The Schweitzer administration has abandoned its controversial plan to set up a Medicaid managed care demonstration project in Lewis and Clark, Cascade, Chouteau, Teton and Judith Basin counties.
The Lee Newspapers State Bureau reported last fall that the Schweitzer administration since August 2009 had discussed using managed-card Medicaid, the state-federal program that provides health care for the poor and disabled. One major proposal came from Centene Corp., a large managed-care firm based in St. Louis.
It was based on the idea that the private company would be paid a certain amount of money for each patient and “manage” that patient’s care by directing him or her to lower-cost health care. That, in turn, was supposed to save money for both the state and the company.
By last week, the state pulled the plug on the idea.
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Anna Whiting Sorrell, director of the state Department of Public Health and Human Services, sent department employees an email that announced the idea was being scrapped.
“Over the past few months, DPPHS has been exploring the possibility of a five-county demonstration in Montana Medicaid to determine if it would improve efficiencies while reducing cost,” she wrote. “The information we have generated and comments we received have been extremely valuable.
“It is not feasible to move forward since the comments received and the input during the 62nd legislative session did not seem interested in exploring these efficiencies.”
She thanked department employees for their efforts.
Both the managed care idea and how the Schweitzer administration developed it without much public involvement sparked opposition.
“Obviously, I’m relieved,” said Kathy McGowan, representing Center for Mental Health, which operates community mental health centers. “Some people still don’t trust that something’s not going forward.”
She said community providers already absorbed financial blows in the 2011 Legislature.
“Managed care on top of the big hit we just took would have been, I think, the death knell for some of the providers,” McGowan said. “No provider ever does well under managed care. They’re already in a weakened position because of actions by the Legislature and the department.”
Sen. Mary Caferro, D-Helena, said it was “really smart” of the administration to shelve the managed care plan for Medicaid in the five counties.
“Montana has one of the most efficient Medicaid systems already,” she said. “If it ain’t broke, don’t fix it.”
She said she was pleased that the Senate and House by large margins passed Senate Bill 351, by Sen. Rick Ripley, R-Wolf Creek, which set up a process calling for accountability, transparency and a public process when the state considers any managed care for Medicaid. Schweitzer signed it into law.
In contrast, she said, “there was no public involvement” regarding the Medicaid demonstration project idea.
The Legislature is always looking for efficiencies and cost savings, she said.
“But we don’t want to compromise the care of patients, and we want to prioritize Montana providers, not out-of-state corporations (Centene).”
Another concern, she said, was the state’s past experience with managed care.
“We don’t want Magellan to happen again,” Caferro said.
She was referring to the state’s much-criticized move to contract with a Maryland firm for managed care of all state-paid mental health care in the late 1990s. Gov. Marc Racicot finally had to terminate the managed-care contract after many problems, including the failure of the company to pay the bills to mental health care providers.
Looking at the latest managed care proposal, Senate Finance and Claims Chairman Dave Lewis, R-Helena said, “They must have decided to step back and rethink it.”
Some administration officials had said they thought the demonstration project could cut Medicaid costs by 10 percent in those counties, he said.
Lewis, who believes some form of managed care is probably inevitable, said that the 10 percent announced savings goal sparked the immediate opposition of providers because “those dollars are going to come out of providers.”
While the proposal didn’t require legislative approval, the administration talked about it with members of the Joint Appropriations Subcommittee on Human Services on which he serves.
“How could they possibly ask us to endorse it?” he said. “We didn’t have any facts.”
He said the department paid a consulting firm $140,000 to examine the proposal. He speculated the study may have found that savings of that level weren’t possible.
