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

CONSENSUS FOR ACION
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works and how they can push states to write strong and enforceable contracts with managed came
organizations Once contracts ate signed, people living with HIV and their advocatcs need to become
active in the monitoring and enforcement of the contracts.
Enconrage people living with HiVto fortm coalitions with other <strong>Medicaid</strong> beneficaries. Success
at protecting <strong>Medicaid</strong> for people living with HIV requires people living with HIV to form broadly
based coalitions. A managed care plan that is designed to meet the complen needs of people living
with HiV should also be designed to provide high quality care to other beneficiaries. Additionally,
people living with HIV should remember that <strong>Medicaid</strong> isbur nation's prinmary health care safety net
and through our strong and consistent advocacy we have the power to make this program better for all
who depend on it
ABOT APITTIONj
What is Capitation?
How Does Capitation Work?
TheortIcal Basis for Capitation
The basis for rmost current managed A capiktaed payment tI a payment rmad Ideaty capicotion will give the provider
care programs Involves paying for to a provider on a per-memberi per- the freedom to make health care deci-
health cam services with capitated ptay month basiks This meas that a physician sions In the best interest of the patient
nene5,as opposed to paying for health or other provider would receive a pay- it f patdent would like servkie th the
core W a foe-for-service basis This fi ment every month for every petientthey provider does not be eve Is medicalty
nanting change marks a fundhlnental have In that managed core paai,' hether nercsary the providers own hi'onclal
shift in the relationships bertween con- or not the p2tient mes any health care risk creates an incentive to deny thi pasumeers
payers and providers of health services, n agreeing to accept this paydent cue service, However, since a
care. Under fee-for-servkwe the payer men the provider is agreeing to as- providers costs increase if the patiant
(in dhe hedicid context, dhis would be sume responsibitity for dhe health of her becontes sick and requires more earen-
the stcte <strong>Medicaid</strong> agency) is largely re- or Ms patients. The caphated payment sloe or mwre eapesi health care sersponsible
for at financial risk should a from onc patient may not be sufficient vices, itshould not be in the Intrest of
beneficoary become ill Capitated mnan- to tonr the health care costs of tdat the provider to densy necessary services.
aged cre sefcs to ,ave dhe payer roney
by utilizing the copikated payment to
IndIvidual paten bypoli the calpor red
payments from every padetn, it Is antici-
This systen presumes that the provider
i5 esxperienetd and knowledgeabletabout
transier some of the risk for health cor
costs from the payer to the health plan
pated diet the provider can pay for all
necessary health care expenses, as well
all typetof illruess,and Incapable ofWg
ing when heal a services can be
or the indtileit beaith care provider.
Pinig for health car Involves risk be-
as receive a fair compensatiow for theIr
own services Thi Isintended te take
denied withoutInfltiing aderae efecra
on the patient.
case there is no way of knoVwng hI ad away: the Incentive in the fee-for-rse,
vwac how wmuhhalth care an individuial vice system to over prescribe health
witi require over a glw. time period. care services for healthy people
MANoacAAocncAeeeoee A. Adile Ploe n Psee UIop n .I1th HIV
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