Medicaid managed care is a complex business, far more complex than commercial, employer-sponsored health plans or Medicare Advantage plans. Medicaid health plans must meet a range of competitive, financial, clinical, operational, compliance, and political challenges. However, in smart hands, Medicaid managed care organizations (MMCO’s) can and often do deliver positive results for beneficiaries (better access and higher quality), taxpayers (lower Medicaid spending initially and/or over time), and investors (top line revenue and bottom line earnings).
Clients and colleagues often ask me about state requirements for Medicaid health plans. Therefore, here is a quick summary of the requirements found in the typical state Medicaid agency RFP for Medicaid managed care services:
Eligibility, including eligibility categories, application and eligibility determination process, and eligibility for enrollment in managed care organization (MCO).
Service area(s), typically by county, regional (multiple counties), or statewide.
Enrollment, including MCO selection and assignment, auto-assignment, maximum enrollment, enrollment effective dates, enrollment period, transfers from other MCOs, enrollment of newborns, enrollment of pregnant women, and information for new enrollees.
Disenrollment, including acceptable and unacceptable reasons for disenrollment, information for beneficiaries at risk of disenrollment, and process for disenrollment.
Covered benefits, including services and items covered by MCO, services carved out from MCO (if any, such as prescription drugs, behavioral health, or dental), non-covered services, cost sharing for services, medical necessity determination, use of alternative services when cost effective, and use of incentives.
Specialized services, including EPSDT services for children, prenatal care, emergency services (handling of in-network, out-of-network, out of service area, and out-of-state emergencies), urgent non-emergency services, pharmacy benefit management, mediation therapy management, preventive services, behavioral health care and crisis management, hospice, health education, women’s health services, and advanced directives.
Provider network, including (a) network capacity, (b) provider credentialing and certification, and (c) special requirements, as appropriate, for primary care providers, physician specialists, hospitals, safety net providers, community health centers, prenatal care providers, pharmacy network, dentists, local public health, and school-based clinics.
Readiness and implementation, including requirements prior to operation, readiness reviews, and corrective actions.
Care coordination and case management, including medical home, disease management programs, identification and stratification of high-cost and high-risk cases, beneficiary education and information, and provider education and information, referrals and care follow-up, and monitoring and formative evaluation.
Service coordination, including (a) collaboration, coordination, referrals, and information sharing among and between primary care providers and specialists and between physical health and behavioral health providers; (b) transition of new enrollees; (c) coordination of pharmacy services; (d) coordination of dental services; (e) coordination with long-term care services (institutional and home and community-based alternatives); (f) for dual eligibles, coordination with Medicare fee-for-service providers, Medicare Advantage plans, and Medicare Part D drug plans; (g) coordination with state and local health agencies, (h) children in state custody; and (i) and response to public health emergencies and disasters.
Marketing, including marketing guidelines, prohibited marketing and advertising practices, and state review of marketing materials.
Quality management and improvement, including quality improvement committee, quality measures and other indicators of performance, pay for performance and other incentives, evidenced-based medicine, clinical practice guidelines, performance improvement projects and studies, identification and reduction of disparities, NCQA accreditation (if state requires or prefers), and HEDIS (i.e., the 71 HEDIS measures, CAHPS 4.0, and participation in NCQA’s Quality Compass).
Utilization management, including prior authorization for covered services, referrals, exception processing, second opinions, provider profiling, and member profiling.
Member relations, including state review of member materials, reading-level standard, identification cards, toll-free hotline, member handbook, provider directory, member newsletter, correspondence handling, interpreter and translation services, staff training, and cultural competency.
Member rights, including requirements, processes, and safeguards for complaints, grievances, and appeals.
Provider relations, including provider services, toll-free hotline, member eligibility verification, web-based information, provider handbook and instructions, provider training and education, claims assistance, and provider complaints.
Program integrity, including identification, investigation, and reporting of suspected fraud or abuse by providers, suppliers, or members; anti-fraud training of staff and subcontractors; compliance officer; compliance plan; and cooperation with federal and State authorities.
Reporting, including routine and special reporting requirements regarding implementation; eligibility, enrollment, and disenrollment; care coordination, case management, and disease management; encounters; specialized services; provider network, provider agreements, and provider participation; service coordination; provider payments; quality management and improvement activities; HEDIS; utilization management activities; member relations and education services; member complaints, grievances, and appeals; provider complaints; marketing activities; provider relations services; financial management reports; claims management; information systems and data; fraud and abuse; subcontractor related reports; HIPAA compliance reports; non-discrimination compliance; corrective actions; personnel changes; and legal actions.
Financial management, including capitation payment management, profit and loss, solvency, working capital, accounting requirements, financial disclosure, disclosure of ownership, independent audits, internal audit function, third party liability, and liability insurance coverage.
Claims management, including capabilities of claims processing system, electronic and paper-based claims formats, prompt payment, payment cycles, claims processing methodology requirements, claim payment accuracy, minimum edit and audit procedures, explanation of benefits (EOB) functions, remittance advice functions, correction of payment errors, tracking and reporting, claims dispute resolution, third party claims functions (coordinating with third party payors, cost avoidance, recovery), and cross-over functions.
Information systems and data, including information systems and data integration, information systems performance (availability, problem management, backup, disaster recovery), data and document management and retention; encounter data system (submission, processing, auditing, reporting); eligibility and enrollment system and related data exchanges; information system security and access management; system testing and change management; technical support capabilities and system user training and support; and information system and data documentation.
Governance, management, and personnel, including licensure, board of directors, management control and capacity, staffing requirements, State right to approve personnel and subcontractors, and non-discrimination.
Monitoring, including availability and retention of records, inspection of facilities, inspection of work performed and work products, accessibility and cooperation, independent reviewers, federal review, and corrective actions.
Other administrative requirements, including HIPAA compliance and medical records requirements.
In addition, states include a variety of other process and compliance related requirements and safeguards in contract language.