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

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Some states use other strategies to ensure that enrollees have adequate access to the
specialists in the network. For example, New York and Oregon encourage plans to
provide enrollees with complex needs with standing referrals to specialists. This
allows the enrollee to see that specialist on an on-going basis without seeking a
referral from the primary care provider for each visit.
Traditional Providers
Many long term care and behavioral health providers used by vulnerable
populations have traditionally not been part of managed care networks. Many
vulnerable members use clinics, health centers, community mental health centers
and publicly funded non-profit community based organizations which are not part
of plan networks. These providers may not meet existing plan credentialing
standards and therefore do not participate in managed care networks. In several
states, traditional providers have formed their own health plan. Federally Qualified
Health Centers (FQHCs) in Massachusetts and Rhode Island organized HMOs which
were licensed under state requirements. Health Centers in Oregon formed an
alliance with the Oregon Health Sciences Center in order to continue to serve elders
and people with disabilities through the Oregon Health Plan. In some instances,
alliances between health plans and traditional providers meet mutual needs.
Health plans often need to expand their general capacity in areas of a state and to add
providers with experience serving <strong>Medicaid</strong> populations. Traditional providers
need to retain members in order to remain viable. States may either require an
alliance or contractual agreement or set bidding standards that create incentives for
health plans to negotiate these arrangements.
Forming networks to deliver behavioral health and substance abuse services is also
difficult. States often have a separate state or county operated network for serving
low income and disadvantaged populations that is not generally used by privately
insured people. HMO networks tend to include mental health providers with
experience serving privately insured populations with acute mental health and
substance abuse needs. These providers tend to have less experience serving people
with chronic mental illness and substance abuse problems who, in the past, have
been cared for by community providers. (Chapter 3 of this volume addresses these
issues in more detail.)
In Oregon, most mental health services for <strong>Medicaid</strong> beneficiaries traditionally have
been delivered by community mental health programs, predominantly operated by
counties. Until 1995, those organizations rarely participated in networks of fully
capitated health plans. In 1995 the State implemented a mental health service
demonstration involving 25% of <strong>Medicaid</strong> beneficiaries and experimented with
several behavioral health service delivery models, including management of those
services by three capitated health plans. An additional model was an alliance of 15
county-owned programs operating independently of the capitated plans in those
counties. The mental health demonstration was expanded to 100% of <strong>Medicaid</strong>
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