MANAGED CARE, CAREFULLY

Some, though not all, providers for the mentally ill in Maine are more than wary of a plan by the Department of Health and Human Services to make Medicaid here a managed-care system for their clients. Specifically, they fear a loss of necessary services under a capitated system that must both pay for the added layer of management and find savings required by the Legislature.

The department believes it can improve services by emphasizing the most appropriate treatment, fairly priced and delivered in a timely manner. There is good faith on both sides of the issue; what’s lacking, at least so far, is a clear sense of how a new system would work.

Department officials made a smart decision recently to push back the date for implementing this reform, from July 1 of this year to Jan. 1, 2007. Mental-health providers should take this as an encouraging sign and increase their work with the department, not necessarily because they want a managed-care system but because further budget constraints are likely and this reform is the only major vehicle around that is looking to protect access to services while saving money.

The amount to be saved under the department plan is substantial. The Legislature has booked $10.4 million in savings in fiscal year 2007, money that would have drawn a 2-to-1 match in federal dollars. The department further estimates that the managed-care contract will cost 8 to 10 percent of the roughly $400 million worth of services covered.

It is understandable that some providers think a budget reduction of $60 million or $70 million will result in worse outcomes for clients, or at the very least added chaos for those suffering from severe and prolonged mental illness.

Acting DHHS Commissioner Brenda Harvey says she is aware of this, which is why the department is moving slowly, but that it must move because the current funding system is fragmented, includes discrepancies in reimbursement and could be streamlined to improve the quality of care. She adds that not just the private nonprofit providers will fall under new effectiveness measures of a managed-care system; the state, which also provides direct services, will also be expected to perform.

Over the next couple of months, advocates and the state have an opportunity to agree on standards that could protect clients from a loss or disruption of service. For instance, clients should be offered a full range of services, with a clear message that they have a choice of providers. They should be fully involved in treatment decisions and have recourse if they are not.

State officials already have said that access to care is more important than expected savings; legislators should understand this too – and this may mean a system that is not fully capitated so that the state retains some of the risk for the cost of care. Outcomes will be crucial to ensure clients are getting appropriate and timely care. Any contract must come with a high degree of transparency so that the public can easily determine if the new system is performing as advertised.

This reform at times will be slow and painful, with lots of contradictory voices – but that’s far preferable than a quick solution from only a few state officials. They key is to make sure clients come ahead of budget savings.