Medicaid Managed Care - U.S. Senate Special Committee on Aging

467
G OWebbingion, n-r- 2lS4
GAOUnited States
t ~~~~~~~~General
Accounting Offike
Health. Education. and
N Services Division
8-276078
October 1, 1997
The Honorable Henry A. Waxman
Ranking Minority Member
<strong>Committee</strong> on Government Reform
and Oversight
House of Petp.rmen"Iave
Dear Mr. Waxman:
California's <strong>Medicaid</strong> program, Medi-Cal, served 5.2 million
beneficiaries-almost one-seventh of <strong>Medicaid</strong> beneficiaries
nationwide-at a cost of nearly $18 billion in federal, state, and local
<strong>Medicaid</strong> funds in fiscal year 1996. Over the past 2 decades, Medi-Cal has
increasingly relied on managed care delivery systems with the aim of
improving beneficiary access to quality care while reducing the rate of
program cost growth. In 1992, California began planning a major
expansion of its Medi-Cal managed care program-one that would
eventually require more than 2.2 million beneficiaries in 12 counties to
enroll in one of two managed care plans participating in each county.
In a 1995 report, we expressed concern about Califomia's ability to
successfully carry out such an expansion because of several weaknesses
that we identified in the Medi-Cal managed care program, including the
state's potential inability to effectively monitor its contracts with managed
care plans and to ensure that the services that plans were contracted to
provide were actually provided.' Now, nearly 5 years after planning began,
the state has repeatedly delayed its completion date for full
implementation of the expansion.
In light of these delays and the magnitude of the state's <strong>Medicaid</strong> program,
you asked us to follow up on our earlier report and (1) determine the
implementation status of California's managed care expansion, including
identifying the primary causes of delays; (2) assess the degree to which
state efforts to educate beneficiaries about their managed care options and
enroll them in managed care have encouraged beneficiaries to choose a
plan; (3) evaluate the management of the state's education and enrollment
process for the new program, including state and federal oversight of
enrollment brokers that the state contracted with to carry out these
functions; and (4) make an initial assessment of the impact of the managed
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