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The House Appropriations Subcommittee on Article II held a hearing on April 6 to consider the following interim charges:
 
Examine the historical growth of the Texas Medicaid program, including factors affecting caseload and cost trends. Review legislative or policy initiatives created to detect or deter waste, fraud and abuse; to reduce cost; or improve the quality of healthcare in the Texas Medicaid program. Evaluate the effectiveness of, and identify savings associated with, these initiatives.
 
Review the Texas Medicaid programs providing long-term services and support to adults or children with medical, physical, or intellectual and developmental disabilities (IDD). Study reimbursement methodologies, the historical appropriated slot allocation compared to the actual fill rate, the procedure of releasing slots to providers, and the impact and timeline of carving services into Medicaid managed care. Identify potential obstacles for the delivery of community long-term services and support, including the availability of community care workers. Make any needed recommendations to improve community long-term services and supports.
 
Opening Comments – Chair Four Price

  • It is essential to understand the Medicaid program and where it has been to understand where it is going and how it will affect the state budget and policy
  • 87% of Medicaid caseload is now in managed care with more transitions planned in the future
  • Goal of the hearing is to understand how program challenges and costs can be managed through budget riders and legislative action

 
Medicaid in General
 
Leora Rodell, Legislative Budget Board

  • Medicaid is a jointly funded state/federal program
  • States are required to cover certain groups and have the option to cover other groups
  • Basic requirements of the program are that it is an entitlement, it must be statewide, the same level of services have to be available to all clients, and choice of physician
  • Waivers can be given to the state from US HHS to waive any federal requirement allowing states to test new delivery and payment methods
  • Medicaid expenditures are a function of caseload and cost
  • Primary factors affecting caseload are population growth, economic factors, etc.
  • Almost 75% of Medicaid enrollment in Texas is children
  • Implementation of STAR+KIDS will put more children into managed care increasing the 87% figure
  • By FY17 Medicaid caseload will have grown by 50% in a decade
  • In FY15 children transferred from CHIP into Medicaid which added about 300,000 children
  • Rate changes, inflation, acuity and utilization are the main factors contributing to cost
  • By FY17 annual cost of Medicaid is expected to have tripled since FY00
  • Financing for Medicaid is based on several matching rates; each states matching rate (FMAP) is different based on per capita income
    • The Texas FMAP has gone down each year for the past 4 years
    • 2017 FMAP is 56.18%
  • Texas is the largest state not expanding Medicaid pursuant to ACA
    • Of the six non-expansion states with Medicaid enrollment exceeding 1 million people Texas has the highest population, lowest percentage of population enrolled in Medicaid, lowest FMAP
  • Rep. Armando Walle asked how a person becomes eligible for Medicaid
    • It is based on eligibility factors such as the person’s state of wellness and income as a percentage of the federal poverty level
  • Walle asked what that means for income
    • Believe 100% of FPL is just under $20,000 for a family of four
  • Rep. Sarah Davis asked about cost savings; hearing that from plans but don’t hear that directly from the agency
    • HHSC does not provide estimates for cost savings from managed care; it is hard to determine what the program would have cost without it and there are a lot of changes going on that make it even more difficult

 
Chris Traylor, Executive Commissioner, Health and Human Services Commission

  • For a family of three 100% of FPL is $20,160
  • Medicaid is an entitlement program and states cannot limit people who are eligible and cannot limit medically necessary services
  • Medicaid serves low income families, children, pregnant women and elderly with disabilities
    • Does not serve childless adults
  • Walle asked about residency requirements; believes that for legal permanent residents they must have been so for 5 years before qualifying
    • That is correct
  • In Texas a little over 4 million people are enrolled in Medicaid; about 3.5 million are in managed care
    • Predominant service delivery product is STAR
  • Back in 2005 state determined there would be a specific model for children in state foster care; about 31,000 people in that program
  • About 580,000 adults in STAR+PLUS and the dual demo

