Senate Health & Human Services – March 21, 2018

The Senate Committee on Health & Human Services met on March 21 to hear invited testimony on interim charges related to managed care quality, compliance, and health care cost transparency.

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

• Schwertner – Will discuss all HHS interim charges over today and tomorrow aside from monitoring charge, which will be discussed later in Summer

 

Evaluate the commission’s efforts to ensure Medicaid managed care organizations’ compliance with contractual obligations and the use of incentives and sanctions to enforce compliance. Assess the commission’s progress in implementing competitive bidding practices for Medicaid managed care contracts and other initiatives to ensure the best value for taxpayer dollars used in Medicaid managed care contracts.

Charles Smith, Executive Director, HHSC

• Presents slides (link)
• 81.2% of $28 billion over biennium is in Medicaid services ($23.2 billion), leaves $5.3 billion over biennium for other aspects of the system (incl. SSLCs, state hospitals, etc.)
• ~92% of $23.2 billion in Medicaid services is tied directly to managed care
• Schwertner – These are the largest contracts the state has?
  • I would assume so
• Schwertner – Very important to focus on this and ensure our spending is effectual and thrifty, contract oversight is key
  • Agrees, very important we make sure vendors are doing what we want and expect
• HHSC Quality Plan was published in November, lays out 6 priorities:
  • Promote good health and preventative care
  • Provide least restrictive and most cost-effective environment
  • Build systems to limit human error
  • Promote effective practices for chronic diseases, includes education of patients
  • Support families facing serious illness
  • Attract high quality providers and promote collaborative care
• Will continue to do what is needed to evolve the health care system and work with providers & legislature to build
• Medicaid cost growth is mostly driven by caseload growth, Medicaid rolls have continued to increase & population continues to grow
• Perry – Do you have a demographics on the 35% cost increase?
  • Increase in costs is across the board, all populations have increased
  • One issue is that elderly individuals may not see increasing income as cost of living goes up, thus needing more support

 

