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Well-planned partnerships ease the transition to Medicaid managed care

July 22, 2016

Community-based agencies have delivered quality healthcare while working under the yoke of a fee-for-service system for too long. Fee-for-service is one of our biggest problems. It is designed to reward volume over value, and measures outputs rather than outcomes. We also lose money on almost every encounter as the reimbursement rates have gone unchanged for eight years.

Illinois has taken a first step towards moving away from fee-for-service to Medicaid managed care. The overarching goal of Medicaid managed care is to create a system to more effectively coordinate care for the increased number of people covered due to Medicaid expansion through the Patient Protection and Affordable Care Act.

Making the shift to this model means we needed to develop strong partnerships with managed care entities. In 2013, we entered into a unique payer/provider partnership with IlliniCare Health/Cenpatico, a subsidiary of Centene Corp. The goal of this one-year pilot program was to improve the lives of 50 of IlliniCare’s most complex, high-risk behavioral health patients. The managed care organization paid us a flat rate to manage patients enrolled in its Integrated Care Program, many of whom were not receiving any mental or physical healthcare. Using a strategy of “relentless engagement,” the Thresholds’ team located the patients and gradually built trusting relationships with them. This new personalized concept, combined with the flat fee that guaranteed payment, allowed Thresholds to creatively pursue the best options for each client.

Reaching out to people with severe mental illness who have fallen between the cracks is crucial. At intake, 90% of Thresholds members are unemployed and living well below the national poverty line. Approximately half have co-occurring substance abuse conditions, and most have at least one advanced physical health problem, such as diabetes or heart disease.

The results of this partnership were highly encouraging: From March 1, 2013, to February 28, 2014, we saw a 50% overall reduction in behavioral health admissions, a 55% reduction in 30-day readmissions, and a 58% reduction in 90-day readmissions. There was also a 63% reduction in overall cost for psychiatric inpatient care.

In the next few months, Thresholds will be rolling out a crisis stabilization program with two local providers and IlliniCare Health to prevent unnecessary hospitalization.

We are also constantly seeking innovative partnerships. For example, 24 of our care coordinators are working in six Illinois counties in partnership with Blue Cross Blue Shield, coordinating care for around 2,000 men, women and children. These teams do comprehensive risk assessments, create and monitor individual care plans, coordinate referrals and resources, and provide health and wellness education.

We are building innovative partnerships with several other MCOs: we have value-based pilots underway with Cigna and Humana while pursuing value-based contracts with Aetna and Blue Cross Blue Shield. Through our partnership with CountyCare we receive an enhanced rate for services that creates flexibility and the opportunity to increase service capacity. We are also working at more than twenty Chicago area hospitals with an IlliniCare hospital linkage program, where we reach 150 to 200 clients each month. This program helps ensure that hospitalized patients with behavioral health needs are discharged to the appropriate level of care. It also helps the MCO meet important quality metrics for successful transitions of care.

We were able to forge this partnership because we operated in a managed care environment and developed a great relationship with IlliniCare. They are learning what we are good at: collecting data, keeping great records and passing audits.

Lessons learned

In times of great transition or to forge stronger relationships, it is critical for community-based behavioral healthcare agencies to:

  • Know the business: When trying to partner with managed care entities, make the conversation about them, not you. We ask: How can we help you meet your goals? What are your biggest challenges and unmet needs? What might we be able to provide to make you more successful?
  • Do your homework: Ask lots of good questions of your prospective managed care partner. Make sure you share a similar philosophy and client-centered approach to work.
  • Be flexible: Be open to change as you discover what is and isn’t working in your partnership.
  • Be data-driven, yet be willing to adapt if the data are steering you in a different path.
  • Know your worth: It is important for community providers to know and be able to express their value to managed care companies. For example, we were able to compare our service rates to the costly, ineffective care alternatives. Specifically, one year of our highest level of community care, plus an affordable housing voucher, costs taxpayers $19,443. By contrast, a year in jail for a person with mental illness costs Illinois taxpayers $60,350; a nursing home costs about $31,400 annually.
  • Go slow: It took time to explain to IlliniCare who we were and how we worked. We used a small pilot study to collect data and build our case. We established how much our services cost, how much costs savings we generated and how to build our managed care services going forward. Now we have claims data; our managed care partners have data. It’s also important to have claims data from managed care to help build your case.
  • Get on the same page: Make sure you and your managed care partner share a similar philosophy and client-centered approach to work. Be open to change as you discover what is and isn’t working.

Cutting costs, improving care

Our partnership with IlliniCare prevented unnecessary and expensive institutionalization. Preventive care avoids institutions, like nursing homes and jails, from eating up lot of money and not serving people well. The results of the Thresholds-IlliniCare study are also encouraging for the future of Medicaid managed care/community-based care partnerships. We hope to continue to deliver high-quality services that improve the lives of our clients through partnerships like this.

Our partnerships, current and future, would have been impossible without the state’s move to managed care. It’s a work in progress. We don’t know how it will shake out here, but if we do it right and continue to partner in a boots-on-the-ground approach, we can make a huge difference in improving care for people with mental illnesses and addictions.

Mark Ishaug is CEO of Thresholds, Illinois’ largest provider of community-based services for persons with a serious mental illness.

This blog was contributed courtesy of the National Council for Behavioral Health.

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