 
Lisa Carruth, CFO, Health and Human Services Commission

  • Discussed historical state spending
  • A lot of the spending stabilized around 2013-2014
  • In 2012 there was a significant increase, about $5 billion, in supplemental payments for health services
    • Includes DSRIP, uncompensated care and disproportionate share payments
  • Total Medicaid spending in 2015 was close to $29 billion
  • Walle asked if that number includes waivers and DSRIP, etc.
    • $29 billion is total for Medicaid, supplemental payments were an additional $9 billion
    • Traylor noted Texas Medicaid is unique because Medicaid clients have access to care through private hospitals and networks that go along with them, without those supplemental payments they would be unlikely to have that kind of access
  • Walle asked if access would be limited without those payments
    • It would be challenged more than it is now
  • Walle asked if supplemental payments include the 1115 waiver
    • Yes
  • Walle asked about current talks regarding 1115 extension
    • Have a high level of confidence that a short term extension will be given that will allow the state to have time to look at other options
  • Chair John Otto asked if there is a date expected for having a resolution of this issue
    • It should be before the session begins in January; the current waiver expires September 30 so it should be before then as well
  • Carruth continued
  • It is a standard of practice that HHSC uses consistent methods and data to forecast Medicaid costs
    • Data includes caseloads and expenditure by program delivery type
  • Rep. Dawnna Dukes noted it is rare to see LBB forecasts similar to HHSC forecasts; the base bill is typically lower than what it turns out to be
    • Traylor noted there are differences almost every session
  • Dukes asked about when the forecasting is done
    • LAR will be submitted in June of this year for a biennium that won’t end until years later
    • There are some things that cannot be forecast; for instance, natural disasters bring a lot of change and many times an increase in caseload for food stamps
  • Carruth continued
  • Timing is a big issue for forecasting; the recession of 2009 did not increase caseload growth until right around the time the 2009 session was ending; information presented by the LBB will many times be ahead of HHSC information
  • Case mix makes a substantial difference in Medicaid cost; certain groups cost more than others; pregnant women are high-cost as well; non-disability children are relatively low cost
  • Population growth and changing demographics affect caseload to a high degree
  • Epidemics and viral outbreak play a part in increasing costs as well; natural disasters will increase food stamps but generally cause a dip in Medicaid costs, presumably because people are missing appointments and physician’s offices are closed
  • Walle asked about effects of oil price decrease on Medicaid caseload
    • Dukes noted it is generally a full session gap before those effects are realized
  • Advances in medicine increase the costs of Medicaid; drugs costs and new drugs coming onto the market at a rapid pace have a revolutionary impact on the practice of medicine
  • Changes in medical practice standards have a more predictable effect on costs
  • Aged and disabled populations have a steady growth and even a small caseload growth for those populations will have a significant impact on cost
  • Otto asked if anyone is looking at the projected affect the baby boomer population will have on Medicaid
    • It is easy to see there will be a demographic shift, however, it is a tough thing to forecast because the unknown of when they will hit the Medicaid caseload
    • Traylor noted that aged and disabled populations are about 20% of the caseload but make up 60% of the cost to the program; lots of acute care; there are extraordinary opportunities in this area; there are possibilities to provide the appropriate services and supports to defray the cost of long-term care; this has been a focus of the agency and the legislature going back to the 1990s

 
Traylor continued

  • There has been a 41% increase in caseload over the last 8 years but only an 8% increase in per member, per month cost
  • Price asked what accounts for the per member, per moth cost decrease in 2015
    • In 2014 there were more children coming into Medicaid because of ACA and they are lower cost clients
  • Prescription drug program makes up 11% of Medicaid costs
  • Dukes asked about prescription drug program cost savings
    • Prescription drug cost is a substantial cost driver; always trying to keep a hand on it
  • Dukes recalled working closely with Albert Hawkins and how important it was to have certain rebates to allow for cost savings; greatly impacted the budget; originally was not a fan of how it was initially represented but the formulary has proven to be beneficial
    • Back in 2003 there was a substantial budget deficit; looked to supplemental rebates on drugs; as we have gone toward a managed care state it may be time to examine how the PDL is handled and whether it should be done by the MCOs; the commission should be neutral on that topic; HHSC has run the program well in ensuring the necessary drugs are available to the people that need them, even brand name drugs
  • Dukes asked about other states that have looked at other ways of doing the prescription drug benefit
    • Texas implemented the program well, however, conditions have changed since 2003; do not have all the information needed to present fully on that subject; believe there is an expiration date in statute for the way the supplemental drug rebates are carried out
  • Dukes noted that expiration dates can change
  • Price noted Andy Vasquez has testified that the method of finance accounts for about 50% of the cost savings
    • Yes but that is both the federal and state rebates
  • Traylor noted it is incumbent on HHSC to reduce the administrative burden that providers are challenged with and to make the Medicaid program something providers want to participate in; also need to focus on incentivizing quality
  • Davis asked what has been done to streamline the program; always hearing that is being done
    • There have been and will be substantial changes in enrollment and credentialing; health plans are working on a standardized credentialing process to ease that burden