Stephanie Stephens, Deputy State Medicaid Director, HHSC

• Highly focused on value, not only maintaining cost, but also ensuring effective treatment
• HEDAS measures see improvement across a number of different measures, incl. wellness visits, diabetes care, etc.
• HHSC uses metrics like this to create report cards for health programs that help consumers choose
• In 2006, caseload was ~60% managed care, today we are about 92% managed care; Due in part to services carved-in
• Nearly 50 contracts, largely divided by programs, can be complex
• Schwertner – We have over 20 MCOs and 13 service areas, there has been some discussion on whether we need this many and, by extension, so many providers; Could provide benefits for taxpayers
• Schwertner – There are statutes that give local providers preference, could be a discussion area; Sendero has pulled out of our Medicaid program, Austin still has 5 providers which is too many and can be inefficient
  • HHSC will kick off discussions about SDAs, but will be discussing with stakeholders for input
• Contracts are the foundation of HHSC oversight, readiness reviews and post contract monitoring are key to this (performance, utilization reviews, also financial oversight)
• Contracts lay out reporting of financial data, data is validated on a quarterly basis and HHSC conducts annual audits
• Watson – Non-compliance can include a recovery of liquidated damages, how often does this occur?
  • Slide 17 details recovery of liquidated damages
• Schwertner – $9.7 million out of $23 billion in contracts, not much money
  • Only for the first two quarters
• Have a system of profit sharing, triggers after 3% above administrative expenses cap
• HHSC is now also performing onsite biennial operational reviews, on top of previous performance audits
• Schwertner – How we get better at this and where do we go from here is what I’m looking at moving into next Session, legislatively and funding wise
  • Smith, HHSC – We are still in a fee-for-service mindset, transformation is needed; Currently pulling together FTEs within the system to look at this issue
• Watson – So MCOs keep profit to less than 3%, over that to 5%, HHSC keeps 20% of profit; Could you share some numbers?
  • Stephens, HHSC – 2016-17 experience rebates are about $500 million per year, numbers can change with audits
• Watson – So this is $500 million you are recovering or $500 million you recover a percentage of?
  • Actual recovery
• Schwertner – We have looked at tightening this down further, of course the MCOs don’t like that
• Schwertner – This begs the question of efficiency if we have this much claw back
  • Smith, HHSC – Have asked our people to look at this internally, have looked at other state’s models to figure out what puts Texas in the best position to fund services
• Perry – Is this 3% built into the contract? Is it tied into direct services or is it pure net income?
  • There are a number of factors that mix into whether a plan is profitable
• Perry – So it is an internally generated HHSC figure
• HHSC has implemented time and distance contracts standards, phasing in remedies for non-compliance, starting with caps and moving to liquidated damages in 2019
• Looking into competitive procurement for products, should have more work done this Summer
• Schwertner – Do you have an idea on which service lines could be competitively bid?
  • Stephens, HHSC – I don’t think we’ve gotten that far yet
  • Smith, HHSC – We understand the direction the legislature wants us to move in
• Schwertner – Will you also be looking at a reconfiguration of number of service areas, as well as number of MCOs; Two is probably too low, 3 might be ideal
  • CMS has standards, also considering the population we serve and how to build the system to properly serve these areas
• Schwertner – Asks after 3-year procurement cycling legislation
  • Will be very difficult, puts the state in an environment of constant procurement; Takes 2 years to fully procure, check for readiness, etc.
• After March, HHSC will have implemented all but one of the findings from the SAO findings, collectively
• Buckingham – MCOs perform audits on PBMs?
  • Stephens, HHSC – HHSC has contractual requirements to audit subcontractors, but HHSC also reviews PBMs in performance audits
• Schwertner – What is timeframe for the legislature receiving HHSC’s vision on moving forward?
  • Smith, HHSC – Many of the staff working on this aspect are being pulled from different departments, HSHC does not have the capacity to pull together yet
  • Will do our best to have something by late Fall that is a high-level view
• Schwertner – There is an Office of Transformation & Innovation, correct?
  • Yes, director will be starting in two weeks and will be building out staff
• Kolkhorst – Last session there was effort to give parameters for competitive bidding, we have done the MCO model & now it’s time to look at the next step
• Kolkhorst – SB 1927 was giving some of these parameters moving forward, important to continue to work on this
• Perry – Should look to geography as we talk about moving the system to the next level, I’m going to give some latitude to the small population that require something other than an umbrella system; Needs to be an incentive to provide and manage care
• Schwertner – Would you like to give comment on the Superior audit?
  • Stephens, HHSC – HHSC is making modifications to the contract to fix
  • HHSC has not historically looked at Superior’s structure as an affiliate relationship, typically look at PBMs as affiliates
• Watson – HHSC agreed with audit findings that these Superior payments were inappropriate payments, creates concern that the contract is being changed to allow this
• Watson – Also unclear why you would want to just change the Superior contract, there is a reason for prohibiting these types of payments
• Watson – Why is HHSC contracting with the holding company and not the service providers, many questions remain
  • Smith, HHSC – HHSC agreed that there was a need to clarify in response to the way SAO read the contract, HHSC did not agree that these were done incorrectly
  • This is a regular practice and how contracts are administered across the board, has always fallen in line with independent audits
• Watson – I would like more explanation about the intended protection and why this falls outside the protected area; Also info on what falls outside of normal practice
  • Stephens, HHSC – There are two considerations, MCOs exceeding administrative cap & the executive compensation cap
• Watson – And HHSC found that these standards haven’t been triggered?
  • HHSC has not yet done its audit, SAO audit came midstream
• Watson – So you don’t know whether you completely agree?
  • Smith, HHSC – Exactly correct, other aspect is that HHSC generally does not dictate the bonuses MCOs pay to employees
• Watson – What is it you’re trying to protect by not allowing these payments to affiliates?
  • Trying to protect against arrangements without visibility into transactions, different from the Superior case
• Watson – Would like updates as this process moves forward
• Schwertner – Good example of HHSC and state’s oversight of contract, need to make sure we continue to be clear moving forward
• Buckingham – So the audit went off the contract which didn’t reflect normal business practices, so you’re changing the contract to reflect normal business practices?
  • This practice has been understood from the contract for many years, HHSC is looking to clarify in response to SAO’s concerns
  • HHSC is now looking at these aspects holistically, will take a long time to look at needed changes systematically

 

Arby Gonzales, State Auditor’s Office

• SAO found that Superior was paying bonuses & incentive payments to affiliate employees, against contract provisions, roughly $29.6 million, $728k were reported into FSR line item, ret were reported in “Corporate Allocation” line item
• Also did not follow reporting requirements of affiliate payments and profits
• Executive compensation limitation in contract may not be enforceable, federal statute used as basis is for cost-based contracts only
• Superior accurately reported medical and prescription claims, less than 1% were for not-covered claims; Superior paid prescription claims for drugs covered under VDP
• Superior did not ensure it sufficiently responded to appeals
• Schwertner – You looked at the entirety of the uniform contract?
  • For the areas applicable to the audit
• Schwertner – is this the most substantive audit you’ve done on a contract?
  • I believe so

 

John Young, State Auditor’s Office

• Prior to Superior, we audited HealthSpring, currently audited Amerigroup
• Schwertner – Seems like Superior was largely operating well, aside from the affiliate payment issue

 

