these addressable patient-level factors among the Medicaid population,” according to the new research, led by Timothy T. Pham, PharmD, PhD, of University of Oklahoma College of Pharmacy, Oklahoma City. “Targeting these factors with appropriate policy interventions and education may prevent future deaths.”

Clinical Factors and Medications Contribute to Opioid Overdose Risk in Medicaid Patients

In a review of Oklahoma Medicaid and Oklahoma State Department of Health data from 2011 to 2016, the researchers identified 639 Medicaid members who died of an unintentional prescription opioid overdose. Of these, 321 patients had at least one Medicaid-covered opioid prescription in the year before death. The average age was 44.5 years; 64 percent of the patients were women and 81 percent were white.

These cases of overdose death were matched to 963 living Medicaid recipients with similar characteristics, including opioid prescriptions. Demographic factors, clinical characteristics, and medical/pharmacy use over the preceding year were analyzed to identify individual-level risk factors for prescription opioid overdose.

Medicaid patients who died of opioid overdose were more likely to have common causes of chronic pain – particularly neck or joint pain and low back pain. Fatal overdose was more likely for patients diagnosed with opioid dependence, as well as in those with other types of drug toxicity. Risk was also increased for individuals with hepatitis, a common complication in people with addiction disorders; and for those with certain psychiatric disorders, particularly bipolar disorder or schizophrenia.

Higher-dose opioid prescriptions were also an important risk factor. For patients in the two highest dose categories, the odds of fatal opioid overdose were three times higher compared to the control group.

Individuals taking benzodiazepines – a widely used class of sedative drugs – were also at increased risk. About 29 percent of patients who died of prescription opioid overdose were taking benzodiazepines at the same time. The odds of death were elevated with as little as one to six days of overlap between opioids and benzodiazepines.

Studies using state-level data have found that the Medicaid population is a high-risk group for death due to unintentional prescription opioid overdose. Information on individual-level risk factors for opioid overdose and death among Medicaid recipients is needed to help in targeting preventive measures.

The new study provides evidence for several categories of risk factors for fatal opioid overdose in Medicaid members, including chronic pain, medical diagnoses associated with addiction, and mental health disorders. “The findings also emphasize potentially problematic opioid exposure including higher daily [doses] and longer durations of opioid/benzodiazepine overlap,” Dr. Pham and coauthors write.

The researchers believe their study “may contribute to recommendations for establishing rational opioid dose thresholds and use of benzodiazepines in clinical guidelines and government policies.” Other suggestions include the use of prescription drug monitoring programs and care coordination models to bring together the various specialists involved in patient care.

Dr. Pham and coauthors also point out that approximately half of Oklahoma Medicaid patients who died of prescription drug overdose during the study period did not have a covered prescription claim in the year before death. The researchers add: “This finding may represent the reality that some people were not eligible near the time of death, implying that they obtained their prescriptions through other insurance coverage, other forms of payment, or diversion.”

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Here’s where the governor candidates stand on expanding Medicaid in Tennessee

The expansion of Medicaid would provide health insurance to all adults who earn income below 138 percent of the federal poverty level, which equates to about $34,638 for a family of four. Experts predict that 250,000 uninsured Tennesseans would become newly eligible for heath insurance if Tennessee expanded Medicaid.

Under the Affordable Care Act, the federal government would pay for 90 percent of costs associated with expansion, while the states pay 10 percent.

Term-limited Gov. Bill Haslam attempted to expand TennCare, Tennessee’s Medicaid program, in 2015, but the General Assembly rejected the two-year pilot program, called Insure Tennessee. Under his plan, Tennessee hospitals actually agreed to pay for the state’s share, but lawmakers were nonetheless concerned about its cost.

With a new governor set to be elected in November, the top six candidates’ support or opposition falls along party lines, with the four Republicans opposing Medicaid expansion and the two Democrats supporting it. 

Here are the Republicans’ thoughts: 

Randy Boyd: “Obamacare has failed us, and as governor, I will go to D.C. to negotiate a Tennessee-based solution, such as block grants. Washington is broken, and it is clear that the answer to making Tennessee healthcare stronger is not going to come from the federal government.

“Returning power to the state is the critical first step in allowing us to create the best system that ensures quality care for the most people, with the broadest coverage, while keeping costs low. As things stand now, Tennessee can’t afford the health we have. I believes we have to focus on making all of Tennessee healthier.”

Diane Black: Black’s campaign did not immediately respond to a request for comment on Medicaid expansion, but the congresswoman has previously expressed opposition to the idea. 

