Gazette opinion: Managed-care report rekindles bad memories

2010-10-22T00:00:00Z Gazette opinion: Managed-care report rekindles bad memories The Billings Gazette
October 22, 2010 12:00 am

Last week’s news that the state health department is considering hiring a private managed-care firm to run Medicaid probably prompted many Montanans to exclaim: “Not again!”

Anyone involved in Montana mental health care in 1997 to 1999 remembers the managed-care debacle. With the Legislature’s authorization, the state of Montana contracted with a Maryland firm to “manage” all state-paid mental health care. The intent was to put an end to biennial double-digit increases in state mental health spending and to provide better care to needy Montana residents.

The results were disastrous. The company that won the contract proved to have insufficient experience working with a public program that served a large proportion of seriously ill and disabled individuals. Contracts negotiated with Montana providers were scrapped/lost. The managed-care company delayed payments so long that Montana mental health care providers had insufficient cash flow to meet payroll. One regional mental health center went out of business. Montana’s sparse population, rural character and shortage of health professionals didn’t jibe with the for-profit model of exacting lower provider rates in exchange for steering patients away from the competition. At one point, every patient’s pharmacy card stopped working, so nobody could get medications. The first managed-care contract company was soon bought out by another, which was taken over months later by a third company. After Gov. Marc Racicot terminated the managed-care contract, Montana hospitals, clinics and professionals still hadn’t collected money the managed-care firm owed them.

That failed managed-care plan was supposed to have covered 72,000 Montanans, including adults and children.

As reported last week by The Gazette State Bureau, the Schweitzer administration is considering a test run of having a private managed-care firm run Medicaid, the state’s $900 million health care program for the poor. Fortunately, the discussion is about a trial involving only Lewis and Clark, Cascade, Chouteau, Teton and Judith Basin counties. (The mental health fiasco was statewide from day one.)

Agency documents obtained by the Gazette State Bureau include a timeline that calls for putting out the contract for bid in January, signing it by next summer and implementing the project in January 2012. Department documents also revealed that state health officials have been talking for more than a year about expanding private managed-care of Medicaid, including a proposal from Centene Corp., a St. Louis-based managed-care firm that operates in several Midwestern and Southern states.

Anna Whiting Sorrell, director of the state Department of Public Health and Human Services, said the managed-care discussion is “very preliminary.”

However, the department’s actions thus far raise some red flags:

  • Why hasn’t DPHHS sought public or legislative input?
  • Why didn’t the department inform Montana health care organizations about its interest in a possible Medicaid managed-care contract?
  • Why did the department discuss a proposal from Centene Corp. of St. Louis and other managed-care companies before even talking with the Montanans who actually care for Medicaid patients?

Managing patient care is a great idea when that effort is directed at seeing that every patient gets the right treatment the first time, that proven preventive measures are consistently provided and that patients have medical “homes” (not hospital emergency rooms) that they can count on for prompt urgent and routine care. DPHHS would do well to work with Montana health care providers to manage the care of needy Montanans rather than looking to another out-of-state firm to solve our budget challenges.

One of the lessons from Montana’s mental health managed-care failure was that taking care of poor people wasn’t the profit center out-of-state businesses expected nor the cost controller state officials hoped.

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