States seek help making health exchange rules

Kelly Kennedy, USA TODAY

Limited guidance meant to give states room to develop individualized health exchanges may be hampering their ability to meet a Nov. 16 deadline to let Washingtonknow if they will create their own.

1:34PM EDT October 29. 2012 – WASHINGTON – As the federal government tries to leave the states with the freedom to set up individualized local health exchanges, state officials say they’ve received so little guidance that they’re afraid they’ll have to make changes as moreregulations come out after the presidential election.

“CMS is walking a very fine line with providing guidance while trying not to be too prescriptive,” said Kevin Counihan, CEO of Connecticut’s Insurance Exchange. “We can either say, ‘I don’t know enough to move,’ or, ‘We’re going to do the best we can with what we have.’ If we do something wrong, we can beg the government for forgiveness later.”

The states are rushing to meet a Nov. 16 deadline to let Washington know if they will create their own health exchanges or participate in the federal program. But because only two states — Massachusetts and Utah — had the systems before the 2010 health care law was enacted, most of them are starting from scratch. And they’re finding that limited guidance from the feds means that state officials need to answer some hard questions, such as whether acupuncture should be acovered benefit, or exactly what meets government regulations for mental health care, or whether they should pay for surgeries meant to help people who areobese.


Medicaid Issues Leave Heavy Burden on WellCare


MON OCTOBER 22, 2012 4:28 PM



The departure of one of three statewide Medicaid operators next year is once again raising concerns about adequate medical coverage in parts of the state.

Earlier this year, coverage was one of the issues brought up between Coventry Cares, another operator, and hospital chain Appalachian Regional Healthcare in a lawsuit over contract issues.

At the time, state officials pointed to the other two operators as proof of coverage. But now one of those operators, Kentucky Spirit, is leaving next July.

And with Coventry still without contracts for many doctor and hospital groups in the eastern part of the state, Wellcare is essentially left as the only operator.

Kentucky Voices for Health Executive Director Jodi Mitchell says that puts pressure on WellCare to pick up the slack.

“But I think that it’s going to be carefully watched to see if WellCare is able to maintain enough providers in their network to care for these Medicaid members,” she says.

Choice is one of the key terms from the federal government when states turn to a managed care system. And if WellCare isn’t able to handle the bulk, it could put the program at risk in a lawsuit.

Mitchell says having only one operator in a needy region like Eastern Kentucky is possible, but comes with high pressures the other two operators have failed to handle.

“I think that is what we are concerned with, that if it has happened to the other two, it is likely to have a similar effect, maybe not the same because they all manage their contracts somewhat differently, but it’s likely to have a similar effect,” she says.

State officials say they will not re-open statewide contract bidding until the end of next year, when contracts for future years are bid on.

Two Louisville region operators, Passport Health Plan and Humana, are interested in expanding statewide at that time.


Health Insurance Exchanges

By the American Speech-Language-Hearing Association


What They Are

Health insurance exchanges are one-stop market places for the purchase of health insurance. As one of the mandates of the ACA, the exchanges will enable consumers and small businesses to choose a quality, affordable private health insurance plan that meets their individual needs. The exchanges will be user-friendly and may be accessed online, by phone, or at a physical location where citizens can compare health insurance plans, enroll in a plan, find out about available subsidies, and obtain customer support to access health insurance solutions and fulfill regulatory requirements.

The framework for the mandate allows states flexibility so that the exchanges meet the needs of the individuals in each state, withfederal grants provided to the states to assist with the set-up of the exchanges. The final rule, released by the U.S. Department of Health and Human Services (HHS) expanded the flexibility given to the states, allowing them to determine whether the exchange should be operated by a non-profit organization or a public agency, how to select health insurance plans that will be included for participation, and whether to partner with HHS for key functions.

The exchanges will perform a variety of functions, including

certifying health plans as “qualified health plans” to be offered in the exchange;

  • operating a website that facilitates comparisons among the qualified plans for consumers;
  • operating a support hotline, funding grants for assistance, and offering other consumer services;

determining eligibility of consumers for the plans and providing information about credits and other programs, such as Medicaid;

facilitating enrollment in the plans.

