HJNO Mar/Apr 2022

46 MAR / APR 2022 I  HEALTHCARE JOURNAL OF NEW ORLEANS COLUMN MEDICAID Because it insures one in five Americans and half of the nation’s births, Medicaid is essential to public health. Across the coun- try, approximately 70% of all Medicaid beneficiaries (75 million) are enrolled in managed care plans. 1 And since the start of the COVID-19 pandemic, that num- ber has increased by almost 20%, making managed care organizations an integral and pivotal part of our nation’s healthcare delivery system. 2 Ten years ago, Louisiana switched from its Medicaid “fee-for-ser- vice” structure and adopted a managed care model, ending years of providers and patients trapped in a system that reward- ed volume over value. It was bold and vi- sionary reform that provided a choice of health plans for recipients and paved the way for integrated care, transparency and accountability. As originally implemented, the state’s Medicaid managed care program — then called “Bayou Health” — was a hybrid of full-risk or “prepaid” and “shared savings” health plans. Today, “Healthy Louisiana” is solely comprised of five capitated MCOs (managed care organizations) responsi- ble for managing the physical and behav- ioral healthcare of more than 1.74 million Louisiana Medicaid and Children’s Health Insurance Program enrollees. 3 Through managed care, Louisiana creates budget predictability and savings. In addition, it benefits from innovations that seek to achieve health equity by improving health outcomes for its most vulnerable popula- tions. Healthy Louisiana Managed Care Plans Through a competitive bid process, the Louisiana Department of Health is cur- rently contracted with five MCOs: Aetna Better Health, Inc., AmeriHealth Caritas Louisiana, Inc., Community Care Health Plan of Louisiana, Inc. (Healthy Blue), Lou- isiana Healthcare Connections, Inc., and UnitedHealthcare of Louisiana, Inc. As the risk-bearing entities, MCOs receive a set “per member per month” (PMPM) payment that is set by LDH. In exchange, they provide a range of benefits, services and support. By federal law, these PMPM payments are actuarially sound and reflect “reasonable, appropriate and attainable costs required under the terms of the contract and for the operation of the managed care plan for the time period and population covered.” Unlike fee-for-ser- vice, these capitated or “fixed” payments provide for everything — utilization of ser- vices, administrative costs, and even plan profit. And, because health plan contracts require certain staff be domiciled in-state, MCOs also have a strong jobs and eco- nomic impact, paying an average annual salary (weighted across all health plans) of $68,979.3 The Value of Managed Care Plans Because it’s their business objective as well as their mission, MCOs — rather than state administrators — are better po- sitioned to manage the complex health needs of Medicaid beneficiaries. With an emphasis on prevention, disease manage- ment, and early detection, MCOs deliver integrated, value-added services based on fundamental operational components and goals: Innovation: MCOs are able to invest in research and development as well as data analytics focused on improving member engagement, health outcomes, and ad- dressing social determinants of health (SDOH). Network management: MCOs establish and maintain a comprehensive provider network with adequate numbers and types of providers, including specialists. In ad- dition to contractually stipulated network requirements, Healthy Louisiana MCOs must ensure their providers are licensed and credentialed. Member education and support: MCOs conduct routine outreach to ensure mem- Medicaid Managed Care Playing a Critical Role in the Delivery of Healthcare to Louisiana’s Medicaid Population