When asked about the proposal by the USA TODAY NETWORK, Black said, “Federal dollars used to fund Medicaid in states, especially those that expanded under a previous administration, will decrease over time. These states are not going to get the Medicaid funding they were promised. Our state has been in that position before, and we are not going down that road again. 

“The answer to problems with Medicaid is block grants from the federal government to the states. The Founding Fathers included the 10th Amendment to the Constitution so states could find their own answers to difficult issues. Prior to Obamacare, Tennessee had programs such as CoverTN and AccessTN designed to provide coverage to different populations. Other solutions include the use of high-risk pools, reinsurance or invisible risk sharing, which was included in the American Health Care Act passed by the U.S. House of Representatives in 2017.” 

Bill Lee: “Expanding Medicaid is not the solution. Federal dollars with strings attached is not free money, and expanding a government program without first addressing rising costs is not the right approach for our state.

“Instead, we should be working with the administration to address the rising costs in our existing TennCare program, and supporting the provider community to help patients make the right choices to address the rising rate of preventable lifestyle diseases.”

Beth Harwell: “TennCare, the state’s Medicaid program, amounts to one-third of the state’s budget, and I’ve been active in the process which keeps it from ballooning. At the General Assembly, the people of Tennessee made it known they wanted to reject Medicaid expansion under Obamacare.

“While serving as Speaker of the House, I have asked President Trump to give states greater flexibility as to how funds can be spent by requesting block grants. With those grants, we can tailor the program to the specific needs of Tennesseans. A tailored solution is the Tennessee way, not the Washington way.”

Here are the Democrats’ thoughts: 

Karl Dean: “As governor, my top healthcare priority will be working across the aisle to expand Medicaid. I believe the decision not to expand in Tennessee was highly political and not in the best interest of Tennessee families. We are now seeing the tangible consequences. Tennessee has seen 10 hospitals close, largely in rural areas. They are closing, at least partly, because the hospitals are not receiving the reimbursements they need to keep operating.

“When a hospital closes in a small town or rural community, the entire area suffers. Without a hospital it becomes more difficult to retain residents and attract new ones. Without a hospital, it is more difficult to attract business. When a hospital closes, it means that families are 30 to 45 minutes away from receiving needed medical care.

“I also believe that expanding Medicaid will make a huge difference in the fight against the opioid crisis. We need the resources to be able to get folks the treatment they need. Virginia came together to approve Medicaid expansion in May; we can do it too. It is not too late.”

Craig Fitzhugh: During the 2018 legislative session, as House minority leader, Fitzhugh proposed an amendment that would have allowed Haslam to expand TennCare, but the measure was shot down by the Republican super majority in the House.

On his campaign website, Fitzhugh said, “When our governor failed to expand Medicaid coverage to cover more Tennessee families, our state lost out on $3.5 billion. It’s past time for the Senate to keep a path open for Tennessee’s next governor to ensure our families have access to life-saving care, and bring our tax dollars back.

“Helping families and businesses thrive means making sure every Tennessean has access to quality healthcare they can afford, and that when the federal government offers to help pay for it for our most vulnerable citizens, we take them up on the offer rather than letting hundreds of millions of dollars go to other states.”

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Nashville health care advocates discuss Medicaid expansion, access to health care in Washington County

While 63 percent of Tennesseans support the expansion of Medicaid, legislators have repeatedly refused to vote in favor of expansion after passing a law in 2014 that bars the state from accepting federal funds to expand coverage.

The two Nashville-based health care advocates have some optimism that this could change during the next legislative session in 2019, but McAlister said the public still needs to be informed of the implications of Medicaid expansion, or lack thereof, in Tennessee.

“A lot of Tennesseans across the state are kind of unsure what our Medicaid provision is and what kinds of people are covered under Medicaid and TennCare in Tennessee,” McAlister said. “So when we meet with communities, we want to provide them with all the background that we’ve been hearing about Medicaid expansion from our legislature.”

The two organizers have been throughout Middle and East Tennessee talking to people in each community about their health care concerns and how Medicaid expansion might affect them. While 11.8 percent of Tennesseans go without insurance altogether, about 17 percent go without in Washington County and 13.8 percent go without health care in Johnson City, according to conservative statistics from Ballad Health.

McAlister said Medicaid expansion could help reduce these numbers and help sustain some of the rural hospitals in neighboring counties, some of which are hard-pressed for funding. Tennessee has lost eight hospitals since 2010 because of this lack of federal funding, McAlister said.

“Currently, Tennessee leaves $3.8 million on the table every single day that is raised by Tennessee tax paying dollars and goes right out of the state to Washington (D.C.) and then goes to other expansion states to increase their health care networks,” she said. “That equates to $1.4 billion a year.

