Managed Care and Poor Children by Jane Perkins, JD, MPH Introduction Goals of the Class Suggested Readings Selected Annotations Suggested Activities Lecture Notes Exercises Additional Resources Introduction This module discusses the interaction between managed care and poor children. It is concerned primarily with how managed care operates to serve children and how these programs provide children’s health services, particularly Medicaid Early and Periodic Screening, Diagnosis and Treatment (EPSDT) services. EPSDT should ensure early and comprehensive preventive care and treatment services for poor, Medicaid-eligible children under age 21. EPSDT’s comprehensive benefits are set forth in the Medicaid Act and include periodic well-child medical, dental, vision, and hearing checkups; immunizations; laboratory tests (including lead blood tests); health education; and a broad package of treatment services. As increasing numbers of disabled and non-disabled poor children are being enrolled in managed care arrangements, it becomes essential to acquaint students of public health/social work with the ways that managed care intersects with Medicaid. This module includes: (1) goals of the class; (2) a list of suggested readings; (3) selected annotations; (4) lecture notes; (5) suggested activities for student, including teacher’s notes; and (6) other resources. Goals of the Class To familiarize students with the health status of poor children; To present an overview of the federal and state laws designed to assure that children have access to health care, particularly the Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) program; To present an overview of the types of managed care programs that states are implementing to enroll poor children; and To discuss how the evolving managed care environment is affecting poor children’s access to health care. Suggested Readings U.S. Department of Health and Human Services Office of Inspector General, Medicaid Managed Care and EPSDT (May 1997) (OEI-05-93-00290) (available by contacting: Chicago Regional Office at (312)352-4124) (http://www.dhhs.gov/progorg/oig) (to Selected Annotation) U.S. General Accounting Office, Medicaid Managed Care: Challenge of Holding States Accountable Requires Greater State Effort (May 1997) (GAO/HEHS-97-86) (http://www.gao.gov) National Association of Child Advocates, Medicaid Managed Care: An Advocate’s Guide for Protecting Children (1997): Chapter 3: Enrollment, Education, and Plan Use in Medicaid Managed Care Programs and Chapter 4: Ensuring Access to Services in Medicaid Managed Care (http://www.childadvocacy.org) (to Selected Annotation) Jane Perkins and Lourdes Rivera, Managed Care and EPSDT: Do Health Plans Know What they are Getting Into?, 28 Clearinghouse Rev. 1248 (Mar. 1995) (to Selected Annotation) U.S. General Accounting Office, Medicaid: States’ Efforts to Educate and Enroll Beneficiaries in Managed Care (Sept. 1996) (GAO/HEHS-96-184) (http://www.gao.gov) (to Selected Annotation) U.S. General Accounting Office, Medicaid Managed Care: Serving the Disabled Challenges State Programs (July 1996) (GAO/HEHS-96-136) (http://www.gao.gov) (to Selected Annotation) Newacheck, et al., The Effect on Children of Curtailing Medicaid Spending, 274 JAMA 1468 (Nov. 8, 1995) (http://ama-assn.org/scipub.htm) American Academy of Pediatrics, Guiding Principles for Managed Care Arrangement for the Health Care of Infants, Children, Adolescents, and Young Adults, 95 Pediatrics 613 (April 1995) (http://www.aap.org) U.S. General Accounting Office, Medicaid: States Turn to Managed Care to Improve Access and Control Costs (March 1993) (GAO/HEHS-93-46) (http://www.gao.gov) Buchanan, et al., HMOs for Medicaid: The road to Financial Independence is Often Poorly Paved, 17 J. Health Pol., Pol’y & L. 71 (Spring 1992) Selected Annotations U.S. Department of Health and Human Services Office of Inspector General, Medicaid Managed Care and EPSDT (May 1997) (OEI-05-93-00290) (http://www.dhhs.gov/progorg/oig) This report examines the extent to which Medicaid managed care providers deliver EPSDT to Medicaid children. The report finds that fewer than one in three Medicaid children enrolled in managed care plans receive timely EPSDT services. Six of ten receive none at all. Children receive significantly more EPSDT services from Medicaid managed care plans when states inform the managed care plans which children are due for EPSDT. The report recommends emphasis on active state identification and notification of managed care plans and tracking of individual children to assure that services are received. National Association of Child Advocates, Medicaid Managed Care: An Advocate's Guide for Protecting Children (1997): Chapter 3: Enrollment, Education, and Plan Use