Jamie Dudensing, Texas Association of Health Plans

• Medicaid plans are committed to providing affordable coverage, managed care plans try to bring the best value to Texas (cost effectiveness and efficacy of care)
• Texas has one of the most successful Medicaid programs in the country, largely due to how system has evolved and the involvement of plans
• Quality of care has dramatically improved in recent periods due to care coordination
• General cost compared to inflation growth has been much better in Texas than other states
• Schwertner – Why shouldn’t price also be considered in the discussion about value and quality of care?
  • Cost growth is a very important factor to watch as an outcome, but most states have found price bidding to be detrimental to the system
  • Bidding low hurts access and quality, system ends up not being efficient in the long run
• CMS looked at Texas’ experience rebate system and determined that it is highly successful and works better than other states
• Schwertner – I fundamentally disagree that price shouldn’t be a factor, rate setting and actuarial soundness also needs to be looked at
• Raymond – Before managed care, this was run by the state and was not looked at as a profit-making venture; Managed care made the promise that it could be done better and cheaper
  • According to the numbers, this is what you see; We’ve had less than 1% of cost growth per year on average
  • Medicaid feels like it’s getting more expensive due to population growth and the federal government knocking down dollar matches
• Raymond – I don’t think Chari Schwertner is trying to argue that point, but need to look at what we can
  • Other pieces needing to be looked at is access and improving care
• Many plans lose money
• Schwertner – How many of these plans that lost money are community-based?
  • It is a mix of different plan styles and types, varies by market, region, etc.
  • Number of plans is based on market analysis, should have most number of plans as fits a region to promote competition
• Schwertner – Asks after liquidated damages, number seems low given contract prices
  • There are many areas where HHSC can claw back or recover funds outside of liquidated damages
  • HHSC does a good job on liquidated damages typically, they work with plans to improve operations
• MCO contracts are the most transparent contracts in Texas, financials, liquidated damages, provisions, etc. are available online, but not sure if this is a user-friendly system; A system that allows users to quickly compare metrics between plans could be useful
• HHSC’s new division could do a lot to improve this
• Contract management should be modernized, sometimes audits are duplicated and sometimes plans are regulated by TDI over similar issues (i.e. network adequacy is regulated through TDI license and HHSC contract)
• Schwertner – I think MCOs are a net positive for the state, but it is still incumbent upon the legislature to continue to have a robust oversight and cost containment process
• Buckingham – Doctors in my area are drowning under all of these reporting measures, seems like HHSC is already collecting tremendous amounts of data
  • HEDAS measures are different, but PPEs, etc. are generated through claims data so providers do not have to report
  • Important to consider what we want the Medicaid program to achieve, could cut down on random data reporting and other issues

 

John Hawkins, Texas Hospital Association

• Hospitals are supportive of managed care focus of Medicaid program
• Managed care is a key component of 1115 waiver, which has allowed large amounts of dollars to flow to the state; Also key to the extension of the waiver
• Need to streamline the data collection piece so as we move to pay for performance we have better encounter data
• Need to work on contracting piece, many have not been updated recently and contain compliance grey areas
• Rate increase program will need to flow through MCOs
• DSRIP will be phased out by the new waiver, need to figure out how to work these payments into the system

 

Ryan Van Ramshorst, Texas Medical Association, Texas Pediatric Society

• Medicaid provides essential care, largest insurer of children and children’s outcomes are drastically improved; Medicaid is also very helpful in improving outcomes for mothers and improving substance abuse care
• Costs are primarily driven by caseload growth
• Value-based payment initiatives – Certain MCOs are working with physicians to improve after-hours care, Houston is innovating in maternal care with a pregnancy home
• Paperwork for providers is burdensome, PAs for therapy are complicated, clinical edits require extra steps
• Care coordination aspects could be improved, many times providers cannot be found to coordinate with after they provide service
• Community-based plans in Bexar are easier to deal with than non-community-based
• Payment rates and administrative burden are also a large issue

 

Review the Health and Human Services Commission’s efforts to improve quality and efficiency in the Medicaid program, including pay-for-quality initiatives in Medicaid managed care. Compare alternative payment models and value-based payment arrangements with providers in Medicaid managed care, the Employees Retirement System, and the Teacher Retirement System, and identify areas for cross-collaboration and coordination among these entities.

Stephanie Stephens, Deputy State Medicaid Director, HHSC

• Health care quality plan was developed in 2017, focus was moving from volume to value
• HHSC has set minimum and high-performance standards for 2018, plans not meeting 1/3 of these targets will have corrective action plans
• HHSC operates web portal for performance data exists, advisory committees on quality, etc.
• Value-based program – Pay for quality program puts percentage of capitation at risk for certain plans if they do not meet measures, percentage from plans failing metrics is transferred to other plans as bonus
• Goal of initiatives is to move from fee-for-service to some risk arrangements
• Year 1, target is to achieve 25% in overall alternative payment models & 10% at risk, Year increases to 50% and 25%
• Need to look at opportunities to share information and be consistent across plans where possible, but don’t want to stifle MCO innovation on value-based initiatives
• Moving to this type of system requires providers and MCOs share data
• There are opportunities for HHSC to engage stakeholders, want to develop tools
•  HHSC is looking at financing models & improving data
• Also working with other agencies with large health care expenditures, developing plan to integrate data and should be delivered by May 2018
• HHSC is working with ERS and TRS on value-based payment strategies
• Schwertner – Tough subject, provider risk often comes in after service is provided
• Buckingham – Have seen providers being re-asked for data, does HHSC try and keep rural provider challenges in mind?
  • Yes, recognize that there are different provider challenges across the state; Working with providers who are ready on alternative payment models
• Buckingham – Can you give me an example?
  • Looking at how to engage stakeholders in the process, working with Dell Medical School
• Schwertner – So the 3% MCO capitation is recent? All plans have some pay for quality metrics as of this year?
  • Yes, haven’t evaluated all the metrics, but made the metrics public and looking at recoupment
• Kolkhorst – SB 17 on maternal mortality looked at outcomes, are you still working in the study component?
  • Will need to follow-up on this