“Tennessee is just losing this money — generating this money and truly losing it,” she continued. “If we can make that the focus and have Tennesseans understand that we could be doing this and we are simply not, that is hopefully going to be the catalyst.”

The opioid epidemic that has plagued Northeast Tennessee is another major concern the two advocates said should prove to be a catalyst in generating more support for the expansion of Medicaid.

“We have yet to talk to a person who doesn’t have a personal connection to this, and that’s what’s so striking, that everyone has a way that this touches their lives,” McDonald said.

McAlister said the expansion of Medicaid could compensate for the lack of funds proposed by Gov. Bill Haslam for 2019 to combat the epidemic. Haslam proposed $30 million as part of his Insure Tennessee program, but that money might not have been needed with the expansion of Medicaid.

“If we expanded Medicaid, we would have all that funding for the full fiscal year in 10 days,” she said.

And for local residents suffering from chronic illnesses, McAlister said the expansion of Medicaid could make affordable health care more accessible.

Local resident Dan Fehr said his chronic illness has continued to cause him financial hardship. Even with past insurance plans, Fehr has had issues paying for health care.

Now uninsured since last year, Fehr is worried about what to do when it comes to receiving adequate health care.

“Luckily my ulcerative colitis has been under control since then, but now, without insurance, I’m playing Russian roulette with getting sick, and if I got bad off on a flare, I would not be able to keep a job due to the physical strain it puts on your body.”

McAlister said stories such as Fehr’s are not uncommon in Tennessee.

“It’s the same stories of people saying, you know, all it takes is one bout of illness or one trip to the emergency room to decrease your well-being significantly,” she said. “Everybody has a story about that; everybody knows somebody who does not have access to health insurance, and when a catastrophe happens, that can be the end of their life. It’s those kinds of stories that we hear across the board.”

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State director of Medicaid tours Green Hills

The director of the Ohio Department of Medicaid saw first hand this week how Green Hills Community is serving the senior population of Logan and Champaign counties.

Green Hills

Barbara Sears participated in a demonstration of the new state-of-the-art telehealth clinic where she connected with a healthcare professional 90 miles away in Bowling Green. The technology is part of a twoyear pilot project that is being tested to reduce hospital re-admissions. The clinic is used on a regular basis to connect with a physician, when the medical professional is not making rounds in the nursing center.

Telehealth is a collaboration between Green Hills Community, LeadingAge Ohio, Ohio Eastern Star Home and Optimized Care Network of New Albany.

Read complete story in Saturday’s Examiner
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White House Council Of Economic Advisers: 53 Percent Of Non-Disabled Working Age Medicaid Recipients Do Not Work

Julia Cohen | Contributor










Fifty-three percent of non-disabled working age Medicaid recipients worked an average of zero hours per month while receiving benefits, according to a Thursday report from the White House Council of Economic Advisers.

The subset of recipients with the largest percentage of non-workers was adults aged 50-64 without children, according to the report. The subset with the smallest percentage of non-workers was working age recipients with a youngest child aged 1 to 5, with 49 percent of recipients reporting an average of zero work hours per month.

Of individuals receiving Supplemental Nutrition Assistance benefits, 54 percent of non-disabled working age adults reported an average of zero hours of work per month while receiving benefits, according to the report.

For non-disabled working age adults receiving housing assistance, 45 percent reported an average of zero work hours per month when receiving benefits.

“The American work ethic, the motivation that drives Americans to work longer hours each week and more weeks each year than any of our economic peers, is a long-standing contributor to America’s success,” the White House Council of Economic Advisers report states, but “many non-disabled working-age adults do not regularly work, particularly those living in low-income households.” The labor force participation rate for the overall work force was 62.9 percent in June, according to the Bureau of Labor Statistics.

The study comes amidst an executive order from President Donald Trump in April directing federal agencies to “[strengthen] existing work requirements or work-capable people and [introduce] new work requirements when legally permissible” in federal safety-net programs.

The executive order also directs federal agencies to “reduce the size of the bureaucracy and streamline services to promote the effective use of resources” and “reduce wasteful spending.” This may especially come into play with possible reductions in Medicaid spending that come from work requirements. Medicaid, unlike may other safety-net programs, does not phase out as income rises; if someone qualifies for Medicaid, they qualify for it whether they have no income or the maximum income. (RELATED: The Federal Government Will Spend $685 Billion Subsidizing Health Care in 2018)

The federal government is expected to spend $280 billion on Medicaid in 2018, according to a May Congressional Budget Office report. That includes an additional $59 million dollars for recipients made eligible though Affordable Care Act Medicaid expansions.

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