in Medicaid Managed Care Programs and Chapter 4: Ensuring Access to Services in Medicaid Managed Care (http://www.childadvocacy.org) This manual acquaints child advocates with the complex issues related to Medicaid managed care and provides concrete suggestions for ways that advocates can influence the development and implementation of Medicaid managed care. The selected chapters focus on substantive issues, while the remainder of the manual offers numerous advocacy strategies for improving health services to children. Jane Perkins and Lourdes Rivera, Managed Care and EPSDT: Do Health Plans Know What they are Getting Into?, 28 Clearinghouse Rev. 1248 (Mar. 1995) This article summarizes the federal legal requirements for EPSDT, identifies issues for managed care plans, and lists issue areas for state Medicaid agencies and contracting managed care plans. U.S. General Accounting Office, Medicaid: States' Efforts to Educate and Enroll Beneficiaries in Managed Care (Sept. 1996) (GAO/HEHS-96-184) (http://www.gao.gov) States have experienced a variety of marketing and enrollment problems and increasingly have banned door-to-door marketing and have contracted with private third party entities to act as enrollment brokers. As discussed in the report, states are using a variety of enrollment policies and techniques to enroll families and children into Medicaid managed care plans. U.S. General Accounting Office, Medicaid Managed Care: Serving the Disabled Challenges State Programs (July 1996) (GAO/HEHS-96-136) (http://www.gao.gov) This report finds that serving disabled beneficiaries through Medicaid managed care poses complex, new challenges to the states. Two challenges are (1) states must develop both the service networks and the necessary assurances that the health care needs of disabled beneficiaries are being met appropriately; and (2) the system must be financially sound and the states current rate-setting approaches may be inadequate. Suggested Activities [Teacher notes are included in bold lettering on each of these suggested activities] Internet exploration Case Example 1: Meet the Baker Family Case Example 2: The Bakers’ Financial Situation Case Example 3: The Managed Care System Case Example 4: Advocating for the Bakers Lecture Notes [Suggested activity: Internet exploration. Prior to this class, distribute this suggested activity and ask students to complete the internet research activity. The answers to the internet questions will be woven into the class lecture notes.] I. Children’s health care needs Children are not little adults. Adolescents are not big children or little adults. Health coverage must recognize that children have particular health care needs. Health habits are learned (or not) during childhood. Measles, mumps, rubella are more likely in childhood. Baby bottle tooth decay, perhaps the only serious dental problem common in children under age three, can be avoided through health education and treatment during checkups in the first years of life. Left unaddressed, the problem can cause tooth loss, tooth decay, pain, infection, increased risk of further cavities, and even failure to thrive. Amblyopia ("lazy eye") may be irreversible if not diagnosed and treated before age five. Children under age six are particularly susceptible to lead poisoning because their blood-brain barriers are still forming. Lead poisoning is entirely detectable and preventable; however, untreated, lead poisoning can cause developmental delays. II. Poor children are in poor health Poor nutritional status Exposure to environmental hazards. When sick, more likely to have severe problems. Four times more likely than other children to experience sickness from infection, debilitating conditions, and serious health problems. More likely to suffer behavioral health problems. 3-7 times as likely to die in childhood. More likely to experience "ambulatory care sensitive admissions" -- admissions that could be prevented by routine care, e.g. asthma and bacterial pneumonia. African-American infant mortality rate twice that of whites; less likely to be immunized. One in five adolescents in the US today has a serious health problem, many reflect the "new morbidities," not just physical in nature but psycho-social, as well. [Suggested activity: Case Example 1: Meet the Baker Family. Distribute this case study at this time. Divide the students into small groups and have them identify the health care needs of each member of the Baker family.] III. Child poverty rates are high Number of uninsured children under 18 grew to 10.6 million (14.8 percent) in 1996. Both the number and percentage were statistically higher than the 1995 figures of 9.8 million and 13.8 percent, respectively. IV. Who are Uninsured Children Hispanic and African-American children disproportionately uninsured. 