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The House Committee on Human Services met on May 9 to continue discussion of Interim Charge 2, a review of managed care in Texas. The committee focused on the following:

  • Study whether access to care and network adequacy contractual requirements are sufficient.
  • Determine Medicaid participant and provider satisfaction within STAR, STAR Health, STAR Kids and STAR+PLUS managed care programs.
  • Study the future delivery of services under a managed care model to additional populations.

This report is intended to give you an overview and highlight of the discussions on the various topics the committee took up. This report is not a verbatim transcript of the hearing; it is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.

 

Opening Comments

  • Chair Raymond – EC Smith is in Washington, will not be available, will begin by hearing an update from the acting COO of HHSC

 

HHSC Update

Victoria Ford, HHSC

  • HHSC is focused on continued services without interruptions, avoiding negative fiscal consequences from procurements, and finding proper fixes
  • Immediate measures have been taken: brought on additional expert personnel for the Procurement & Contracting Department, implementing additional quality control steps
  • Most issues identified have been inconsistent application of agency policy and lack of sufficient quality controls to manage this
  • DIR is assisting with review of contracting process, Comptroller’s Office also sent a team to review each current procurement
  • Exploring contracting extensions to continue services
  • Raymond – Just to be clear, we haven’t awarded any contracts to those who don’t deserve them?
    • Correct
  • Procurements that were in process are still in process right now, deadlines matter
  • Internal audit team review of contracting is due early Summer, state auditor has begun it’s review and is expected later in Summer
  • In process of hiring consultant firm to take all results, determine root causes, and develop plan
  • Hoping to implement reform plan in Fall
  • Frank – What type of followup on the personnel side of things?
    • I think previously there weren’t many used
    • Will start with training and re-training where needed, can explore HR disciplinary measures to correct, and can fire people
  • Frank – Can fire? So there have been no consequences to not following these processes?
    • 3 people have been fired
  • Frank – Not “looking for heads,” but need consequences
  • Raymond – I think also several positions in procurement have been opened, but not filled
    • Yes, pretty specific skillset with hard-to-find certifications
    • Has been hard to keep positions filled, but jobs have been posted to replace outgoing personnel
  • Reform process will take the rest of this year, HHSC will try to be transparent and make legislature aware of any statutory issues that need to be corrected
  • Keough – Looking at the manuals and handbooks, there is a 65-page handbook on procurement with 50 handbooks; how are you going to re-evaluate this?
    • First thing we did is revisit the 3-page procurement checklist & seeking to simplify; manual provides procedure details, but checklist details every step
    • Will also look to reorganize department functions
  • Keough – there is so much process in place right now, would what we have in place work if people would do it?
    • Interesting question, not sure all of our procedures are up-to-date
  • Keough – Was updated in 2015
    • I understand, but Comptroller contracting policy and state law change, processes need to be evaluated

 

