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

Fee-for-service payment systems penalize
service providers for using dollars more
efficiently and create other barriers to flexibility
and agility in delivering person-centered
supports. The regulation of service
systems remains grounded in process
and paper. New approaches to Fewarding
exemplary performance and achIev-
Ing valued outcomes must be developed.
As a result of federal policies and other
factors, many public developmental disabilities
systems are over-invested in costly
service models. The financial burden of
maintaining such models has foreshortened
the capacity of service systems to
respond to the needs of youth transitioning
from school to adulthood or to step in
promptly to meet the needs of individuals
when their families no longer are able to
provide supports. States need to acceler-
-ate the shift away from costly service
models by emphasizing publicly-funded
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supports that are blended with other
natural and community supports.
System change is threatening. It is marked
by turbulence and uncertainty. However, it
is abundantly clear that, unless productivity
Is Improved, public developmental
disabilities systems will be less and less
able to-carry out their mission. Waiting
lists will become longer and longer. It will
become increasingly difficult to provide high
quality services and supports. Maintaining
the status quo will have partlculary
disastrous consequences for people
who need supports but are locked out of
the service system.
System change must be anchored in and
constantly referenced to the essential
mission of public systems: supporting
people with disabilities to live everyday lives
in their communities. System change must
be continuously informed by person- and
family-centered values.
A MANAGED CARE APPROACH TO RESTRUCTURING
SERVICE SYSTEMS
The intelligent, informed, value-based
adaptation of managed care approaches
can serve as a platform for reconfiguring
and, thereby, improving the productivity of
rpub~i-caevelopmental disabifties systems
and strengthening the emphasis on valued
outcomes. <strong>Managed</strong> care approaches -intermediaries
responsible and accountable
for systewide performance, capitation and
risk assumption, managed utilization of
costly services, cost savings incentives,
and performance indicators -- provide
promising tools for system improvement
<strong>Managed</strong> care techniques can help public
developmental disabilities systems to replace
fragmented, categorical funding with
single-stream approaches that deploy
dollars more flexibly to meet the unique
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needs of each individual. System incentives
can be created to foster improved
productivity. <strong>Managed</strong> care offers new
opportunities to reconfigure systems along
customer-driven and directed lines. Process
regulations can be replaced by objective
measures of the service system's
performance in achieving desired public
policy outcomes.
Still, there is scant experience in applying
managed care strategies to the delivery
of long-term services and supports.
Important differences exist between the
delivery of long-term supports and health
care services, where there is more experience
with managed care approaches.
Health care touches one aspect of an individuals
life; long-term supports, in contrast,