An algorithm that dictates assignment of many Medicaid patients to health plans could cause another high-stakes tussle among plans that have received an estimated $90 billion worth of contracts to manage care in Florida’s Medicaid program.
The state Agency for Health Care Administration submitted a report this month outlining options the Legislature could consider to make the process more “equitable” for health plans.
If approved by lawmakers, the proposals could help managed-care plans that entered Florida’s market as a result of a process that led to awarding Medicaid contracts last year.
The new entrants include Lighthouse Health Plan in the Panhandle; Vivida Health in Southwest Florida; and Miami Children’s Health Plan in Southeast Florida.
But the gains for those health plans — all of which are what are known as provider-sponsored networks --- would come at the expense of more-established plans that have operated in Florida’s 11 Medicaid regions since the state first launched the managed-care program during former Gov. Rick Scott’s administration. Provider-sponsored networks generally are run by hospitals or doctors.
“We hope that the Florida Legislature will act on this report to ensure the long-term operational success of smaller health plans. Specifically, those that are owned by provider-sponsored organizations that already (are) linked to their communities. This would ultimately afford all Medicaid recipients more choice when it comes to selecting their health care provider,” Michael Minor, CEO of Miami Children’s Health Plan, said in a statement to The News Service of Florida.
An affiliate of Nicklaus Children’s Health System, Miami Children’s Health Plan has enrolled 3,134 Medicaid patients in Region 11, which is made up of Miami-Dade and Monroe counties. That is a less-than-robust enrollment that Minor attributes, in part, to an algorithm used to automatically assign patients to health plans.
Miami Children’s Health has enrolled 12,419 people in the Medicaid program’s Region 9 which is made up of Indian River, Martin, Monroe, Okeechobee, Palm Beach, and St. Lucie counties.
Minor said changes are needed to ensure that there is a “equal and competitive playing field” for new health plans that were awarded five-year contracts in 2018. A top Medicaid official has said that the contracts statewide, in aggregate, could be worth up to $90 billion.
The 21-page Agency for Health Care Administration report outlined two options for legislators to consider: a round-robin automatic assignment process or a process that guarantees a minimum enrollment level for health plans.
Under a law that took effect during the Scott administration, most of the state’s 3.8 million Medicaid beneficiaries are required to enroll in managed-care plans, whether the plans are corporate HMOs or provider-sponsored networks. The state awarded varying numbers of contracts to managed-care plans in the 11 regions of the state.
Medicaid patients are given a choice of plans in which to enroll. Under the current system, people who don’t choose a plan are assigned to one based on an algorithm that factors in several items.
Legislative mandates also require special considerations. For example, the program includes special placements for Medicaid beneficiaries who require “specialty” plans because of health conditions. Another consideration involves Medicaid patients who are also enrolled in Medicare managed-care plans.
The algorithm also is designed to promote continuity of care, which includes enrolling family members into the same plans and re-enrolling people in plans with which they had prior relationships.
Those policies have left some new entrants into the program with less-than-anticipated enrollment.
Vivida, operated by Lee Health is a provider-sponsored network in Region 8, a swath of seven counties in Southwest Florida. The hospital launched its health plan on Jan. 1, announcing that upward of 200,000 eligible Medicaid beneficiaries in the area could enroll in the plan.
The plan had 9,098 enrollees as of Sept. 30, according to the latest available data from the state.
Lighthouse, another new provider-sponsored network created by physicians, operates in Northwest Florida’s Medicaid regions 1 and 2, where its enrollment was 18,424 and 11,353, respectively.
The Florida Association of Health Plans is a trade group that represents managed-care plans, including provider-sponsored networks. Association President and CEO Audrey Brown told the News Service that her group is not weighing in on the issue.
Charles Talbert, a spokesman for Tampa-based WellCare Health Plans, also declined comment for this story. WellCare, which operates as Staywell Health Plan of Florida, has the largest market share in the Medicaid managed-care program, accounting for 26 percent of enrollment statewide.
Centene, which operates in Florida as Sunshine Health Plan, announced this year that it was purchasing WellCare. Centene has the second-largest market share in the main part of Florida’s Medicaid managed-care program, with 17 percent enrollment. While the sale remains subject to final approvals, the merged company would dominate Florida’s Medicaid market.
The state signed new five-year contracts with the managed care plans last year, the result of a contentious and lengthy procurement process to replace earlier contracts. According to the AHCA report, there were plan changes in each of the 11 Medicaid regions.
The Legislature mandated a study as part of the budget process and required AHCA, which administers the Medicaid program, to submit the report by Oct 1. The Legislature also directed AHCA to recommend changes.
The budget provision that mandated the study also described equitable treatment as ensuring that “the number of assignments does not systematically prevent new plans from establishing successful operations within the program.”
In compiling the report, the agency solicited input from Medicaid managed-care plans and received nine responses --- four from new plans and five from health plans that had participated in the program from the outset.
Not surprisingly, the report noted the health plans could not agree on what changes should be made. Some plans thought that no changes should be made to the formula, others thought that Medicaid patients should be automatically assigned to “new” health plans for a set time; and still others thought the algorithm should be changed to ensure that each health plan in a region has at least 25,0000 enrollees.