The exchanges will include plans for the purchase of private health insurance, but many of the plans will be available for Medicaid recipients as well, with tax-credits and advance payment of a premium tax in some situations, making it easier for more individuals to participate in the exchanges.

What This Means for SLPs and Audiologists

Because each state will employ a different model for exchange development and management, it is important for the provider to find out the specifics of the exchange in his or her state. Some states are currently developing the exchange boards; there may be opportunities for speech-language pathologists (SLPs) and audiologists to serve as members orconsultants, especially for boards run by a public agency. Once the exchanges are established, it is important for providers to become familiar with the insurance plans that have been certified by an exchange and understand the coverage categories and limits for billing speech-language pathology and audiology services. For more information on how to get ready for exchanges, see The ASHA Leader article, “Preparing for Health Insurance Exchanges.”

Implementation Time Line

The exchanges will begin operation in 2014 and will initially target the 24 million Americans who are currently uninsured and work for small employers; by 2017 plans will expand to include larger employers.

ASHA’s Role

ASHA continues to monitor the development and implementation of exchanges in the states and will also provide information regarding actionsthat audiologists and SLPs can take to participate in the developing exchanges.



Medicaid Operators Look to Take Place of KY Spirit

By Kenny Colston, KPR-Frankfort Mon October 22, 2012


As the fallout continues from the announced departure of statewide Medicaid operator Kentucky Spirit, many other Medicaid operators are already looking to take their place. Kentucky Spirit announced last week they would break their contract with the state early. State officials say they won’t re-open those statewide contracts to replace Kentucky Spirit until the current contracts expire.

When the state first decided to implement Medicaid managed care statewide, seven companies initially expressed interest. But only three received contracts: Kentucky Spirit, Coventry Cares and WellCare.

Bidding for statewide contracts won’t occur again until late next year. But Cabinet for Health and Family Services Secretary  Audrey Haynes says all four Louisville region operators have expressed interested in getting statewide contracts.

“All of those companies are interested in looking statewide with us in the future, they’ve all voiced that,” Haynes told lawmakers at a recent committee hearing.

That would include statewide contract renewals for Coventry Cares and WellCare, but new statewide contracts for Humana and Passport. All four currently are slated to serve the Louisville region.

Passport CEO Mark Carter says his group is interested in expansion and has received encouragement to do so.

“In fact while some of the implementation challenges have taken place in the rest of the state, we received a number of unsolicited calls asking us if we would try to work with the Cabinet to expand currently,” he says.

Carter says Passport’s reputation for quality care is well-known throughout the state and is a positive for his company. He says the reasons Passport wants to expand is to help maintain staffing levels since they no longer have exclusive rights to the Louisville region and to expand their quality of care to those currently outside its service region.

Humana officials have not responded to a request for comment on what their plans are.


10 states with the most and fewest doctors

Posted on Market Watch

Oct. 19, 2012, 1:41 p.m. EDT

By 24/7 Wall St.


The United States is currently facing a severe shortage of doctors. The Association of American Medical Colleges predicts that by 2020, the shortage will amount to more than 90,000 doctors, including 45,000 patient-care physicians.


Why such a shortfall? The baby-boom generation is getting older and will require more medical care in the coming years. The newly enacted Patient Protection and Affordable Care Act will soon require most people to obtain health insurance, leading millions more to seek care. Finally, a third of all doctors plan to retire this decade.

24/7 Wall St. looked at the 10 states with the highest ratio of patient-care physicians and the 10 states with the lowest. The differences are stark: Massachusetts had 314.8 patient-care doctors forevery 100,000 residents. On the other hand, Mississippi had just 159.4, or just half the figure for Massachusetts.

States with a higher doctor-to-resident ratio share some common attributes. Generally, the states with high median incomes tend to have more doctors per capita, while poorer states tend to have substantially fewer. Among the 10 states with the most practicing physicians per capita are five of the six wealthiest states by median income in the country.

