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

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facility's delivery, dosage, and packaging requirements and Oregon law." This State
also requires plans to generally cooperate with residential and nursing facilities.
Access to New Treatments
Treatment for some chronic conditions, such as AIDS, evolves rapidly. New
treatments for other conditions are continually being developed. Medical science is
continually improving its ability to perform transplants. Programs that serve
persons with disabilities and the elderly must include mechanisms that allow
enrollees to access these services when medically appropriate. This can be difficult
(1) if the specific service was not included in the plan's scope of service or the
capitation payment determination process, because it did not exist; or (2) if the use of
the service or prescription drug that was covered in the contract and payment
greatly increases because a new application was found for an existing treatment. In
these cases the plan may be reluctant to provide the treatment because either the
plan does not believe it is responsible for providing treatments that were not part of
the contracted benefit package or because the plan does not believe that it is being
reimbursed for providing the service in the manner in which it is proposed to be
used.
States have a number of responses to this situation. Options include carving out the
cost of new treatments or specified services such as transplants or protease
inhibitors; providing supplemental payments; offering some type of risk sharing
arrangement; 6 amending the contract and adjusting the capitation rate; and
developing a process for determining when new services will be covered. California
recently passed a law requiring that each health plan utilize an independent panel of
three experts accredited by a private non-profit organization to review the validity of
new experimental treatments for people with terminal conditions. The treatments
would be covered if the panel finds the treatments are effective.
Importance of Defining Medical Necessity
As discussed in Volume II, it is important for <strong>Medicaid</strong> agencies to define medical
necessity in their contracts to ensure that individual enrollees receive the specific
services they need. This becomes even more important for persons with complex
needs. In particular some states may want to consider creating a definition of long
term care necessity or mental health care necessity to accompany the medical
necessity definition or reviewing the medical necessity definition to determine
whether it covers these situations.
In Oregon, home health benefits were authorized by case managers in the home and
community based services system prior to the Oregon Health Plan. The benefits
were used to support and maintain people with chronic conditions in their home.
6 Risk-sharing models are described in more detail later in this chapter.
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