 
Gary Jessee, Medicaid Director, HHSC

  • The number one complaint from providers is the burden of enrollment and credentialing
  • Will be reprocuring the enrollment provider to modernize those services
  • The common credentialing repository is going to be a big help for providers
  • One of the biggest challenges for a managed care system is having an abundance of providers; have to be able to attract and retain those providers
  • Focusing on stakeholder feedback; working through challenges from administration to program design and coordination, etc.
  • Working on access to care issues to help clients find providers they need and working to get providers they use in their MCO network
  • Working to evaluate network adequacy standards to improve access for people navigating those systems
  • Want people to be making informed choices when selecting their MCOs
  • Dukes asked how the state is doing in ensuring provider lists are accurate and up to date and represent providers who are accepting new patients and not just in the program
    • There are always issues with providers and determining which ones have open panels; it is a constant process whether through secret shopper programs, EQRO processes, or other methods of making those determinations; always expect MCOs to help their clients find the providers they need; MCOs can walk through the process with clients as well as helping to negotiate services from out of network providers
  • Dukes noted providers point to low reimbursement rates as a reason for not taking part in the program; MCOs must always meet network standards; this will remain a priority
  • Price asked about implementation of SB 1760
    • Lots of components including provider directories, expedited credentialing and network adequacy; very close to having a product for expedited credentialing, will be going through rulemaking; there are existing expedited credentialing protections in place for physicians joining a new practice; identified a date for a public forum to roll out recommendations for network adequacy; the public rollout will be in June; on target to implement all provisions of SB 1760; it will not be perfect but it is a good starting place to implement provisions that can be built on
  • Major changes in managed care with carve-ins have been tied to advisory committees that guide the department on things that are important to the particular populations in question
  • SB 1150 (83R) was designed around provider protections; there is a need to reduce the challenges providers face; have focused on MCOs and their portals that providers interface with; have required additional portal functionality; added electronic signatures, electronic attachments and pre-population with TMHP to ease some of that burden
  • TDI was directed to implement a standard prior authorization form for acute care services
  • Managed care lends itself to implementing quality programs; can achieve outcomes by incenting MCOs to achieve certain outcomes
  • Pay for quality program puts MCOs at risk for 4% of their capitation; they must meet certain quality measures to keep their at-risk percentage
  • MCO report cards have been implemented to help clients make their MCO selection; they typically don’t make a difference for members but they create an incentive for MCOs who will want to show they are as good or better than the other MCOs
  • Carved-in nursing facilities into managed care; established a quality program related to that
  • Implemented a dual demonstration as a result of SB 7 in multiple counties; MCOs have responsibility for coordination of Medicare and Medicaid benefits
  • QIPP program has not been implemented
  • Rep. JD Sheffield noted he has rural counties with rural nursing homes and they were very excited about QIPP; curious what is going on
    • Traylor replied that when QIPP was being implemented, federal partners had some major issues with the program; particularly IGT issues, quality measures, etc.; the program has not gone away it is just on hold until those issues can be resolved
  • Dukes noted she believes it is important to ensure those issues are worked out to ensure QIPP is available to all nursing facility patients in the state
  • Dukes asked how the dual demonstration is going
    • There is not a very high population in the program; the program is a choice of the client and compared to other states Texas had a high retention rate
  • Dukes noted the model that estimated enrollment projected a cost savings from the program
    • The program will achieve savings on a per member, per month basis but the full expected savings will likely not be achieved because of the low population in the program
  • Jessee continued
  • With the capitation at risk program an MCO that does better than expected can be rewarded by receiving the at risk portion of another MCO’s capitation that they lost
  • Many measures used to determine quality include HEDIS measures, CAHPS surveys, potentially preventable events
  • Implementing NCIAD to generalize findings specific to each MCO delivering services; will have specific experience information from clients that is linked to MCOs
  • Discussed the nursing facility quality program; using specific measures to determine quality; daily rate is protected under this program; expect MCOs to provide supports to those clients who wish to leave a nursing facility
  • Want to make sure MCOs are providing service coordination and supports to individuals transitioning between the hospital for acute care and the nursing facility for long-term care
  • Walle asked how to incentivize clients who want to stay at home
    • Money follows the person initiative; individuals indicate what their preference is for where they would like to live; there are quite a few initiatives such as housing vouchers, expanded options around assisted living and adult foster care; trying to be as flexible as possible; if somebody needs attendant care it is provided, if they only need a few meals a day then that is what is provided
  • Walle asked about provider rates for therapies; are we incentivizing that piece
    • There are a lot of opportunities to receive the needed therapies; all of those processes are supports that HHSC delivers; sometimes they are dual eligible and Medicaid only picks up the portion that Medicare doesn’t cover
  • Davis asked what the agency does regarding cost savings for managed care; how is that measured
    • Traylor believes that HHSC can provide that granularity of data; does not have that information now