 

Porter Wilson, ERS

• ERS covers state employees and many higher education employees
• ERS strives to make plan very efficient, administrative costs are about half of what is seen elsewhere in the sector
• Significant portion of contracts presented by ERS’ Third Party Administrator have value-based components (evidence-based medicine, hospital admission, etc.)
• Patient-centered medical homes are a new initiative with significant benefits for members
• ERS is focused on getting members involved in care, several measures have been implemented to incentivize good member choices like lowered generic copay, use of Centers of Excellence for some treatments, tobacco use rate, copay for free-standing ER utilization, eliminated copay on remote doctor system, pre-diabetes care program with coaching
• Kolkhorst – Do the doctors charge the same fee for these remote visits as face-to-face?
  • I believe the fee is lower as well, can get this info
• Kolkhorst – So what type of savings are you seeing with increased use?
  • Can get you this info
• Pre-diabetes prevention program coaching members is expected to realize $11 million in savings
• ERS is looking to grow member participation in these initiatives through co-insurance, etc.
• Schwertner – How about the cost collaboration across the agencies, are you having meetings yet?
  • Yes, have had conversations about data management, ERS and TRS meet regularly
• Schwertner – What is the projected cost growth for ERS?
  • FY17 @3.7% mostly due to PBM switch
• Schwertner – The $300 copay for free-standing ER utilization, has this improved utilization?
  • Too early to see at this point
• Kolkhorst – Overall your cost trend is what?
  • In general, around 7-8%, expecting to keep this due to recent changes

 

Brian Guthrie, TRS

• Aetna is the administrator, CVS Caremark as PBM
• Pay for performance modeling is primarily used in rural areas, pursing things like bundled payments aggressively in urban markets
• Had roughly 62,00 Teladoc visits in 2016, saved TRS ~$9 million mostly through ActiveCare
• Kolkhorst – So you use this in ActiveCare, but not for the traditional plan?
  • It’s available, but not utilized as much
• Kolkhorst – it is my impression so far that ERS is way ahead of TRS on these types of issues
  • ERS is ahead in some ways and TRS is ahead in some ways
• Kolkhorst – Then you can point those out as we move through this
• Perry – Seemed like our goal during session was to protect our post-65s from premium increases, but it seems like dependent coverage went up; TRS did not seem to educate the legislature well on this aspect
  • Apologizes for Perry not having this info, made this info clear to those heavily involved
• Perry – This concept didn’t get communicated to the members very well either
• TRS is trying to improve coverage in West Texas
• Recently added Kelsey-Seybold to the list, frequently requested by members
• Per member/per month not in value-based care model $251 per month, savings to get more people into the program
• Collaboration with ERS and HHSC is looking closely at diabetes data
• Working with UT health to compare data on health care claims to look for opportunities for savings
• Kolkhorst – In changing TRS, we probably still have work to do, we will still have a shortfall, correct?
  • Yes
• Kolkhorst – If we can work to institute as many things as possible; What is your cost growth?
  • Medical is about 7%, prescription is about 12%
  • Aggressively pursuing everything we can to limit this, difficult with the market as it is
• Kolkhorst – What is the difference between ERS and TRS?
  • TRS has a split population, ActiveCare is handled differently and we do not have the opportunities for cost-sharing and spreading the risk
  • Population has shifted since recent policy changes, 10% left the TRS program with most from the older post-65 (28,000 members left, 15,000 were >65 Medicare eligible)
• Kolkhorst – Why can’t we merge active and retirees and spread the cost?
  • Funding mechanisms are vastly different, actives are funded primarily through school finance system
  • Retiree program is funded primarily through state, district, and active contributions
• Kolkhorst – If we could get over the school finance element, would we see savings?
  • I believe so
• Kolkhorst – Should be looking at the very large system and continue to look for options to reduce costs

 

Jamie Dudensing, Texas Association of Health Plans

• Texas has been moving towards quality and outcome-based care for the past decade, many accountability measures have been implemented
• Have seen significant improvement in outcomes due to this effort
• Plans work with provider groups to tailor approach to what the provider group can handle; Could mean incentive payments
• Difficult step in value-based purchasing is provider taking on risk for outcomes in order to incentivize quantity versus quality
• Recommendations:
  • Important to align incentives throughout the system
  • Should focus on outcomes versus process
  • Annual targets increase very quickly over the next few years, important to have provision for good faith effort
• Important to keep in mind that value-based purchasing means state will be picking providers over others, should keep variables in mind when pushing for these initiatives
• Kolkhorst – Could you have clear metrics that clearly defines differences in approach within a group?
  • We do this, quality of care metrics are clear and aligned throughout the system
  • Important to not only incentivize providers doing well, but also help providers perform better and meet those metrics

