Illinois Medicaid managed care kickoff delayed for much of state

Several metro areas, including Chicago, will have to wait at least month longer

By Peter Frost, Chicago Tribune reporter | June 10, 2014

Illinois is delaying the launch of all Medicaid managed care programs by at least a month in much of the state, including the Chicago area, a state official confirmed Monday.

The state, which originally intended to start moving Medicaid patients into managed care July 1, still has not signed final contracts with some insurers and has yet to mail patients informational packages asking them to select health plans.

It has not yet determined when the programs will launch, but it is targeting either an Aug. 1 or a Sept. 1 start date, said Theresa Eagleson, the state's Medicaid administrator.

"We're giving ourselves and our providers more time in the northern part of the state," she said. "We must take a very deliberate approach. We can't just press go and have 1.5 million people (sign up) the next day."

Under state law, at least half of Illinois' 3 million Medicaid members must be moved to managed care programs by Jan. 1.

The state had long planned a phased rollout of managed care in part to avoid crushing the state's limited infrastructure with a flood of phone calls and paperwork. But to meet its initial July launch, patients already should have began getting application information.

Medicaid patients in the Chicago area won't receive plan-selection documents until at least July, Eagleson said, pushing the start of enrollment back to at least August.

Once the state determines a date on which to launch managed care in about a half-dozen metro areas, including Rockford and Peoria, patients will get 60 days to select one of several managed-care plans offered in their area.

In the Chicago area, some patients will have 20 or more plans to choose from, including offerings by large insurers as well as plans created by new amalgamations of health care providers like hospitals and clinics.

Those who select plans before about the 15th of each month will be enrolled in a managed care plan effective the first day of the following month. Those who sign up after the 15th generally will join the program in two months.

State officials expect only about half of those given the option to select a plan to do so; patients who do not respond will be automatically enrolled in a health plan.

Because that process takes at least two months and in many cases longer, any move to delay the start date beyond Sept. 1 could result in many enrollments slipping beyond Jan. 1.

Additional delays "make it more difficult, but not impossible" for the state to meet its goal of having at least 50 percent of patients in managed care by the turn of the calendar, said Samantha Olds, executive director of the Illinois Association of Medicaid Health Plans, a trade group that represents nine commercial insurance companies that will offer Medicaid plans in Illinois.

"But right now, it's too early to know the consequences that will result because at this point, we don't know how long the delay is."

Illinois intends to launch managed care programs on time in the East St. Louis metro, a region where there are no so-called accountable care entities, a type of managed care program sponsored by health care providers like doctors' groups and hospital systems.

Even with the delay, patients are still able to access care in the same way they do now. The downside is they'll have to wait to get their health care coordinated by an insurer with skin in the game.

By moving into managed care, these patients will get more attention from providers, Illinois hopes, resulting in better care quality and lower costs for its $15 billion Medicaid program, which consumes a vast part of its cash-strapped budget.

The mechanism upends the way Medicaid reimburses hospitals, physicians and other providers for taking care of patients. Instead of paying for each service they perform, a system that rewards volume instead of quality, managed care programs pay providers a fixed monthly payment for each patient they supervise, allowing them to profit if they keep people healthy.

To prepare for the influx of new patients, insurers have spent millions investing in their systems, enlisting providers in their networks and hiring care coordination specialists to work with patients.

The delay "is an opportunity cost, in that it doesn't allow for savings as quickly," Olds said.

Still, she said, insurers support the state's decision not to rush the deployment of a program that's clearly not ready. Insurers want new patients on their rolls as soon as possible, but not at the expense of a troubled rollout.

The Ann and Robert H. Lurie Children's Hospital of Chicago won approval to launch its own managed care program for up to 5,000 extremely sick children that was supposed to launch July 1. It also is participating in several other managed care networks.

Susan Hayes Gordon, Lurie's communications chief, said the hospital has made all necessary preparations and is confident it can improve health outcomes for children and reduce costs for the state.

"As soon as (the state) is ready, we are ready," she said.

http://www.chicagotribune.com/business/ct-medicaid-managed-care-delay-biz-0610-20140610,0,1523187.story