 
Stuart Bowen, Inspector General, Health and Human Services Commission

  • 2015 was a year of restructuring and reform in the OIG; 2016 will be the year of results
  • Partnership with state leadership, HHSC and the provider community including MCOs is key to functionality of the OIG
  • Oversee about $40 billion annually in federal and state funds through audits, investigations and inspections
    • There has not been an inspections operation within the OIG ever
  • There were abuses of the CAF hold; they are no longer being implemented
  • Legislature provided new OIG subpoena power
  • Working to increase transparency through quarterly reports
  • The most recent quarter has realized a 75% increase in recoveries over the last quarter
  • Working with TMHP on provider enrollment packages is a large part of the focus currently at OIG
  • Partnering with MCOs; the advent of managed care in Texas dichotomized oversight of Medicaid; goal of the partnership is to collaborate with each of them to ensure cost savings to Texas taxpayers
  • Price asked for OIG opinion of SIUs
    • Extraordinarily productive so far; spending a lot of time to figure out what can be done better in carrying out federal and state mandates
  • Have created a new data and technology division in the OIG that fits within the ongoing system transformation; have been able to collaborate with the system to promote efficiencies
  • Walle asked about cybersecurity; are we putting enough resources into that
    • It is an issue of high concern at HHSC and OIG; very sensitive data
  • Case back log was an extraordinary problem a year ago; it is no longer a problem
  • Medicaid provider integrity has referred 300 cases for prosecution in the last year
  • SNAP program and abuse of the LoneStar card is a huge issue in the OIG; referred 500 cases to the district attorney in the last quarter
  • Rep. Cindy Burkett asked if there is something that can be done to prevent that fraud upfront
    • Deterring abuse will take collaboration between all entities involved in the program; recipients need to know they are being held accountable; there is no deterrence if the users do not recognize the law enforcement profile
  • Price asked where money goes that is recovered from providers
    • Understand that most of it goes back to GR; it is on a case by case basis; some would have to go back to federal partners based on circumstances
  • OIG integrity initiative envisions bringing the community policing framework into the oversight regime; trying to crack down on providers to remove fraud, waste and abuse
    • Asking providers, their employees and others to report bad actors and take part in integrity training; integrity hotline had 8,000 calls last quarter

 
Jamie Dudensing, Texas Association of Health Plans

  • Texas was one of the first states in the country to create an integrated acute/long-term care Medicaid program
    • Involved better management of care, reduction of costs, shifting towards lower cost care that provides individuals the opportunity to live in the community
  • Most of what is not in managed care right now is IDD long-term services
  • Almost all acute care services are coming through managed care
  • Managed care provides budget certainty and cost containment; if profits are made beyond 3% those profits are shared with the state
    • In return for that, the government determines what services must be provided
    • Above and beyond that, MCOs can provide value added benefit services that are not required in order to help bring costs down and create healthier populations; innovative things to reduce hospital costs and emergency room visits
  • Improved outcomes in quality of care are provided through MCO contracts and quality measures
  • Increased access comes through network adequacy requirements; this did not exist in fee-for-service model
  • No wait list for community care services that have been integrated into STAR+PLUS
  • Texas is the only state that caps administrative costs and provides profit sharing
  • For STAR program from 2009-2013 costs only grew 2%; at the same time US health care costs grew 15%
  • The Miliman group extrapolated out what fee-for-service would have cost from 2010-2018; found that managed care will have saved $3 billion in savings from 2010-2015 and another $3 billion in savings from 2015-2018
  • As the state of Texas has been implementing managed care, per capita spending per enrollee has been decreasing
  • Dental managed care cost savings; between 2011-2012 there was a 20% reduction in overall spending on dental services; 81% decrease in orthodontia spending
  • MCOs are in partnership with the OIG and required to have an SIU to conduct fraud, waste and abuse investigation; the goal is to prevent it in the first place
    • The current inspector general has made a concerted effort to partner with MCOs where previous inspector generals did not
  • From 2009-2011 MCOs dramatically reduced hospital admissions for some serious disease states
    • Based on HEDIS measures
  • In 2011 additional measures were added; preventing hospital stays, emergency room visits, readmissions, etc.
    • There have been dramatic reductions in preventable events in Texas from 2012-2015
  • As STAR+PLUS expanded, waiting lists were dramatically reduced and at this point are almost completely eliminated
  • There are a number of ways MCOs are measured on access; the EQRO determined that Texas MCOs surpassed national standards for child well visits; 93% of families with Medicaid eligible children report having access to PCPs when needed
  • Recommends the state focus on outcomes versus process measures; making sure measures are meaningful; adopting standard measures across the state
    • Need to ensure there is a clear and deliberative process for how measures are added to the system
  • Price noted there is some stability there already
    • Some concerns surround MCOs replicating how information is measured; it needs to be measured in real-time to ensure changes are made as problems are happening
  • There are additional opportunities for savings with a pharmacy lock-in program; the state has a very small program; there is substantial increase in prescription drug abuse and opioid abuse lately
    • Want MCOs to have the ability to determine who those lock-ins apply to
  • There are additional savings with fully carving in the formulary piece of the VDP
    • Believe there would be $100 million in annual GR savings if this is done
    • In 2003 when managed care was being expanded and the rebate system was developed the federal government prevented it from being carved into managed care; that changed in 2009
    • 90% of rebates are federal statutory rebates; of the 10% in supplemental rebates, many states that have the formulary fully carved into managed care have seen  the MCOs maintain much of the supplemental rebates
    • States who focus on managing drug mix and price do a better job than states that go after rebates even though those states do a good job getting rebates
    • Texas ranks 45th in generic use; states who focus on drug mix and price do a better job in generic usage
    • States that focus on generics have a 24% lower cost than states that focus on rebates
    • States that use MCOs have substantial savings over other states
    • After rebates, brand name drugs are still 5 times higher than generics
    • These savings do not cut rates or benefits or cut people off services
  • Burkett asked how it affects the doctor patient relationship in choosing drugs
    • Doesn’t change it much from where it is now; one of the top complaints in Medicaid right now are complaints about the VDP and the way it is set up
  • Burkett asked if the proposal would allow the patient and provider to choose a brand name over a generic
    • It depends how the state sets it up; that type of protection can be included in the program; could allow for a physician to indicate “brand name only” on a prescription
  • Dukes noted concern; in 2003 there was a lot of discussion around the prescription drug program; Dukes noted she has believed that doctors should determine which medications are used for their patients, not a prescription drug list; has been in a situation where a generic was prescribed and it did not end well; just because there is a provision that allows a doctor to write “brand name only” on a prescription it does not mean the client will not have to fight to get that honored and get the brand name drug they need; need to do a lot more studying on prescription drug lists to ensure clients are getting the drugs their doctors want them to have; not sure who is controlling the drug lists
  • Price agreed that the issue needs to be studied in-depth before any decision is made; a study that shows the state can save $230 million per biennium will catch anyone’s eye
    • There have been 5 studies that have shown those savings
  • There are drug classes such as for oncology drugs, hemophilia drugs, etc. that can be protected, and can be protected more so than they are now
  • Majority of the cost savings come from drug mix and picking the right drugs for each drug class; not from limiting very complicated drugs that treat severe disease states
  • The state controls the safety edits and clinical drug edits in the VDP; MCOs can look at all pieces at once to ensure there are cost savings and quality of care
  • The VDP exists in a silo and is not managed with other benefits in the Medicaid program; choices are made based on the greatest rebate and not necessarily what the right drug mix might be
  • Recommends looking at ways  that the women’s health program can become more efficient and create consistency with the Medicaid pregnant women program; may want to consider carving this program into managed care as well
  • Davis noted this is supposed to be a very particular program; the point of the money is to prevent unintended Medicaid births; how can we be sure the money will be used for its intended purpose
    • It would allow for a much better transition into prenatal care; transitioning from program to program is a hassle and this would ease that transition for the mom
  • Dukes noted because the federal women’s health waiver was not continued there are currently provider shortages
  • Davis agreed that providers were lost when the “tier” language was put in; that was in 2011 and now it is 2016 and the capacity has been increased