 

Andi Gillentine, COO, Superior Health Plan

• Incentives should reach providers providing care, and payment models should be attached to quality metrics
• Superior works to support providers through this transition period, would eventually like value-based payment to be the dominant form of payment
• Superior has grown program to provide alternative payment models that meet differing provider’s needs
• Will be creating a program this year for facilities focused on shared payments for episodes of care
• 3M Value Index Score is used to evaluate PCPs, Superior supplemented this model with a bonus metric
• Alternative payment models cover roughly 40% of patients, can cover patients and providers in all different locations and settings
• Pathways to Clinical Excellence program supports physicians and trains them on tools and quality data
• Shared savings program has led to significant cost avoidance
• Schwertner – Seems like Superior has pursued these measures extensively

 

John Hawkins, Texas Hospital Association

• THA is working on avoidable readmission, patient experience at rural hospitals, hospital acquired infections, creating a patient safety group that shares info between hospitals; Working with other local, state, and federal partners on these initiatives
• What worked well for the Medicare side is that these efforts are budget neutral and that “losers” end up supplemental the good performers, ultimately ends up being an across-the-board payment reduction
• Can also tailor to specific actors, e.g. can have hospitals compete against themselves or others, depending on how well they are performing
• Typically exclude low-volume rural providers from these regimens as they are not always a good fit, but working on other initiatives
• Ability of patients to change plans every month works against continuity of care in value-based payment models
• Patients presenting at different hospitals for emergency care can also see other hospitals than intended receiving the benefit
• Need to look at data as well, safety net hospital data will look differently than others
• Key is coordinating all of these efforts across all of the payers and making them outcome-based in order to reduce administrative burden
• Kolkhorst – Difficult for rural hospitals that do not have the volume to keep certain metrics, but could certainly look at approaches tailored to these hospitals
  • Waiver has been very helpful on this front with Regional Healthcare Partnerships
  • Could also reach out to communities and look at best use for hospitals
• Kolkhorst – Is there a role for rural Texas in incentives and can they survive?
  • Absolutely, urban hospitals are operating at capacity and rely on rural hospitals for discharge, rehab work, community-based services, etc.
  • A lot of this is a D.C. issue
• Kolkhorst – Waiver proved what we could do with rural hospitals, would hope that federal government would continue providing path to let us innovate

 

Stacy Wilson, Children’s Hospital Association of Texas

• As a lot of these models started in Medicare, children’s hospitals have been behind generally
• Began two efforts in 2012, quality collaboratives which share data and a pediatric safety program; Working to look at systemic best practices and how to standardize and implement
• One example is asthma, sharing data and best practices amongst CHAT members significantly improved outcomes and lowered stay metrics; Also working on bronchiolitis and sepsis
• Solutions for Patient Safety is a national collaborative effort sharing patient safety models
• Excited about HHSC’s commitment to stakeholder engagement
• Funding to incentivize change is important

 

Study efforts by the Department of State Health Services and the Texas Department of Insurance to increase health care cost transparency, including a review of the Texas Health Care Information Collection (THCIC) system, and the Consumer Guide to Healthcare. Recommend ways to make provider and facility fees more accessible to consumers to improve health care cost transparency, increase quality of care, and create a more informed health care consumer base.

Kirk Cole, Department of State Health Services

• DSHS is heavily reliant on data, THCIC system is extensively used inside the agency and outside
• Schwertner – Difficult to interpret THCIC’s data, not very user-friendly
  • Correct, health care in general is difficult to navigate and challenge is to present this in usable ways; Could use improvement
  • Spoken with TDI and OPIC and asked for ways DSHS can assist
• Schwertner – Would OPIC be a better house for this considering the guide they produce?
  • Decision for the legislature, our programs use the raw data and incorporate into registries and special data projects like preventable hospitalization reviews
• DSHS collects info on inpatient and outpatient health care activity, also get HEDAS measures
• DSHS collects health care charges before billing adjustment, info on length of stay, major procedures & diagnosis, quality; Do not receive data from medical records or individual physician charges, though EMR does supply some of this data
• HEDAS data is collected exclusively from managed care to avoid conflicting information; National Committee for Quality Assurance collects and provides to DSHS, DSHS provides to OPIC
• DSHS creates a public-use data file quarterly with identifying info removed, also create a research data file available on request and approval
• DSHS also produces hospital inpatient quality of care reports and potentially preventable reports, complication reports, etc.
• DSHS also publishes a consumer guide to health care as a website
• Perry – Asks after payment data that could identify discounts
  • Can’t have any info that would point to discounts on payments
• Perry – Is this information available if you did not have a barrier to providing this?
  • I don’t know that we do have this
• Schwertner – Are you going to have an exceptional item regarding data on free-standing ERs? And are you going to make this more consumer friendly?
  • There are a lot of things we can do that don’t necessarily cost us in trying to make this info more usable
• Schwertner – Many might already have data tied to CPC codes, etc., shouldn’t be that difficult to crunch this data
  • Can look at this, I know some others use our data to feed other datasets
• Kolkhorst – So data collected and not collected is driven by statute?
  • Yes
• Kolkhorst – People on high deductibles need this information desperately, in many ways our data system is out of date; If you had authority, could you modernize our processes?
  • Anything can be done, is very complex to separate billing data for consumer use
• Kolkhorst – Need to work on this and get the right data into the hands of the consumer
• Schwertner – THCIC should respond to the creation charge which is quality and consumer awareness

