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

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recent legislation provides for longer lock-ins including an annual lock-in for
Medicare beneficiaries after 2002.16
Absent explicit Medicare lock-in to their <strong>Medicaid</strong> networks, some states (e.g.,
Arizona and Minnesota's PMAP program) have fashioned defacto Medicare lock-in
to <strong>Medicaid</strong> plans by limiting their payment of Medicare cost sharing to the
<strong>Medicaid</strong> plan in which the dually eligible person is enrolled. These states
established this policy to encourage enrollees to use a primary care provider within
the <strong>Medicaid</strong> plan's network. Network lock-in is an important issue because the
primary care provider plays the major role in deciding what specialty and LTC
services and which providers (through referral arrangements and admitting
privileges) enrollees will use. Therefore, those that use a primary care doctor that is
not part of the plan's network are more likely to obtain other services outside the
network-including services that <strong>Medicaid</strong> pays for. However, this defacto lock-in
is a controversial policy which HCFA has stated it will not approve in the future.
Is it Possible to have Capitated Medicare Payments Outside of Medicare
HMOs?
As part of its waiver, Minnesota did get approval to have capitated Medicare
payments made to contractors that are not necessarily Medicare HMOs. The
payment is made directly to the contractor by HCFA, but is triggered by successful
execution of a contract between the State and the contractor.
However, doing so requires a Medicare waiver, which is likely to take a considerable
amount of time to obtain, given the still new and somewhat controversial nature of
the approach. Several states, such as Maine, have begun or plan to begin enrolling
dually eligible people with a Medicare fee-for-service component, with plans to
capitate Medicare in the future, pending waiver approval. Either way, the main
challenge becomes convincing dually eligible beneficiaries of the value of obtaining
their Medicare and <strong>Medicaid</strong> services through a single entity, since beneficiaries are
free to pursue Medicare services from any provider who will see them.
Summary
<strong>Managed</strong> care for the elderly and people with disabilities is still in its infancy.
Though several <strong>Medicaid</strong> managed care programs have included older people and
people with disabilities for some time, a limited amount of research has been
completed, and it has not focused on comparative analysis of different program
models. Thus, little consensus has developed regarding best approaches to take to
16 Specifically, Title IV-A of the Balanced Budget Act of 1997 will allow for continuous
enrollment and disenrollment for Medicare beneficiaries only during the first three months of each
calendar year after 2002.
The National Academy for State Health Pohcy 0 08/97 IV-18
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