 
Long Term Services and Supports (LTSS)
 
Jon Weizenbaum, Commissioner, Department of Aging and Disability Services

  • DADS provides and regulates LTSS for people with intellectual and physical disabilities
  • DADS covers both entitlement and non-entitlement Medicaid funded programs as well as non-Medicaid funded programs
  • Entitlement services include institutional and community based services and supports
  • Waivers refer to exceptions to the usual Medicaid requirement such as eligibility criteria, geographical issues, scope, etc.
  • Each session the legislature appropriates funds that translates to a number of slots for each waiver program
    • When the interest for the program exceeds the appropriation the client is placed on an interest list
  • DADS considers take-up rates, attrition rates and remaining funds when deciding to release slots
  • When a slot is released the individual is contacted and if they choose to accept the service offer they decide on a provider and eligibility is determined
  • Discussion of situations where a full appropriation for slots might not be used
  • Having an adequate provider base is an obstacle to providing LTSS; other challenges include sustaining the workforce and other geographic challenges

 
Gary Jessee, Medicaid Director, Health and Human Services Commission

  • In September 2014 STAR+PLUS was expanded to the MRSA
  • As part of the expansion, acute care was integrated for individuals with intellectual and developmental disabilities
  • The carve in of individuals in nursing facilities in STAR+PLUS took place last year
  • Will be implementing STAR+KIDS in November of this year
  • An IDD pilot was directed through legislation; one of the clear directions was to implement the pilot to inform and understand what things should be considered as we move forward with additional carve-ins for this population; developing an RFP right now; not sure when it will be out

 
Pam McDonald, Rate Setting, Health and Human Services Commission

  • Fee-for-service rates and rate changes are incorporated into the calculation of managed care capitation rates
    • When fiscal impacts are determined managed care and FFS are considered
  • Most contracts between MCOs and LTSS providers incorporate the FFS rates to some extent
  • HHSC is responsible for setting a minimum payment rate for nursing facilities under managed care
  • HHSC administers nursing facility direct care staff rate enhancement; work with MCOs on attendant care compensation rate as well
  • Burkett asked about differences between IDD based programs and non-IDD
    • Weizenbaum noted it has to do with the types of disabilities that create eligibility for that program
  • The only federally mandated rate is the hospice rate; other rates are determined annually but are not federally mandated
  • Price asked how the rate setting process can be improved to take into account the complexities of the programs
    • Cost reports are designed and maintained by HHSC and some are specific to program; have had problems with providers not accurately filling in the cost reports
  • Dukes asked how cost reports can be altered to make them more accurate
    • There are about 30 pages of rules regarding what can be allowed on cost reports
  • Dukes noted it may be helpful to add some of the most requested but disallowed items
  • Many times there is a shortfall between what HHSC funds in the rates and what the methodologies show as full cost; this shortfall is caused by not having high enough appropriations
  • Recruitment and retention of attendants is an issue; rate analysis is helping to collect data that can be used to look at hourly wages, benefits, turnover rates, etc.; will be collected through 2015 cost reports; also developed an online survey that will collect some detailed data

