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

age, which pays for those <strong>Medicaid</strong>-covered items and services
that are not included in the plan's contract and instead
are paid for directly by the <strong>Medicaid</strong> agency.
In developing a contract with managed care planss states
must first identify which services and duties are to go into
their contracts. Agencies then must draft the actual terms
and conditions with sufficient precision and clarity to ensure
that the description of the plans coverage duties is correct
and that contracts do not leave a state either administratively
or financially liable for care and services that it believes
are covered under the contract. While state agencies always
remain liable for the proper performance of their contractors,
ambiguous contract terms can render agencies obligated
for the direct provision of care and services in ways
;;hic"h Uhay did n.ot Con-.emplate.
Findings on Translating of <strong>Medicaid</strong> Benefit and
Administrative Requirements Into Contract
Language
States varyin:
4 The classes of services and benefits they include
in their contracts. although certain services commonly
associated with very sick and disabled beneficiaries
(e.g., extended nursing home care, home
and community based care) typically are excluded
from the scope of the service agreements.
*The extent to which certain classes of services
are included in their contracts (i.e., coverage of all
medically necessary physical therapy services versus
coverage of only a certain number of visits
annually).
* The degree of guidance they give plans regarding
the medical necessity crtena plans are required to
use in making coverage determinations or the procedures
that plans should follow in making coverage
determinations.
e The extent to which they permit contractors to apply
standard insurance coverage exclusions principles
and exclude coverage for certain services
that are otherwise included in the contract.
* The extent to which they explicitly identity for their
contractor services that the state agency will continue
to cover directly under their residual <strong>Medicaid</strong>
plans, as well as those that are not covered
services.
* The conformity of state contracts to the wording of
the federal statute and regulations to descnbe the
covered services for which they are contracting.
This disjunction between federal legal definitions and
states' contractual definitions has several potential consequences.
Firt, it may dilute the level of coverage for enrollees
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who may not understand that certain sevices (or aspects of
services) remain available directly through the state <strong>Medicaid</strong>
agency and are simply not included in the managed care
benefit package. Second, the disjunction may create contractual
'gaps that leave a state financially obligated to pay
directly for certain items and services that it intended to
include in the contract.Third, i may cause confusion for plans
and participating providers regarding what is and is not covered.
Fourth, wide vanation in service terminology means
that there may be substantial state-to-state differences in
the types of care within classes of benefits that, in fact, may
be covered under state contracts.
3. Octinlng Mcdlcold <strong>Managed</strong> Crn Rct :tlnsbf p h
the Larger Health System
While <strong>Medicaid</strong> managed care represents an unprecedented
effort to purchase complete and integrated health
service delivery arrangements, these systems nonetheless
are only a component of the larger health care system in
which they operate. <strong>Medicaid</strong> beneficiaries may be served
by more than one part of the health care system because
they may have needs that go beyond the benefit package
bought from managed care companies. Moreover, short
<strong>Medicaid</strong> enrollment periods mean that patients (not at their
own choice) will have to move between health care systems.
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Negotiating the New Health System:
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<strong>Managed</strong> <strong>Care</strong> Contracts.
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Negotiating the New Health System:
A Nationwide Study of <strong>Medicaid</strong>
<strong>Managed</strong> <strong>Care</strong> Contracts.
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