9 in 10 uninsured children have parents who work, and 2 in 3 have parents who work full-time. Clearly there is a great need for these children to have access to defined screening and treatment services, i.e. EPSDT. Medicaid eligibility improves child access to preventive care and timely care. [Suggested Activity: Case Example 2: The Baker’s Financial Situation] V. Early and Periodic Screening, Diagnosis and Treatment (EPSDT) 1. Early and periodic screening There are four distinct screens: medical, vision, hearing and dental medical screen includes: comprehensive mental and physical assessment; unclothed physical exam; immunizations; lab tests (including lead blood tests); health education and anticipatory guidance (including nutritional guidance) dental screen must be performed by a dentist. Periodic screens periodic screens must occur according to periodicity schedules set by the state in consultation with medical (and dental) child health professionals Medical professionals currently call for annual screening of children, for example, Bright Futures and AMA Guidelines for Adolescent Preventive Services Dental professionals call for screening every 6 months for adolescents Interperiodic screens -- any encounter with a health care professional acting within scope of practice. This is important because an interperiodic screen can determine the need for additional treatment services, and the child will be eligible for the broad EPSDT treatment package. 2. Treatment The Medicaid Act defines "medical necessity" for children -- services needed to correct or ameliorate a defect in physical or mental condition discovered during a screen, if the service is listed as coverable by the federal Medicaid Act. This cannot be diminished or changed by a managed care program, unless the U.S. Department of Health and Human Services waives the EPSDT rules. It has done this only for Oregon. Medicaid Act includes a broad treatment package, e.g. private duty nursing, rehabilitative therapies, physical therapy, case management, transportation. Quantitative caps are illegal(e.g. 12 inpatient hospital days). Services must be covered for children even if they are not part of the state’s Medicaid plan for adults.   3. Outreach and informing All eligible children must be informed. Informing includes information about (a) benefits of preventive care, (b) EPSDT services. Must offer transportation and appointment scheduling assistance prior to the due date of each screening. Combination of oral and written informing techniques should be used. Targeted outreach: pregnant women; persons who have not used in last two years; foster children. 4. Reporting Encounter data must be reported. Participation goals -- improvement in each state to reach 80% by FY 1995. VI. Managed Care and Children 1. Medicaid enrollment is increasing rapidly. As of June 30, 1996, 13 million enrollees, or 35% of Medicaid population. (This is a 170% increase since 1993.). Highest enrollment, Tennessee; lowest enrollment, Alaska. N.C. -- 37.24%. Most of enrollees are families and children; however, states are now moving disabled populations into managed care as well. 2. Goals of managed care Reduce provision of unneeded or unnecessarily costly services. Contain Medicaid spending. Improve access to health care -- provide a "medical home". 3.Types of managed care programs Primary care case management -- provider is paid a monthly fee per enrollee to act as "gatekeeper" to provide and approve needed care. Services reimbursed on fee-for-service basis. Fully capitated system, e.g. HMO, paid a pre-set or "capitated" rate per enrollee and at-risk for excess costs. HMO and participating providers act as gatekeeper. Partially capitated health providers -- Managed Care organization (MCO) receives a capitated rate and is at risk for a limited package of services (e.g. mental health or dental services may be excluded). MCO and participating providers act as gatekeeper. Trend is toward prepaid, at-risk arrangements. 4.Process the state most follow to require enrollment. Prior to Balanced Budget Act of 1997, state had to obtain a "waiver" from Department of Health and Human Services to mandate enrollment (e.g., without waiver, enrollment voluntary). Two types of waivers: 1915(b) freedom of choice waiver, usually used to restrict freedom of choice and to begin implementing managed care on a less than statewide basis. 