Psychiatr News June 2, 2006
Volume 41, Number 11, page 10
© 2006 American Psychiatric Association
MH Experts Wary About Law on Medicaid Changes
Rich Daly
Kentucky and West Virginia are the first states to amend their Medicaid
programs permanently under a new federal law that allows states to enact
changes to the programs.
Although federal officials refer to newly approved Medicaid programs in
Kentucky and West Virginia as "historic," mental health
professionals have mixed reactions to their likely impact on patients.
The two states were the first to receive federal approval of redesigns of
their Medicaid programs under the Deficit Reduction Act of 2005 (DRA, PL
109-171), which gave states more flexibility to design Medicaid programs with
increased cost-sharing for some services and populations.
The federal Centers for Medicare and Medicaid Services (CMS) approved the
two state plans in early April, although both are still finalizing some
components.
The redesigns, which unlike past Medicaid waivers are permanent, strive to
tailor Medicaid service to the age and health status of individual recipients.
Prior to enactment of the DRA, Health and Human Services Secretary Mike
Leavitt said, states generally could not target benefits to specific groups of
enrollees.
"Kentucky is leading the nation in crafting Medicaid benefit packages
to the needs of its residents," Leavitt said, when announcing that
program's approval. "These changes make sense for enrollees and the very
future of the Medicaid program."
The Kentucky program, called Ky-Health Choices, will offer various benefit
packages aimed at meeting the needs of groups such as children, the elderly,
people with disabilities who need institutional care, and the general Medicaid
population. Medicaid enrollees can choose the most appropriate benefit plan
based on their needs, such as the Family Choices program to serve healthy
children and Comprehensive Choices and Optimum Choices to serve individuals
with complex health care needs.
The changes are intended to make Medicaid more sustainable without
restricting eligibility or access to services for low-income and disabled
beneficiaries. Kentucky's Medicaid deficit reached $675 million by July 1,
2005, and the new plan should save about $120 million in the first year and $1
billion over seven years, according to state officials.
Mental Health Concerns Arise
Sheila Schuster, Ph.D., executive director of the Kentucky Mental Health
Coalition, said Medicaid participants with mental illness will be most
impacted by the institution of medication copayments. She noted that the
copayments of up to $3 are significantly less than the $15 copayments state
officials initially proposed and allowed by DRA.
"If a copay is a barrier, then people don't get the treatment they
need," Schuster said.
The program will use "Get Healthy" benefits to provide
incentives to Medicaid enrollees practicing healthy behaviors, with those who
follow preventive programs for one year receiving additional services. The new
benefit design was implemented in May throughout the state, except in the
Louisville area, where an existing Medicaid demonstration program
operates.
Although some have raised concerns that the Medicaid changes are permanent,
Schuster said the new system may increase the state's ability to improve the
plan as needed because it includes a shorter federal review process and does
not lock the program changes in place for five to 10 years.
The Medicaid redesign approach also has allowed significant regional
flexibility in the delivery of mental health services in the state, which
should improve service delivery. Additionally, the new Medicaid approach does
not require the budget neutrality of the traditional waiver process, which
would have necessitated major cuts, Schuster said.
"Those spending caps scared us to death," Schuster said.
Local mental health advocates were able to win exemptions to the program's
limit of four prescriptions a month and the limit of three name-brand drugs
for serious mental illness.
Overall, the changes were not as negative for those with mental illness as
the changes and cuts made in some states in recent months, she said.
West Virginia Changes Less Clear
West Virginia's Medicaid redesign includes a choice of two benefit
packages—a basic plan based on the current Medicaid service package and
an enhanced plan that includes benefits not traditionally offered under
Medicaid.
To enroll in the "advanced benefit package," enrollees must
sign an agreement with the state saying that they will comply with all
recommended medical treatment and "wellness behaviors." Enrollees
who chose not to join the enhanced plan and those who no longer want to
continue in it will receive the standard Medicaid benefit package.
About one-fourth of West Virginia's 1.8 million residents rely on Medicaid,
which cost the state and federal government $2.3 billion in 2005.
"Medicaid enrollees in West Virginia will now become part of an
emerging trend in health care that empowers patients to make educated,
consumer-driven decisions related to their own treatment," said Mark
McClellan, M.D., Ph.D., administrator of CMS, when the redesigned program was
approved.
A major change from the current Medicaid system will, however, limit access
for most adults to chemical dependency and mental health services to those who
choose the enhanced package, access to which is based on compliance factors
such as taking medication as directed and keeping all medical
appointments.
"Do we really want to penalize a low-income person who misses an
appointment because they don't have a car?" asked Kathleen Stoll,
director of Health Policy at Families USA, a national advocacy group.
The compliance issue also concerned Andy Schneider, senior adviser at the
Center on Budget and Policy Priorities, because of the difficulty for many
with mental illness to comply with treatment regimens "under the best of
circumstances."
"The consequences of not complying with this agreement are to not get
the services you need to be able to comply with it," he said.
The enhanced package includes limited chemical dependency and mental health
services for up to 30 inpatient days and 20 outpatient visits annually, as
well as unlimited prescriptions.
The standard package includes no such care and limits prescriptions to four
per month.
Schneider said he is concerned that the Medicaid redesign did not use a
traditional pilot-project approach to assess its impact, such as its
first-ever decision to make treatment for mental illness contingent on
compliance with a member agreement.
West Virginia plans to offer the new benefit choices in three counties
initially and then expand it statewide. The state plans to assess both medical
outcomes and compliance with the member agreement at the end of the first year
by tracking four indicators, including the number who received screenings as
directed by their health care provider.
Future changes to the state plans may come more quickly and with less
opportunity for public input, Stoll said, as some West Virginia patient
advocates found when they were unable to see a copy of the proposed changes
before they were approved.
An overview of the Kentucky Medicaid redesign is posted at
<www.chfs.ky.gov/dms/kyhealthchoices.htm>.
HHS information on the West Virginia plan is posted at
<www.hhs.gov/news/press/2006pres/20060503.html>.
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