Interim Charge: Review of Managed Care in Texas

Stephanie Muth, HHSC

  • Link to presentation
  • HHSC has responded to legislation on adequacy, HHSC has moved away from self-reporting on adequacy and is producing data
  • This year, if MCOs do not meet 75% on the adequacy scale HHSC can issue corrective action plan, will rise to 90% in the future
  • Biggest transparency area in the Medicaid program is when members tell HHSC how MCOs are doing through surveys, HHSC has moved from a 3-star to 5-star rating on report cards & info is shared with enrollees
  • 2017 report card will be posted within the next week
  • Raymond – Who are you hearing from, how many people?
    • Our External Quality Review Organization (EQRO) conducts the survey, can get you specific numbers
  • Frank – If there are similar questions asked in other states, how do we compare?
    • Do not have this info now, but can bring it back
  • Rose – Where is this report card?
    • Posted on the HHSC website, also included in enrollment packet
  • Highlights slides in presentation, slide 6 details SB 7 requirements for STAR Kids, slide 7 details enrollment and MDCP numbers, slide 8 details SB 8 goals
  • Part of SB 7 was looking at how to better coordinate care
  • New service assessment tool in STAR Kids, has been used as assessment of medical necessity
  • Klick – Perceives that the assessment tool is overly complex and that it may be a reason for issues with participation
    • Have heard that the amount of time to complete the assessment is unreasonable
    • Difficulty to schedule the assessment
    • Receiving feedback regarding those types of comments and reconsidering the modules involved
  • Klick – Are there other tools that other states are using that may be more appropriate?
    • There was extensive development of the tool, over three years
    • Will provide additional information to the committee regarding that
  • Klick – In determining an assessment of this type, perhaps creating our own is not the best approach as compared to using one that has been validated and used in other states. There are questions in there that are likely not appropriate
    • The questions and format will be reviewed and there is a need to refine the assessment
    • Slide 12 – the MCOs in the STAR Kids Program have provided feedback regarding best practices to streamline the process
  • Klick – Regarding Network Adequacy (pg 14 of presentation), concerned about moving forward with the main program without the pilot programs
  • Raymond – There has been a lot of feedback to move the date back, potentially next session remove the date for the implementation and in the following session make a determination to move forward
    • Slide 16 speaks toward the IDD implementation
    • Language in SB 7 regarding the pilot is permissive, but the hard implementation date there meant a lack of time to gain information from a pilot
    • Have contracted out an evaluation, includes as assessment of lessons learned in other states, best practices, & cost effectiveness; will be made available during the session
    • IDD Advisory Committee is considering implementation given the current deadline
  • Highlights Slide 13, service coordination for STAR Kids
  • Post implementation, started doing operational reviews of MCOs including service coordination through onsite reviews
  • Complaints have helped identify areas where training or policy guidance is needed for MCOs
  • Looking at using some of the resources to start working on STAR Kids and MDCP, planning on exceptional item request to allow study to have a statistically balanced sample
  • HHSC has good partnership with OIG who can step in where needed
  • HHSC has opportunities to improve around complaints, especially with data/analytics; intending to hire personnel for trends and analysis of complaints
  • Frank – Can you give an example of what people should do if they feel like they aren’t getting good services? What are the steps & checks and balances on the appeal process?
    • Particularly with the new assessment tool, one of things we have done is call individuals who are denied & informing them of the right to a fair hearing
    • Benefits continue until the hearing is held
  • Frank – From their perspective, what step do they take after they are denied? They appeal?
    • Yes, they would receive a notice and call with instructions for the fair hearing
  • Frank – So one appeal only? If they get denied there it is done?
    • Yes, I believe this is the final step
  • Minjarez – What is the length of time between denial, notice, and hearing?
    • Not sure, but individuals continue to receive services if fair hearing is requested within time period
    • Also tried to relax some scheduling requirements
  • Rose – If notices are not always easy to understand, why would you expect families to be able to?
    • We are working to improve and clarify communication, calling to notify is an interim measure to bridge the gap
  • Rose – What is difficult about these improvements?
    • Need to determine content, also requires automation changes to be able to produce and send these out
  • Rose – Asks to be kept informed of changes to the notices
    • Will do & will continue to call to notify
  • Klick – Didn’t you have some special provisions for Harvey impacted individuals and special hearings?
    • Can follow up and get the answer

 

