Stalled HUSKY program offers savings for state

Connecticut’s new governor will have the opportunity to put in place an innovative, cost-saving system for delivering health care to 390,000 low-income children and parents in the HUSKY program.

Under primary care case management (“PCCM” or “HUSKY Primary Care”), no insurance company is involved. The Department of Social Services (“DSS,” the state Medicaid agency), pays primary care providers $7.50 per member/month to coordinate health care for patients. The closer relationship between patient and provider gives control back to them, improving care. PCCM also eliminates insurance company profit incentives to deny needed coverage. States implementing PCCM find that many doctors who shunned Medicaid are now willing to participate.

Most states provide Medicaid through PCCM, exclusively or in parallel with MCOs (managed care insurance organizations). See http://www.cthealthpolicy.org/pccm/pccm_medicaid.pdf. In March 2010, the Connecticut legislature’s research arm concluded that other states have saved millions through PCCM (http://www.cga.ct.gov/2010/rpt/2010-R-0138.htm). For example, it noted that administrative costs for PCCM in Pennsylvania are almost half the administrative costs of its MCO-run program.

In 2004, Oklahoma went from three MCOs to a statewide PCCM program, saving $23.9 million in medical outlays and a net of $4.3 million in the first six months, including start-up costs. It continues to save millions while improving access to needed medical care and reducing emergency room visits. (http://www.mathematica-mpr.com/publications/pdfs/soonercare%20summary.pdf)

PCCM savings come from reductions in high MCO administrative costs, executive compensation and profits, often 20 percent or more of premiums, and from better care coordination, avoiding costly medical complications.

Three years ago, Connecticut’s legislature required DSS to implement a PCCM pilot to test its ability to save money and improve access to care. Legislators were concerned that Connecticut’s managed care program has serious care access problems and a lack of accountability, with continuing MCO demands for increased state payments. The mandate was to cover at least 1,000 individuals in HUSKY by April 1, 2008, under a plan submitted to the legislature by November 1, 2007.

Unfortunately, the Rell administration has thwarted the success of the PCCM pilot. It submitted its plan very late, and limited the program to only two communities after promising a statewide offering wherever providers expressed interest. It expanded in January, 2010 to two other communities where providers had expressed much interest, only after legislative intervention, and then sent confusing notices to area families ensuring their lack of interest.

DSS’s medical director acknowledged in February 2010 that it would not market PCCM because it “would be like marketing against the managed care companies.” DSS also restricted what PCCM-participating providers could communicate about PCCM, even at their own expense. DSS gave doctors conflicting messages, telling providers they could not bring up PCCM with their patients, only answer questions about it if asked. To attempt to address this, advocates paid for and distributed buttons to providers saying “Ask me about PCCM.”

The Rell Administration has actively favored the MCOs, undercutting PCCM’s viability. It authorized millions of taxpayer dollars for marketing campaigns by the MCOs to expand their name recognition. By contrast, while the state budget provided $5 million for PCCM implementation for July 2007 to June 2009, DSS spent almost no money to expand recognition of “HUSKY Primary Care.” Instead, DSS used most of the $5 million to cover budget holes, including $50 million in overpayments to the MCOs identified by an independent audit commissioned by State Comptroller Nancy Wyman.

In February 2009, the Administration terminated one MCO’s contract. The Administration took the affected HUSKY enrollees who did not choose another plan by a deadline and put them only into the two new for-profit MCO plans (not the one non-profit plan already operating in HUSKY). It did this specifically to make the two new for-profit plans “viable” by increasing their enrollment. But when DSS’ Medicaid director then suggested a similar default-assignment procedure to make PCCM viable, the Rell Administration refused.

The Administration’s actions have propped up the expensive HUSKY MCOs and effectively limited enrollment in PCCM. As a result, only about 400 people have enrolled in PCCM statewide, too small to satisfy the statutory minimum or offer either families or the state a feasible alternative to the troubled MCOs.

It is not too late to change course. Every gubernatorial candidate’s campaign should include robust statewide expansion of PCCM, including marketing support to ensure eligible families are aware of this option and its benefits. Especially in times of severe deficits, there is no excuse for failing to implement a statutorily-required program which promises substantial savings and delivers better medical care to children.

Are the candidates listening?

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