 

Jan Graeber, Texas Department of Insurance

• TDI regulates 17% of the health insurance market
• SB 1731 requires TDI to collect and publish information about the price of medical services, along with other data that allows consumers to compare health plans and companies
• Schwertner – When was the last time the Consumer Reimbursement Rate Guide was updated?
  • The rate guide was last updated in 2013, working to update now
• Schwertner – This data is collected from health plans, when was our last data call?
  • We do have 2016 data
• TDI had difficulties collecting the data required after 2013, partnered with UT School of Public Health to reorganize data collection; Redid data that was previously only CPT identified, held additional stakeholder meetings for input, adopted rules to incorporate comments
• As a result of these efforts, data call during 2014 and 2015 was limited to how methodology could be improved; Rule was adopted in June 2016
• Schwertner – This is 2 or 3 years down the road without publications, statute requires data to provided by TDI for publication
  • We did hold public meetings, asked for input
• Schwertner – Don’t you think consumer needs to know about bill charges? When will this be shown on the website?
  • Website was redesigned at the end of last year, contracting was just finished and final security checks are being run; Data will be populated afterwards
  • Will show billed charges and allowed amounts for 12 inpatient procedures, 20 outpatient procedures
  • New data is due to TDI by May
• Schwertner – And it will be published when?
  • Have to verify the data and will take part of 2018
• Perry – System is rigged to ensure we charge people for health care they can’t afford and we should inform the consumer, but it seems crazy to have the agency audit industry data
• Kolkhorst – Maybe we should make industry post the costs and take TDI out of having to be the mediator on how it is posted
• Schwertner – Might be able to do that with billed charges, but the contractual reimbursement is tougher, TDI data supposedly obscures this data enough for publication
• Perry – You mentioned that TDI has 17% of the health insurance market, who has the other 83%? Do you have data on that?
  • Things like self-insurance plans, do not have data on these portions
• Schwertner – You have the ability to leverage penalties under Chapter 84, do you know what these are? Each day data is not rendered is a separate penalty
  • Not familiar
• Schwertner – Do you think this should be housed in TDI, do you think it should move to OPIC?
  • Will do whatever legislature directs us to do
• Kolkhorst – Could require providers to post average prices
• Kolkhorst – If you want price transparency, you need high-deductible and HSA plans; Consumers will demand price data
• Schwertner – Asks after network adequacy data
  • We do get network adequacy reports, but they are available through public information request only as they are confidential; Not published
• Schwertner – Whose decision is that?
  • It’s the law, available through open records through AG
• Schwertner – Might should ask AG for an opinion on this, important for consumers to know network adequacy data
  • Consumers do have the provider directories, which must be made public

 

Melissa Hamilton, Office of Public Insurance Counsel

• OPIC produces two HMO report cards annually, goal is to provide consumer with data they can compare
• Guide to HMO Quality provides info on quality of services, Comparing Texas HMOs provides results of consumer satisfaction surveys
• Recommendations
  • Centralize and aggregate health care transparency resources
  • Make resources more user-friendly
  • Assess scope of info provided and find gaps
  • Improve public health insurance literacy
• Many different agencies have many different pieces of health care transparency information, compartmentalization can be challenging for consumers
• Can aggregate info via the web, could link to all resources from one central location or create a new health website
• Schwertner – I like the idea of consolidating this data

 

David Bryant, Texas Medical Association, Texas Society of Anesthesia

• TMA & TSA are interested in consumers having good data
• Several components to transparency, for providers it is important to understand how they get paid and how this works into prices (i.e. for anesthesia there is a time component and can interact with prices differently), determining networks can be very difficult but plays into end price, etc.
• Perry – Anesthesia is an important consideration, but it sidetracks the larger conversation over sufficiency of data and consumer-friendliness; Ultimately, we want the consumer to know how much a given procedure will cost

 

John Hawkins, Texas Hospital Association

• Price transparency is a very complex issue involving many different entities, health plans have become more sophisticated in providing some of this info for insured individuals
• THA has a website and buys the THCIC data, publishes data in a consumer-friendly matter and puts some data into context for consumers
• ACA requires hospitals to make standard charges public, CMS provides average charges per patient in some areas
• Supportive of continued iterations of state legislation that requires hospitals to provide cost estimates for elective services; Should look at this again to modernize timelines
• Kolkhorst –