1115 demonstration waiver, in recent years usually coupled with an expansion of Medicaid to previously uninsured populations (e.g. TennCare, MinnesotaCare). After Balanced Budget Act of 1997, no need for a waiver to enroll most Medicaid recipients. Some groups still require a waiver to mandate enrollment, including the following groups of children under age 19: Disabled and eligible for SSI; Described in community-based, coordinated care programs under title V; Living at home because of a "Katie Beckett" option; Receiving foster care or adoption assistance or in out-of-home placement. [Suggested activity: Case Example 3: The Managed Care System. Distribute this case study. Divide students into groups and have them make a list of questions that the Baker family needs to ask about the Medicaid Managed Care Program.]   Some problems to avoid with managed care Inadequate provider network -- insufficient number or qualifications. Inadequate provision of preventive care -- 1989-90 measles outbreak in Wisconsin, 83 percent of cases among children aged 1-4 occurred in Medicaid recipients enrolled in HMOs; some providers declined or hesitated to vaccinate out of fear or inadequate or delayed reimbursement (Wis. Med. Journal, July 1990). Inadequate coverage of treatment services -- services may be limited in scope (e.g. 12 physical therapy) or denied. Inadequate complaint processes -- process must include prior notice; impartial hearing; continued benefits; timely fair hearing decision (Medicaid Act and U.S. Constitution require this). On-again-off-again eligibility -- some estimates show about 1/2 the Medicaid population going off and on eligibility. This makes preventive care and continuity of care difficult. President’s Committee on Consumer Protection and Quality in the Health Care Industry. Currently includes no child-specific protections for managed care plans.   Consumer protections Balanced Budget Act of 1997 provisions. Choice of at least two plans (with some exceptions, including rural areas). Process for enrollment and disenrollment to include notices and default processes that account for existing provider-patient relationships. Provide information on identity, location, and qualification of providers; rights and responsibilities of enrollees; grievance and appeal procedures; covered benefits; cost sharing; service area; "to the extent possible" quality and performance data. Prudent layperson standard for coverage of emergency care. "Gag clauses" prohibited. Sufficient number and range of providers. Quality assurance and improvement, including external review. Prohibitions on door-to-door marketing and deceptive marketing practices. [Suggested activity: Case Example 4: Advocating for the Bakers. Distribute this case study. Divide students into groups and have them make a list of consumer protections for this Medicaid Managed Care System.] Child-specific protections A. Contract between state and managed care organization and between managed care organization and panel of providers is important. Responsibility for the following need to be clearly described. B. Outreach and the Provision of Information. Responsibilities of plans, providers, and the state agency for conducting outreach/informing. Responsibility for targeting "high-risk" enrollees (e.g. pregnant women and adolescents, foster children). Requirements to communicate with persons who do not speak English or are hearing impaired or blind. Responsibility for informing enrollees of transportation assistance and arranging for or providing non-emergency transportation coverage. C. Screening Services. Separate screening schedules for medical, vision, hearing, and dental screens and responsibility for each of these screens. Medical screens must minimally include: (a) comprehensive physical/mental health and developmental history; (b) a comprehensive unclothed physical exam; (c) immunizations as set by CDC Committee on Immunization Practices; (d) laboratory tests, including lead blood tests; (e) health education, including anticipatory guidance to the child and family. D. Treatment and Provider Participation. Contracts should list all of the services included in 42 U.S.C. 1396d(a) and specify which services the plan is expected to provide. Include EPSDT definition of medical necessity. Inform adolescents of the availability family planning services offered by the plans and outside of the plans, that is -- freedom to choose a family planning provider outside of the plan cannot be impeded. Report encounter data sufficient to complete EPSDT reporting. Coordination with other services, e.g. WIC, Title V, Parts B and H, school based services, Head Start. Exercises Internet exploration Case Example 1: Meet the Baker Family Case Example 2: The Bakers’ Financial Situation Case Example 3: The Managed Care System Case Example 4: Advocating for the Bakers Internet Exercise Directions: You will find the answers to these questions on the internet. Once you have answered these questions, you will have completed a brief overview of the current status of child health and managed care and familiarized yourself with helpful websites. 