Health Plan Variety Does Not Boost Managed Medicaid Performance
Expanding health plan variety in state Medicaid programs may not lead to improved Managed Medicaid performance.
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By - Managed Medicaid performance does not increase as state Medicaid programs introduce more health plan variety, but a single health plan with value-based characteristics may be more effective in improving performance, a new JAMA commentary argued.
Andrew Bindman, professor of medicine and epidemiology at the University of California, San Francisco, Philip R. Lee Institute for Health Policy Studies, observed that California’s Medicaid program (Medi-Cal) provides various health plan models as a means to expand appropriate healthcare options for beneficiaries.
However, Bindman explained that Medicaid performance improved when there was less competition within a county and when the public health option was the primary choice for Medicaid beneficiaries.
“In general, the quality of care—as measured by the state using HEDIS is consistently higher among Medi-Cal managed care beneficiaries in counties with just a single Medi-Cal plan than in counties with multiple competing plans,” Bindman asserted. “Furthermore, in most counties where a public plan competes with a private plan, the public plan performs better on average.”
Medi-Cal uses a two-health plan model within 14 counties, a county-organized health plan model in 22 counties, and a regional health plan model in 20 counties.
The two-plan model offers one public health plan and the commercial health plan, the county-organized model offers a single public health plan, and the regional model provides beneficiaries with multiple private health plan options.
The two-health plan model covers 64 percent of Medicaid beneficiaries and the state’s remaining members are in either the county or regional model.
Bindman found that the county-organized model, with fewer beneficiaries and only one health plan option, generated the best Medi-Cal performance compared to models with more robust health plan options.
He determined that non-public Medicaid plans were likely to have a profit incentive and that competition inadvertently led to a narrowing in healthcare access.
“Competing Medicaid managed care plans further narrow the network of physicians available within their plans, which can further reduce a Medicaid beneficiary’s access to care,” Bindman argued. “Problems with access to care can be further exacerbated when Medicaid programs are unable to provide beneficiaries with timely and accurate information about which physicians are in the network of the various managed care plans.”
Bindman suggested that Medicaid programs would benefit from a single health plan that incorporates effective performance measures and value-based payment models.
He added that other states are experimenting with these models and that Oregon has already created successful performance improvements by improving quality and lowering costs.
Oregon’s Medicaid program uses coordinated care organizations (CCOs) that rely on a global budget for Medicaid payments instead of a competition-based design. The National Institutes of Health determined that the state is likely to generate billions in savings and improvements in beneficiary preventive care.
“Having a valid, reliable, and robust method for measuring the performance of health plans is essential, but a single local Medicaid plan combined with payment models that incentivize quality may result in greater value and accountability in Medicaid managed care programs,” Bindman concluded.