 
Bob Kafka, ADAPT

  • Need to save as much money as possible on administrative costs to put into services
  • There are opportunities to continue integration of the fragmented services and supports system; should use the Community First Choice model
  • The base rate for attendants is $8 per hour; increasing this rate needs to be a main priority for next session
  • Incentivizing consumer directed services has the opportunity for cost savings as well

 
Dennis Borel, Coalition of Texans with Disabilities

  • The age of onset of disability is irrelevant; do not need the label of IDD
  • If the base rate for attendants were adjusted for inflation it would be $10.90; that represents an erosion of about 30% of that compensation
  • Need to make an effort to move forward on attendant rates and not take the minimalist approach
  • If adults with disabilities received dental services they would stay healthier and cost less
  • The legislature needs to spend more time considering that spending more money on the front end for low cost services will save money on the back end in high cost services
  • Borel discussed a Dallas Morning News article that said Texas is losing nursing staff to McDonald’s and Wendy’s because rates are so low

 
Susan Murphree, Disability Rights Texas

  • There is a bit of concern with totally letting the VDP program be handled by MCOs
  • Having some stability in the formulary is important
  • It could cause significant harm to certain individuals to have to fail on a generic before being prescribed the best drug for them

 
Judy Day, Leading Age Texas

  • Need to look at starting rates between $11.00-11.50 per hour for nursing facility staff
  • Need to target dollars to facilities that are providing additional staff
  • Price noted it’s obvious there is a problem with nursing staff rates and turnover; surely that increases costs
    • Absolutely

 
Scot Kibbe, Texas Health Care Association

  • On the verge of significant growth in elderly population in Texas for a number of reasons
  • There has been a challenge in that acuity for nursing facility residents is increasing; Medicaid funding has not kept up with those changes
  • Nursing facilities are funded around 14% lower than the cost of care
  • Funding shortage is exacerbating the turnover problem we are facing

 
Rachel Hammon, Texas Association for Homecare and Hospice

  • Cost reports are an objective way to measure cost; translates into the consolidated budget that is used in appropriations decisions
  • There needs to be a process for stakeholders to have more frequent real time input on what goes into cost reports
  • Unallowables are based on Medicare unallowables but Medicaid provides a lot of services that Medicare does not
  • State mandates such as EVV can increase the cost of doing business as well as managed care; managed care increases administrative costs and burdens of providers

 
Carole Smith, Private Providers Association of Texas

  • There are serious problems with reimbursement rates for LTSS programs
  • Transition to managed care for certain services has exacerbated the problem of being able to find physicians; many physicians that were seeing patients before would not contract with MCOs to continue seeing them
  • Anything to boost staff rates would be a big help

 
Doug Svien, Providers Alliance for Community Services of Texas

  • Current reimbursement methodology is fraught with problems
    • Does not capture all of the costs of providing services
  • Managed care adds administrative costs
  • Routinely hear from physicians that they will not take certain MCO’s patients; it is also a burden to try to locate providers that will work with certain MCOs

 
Trey Berndt, AARP

  • Community attendants are the least expensive part of LTSS, STAR+PLUS waiver programs  is next and nursing facility care is the most expensive
  • Nursing facility populations have remained relatively flat for a long time, partly because Texas built a very good community care program early on
  • The issue of attendant wages must be addressed before the baby boomer population starts needing their services and are forced into high cost nursing facilities

 
Katharine Ligon, Center for Public Policy Priorities

  • Most Medicaid provider adequacy problems are a direct result of reimbursement rates
  • HHSC Should eliminate the waiting list for Medially Dependent Children program with the launch of STAR+KIDS

 
Kate Murphy, Texas Public Policy Foundation

  • Texas could establish a block grant program to provide funding to individuals based on need that could be used to purchase LTSS; threshold for using institutional care would be high and could only be used when less expensive community based services have been exhausted
    • Would incentivize community based care
    • Would force clients to choose cost effective services and become managers of their care
  • Something has to be done about the current trajectory of Medicaid spending

 
Public Testimony
 
Medicaid in General
 
Will Francis, National Association of Social Workers

  • Licensed clinical social workers are very important for mental health services
  • Pay rates have been a barrier to social workers, pay parity with psychologists and psychiatrists is crucial
  • Pay rates should be based upon tenure and certification

 
Greg Hansch, National Alliance on Mental Illness

  • Many 1115 waiver projects are connected to behavioral health
  • NAMI is concerned about losing crucial 1115 waiver projects if a renewal is not negotiated, would be very costly to continue these projects without a renewal
  • Burkett – Would like formulary testimony that he presented
  • Burkett – How is the insurance gap covered under the ACA?
    • Low income individuals cannot afford these policies