 

Jill Sluder, Texas Ambulatory Surgery Society

• For the average consumer, the THCIC data is too voluminous and complex to be useful
• Recommendations
  • Organize and provide info as aggregate data by zip code via CPT code
  • Provide both bundled and unbundled data
  • Rate information guide is complementary and should consolidate data collection and housing

 

Spotlight on Public Testimony

Jamie Dudensing, Texas Association of Health Plans

• Provider prices are the largest driver of costs in the US, plans have provider cost calculation services on web portals
• However, out-of-network providers do not have transparency, more is needed; Plans cannot provide without contracted rates
• Free-standing ER prices are especially hidden due to being out-of-network, other states have tried to increase visibility
• Very interested in health care providers and facilities having to post some type of price information
• Would also be helpful to have them warn consumers if they are going to be charged well above Medicare
• Schwertner – Would also be informational for them to know what third party reimbursement would be
  • We are already required to do that, we have calculators on the plan websites that allow them to do this
  • If you go out-of-network, if you rely on an HAS, if you’re trying to compare, etc., it’s difficult
• Schwertner – You’re saying people have the ability to find this sort of cost information from the plan website?
  • If they have insurance, yes
  • There is a low uptake rate on this, people really want point of sale info
• Schwertner – And the issue with network adequacy reports being published?
  • April 1 is the deadline, will need to be checked after
• Schwertner – And they are marked “confidential” and not published?
  • Not sure that thousands of pages of geo access maps would be helpful

 

Lynn Tu, Patients Premier Choice

• Don’t have issues with transparency measures, but have been having issues with prompt payments; Had issues with a plan not responding to incorrect payment report
• Perry – Would hope TAHP can help

 

Carrie De Moor, Code 3 Emergency Partners

• Biggest issue with transparency is to keep health plans accountable and be open about network rates
• State pays more for in-network care, health plans are patient steering
• Difficult for free-standing ERs to inform patients of expected charges due to actions of health plans

 

Priscilla Anderson, Self

• Shares experience with medically fragile child on a Superior plan

 

Selena Hammon, Dallas Behavioral Health Care

• PA for pharmacy authorization can be cumbersome, one example of burdensome administrative procedures
• MCOs also have shorter stays that private insurance typically, these types of issues can affect care

 

Randy Lee, Randy Lee Public Affairs, Self

• Shares experience with caring for ailing sister; Frustrating to deal with lack of health care records standardization & coordination, patients would expect every care providers in a given facility to be in-network

 

Kelly Barr, Physical Therapist

• Medicaid credentialing has been streamlined significantly, but now have to credential with multiple agencies; No standardization
• Also barriers to continuity of care, evaluations are fractured out into multiple facilities

 

Adrienne Trigg, Protect TX Fragile Kids

• Obvious issues with the MCO model, House supported a restoration of rate cuts during the special session, but the Senate did not
• Medically complex children need more support and are being ignored

 

Hannah Metah, Protect TX Fragile Kids

• Massive problem with managed care system in caring for medically complex kids, cost containment measures coupled with inappropriate delivery model is damaging
• MCOs are focused on profit and not on proper care for children

 

Amy Litzinger, Self

• Shares story of parent with medically fragile child with care difficulties under MCOs

 

Kay Ghahremani, CEO Texas Association of Community Health Plans

• Texas program has been successful due largely to competition between plans
• 8 of 20 health plans in FY17 lost money, 5 more came in at 1.5% profit or less
• With regards to competitive bidding, State now aggressively sets the rates

Vicki Niedermayer, Helping Restore Ability

• Struggles with timeline MCOs are given on time to pay, 30 day window can mean millions of dollars are on the line
• Have also had issues with state coming to reclaim money spent on fraudulent services, providers often walk free and OIG does nothing
• Kolkhorst – Has it always been net 30?
  • Always, and it puts people out of business
• Kolkhorst – I assume you have a line of credit?
  • Very difficult to work under this
• Kolkhorst – Asks after action on the fraud issues
  • Fraud reports difficult to file, have never seen action taken when filing with OIG
• Kolkhorst – Will be looking at this in the next session

 

Mary Dale Peterson, Driscoll Health Plan 

• Experienced difficulties getting screening up for preventable mouth disease in children, after starting program to mitigate, saw dramatic savings
• Also worked to decrease pre-term birth rates
• Schwertner – If the SDAs were enlarged, could you compete at that level?
  • It might, depends on the environment; Challenging for regional system and hospital
  • SDA is where Driscoll has traditionally served, have relationships with the provider community
• Kolkhorst and Peterson discuss the widely differing health care environment even in geographically close communities
  • Essential to be working in the communities to know how to improve

 