1. Should there be a separate health benefit package for children? If yes, why? If no, why not? Hint: http://www.healthlaw.org Yes, children are not little adults. Their psycho-social development differs from that of adults, and they experience developmental milestones that if not addressed during children may never be addressed. 2. What does "EPSDT" stand for? Why is it important for poor children? Hint: http://www.childrensdefense.org Early and periodic screening, diagnosis and treatment. Poor children are more likely to be unhealthy; unable to afford to purchase insurance; less likely to be covered through the workplace; at high risk because of poverty status. 3. When Medicaid-eligible children are enrolled in a managed care plan, the state has negotiated a contract with the managed care organization. List five important questions to consider when negotiating with a managed care organization that is going to enroll children with special health care needs. Hint: http://www.healthlaw.org Examples of important questions to consider: Who is responsible for outreach to these children? Are alternative communication devices covered services? Is medical necessity defined as required by the EPSDT Act? Is the provider network for children with special needs adequate? 4. What is the penetration rate of Medicaid managed care in your state as of June 30, 1996? Which state has the highest penetration rate? Which state has the lowest penetration rate? Hint: http://cms.hhs.gov Tennessee is the highest with 100%; Alaska, lowest with 0%. 5.Describe the child-specific recommendations included in recommendations of the President’s Advisory Committee on Consumer Protection and Quality in the Health Care Industry. Hint: http://www.hcqualitycommission.gov None Case Example 1: Meet the Baker Family Roberta Baker visits you today. Here is what you learn: Roberta and John Baker live in the country, about 30 minutes from Chapel Hill, NC with their two children, Annabell, age 4, and Laurice, age 14. Roberta works part-time as a seamstress, and John fixes petroleum equipment. Roberta has severe head aches and experiences periods of time when she cannot work or drive a car. The family lives in an old wooden house that Mr. Baker recently has begun to fix up in his spare time. The family earns about $17,000 per year. Neither Roberta nor John completed high school. Roberta comes to you because she is worried about her children. Annabell is a sweet child but she has some problems. She has asthma. Her mother has had to take her to the emergency room at University Hospital twice in the last six weeks because of bad attacks. Annabell’s teeth are not coming in properly. She has difficulty chewing and says her stomach hurts. She has a large wart on her foot that she says hurts. Today, she has been limping around the house. Lately, her mother has noticed that Annabell’s attention span seems to be very short. She is terrified of her sister. Roberta describes Laurice as a physically active child. However, she has always been high strung. Recently, she has begun biting herself and pulling out her eyelashes when she becomes upset. She has hit her mother and called her names. She pushes her little sister around. She has threatened to run away, and her mother thinks she may be spending time with a 22-year-old man. Roberta says that caring for Laurice is very tiring and she is afraid she is not going to be able to continue unless she gets some relief. Activity:Make a list of each of the Baker’s possible health care needs. Teacher notes: Annabell:routine physical exams; vision, hearing and dental exam; dental work; asthma education and supplies; wart removal; behavioral health check; environmental evaluation for lead; transportation assistance Laurice: routine physical exams; vision, hearing and dental exams; mental health assessment by a mental health practitioner; mental health services; personal care services; medication; private duty nursing; case management; family planning counseling and services; transportation assistance Roberta: respite care; physical exams John: physical exams; smoking cessation Case Example 2: The Bakers’ Financial Situation You ask Ms. Baker about her family’s financial situation. She repeats that the family earns about $17,000 a year. This can fluctuate by as much as $3500, depending on her husband’s employment and her own ability to work. The Bakers own two cars, but one of them is breaking down all the time. They own their small home. Roberta says the family has been struggling to save money but, to date, has not been able to save very much. Neither Roberta nor John has health insurance. Assume: The federal poverty level