‘Nail in the coffin’ for Bush’s plan?

Feb 5, 2009

By Christine Jordan Sexton
2/5/2009 © Florida Health News

TALLAHASSEE— Even as critics predicted the pullout of Medicaid Reform's major contractor will be the "nail in the coffin" for the experimental program, AHCA Secretary Holly Benson defended it Thursday, saying her staff would find other plans for all 78,000 beneficiaries affected and raising the possibility that new plans will enter the market.

On Wednesday, WellCare Health Plans Inc. announced that on May 1 it will pull out of Broward and Duval counties, the two main counties in the experiment started by former Gov. Jeb Bush. 

“I think this is very telling, and it could be the nail in the coffin of Medicaid Reform,” said Laura Goodhue, executive director of Florida CHAIN, a grassroots advocacy group that has opposed the project. 

But the Secretary of the Agency for Health Care Administration, which administers the Medicaid program in Florida, said AHCA is in talks with other plans that are already participating in the pilot as well as some that might be interested in entering the market in Duval, where WellCare subsidiaries were dominant. "We've had good meetings with the other plans in that area and are optimistic that they can continue to meet the needs of our beneficiaries," Benson said. "And we continue to approve other plans that may be interested in coming into Duval."

WellCare notified the state on Jan. 30 that it was pulling out of Broward and Duval counties as well as 11 other counties not involved in the pilot project. In that letter, WellCare Vice President of Regulatory Affairs and Government Relations Robert Diaz said that despite “aggressive administrative cost reductions and rigorous efforts” to control expenses, it is “financially unsustainable” for the HMO to continue to operate there. 

Diaz sent a follow-up letter on Wednesday saying the company had rescinded its decision to pull out of 11 counties that are not participating in the project. 

Lawmakers earmarked nearly $2.3 billion for Medicaid HMOs this year. In the January special session, that figure was pared back by 3 percent, or nearly $24 million, the Florida Association of Health Plans reports. 

Fernando Senra, spokesman for the Agency for Health Care Administration, said the state would start advising the 78,000 WellCare members in Broward and Duval that they will need to switch plans. WellCare’s departure from Medicaid Reform won’t affect the program, Senra said, because there are enough managed care plans still operating in the Jacksonville and Fort Lauderdale metro areas to absorb the displaced WellCare patients. 

Not everyone sees it that way, though. 

According to the latest Medicaid Reform quarterly analysis compiled by AHCA, Duval County had four Medicaid HMOs and three provider-sponsored networks—or hospital- and physician-run managed care organizations. WellCare’s two HMOs, Staywell and HealthEase, together had more than 50 percent of the Medicaid Reform market. 

Their departure leaves just two HMOs for beneficiaries to choose from, United Healthcare and Universal Healthcare. The AHCA report showed those plans combined had about 17 percent of the market as of September 30. 

First Coast Advantage, the plan operated by Shands Jacksonville, is second in the share of Medicaid Reform patients, with about 21 percent. 

“It’s going to have a dramatic impact on the landscape there,” Georgetown University Health Policy Institute researcher Joan Alker predicted. 

With funds from Jacksonville-based Jessie Ball duPont Fund, Alker studied the Medicaid Reform program for two years and issued seven policy briefs that raised critical questions about the program. 

Florida requires Medicaid patients throughout the state to be in some form of managed care. If they don’t want to be in an HMO-style plan, they can sign up for MediPass, which pays primary care doctors a small fee for making sure their needs get met. 

When the Legislature gave the green light to Medicaid Reform, which formally began in 2006, it agreed to eliminate MediPass as an option in the five Reform counties-- Baker, Broward, Clay, Duval and Nassau. The state could alter the benefits that patients receive under Medicaid, which covers low-income children, the elderly and disabled under federal rules. For the first time benefits could differ between plans, as they do in commercial health insurance, and they could be capped. 

“It might have been a good idea at that time,” said Mary Brandenburg, the ranking Democrat on Florida’s House Health Care Appropriations Committee, “but it hasn’t worked.” 

Last year, some in the Legislature tried to add more counties to the pilot, including Miami-Dade, but an outcry from patient advocates stalled the effort. AHCA's legislative agenda for 2009 included a try for expansion of the pilot, but when questioned about it in the fall, an agency spokesman said no decision had been made, that the agenda item was merely a "placeholder."

CHAIN’s Goodhue said that Medicaid beneficiaries and social service advocates have expressed concerns ever since the experimental program was launched, saying patients in Reform counties were having difficulty getting the proper care and prescriptions. WellCare’s departure, Goodhue said, is the “final proof” that Medicaid Reform “isn’t working for any of the stakeholders.” 

News that WellCare was dropping out of the Medicaid Reform program became public Wednesday during a meeting of the Senate Health Regulation Committee, where Medicaid Director Dyke Snipes was making a presentation on the pilot project. 

Snipes reported to committee members that a University of Florida analysis showed 73 percent of those enrolled in the Medicaid Reform project reported satisfaction with their doctor -- comparable to the 70 percent rate before Medicaid Reform. 

Snipes said the pilot had a beneficial impact on Florida’s Medicaid managed-care market, with four new plans seeking to enter. 

But State Sen. Dennis Jones, a chiropractor from Seminole County, told Snipes he hears only complaints about Medicaid Reform from providers he knows. And he mentioned that he’d heard WellCare was dropping out of the program, leaving thousands of beneficiaries ‘”in limbo.” 

Snipes didn’t reply. Later, AHCA’s public information office released the letter from WellCare. 

“I’m just very happy this has been a limited program in two areas of the state,” Jones said. “And I just hope it stays away from West Florida.” 

--Contact for Christine Jordan Sexton.