Protecting NH’s Medicaid
State | Right now our most vulnerable citizens are at stake with private managed care insurers.
Will New Hampshire rush into turning over its Medicaid long-term care program to private managed care insurers? The fate of its most vulnerable citizens ÃÂ¢ÃÂÃ” including over 4,200 nursing home residents ÃÂ¢ÃÂÃ” is at stake.
While managed care has had success in everyday health care, it is more uncommon with long-term care. Recognizing challenges, the Legislature passed Senate Bill 553 last year to delay a planned 2016 Medicaid managed care implementation for long-term care (ÃÂ¢ÃÂÃÂStep 2ÃÂ¢ÃÂÃÂ) while a working group examines many unanswered questions as to how this would work.
Providers throughout the long-term care continuum ÃÂ¢ÃÂÃ” whether in-home or facility-based ÃÂ¢ÃÂÃ” welcomed delay. The stateÃÂ¢ÃÂÃÂs long-term care clients are medically-fragile and cannot survive a failed social science experiment. Indeed, a bipartisan group of senators introduced Senate Bill 155 this year to formally wait until July 2019 to implement Step 2. A post-election poll of 800 New Hampshire voters showed only 27 percent supported managed care for long-term care. Yet others are now pushing to implement managed care by the end of this year.
This rushed approach carries too much risk. New Hampshire has long had among the nationÃÂ¢ÃÂÃÂs worst Medicaid payments for long-term care ÃÂ¢ÃÂÃ” currently third-worst for nursing homes ÃÂ¢ÃÂÃ” and it is hard to even imagine how involving managed care insurers, and their administrative costs, would not diminish these payments even further. Certainly, no one from the state or an insurer has come forward to explain why this fear is unfounded.
It is also unclear what the state is trying to accomplish. Often managed care has been sold as a cost-manager, although it can drive costs higher. That has been true in New Hampshire, with a budget overrun for existing managed care. It is also true in a state like Iowa that recently implemented managed care and now, just a year later, finds insurers demanding more than $127.7 million in higher rates and claiming their losses have been ÃÂ¢ÃÂÃÂcatastrophicÃÂ¢ÃÂÃÂ ÃÂ¢ÃÂÃ” despite the much-publicized failure of those same insurers to pay care providers on time or, in some cases, at all.
Some states are rethinking managed care for long-term care. In Florida, for example, an accounting study showed that the state could save $68 million by not involving the administrative expense, and duplicative ÃÂ¢ÃÂÃÂcase management,ÃÂ¢ÃÂÃÂ of managed care insurers for residents of nursing homes staying beyond 60 days. What is there to manage that a nursing home itself cannot? Further, managed care drives not only state costs but also provider costs. In New Hampshire, providers ÃÂ¢ÃÂÃ” already short-staffed by a terrible Medicaid funding crisis ÃÂ¢ÃÂÃ” would have to take nurses off the floor to handle even more insurance company paperwork.
Indeed, the cost-management argument for managed care is weakest in a state like New Hampshire where a ÃÂ¢ÃÂÃÂbudget neutrality factorÃÂ¢ÃÂÃÂ already ensures the state ignores at least 27.34 percent of nursing home care costs. Over an eight-year period beginning July 1, 2009, and ending June 30, Medicaid rates will have only grown 7.2 perceny for New HampshireÃÂ¢ÃÂÃÂs nursing homes. The stock price for one politically-powerful managed care insurer has already grown 700 percent since July 2009.
Another argument often used in favor of managed care is it could balance out the Medicaid long-term care provided in nursing homes and home-and-community based settings. Yet there is another way of doing that without involving a costly middleman: the political will to properly fund all of long-term care.
States that have led in supporting home-and-community-based care not only pay much higher nursing home rates but also pay living wages to those providing in-home care. It did not take private insurers for them to do the right thing.
The careful process begun last year should be allowed to work, and SB 155 adopted to delay managed care until July 2019.
A vital safety net must not be jeopardized by a rush to judgment.
Brendan Williams is president/CEO of the New Hampshire Health Care Association.