Sylvia Hernandez Kauffman, OIG

  • Link to OIG Presentation
  • Speaking to program integrity issues in Texas, other states, and federally
  • Managed care requires a different integrity focus than the fee-for-service model did; integrity carries different risks, including incorrect or inappropriate capitation, potential for underutilization of services, and potential for heavy reliance on cost-avoidance rather than recoupment
  • This does not mean these issues are present in Texas, but managed care requires a different focus
  • In managed care, focus is determining whether a member’s health outcomes and efficiencies are being achieved
  • Duty to monitor fraud, waste, & abuse has been delegated to MCOs, MCOs have responsibility for provider oversight
  • One area with varied application in states is liquidated damages, federal government has offered very little guidance to date
  • Data is also key to being able to identify integrity trends, encounter data may not have all data elements to detect fraud, waste, & abuse
  • Little federal guidance has also led to varied contracting and reporting requirements
  • Raymond – So is Stephanie Muth and her department rolled into your work on encounter data?
    • Yes, we work closely with HHSC on this
  • Raymond – Who determines what is asked for in encounter data?
    • HHSC is the primary entity
  • Raymond – Could you tell them it could be better
    • So far have been focused on matching data to claims
  • There is not standard way to measures care effectiveness, challenging
  • CMS reviews managed care programs, highlighted several of these issues in other states such as Florida
  • CMS noted issues in verification of beneficiary services, encounter data, and insufficient staff in MCOs to handle these issues
  • CMS also recommended increased collaboration efforts to increase program integrity, CMS’s issues have been addressed by the state
  • Raymond – Are there statutory issues that limit your ability to pursue fraud, waste, & abuse? OIG was perceived as broken for some time, critical to give you the proper ability to do your job
    • Historically OIG has focused on recoveries and has been mandated to do so, in managed care the risks are different and recoveries shouldn’t be the focus
    • Need a new way to measure success for the OIG
  • Raymond – Sounds to me like we need to fix this, sounds like we didn’t give you the ability to follow the changes we made to managed care
  • Frank – So this is a statutory change?
    • Yes, required in law
  • Per statute, OIG has for primary oversight tools: audits, reviews, inspections, and investigations
  • These tools need to act differently in managed care
  • OIG also works on integrity through data analytics to identify areas of interest
  • Recommends requiring MCOs to report on total cost avoidance dollars, report on total paid claims; OIG planning to form work group to determine method
  • MCOs should also improve member verification services
  • Raymond – Can you expand on this recommendation?
    • Olga Rodriguez, OIG – Relates to what health plans must do to verify services
    • MCOs typically send Explanations of Benefits to verify services, recommendation is to look beyond this to verify services
  • Klick – Could it be that the EOB needs to provide more info?
    • It has the code and physician services, would defer to MCOs on how to operationalize this
    • There is broad variation between MCO policies
  • Klick – Have heard that attendants will bill for attendant services while the member is in the hospital, attendant will get fired & member will change MCOs, but not many consequences
    • Hernandez-Kaufman, OIG – Have heard of this, systemic issue
    • Have been looking at this, trying to look at trends to try and come up with policy changes to address this issue
  • Klick – Needs to be looked at, not necessarily something the MCO can address
    • Absolutely
  • Method for measuring success will need to change from recoveries to monitoring provider and member outcomes
  • Recommendations: cost avoidance calculation should be explored, value for payments, encounter data should be expanded to address new oversight needs, state can look for broader systemic issues and solutions

 

Spotlight on Public Testimony

Over 100 individuals signed up to testify, many came from Protect TX Fragile Kids to speak on their experiences with children in the MDCP

 

Jennifer Woolsey, Self

  • MDCP keeping fragile kids out of institutions is important
  • Rural access to care is very challenging for those participating in the program, practitioners will often need to travel and working with managed care is too complicated
  • Raymond – So the bureaucracy is too burdensome?
    • It’s just too much, complicated by network issues
  • Raymond – So you recommend making it easier for providers to be in network?
    • I thought MCO was going to try and contact our providers to make this process easier, but there has been no attempt
  • Also have worked with MDCP kids from many different families, have never heard of anyone getting a phone call to notify of denials
  • From a caseworker perspective, the is not enough administrative/programmatic support

 

Amira Abrun, Self

  • Shares personal experience raising children involved in MDCP program

 

Misty Fairchild, Protect TX Fragile Kids, Journeyfest

  • Shares personal experience raising children involved in MDCP program; child transferred out of MDCP and into the Deaf/Blind program; Deaf/Blind children need to be included in solutions
  • Works as an Occupational Therapist
  • Nursing hour determinations are arbitrary and not based on the individual case
  • Have received threats from MCOs in response to challenging hour reductions
  • Has also had issues with MCOs trying to move child to step-down therapy after using the same medications for 7 years
  • Klick discusses the specific conditions of Fairchild’s child and how she cares for him
  • Raymond asks after specifics of the threats received, Fairchild did not have some information with her

 

David Riggs, Self

  • Had difficulty receiving services under Superior after foster daughter suffered a TBI, Superior only responded after stating that a complaint would be filed with HHSC
  • Superior personnel were uninformed and suggested options foster daughter was not eligible for
  • HHSC should re-evaluate Superior’s prior authorization process

 