for a family of four is $18,000. Your state covers children up to age 6 with family incomes up to 133% of the federal poverty level. It covers children age 6 through 18 up to 100% of the federal poverty level. Activity: Discuss the Baker’s potential eligibility for Medicaid. Teacher notes: Annabell is eligible for Medicaid because she is aged 4 and the family income is below 133% of the federal poverty level. Laurice is currently eligible for Medicaid because she is aged 14 and the family income is just below the federal poverty level. However, any fluctuation of income could cause her to lose poverty level eligibility. Depending on what the doctors diagnose, Laurice may be classified as disabled and eligible for Medicaid through SSI. Case Example 3: The Managed Care System Ms. Baker visits you today and shows you the following notice that she got three days ago from the state Medicaid agency: Dear Ms. Baker: Our EVS system has verified that you are eligible to enroll Annabell Baker and Laurice Baker in the mandatory "HealthNow" program. You must enroll in this program and select an HMO within 10 days from the date of this letter. You should contact 1-800-0000 for information about the HMOs that are available to you. If you do not make a selection within 10 days, we will automatically assign your children to an HMO. Sincerely, State Medicaid Agency Activity: Make a list of questions that the Baker family needs to ask about this notice and the HealthNow program. Teacher notes: Information: notice is too complicated enrollment period is short; not much information is provided how to select a primary care provider default or automatic assignment -- how it works Network: does everyone in the family have to enroll with the same provider are family doctors/hospital/pharmacy/specialists in the HMO transportation coverage who are the in-plan providers for primary care and mental health services Benefits: EPSDT coverage dental services transportation mental health benefits prior approval process coverage of services during the transition from fee-for-service to managed care Problems: complaint processes Case Example 4: Advocating for the Bakers Ms. Baker has been using the managed care system for a year now. She says that Annabell has gotten pretty good care but that it is hard for her to get Annabell to appointments. She is not sure what she is supposed to do about Annabell’s dental care. Laurice’s experience has been one frustration after another. She keeps getting changed from one doctor to the next. The HMO will only cover a limited number of home health visits. She has had three short inpatient hospital admissions, one right after the other. Her medications do not seem to work but Ms. Baker has difficulty getting appointments for medication checks. Ms. Baker is also frustrated because she is having difficulty keeping track of all the various social services and supports that might help Laurice, and she is learning about these supports only by chance. Laurice was getting some rehabilitation therapy services, but last week the HMO told her those would end after three more visits. She tried to complain about this, but a person at the HMO said that her problem "started and stopped with me." Ms. Baker has joined an alliance of parents of mentally ill children. These families are experiencing problems with the managed care system. Ms. Baker calls you because you have been so helpful in the past and invites you to speak at the next meeting of the alliance. She would like for you to talk about consumer protections to address the problems she has described, as they are affecting Laurice and other families in the group. The group hopes to advocate with the Medicaid agency. Activities: (1) What steps will you suggest that Roberta take for Laurice to continue to receive the rehabilitation therapy service? (2) Make a list of the consumer protections that you will suggest to the group. Teacher Notes: (1) Appeal directly to state Medicaid agency and seek aid paid pending. According to Medicaid regulations, if the appeal is timely, then benefits should continue pending a final administrative decision. This decision should occur within 90 days of the date of the request for a hearing. (2) Choice of provider and plan; confidentiality; appeals and grievance process; marketing; benefits package; information to consumers. Additional Resources Web Resources: American Academy of Pediatrics Center on Budget and Policy Priorities Children's Defense Fund Health Care Financing Admin Institute for Child Health Policy National Health Law Program President's Advisory Committee on Consumer Protection and Quality Office of the Inspector General Society for Adolescent Medicine

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