 
Tanya Lavalle, Easter Seals Center Texas

  • Interim Charge 10 –
  • Housing has been identified as the biggest barrier for people transitioning out of institutions
  • HHSC should work with TDSCA to focus on housing as a priority to improve outcomes
  • Providers can be required to be credentialed by TMHP and MCOs, redundant credentialing is costly and time consuming and THMP credentialing should be sufficient
  • Cuts to physical, speech, and occupational therapy were misguided, will radically reduce or eliminate these services
  • Price – Can you expand on why efforts to expedite credentialing haven’t gone far enough?
    • This is a step in the right direction, but redundant credentialing is still a burden
  • Walle – How important is therapy for ECI services?
    • Very important, provides therapy in the patient’s home
  • Walle – So this is for children with developmental issues?
    • Yes, for children up to 3 years of age
  • Walle – Why do we cut those services at 3 years old from a policy perspective?
    • Programs exist outside of ECI to care for children above 3 years, but capacity is lower than ECI
  • Walle – My son needed speech therapy and received ECI, these services are very important

 
Laura Guerra-Cardus, Texas Association Director of the Children’s Defense Fund

  • Cutting children’s services does not pay off, largest population in Medicaid, but also most affordable
  • First study came out looking at adults who had been on Medicaid as children, quality of life measures and chronic illness metrics where more positive than children who had not been on Medicaid
  • Case load growth is largely due to reaching eligible children, growth will level off when program reaches all of the children it was intended to reach
  • Medicaid spending tends to grow more slowly in states that have worked to expand services

 
Rev. Dr. T. Randall Smith, President of Texas Impact

  • Families below the poverty rely heavily on Medicaid to meet healthcare needs, a portion of families are not eligible for state aid or federal aid as state has not adopted certain portions of the ACA
  • States who have adopted these provisions tend to see better health outcomes
  • Lack of coverage leads these families to emergency rooms or other avenues, puts small hospital funding at risk
  •  State should expand Medicaid to the working poor who desperately need it and accept federal coverage that comes with it

 
Long-Term Services & Supports
 
Laura Redmond, self

  • Problems exist with current payment claims system, financial services and consumer directed services have a disconnect between state regulation and functional MCO payments
  • Walle – What kind of services do you offer?
    • Home and community based services for individuals with IDD from teenagers to adults
    • Residential services, in-home support, foster care
  • Price – Have you experienced payment issues with one MCO or multiple?
    • Cigna, UnitedHealth Care, and others
  • One call system does not work, never get the same service rep at the MCO
  • No organization can afford to serve people without being paid

 
Kevin Barker, Director of Intellectual and Development Provider Services at Texana

  • Day habilitation is the lowest funded service at $5/hour, averages to ~$25/day
  • However average provider cost for this is $32/day
  • Day habilitation is funded at low levels, however service is charged to provide CE and other associated services, difficult to provide this without appropriate funding
  • Day habilitation is very important for functional families
  • Price – Did you hear the testimony yesterday concerning cost reports?
    • No
  • Price – There was quite a bit of information over how these reports are compiled and used to set rates, would like any information about this

 
Stephen Abshier, Director of Outreach Health Services General Partner, Inc.

  • Industry hasn’t had an administrative rate increase in a decade, administrative changes in organizations have driven costs upwards
  • ACA has required accounting and administrative software upgrades as well as increased record keeping, which is costly
  • Hard to keep nursing personnel in the industry given poor rates

 
Kyle Piccola, Director of Government Affairs, The Arc of Texas

  • Serve the homeless and people with IDD
  • Unfortunate that people with disabilities are on a waiting list for services years after graduating high school
  • Advocates for
    • more quality services
    • a day habilitation rate of $40-$50
    • more examination of state supported living centers (wants a better structure)

 
Kate Johnson-Patagoc, Director of Specialized Services at Texana

  • Board Certified Behavior Analyst (BCBA) working with IDD persons
  • believes providing behavioral supports through Medicaid should be more widely available
  • Autistic children who are receiving behavioral therapies greatly improves their health and life outcomes
    • 50% of children who receive effective therapy and treatment will no longer need day habilitation
    • Would save millions per individual
  • ABA therapy improves cost savings over the long term
  • Wants the legislature to recognize the need for ABA therapy, fund these services through Medicaid when medically necessary, and expand it to older individuals

 
Susan Payne, President of the Parent Association for the Retarded of Texas

  • Representing the state supported living centers (SSLC)
  • Discusses the equipment available at some of the SSLCs and how they need more wheelchairs
  • Walle –how much does one of the chairs cost and does it greatly improve their lives?
    • I don’t know the costs because the chairs have to be customized to each individual’s needs. The wheelchairs allows for patients to move around comfortably and get around easier
  • Walle –I only know some of what my wife has told me and from my visit to the Richmond school
  • Wants to see all cost comparisons of the SSLCs
  • Communities don’t have the proper rates to take care of SSLC patients’ severe needs
  • Wants Texas to be the leader in providing cost effective services