Amber Maureen, Self

  • Has had trouble resolving insurance status issues with MCO; MCO believes that family has private insurance, but they do not
  • Medication has been denied through PA process even with doctor recommendation
  • Therapy cuts have also impacted availability of therapy services

 

Jessica Lucas, Self

  • Son was removed from Medicaid due to HHSC believing the family had a higher income, son is on a waiver program regardless; was very difficult getting HHSC to resolve the issue

 

Joe Potts, Self

  • Managed care is a horrible burden for families with IDD children, system has horrible outcomes
  • Should examine MCO consequences for maliciously eliminating services to serve their bottom line; MCOs make money by not providing services
  • SB 7 (83) should be repealed
  • Presents statistics showing that Texas is close to the worst amongst all state in IDD dollars spent and other related outcomes
  • Rose – You were on a waiting list for 12 years?
    • Yes
  • Rose – Asks HHSC if they are familiar with this data
    • Muth, HHSC – Maintain an interest list, not a wait list as such
    • In Texas, we do not screen for eligibility prior to placement on the interest list, but number of slots is funded by the legislature and that dictates number of individuals that can be served
  • Rose – Can you address the list you do maintain?
    • Can follow up, typically a discussion during the appropriations process
  • Klick – So some of the folks on that list may not be eligible?
    • Correct, interest list only
    • Sometimes makes state-to-state comparisons difficult

 

Arlene Phillips, Self

  • Has grandchildren in the MDCP
  • Discusses issues with obtaining drugs via PDL; Amerigroup required them to use Albuterol, but MDCP child is allergic
  • Also was required to use a medication that had not worked in the past; Amerigroup imposed a fail-first requirement for medication, medication did not work, and child ended up in the hospital
  • Frank – Asks for HHSC to respond; when these decisions are made, who absorbs the cost of resulting hospital stays? Trying to understand where the incentives are, if the MCO messed up they shouldn’t receive the benefit
    • Muth, HHSC – I think I need to explain how the PDL works, state establishes this list & MCOs must follow the list
    • The PDL lists drugs that do not require PA, if it is not on the PDL an individual can request a PA & they are supposed to be able to receive a 72-hour emergency supply of non-preferred agent
    • I’m hearing a lot of issues around prescription utilization today, will want to follow up on this as this is not how policy is supposed to be working
  • Klick – So those that are having difficulty with uncovered drugs and being required to change drugs, the state establishes this?
    • We have a Drug Utilization Review Board that establishes the list, based on rebates, etc.
    • Members not entirely limited to using only these drugs
    • MCOs must follow and cannot establish their own lists
  • Klick – It sounds like on some of these, especially long-term meds that suddenly drop off, there probably needs to be more communication with patients and families
    • Absolutely, need to go back and look at recent changes
  • Klick – So this is not something that is the fault of the MCOs?
    • Generally, drugs being on PDL or not is state policy
  • Frank – Shouldn’t go after MCO if they aren’t at fault, but if MCO is making threats, etc., that’s something that needs to be discussed
    • Rider 219 required a study of the way RXs are handled in Medicaid, will be available in the next session
    • Looking at the way state handles the PDL and if it is working the way we need it to
  • Frank – Are you and the MCOs looking at this elsewhere to try and handle these problems, user groups, etc. to explore best practices? Some of this is a communication and training issue
    • Each MCO may have a different approach to this, previous witness was involved in roundtable discussions
    • HHSC generally receives info on problems from the complaints process

 

Brian Broadbend, Self

  • Shares personal experience of daughter in MDCP
  • Recommends that MDCP should not be a state-level program, should work with federal legislators to move them into their own system
  • Genome sequencing and fast identification will likely reduce costs, but need to currently think about MDCP budgeting long-term
  • Should also address HHSC website links and usability

 

Susette Wilson, Self

  • Had a difficult time obtaining a fair hearing after service denial, Blue Cross brought 7 individuals from within the organization and treated the case of her child lightly
  • Minjarez – Were you given any kind of direction about what to expect or advice to prepare?
    • Was given a notice of the date for the hearing and contact information to fax relevant info, but no direction on process
    • Was not allowed to present case for physical therapy for her child, only respond to questions
  • Minjarez – How long was the hearing? How long did the decision take?
    • About 1 hour 30 minutes, took roughly 4-6 weeks to get a response

