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State: HMO data clean-up will take another year

 By Christine Jordan Sexton
2/18/2009 © Florida Health News

TALLAHASSEE—Despite spending hundreds of millions each year on Medicaid HMOs, state officials say it may be at least another year before they really know what they’re buying because the detailed data that would provide the answer still need “cleaning up.”
The chief of Florida’s Medicaid program, Dyke Snipes, told state lawmakers on Tuesday that the state is collecting the information from the 16 HMOs that manage care for Medicaid patients, but that his staff is still sorting through it to verify its accuracy. The 2007 data are being worked on now, he said.

Consumer advocates are eager to see these “encounter data,” which register each encounter a patient has with a doctor, pharmacy, hospital, and so on.

“Our concern is that there is no way to monitor if patients are receiving care or not,” said
social services advocate Karen Woodall. With a system that pays HMOs a flat fee each month, she said, “there is a built-in incentive to reduce services that you provide because that’s how you’re going to make your money.” 

In traditional Medicaid, the state can track what’s happening to patients because the state pays each claim -- 140 million of them last year.
But with managed care, the state pays a flat monthly fee per person – a “capitation” – regardless of the services rendered. The idea is that health plans have an incentive to keep patients healthy to avoid high medical costs down the road. But consumer advocates argue that some HMOs may figure if they skimp on care, patients who get sick will switch to another plan. 

Health plans have captured more and more Medicaid business by saying they can save the state money. There are 777,086 patients enrolled in HMOs, according to the latest available data from AHCA. The plans receive, on a statewide average, 8 percent less than what the state would pay a doctor to manage the care.

The data become increasingly important in helping the state to figure out how much plans need to be paid to operate safely. Encounter data are also needed to adjust the payments for managed-care networks operating in the Medicaid Reform plan, so that those enrolling sicker patients could receive higher premiums and those attracting healthier patients could be paid less.

The Reform pilot is now operating in five counties and includes 137,700 enrollees. AHCA has recommended that the pilot be expanded.
Legislators have asked AHCA twice in as many weeks for the data and are growing restless with the state’s responses. Rep. Keith Fitzgerald, a Democrat from Sarasota who is a college professor, said he didn’t understand why it was taking so long to do “this clean stuff.” 

Snipes told the committee that his staff would prepare a written report detailing exactly what is involved in verifying the accuracy.
Michael Garner, president and CEO of Florida Association of Health Plans, said that collecting and verifying the information isn’t as easy as it seems. Encounter data, which are derived from claims, trip up commercial plans and doctors and hospitals, he said.

In fact, disputes over billing and coding became so severe in recent years that the Legislature passed laws requiring that certain claims be paid within 20 to 40 days, depending on whether they’re submitted electronically or on paper.

“It’s not such a simple process,” Garner said. “Everyone is working very, very, hard.”

--Contact for the reporter: Christine Jordan Sexton.