 
Leigh Dunson, Administrator for the Mary Lee Foundation

  • Foundation offers: group homes, adult foster care, single and family homes
  • Mainly provides services to adults
  • Hiring and retaining staff has become problematic
    • Supervisors working overtime leading to case ineffectiveness
    • Constantly has job openings that can’t be filled
    • Pay is competitive with food industry
    • Wants to be able to provide better training to staff
  • Cost reporting doesn’t fully represent the costs they pay for
  • Still not enough behavioral support and people where it is covered by HHSC
  • Doesn’t receive support during behavioral emergencies, usually has to call the police for assistance
  • Also needs wheel chairs at her facility
  • Long waits for people trying to receive Medicaid funding. Sometimes are serving patients for months before funding comes through

 
Sara McDermott, Mary Lee Foundation

  • Case manager, helps clients be independent in an apartment complex
  • Concerned the most about the lack of communication and slow responses from service coordinators
  • Referrals to specialists have also become burdensome for the care giver to set up an appointment and find a doctor. Can often turn into a process that they have to start over

 
Elizabeth Harvey, Mary Lee Foundation

  • They are held to very high standards of care; multiple annual checkups for each patient (dental, medical, specialists, etc.)
  • Under managed care, finding specialties is difficult
    • Many doctors move out of network
  • Doctor’s appointments are now asking for photo IDs and Medicaid cards
    • Hard for clients to remember to bring ID or consent to letting the care giver hold onto it for the appointment
    • This can waste valuable rehab time when they are turned away for not having their ID and they drove hours away for the appointment
  • Concerned about the lack of streamlined services to take care of doctor’s appointments

 
Diane Moore, Owner of Innovative Outcomes

  • Facing critical care service shortage
  • Concerned with enrollment approval and getting funding turned on
    • Sometimes are providing services to a person for 6-9 months that still hasn’t received their Medicaid funding
  • Before managed care, there were longstanding relationships with medical specialists. Since managed care, the specialists are moving out of network. It is challenging for people with IDD to form a relationship with a new specialist.
    • Requires an increase in nursing support to merge the gap in services
  • Problem is pervasive and everyone is running into the same problems
  • Wants managed care to be contractor obligations

 
Innovative Outcomes

  • Says they have lost most of their specialists because it’s not worth the pay and hassle they have to deal with so they move out of network. As a result, they are consistently cycling through doctors
  • Even the staff are having issues with getting prescriptions, scheduling appointments, etc.
  • Managed care has made getting medical care worse

 
Ruth Mason, self

  • Oldest son has disability and receives services through a waiver
  • No measurement to show if individual progress is being made; provider is requiring him to write personal goals during treatment/rehab
  • People are not being fitted with needing equipment (wheelchairs)
  • Some of the nursing and staff aren’t competent and following the proper protocols
  • Son is only visited by 3 people a month:
    • Nurse, case manager from provider and one case manager from local authority
  • Recommends keeping the citizens of Texan safe while living in the SSLCs and in the community
  • Walle – please state for the record what your 3 recommendations are
    • Follow the recommendations from DADS Sunset Report: provide higher quality of life in SSLCs, keep SSLCs accountable, and close facilities in violations
  • Walle – is having your son live at home is most helpful for you and your family?
    • we gave him other options like living with a friend and an independent facility but he requested to live at home with his parents and his dog
  • Walle –give the panel an explanation of the stress the family experiences with someone who have IDD needs. I want the panel to be reminded of the family aspect of these issues and please state it for the record.
    • My family is experienced in caring for IDD family members before. Also has worked with families who were prepared to go to long term care facilities and aided their transition
  • Walle – I appreciate you speaking on behalf of your experience and other families

 
National Association of State Directors of Developmental Disabilities Services

  • Wants to hold the MCOs accountable through objective data
  • MCOs are not ready today to meet the deadlines
  • Need the rates reinstated
    • It’s difficult to retain staff when the food industry offers more money with less responsibilities
  • Cost reviewers significantly revise their reports before it gets to the legislature

 
Zenobia Joseph, self

  • Educator who does free lance writing in home health
  • Worked on a piece at the Brookedale Senior Living facility in Austin and was disturbed by the conditions the patients were in when they pay thousands in care each month
  • Recommendation: amend the Health and Safety Code that relates to the complaints against home health care facilities
  • Believes the employees are experiencing wag theft
    • the employee pay isn’t equal to the amount of work they put in, especially when they are supposed to work overtime and on call 24/7
  • Also concerned that a caregiver who is taking care of a couple in a home is getting paid for the equivalent of one person’s care
  • Provides an example of a model featured in Forbes in the March 2016 issue who opened nursing homes in New York, Baltimore, etc. and is widely successful in providing high quality care

 
Renee Lopez, self

  • Community advocate, retired state employee, and has a disability
  • Concerned about the tenants aging out and the new workforce won’t accept the low pay
  • Wants the legislature to consider increased pay to $13 an hour minimum for care workers