 

Miffy Cauzy, Self

  • Shares experience of child involved in MDCP, has lost access to medical supplies/DME
  • Should enact a protection & safeguard program for medically fragile children, also explore options to help families choose providers without MCO interference

 

Jennifer Cauzy-Windell, Self

  • Medicaid is considered secondary insurance for her family, provides needed services not available through private insurance
  • However, transition to managed care has seen doctors, providers, medicines, etc. becoming unavailable; many do not wish to work with MCOs
  • MCO assessments and denial of procedures identified as “medically necessary” by care providers seems unfair, existing tool is not detailed enough to make these determinations

 

Catherine Carlton, Self, STAR Kids Advisory Committee

  • Shares personal experience of raising child involved in MDCP
  • Was hopeful that STAR Kids would’ve fulfilled the initial promise of better care and outcomes for Texas, but system has grown more complicated and burdensome
  • Did not have concerns about access or networks when MDCP was managed by the state
  • Complaint data shows a tiny fraction of the real negative impact, her son has gotten much worse since transition

 

Rachel Hammon, Texas Association for Home Care and Hospice

  • All of the member providers in TAHCH provide services testified to during today’s hearing
  • Legislature tried to bring together MCOs, HHSC, and providers during 2016; HB 3982 tried to address some providers issues surrounding access, prompt payment, onerous PAs, non-negotiates rate increases, value-based purchasing, and EVV
  • Should continue exploring ways to improve access to care & reduce providers burden
  • TAHCH did a survey of member providers to aggregate experiences in managed care, much the same as other testimony heard today
  • There have been significant rate reductions to Medicaid therapy services, need more focused attention on this; Legislature recognized some of this and passed a 25% restoration of rate reductions
  • Home provided therapy services saw additional policy changes that made this restoration unattainable for them, however; policy/code choice changed methodology on payment
  • Providers are experiencing a lack of access; Rider 57 required studying impact on therapy, provider and member complaints, etc.
  • Administrative burden on providers is very high, directly impacts patient care

 

Ed Cortez, Pediatrician

  • Has been involved in the Corpus Christi area for some time
  • Changes to managed care have been largely positive, have roughly 1,000 children in STAR Kids in his practice group
  • Driscoll does a marvelous job communicating with us, wondering how the PCP factors into the complaints heard today
  • Pediatrician should be the advocate for the patient
  • Frank – How MCOs operate in your area?
    • Driscoll, Superior, United
  • Frank – So Driscoll does a better job?
    • Agrees
  • Frank – Asks HHSC, is Drsicoll just better?
    • Muth, HHSC – Scorecards are the primary method, looks at health outcomes
    • A number of health plans have scored very well on outcomes, Driscoll has scored very well
  • Frank – What does Driscoll get out of scoring well? More customers and that’s it?
    • That’s a piece of it, but we also have a pay for quality that incentivizes performance
  • Frank – Everyone wants better health care at the end of the day, better to incentivize good actors than penalize the bad

 

Aaron Head and David Gore, Amerigroup

  • Amerigroup has 27k children, 400 MDCP members
  • Amerigroup had difficulties with PDN at first, went on a listening tour to solicit input to fix Amerigroup policy
  • Changes made have led to drastic reductions to appeals, most fair hearing requests were received before changing Amerigroup approach to PDN
  • Raymond – Seems to me that the issue here is we are trying to find the right balance, makes sense that HHSC and OIG would receive data on complaints
  • Klick – “Cookie cutter” approach doesn’t work, each individual patient needs to be assessed
  • Frank – Was there anything legislatively that changed or was it outside pressure that cause you to re-examine your processes? Sounds like you were denying services
    • We were applying our processes “rigidly,” state partners, members, and providers made us understand that there needed to be some leeway there
  • Frank – Rules didn’t change, law didn’t change, the results of your actions changed; trying to figure out how to encourage others to do something similar
  • Rose – There were several witnesses who mentioned their issues with Amerigroup, were you able to follow up with them?
    • Caught one person, not sure if we got all of them