MACMHB Winter Conference Kalamazoo, Michigan February 3, 2016 Michael McCartan, CEO, Region 10 PIHP Dave Schneider, CEO, Northern Michigan Regional
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1 MACMHB Winter Conference Kalamazoo, Michigan February 3, 2016 Michael McCartan, CEO, Region 10 PIHP Dave Schneider, CEO, Northern Michigan Regional Entity
2 Overview Today s Healthcare Environment Michigan s Model What is a PIHP and What Does it Do Federal Regulations Contractual Relationship/Requirements Examples of Structures/Arrangements Environmental Factors
3 Today s Healthcare Environment The following slides are from a presentation by Jay Rosen, President, Health Management Associates. Mr. Rosen gave this presentation at the MACMHB Improving Outcomes Conference in May, These slides are used with permission. Key concepts: Public Financing Role of Health Plans Application of Managed Care to Long Term Care
4 Public Financing in the US Health Care System 4
5 The Role of Health Plans The broad shape of the publicly-financed parts of the US health care system has reached a tipping point. Whereas the classic arrangement involved a purchaser and a provider, there is a new, dominant model: a purchaser, a risk-bearing intermediary, and a provider. The health plan is now the chosen instrument for policy change in Medicaid, and increasingly, for Medicare as well. 5
6 The Role of Health Plans Medicaid Managed Care Penetration $M FFY 06 FFY 07 FFY 08 FFY 09 FFY 10 FFY 11 FFY 12 FFY 13 FFY 14 Medicaid MCO expenditures* $53,522 $60,663 $71,318 $78,644 $90,394 $102,478 $120,325 $141,759 $177,362 % y/y 13.3% 17.6% 10.3% 14.9% 13.4% 17.4% 17.8% 25.1% Total Net expenditures $299,009 $311,014 $337,055 $356,285 $381,615 $406,459 $408,850 $432,944 $467,426 % y/y 4.0% 8.4% 5.7% 7.1% 6.5% 0.6% 5.9% 8.0% % of Total 17.9% 19.5% 21.2% 22.1% 23.7% 25.2% 29.4% 32.7% 37.9% *Includes Prepaid Ambulatory Health Plans and Prepaid Inpatient Health Plans Managed care spending as a percent of total Medicaid spending 38%. Medicaid managed care penetration has doubled since Using Arizona as a proxy for full penetration (82%) we estimate over $200 billion of Medicaid spending currently outside of Medicaid managed care. 6
7 Transformation of Care/Complex Patients - LTC LTSS are a broad set of services for those with long-term care needs, outside of traditional acute medical care services: Home and Community Based Services (HCBS), such as personal care, Section 1915(c) Waiver services, and rehabilitative services Institutional services, such as nursing homes, intermediate care facilities for individuals with intellectual disabilities (ICF-IID), and mental health facilities Payment system/delivery system reform of LTSS involves reorganizing more spending in less time that has ever happened before. 7
8 Anticipated Growth of MLTSS Spending through 2030 At the beginning of 2014, 613,000 MLTSS beneficiaries account for $22.7 billion in annual spending. By 2017, 1.4 million MLTSS beneficiaries anticipated to account for $50 billion in annual spending. Projected Annual MLTSS Spending through 2030 (in $millions) $200,000 $180,000 $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $ Source: HMA Estimate By 2020, more than 2.5 million MLTSS beneficiaries could account for more than $90 billion in annual spending. By 2030, more than 4.6 million MLTSS beneficiaries could account for nearly $200 billion in annual spending. 8
9 Michigan s (Purchaser) Model Medicaid Managed Care since 1998 Michigan has used a carve out of the behavioral health benefit since 1998 Medicaid Health Plans manage physical health benefit Prepaid Inpatient Health Plans manage the behavioral health benefit
10 Use of Waivers
11 Risk Bearing Entities Physical Health Medicaid Health Plans have full risk contracts Behavioral Health Prepaid Inpatient Health Plans have shared risk contracts
12 Providers CMHSPs are the backbone of the mental health system and the primary providers for behavioral health Unique as providers because of the broad role they play Not just providers by public safety net, public policy Other Providers
13 Regional Map October 2012
14 State of Michigan Prosperity Regions
15 Beginning January 1, 2016 Michigan Medicaid Health Plans
16 How Do Those Maps Overlap? Note that UP stands alone: Single PIHP, Single MHP and the MHP is only in the UP The MHP bid was by Prosperity Zones, which do not line up well with the PIHP Regions Three MHPs are in the entire lower peninsula, one is in 8 of 9 regions, one in 5, one in 3, one in 2 and three in just 1 region. PIHPs, other than North Care, have 4 or more MHPs in their regions.
17 Medicaid is Big Business! Average monthly enrollment is 2,228,000 covered lives, which is just over 22% of the population in Michigan Physical health dollars total approximately $13.9 Billion Behavioral health dollars total approximately $3.1 Billion Total Medicaid dollars: $17 Billion Source: DCH Department Overview, Budget FY16
18 What is a PIHP Federal regulations define a PIHP as: - Prepaid Inpatient Health Plan means an entity that (1) Provides medical services to enrollees under contract with the State agency, and on the basis of prepaid capitation payments, or other payment arrangements that do not use State plan payment rates; (2) Provides, arranges for, or otherwise has responsibility for the provision of any inpatient hospital or institutional services for its enrollees; and (3) Does not have a comprehensive risk contract.
19 What Does A PIHP Do? The responsibilities of a PIHP are detailed in a variety of documents, including: Federal Regulations: Specifically, 42 CFR Part 438. This is often referred to as the BBA after the Balanced Budget Act of That is the legislation for which the regulations were written. The Application for Participation, 2013: This document laid out several requirements to be selected as the PIHP for a region. The MDHHS-PIHP contract: This includes the various managed care and other requirements of a PIHP. Oh, and other things.sis, HCBS Rules, Autism, SUD,
20 What Does A PIHP Do? Federal regulations are broken into subparts including: Enrollee Rights and Protections Quality Assessment and Performance Improvement Availability, adequate capacity, coordination of care, authorization of services, provider selection, grievance, subcontracting and delegation, practice guidelines, QAPIP, health information system Grievance System Grievance and appeal processes Delegation is an important item to understand
21 What Does A PIHP Do? Contract with MDHHS is 600+ pages Statement of Work includes: Service requirements, Access Assurance, Special Coverages, PIHP Organizational Structure, Provider Network Services, Financial Management System, QAPIP, Utilization Management, Regulatory Management, PA 500 Requirements, Financial Planning
22 What Does A PIHP Do? Substance Use Disorder Services Substance Abuse Prevention and Treatment Block Grant Financing includes: Block Grant, Medicaid, and Liquor Tax Prevention Efforts, including SYNAR obligations Integration of SUD and Mental Health Services
23 Structures There is a common saying that if you understand one PIHP, you understand one PIHP in Michigan. This is, unfortunately, very true. Governance Operations Committees Authority vested by regulation and contract in PIHP, but through various regional structures, shared with CMHSPS Responsibility Authority Balance
24 Environmental Factors Changing Rates (October, April, October) Uncertainty of budget, issues with enrollment HMP Program..in budget? Carve Out Debate SIM CCBHC Beacon Report Impact Integrated Care
25 So, what did we cover. Today s Healthcare Environment Michigan s Model What is a PIHP and What Does it Do Federal Regulations Contractual Relationship/Requirements Examples of Structures/Arrangements Environmental Factors
26 QUESTIONS?
(C) MERCER MERCER
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