Julie Ross, The Arc of Texas

• We need to have more security for care for medically fragile children under MCOs
• Texas Home Living services will soon be carved in, need to be assured that this will not disrupt services
• Kolkhorst – Sponsored HB 3595 to delay the carve in, not sure the agency is making progress on the pilot, will be monitoring closely

 

Don McBeth, Texas Association of Rural and Community Hospitals

• There is a $60 million/year underpayment to Texas rural hospitals, MCOs are not required to pay rural hospitals differently according to services
• HHSC has looked into this, but has stated federal law prohibits requiring MCOs to reimburse, but state can put in requirements without micromanaging MCOs
• Would ask that legislature puts stronger language into budget rider reinforcing that rural hospitals are to be reimbursed at cost

 

Lucy Beth Powell, National Association of Social Workers

• Children have been harmed by transfer to managed care, have had issues with credentialing
• HHSC has been slow to move on complaints with the process, complaints have been closed without resolution

 

Linda Litzinger, Self

• Are having problems with therapists quitting and requirements for therapists are increasing unnecessarily
• Physician signature requirement and progress interval has complicated delivery of therapy

 

Will Francis, National Association of Social Workers

• Dealing with managed care and insurance regulation is a challenge, many regulations overlap and burden could be simplified
• Would like to see the complaint process moved to TDI, handling complaints on top of other responsibilities seems difficult for HHSC
• LCSWs can bill Medicare and have had issues with PQRS, if looking at value-based payments, should incorporate behavioral health providers

 

Lisa Famiglietti, Independent Therapy Providers Association

• Value-based incentives for high quality care is a great idea, but HHSC is not necessarily responsive to problems
• Superior brought on a therapy evaluator and set up a preferred provider agreement, set up re-evaluations for certain areas of Texas, which blocked access to services by being shunted through complicated evaluation process

 

Kathy Macy, Speech Language Pathologist

• MCO stewardship has been a disaster, denials are widespread and denial reasons are complicated to navigate and seemingly arbitrary

 

Laura Montgomery, Children’s Behavioral Health Specialist

• United came into her area when STAR Kids rolled out, began paying home visits by unit which resulted in underpayment; state complaint made them pay properly, but United alter came to try and recoup the proper payment amount; Have had similar problems with BlueCross

 

Steve Abshier, Outreach Health Services

• Tremendous problem with client reauthorizations with all MCOs, not being completed timely
• Problems with system errors which cause large amounts of claims payments to not be paid
• Administrative requirements to properly get paid are too heavy, monetary losses are larger than they ever have been

 

Eddie Parades, Stonegate Senior Living

• 3 of 5 MCOs have implemented quality-based programs, one is doing well and authorized $3 million worth of payments, second is $300,000, third is $10,000
• Some limit provider participation through minimum provider participation numbers, will not allow providers to participate without a certain number of the MCOs patients
• Asking for established guidelines for MCOs to follow for quality-based programs, need heightened oversight for implementation as these programs work

 

Sandra Torres, Davila Pharmacy

• Value-based purchasing and reimbursement cuts continuing to be bundled will impact fragile populations and diminish extra services these populations depend on
• MCOs are more concerned with profits rather than quality of care and network adequacy

 

Shannon Butkus, Texas Speech Language Hearing Association

• MCO methods used to achieve cost savings are stripping members of their service options and limiting size of networks
• Also has concerns as to PA policies, these can lead to unnecessary delays as PCP is used a go-between

 

Sarah Mills, Texas Association for Homecare & Hospice

• There is no more room to move rates down further, other methods for cost containment should be explored; Value-based initiatives could be a solution
• Home health prevents hospitals visits and save money for Medicaid services

 

Amanda Fredrikson, American Association of Retired Persons

• Important to take a special look at nursing homes under the value-based model
• Nearly all funds for nursing homes are flowing through managed care, no piece in this where MCOs are held accountable for the quality; Basically operating like fee-for-service with a passthrough currently
• Important that MCOs reward well-preforming nursing homes, but should also reward nursing homes that are getting better
• Kolkhorst – Do you know how much of the STAR+PLUS funding goes into nursing homes?
  • Frustrating thing with managed care, we’ve lost the ability to track numbers for individual services
• Kolkhorst – Should see if the agency has this data, important to track
• Kolkhorst – Facilities performing well should be encouraged

 

Blakely Hernandez, Self

• Shares personal story of son with complex medical condition

 

Greg Hansch, NAMI Texas

• Medicaid provides a critical backbone for healthcare support, promotes access to quality care
• Access to interventions, telemedicine, etc. are a good recent movement; Would like to see this continue
• Medicaid provides robust mental health services, peer services access is crucial
• There is a lack of network adequacy, significant workforce shortages, reimbursement rates are a significant barrier

 

George Nardi, Apple Home Care Medical Supply

• Increase in PA requirements has been a very large burden for DME providers, MCOs seem to view the DME sector as an enemy & PA has been used as a weapon to limit care and place undue burden on providers
• Medicare does not have the same PA requirements & DME services perform better