The ability to pay has a major influence on whether people have health insurance. Each of the 10 states with the highest concentration of doctors has uninsured rates lower than the national rate of 15.5%, while seven of the 10 states at the bottom have uninsured rates higher than the national rate. When doctors treat insured patients, they are paid more than when they treat uninsured patients, incentivizing them to move to highly insured states.

“Most of [the uninsured] are choosing to not get insurance because they can’t afford it, and so you’re not likely to get paid, at least paid fully, from those patients,” AAMC’s chief policy officer Atul Glover told 24/7 Wall St. He notes that although the new federal health law will expand Medicaid coverage, the program, along with Medicare, tends to pay physicians between 30% and 40% less than private insurance companies.

Many of the states with high doctor-to-patient ratios also have a larger number of students who perform their residency in the state relative to the size of the population. This also signifies the ample medical facilities in which to practice medicine in thestate. Six of the top 10 states are in the top 10 for the number of medicalresidents per 100,000 people. Meanwhile, six of the bottom 10 states are in the bottom 10 for medical residents.

A state’s doctor-to-patient ratio has significant consequences. The states with the most patient care physicians per capita also tend to be healthier states, and vice versa, Glover said. Statistics back that up. For instance, all but one state in the top 10 had a longer life expectancy than the country’s 78.6 years, with four of the states in the top 10 for life span. Meanwhile, all but two states in the bottom 10 had a shorter life expectancy than the national average, with five of the states in the bottom 10 for life span. States with high doctor-to-resident ratios tend to have lower smoking rates, as well as fewer people who are either overweight or obese than those with low doctor-to-patient ratios.

Both medical schools and governments are trying to find solutions for the shortage of doctors. Some medical schools are expanding enrollment, although that is difficult to accomplish due to cutbacks in federal funds. Others state governments are considering programs that would pay patient-care doctors to go to underserved areas for designated periods of time. This is similar to the National Health Service Corps, which will help pay off medical-school loans for graduates who go to certain underserved states for two to four years.

Based on the American Association of Medical Colleges’ State Physician Workbook Data Book, 24/7 Wall St. determined the 10 states with the most and least practicing physicians per 100,000 people. From the report, we also considered information on physician education, training and gender. All information from the AAMC is from 2010, and represents the most recently available data. 24/7 Wall St. also studied 2010 data on income, poverty and health insurance provided by the U.S. Census Bureau. Additionally, we reviewed data on life expectancy, obesity and other healthfactors from the Henry J. Kaiser Family Foundation.

10 states with the fewest doctors


10. Georgia

Doctors per 100,000 people: 179.9

Medical students per 100,000 people: 23.6 (22nd lowest)

Percentage without health insurance: 19.7% (5th highest)

Life expectancy: 77.1 years (10th lowest)

Georgia is one of the worst states on paper for doctors looking to have a lucrative practice. Median income in the state was about $4,500 below the national average, and the state had the ninth-highest poverty rate. Also, nearly one in five Georgia residents werewithout health insurance, the fifth-highest proportion in the country. In 2010, the state had just 20 doctors in a residency or fellowship program per 100,000 people, compared with the average of more than 35 per 100,000 people nationwide. According to the Atlanta Journal-Constitution, state medical schools have increased enrollment by 50% over the past decade in anticipation of an increasing doctor shortage in the state.

9. Wyoming

Doctors per 100,000 people: 178.8

Medical students per 100,000 people: N/A

Percentage without health insurance: 14.9% (21st highest)

Life expectancy: 77.6 years (15th lowest)

No state had fewer doctors than Wyoming, where just more than 1,000 active physicians were employed. Additionally, there are no accredited medical schools in the sparsely populated state, and only two accredited residency programs, which have a total of 39 participants. At a ratio of 7.1 medical residents per 100,000 people, Wyoming trains fewer doctors per capita than all but three other states. The state also has been unsuccessful in recruiting female doctors, who make up just 23.5% of physicians in Wyoming — the fifth lowest percentage in the United States. However, there are some potential benefits to practicing in Wyoming: Median household income was $53,512 in 2010, more than $3,000 higher than the national median. Also, just 14.9% of the state’s population was uninsured, less than the national rate of 15.5%.

8. Oklahoma

Doctors per 100,000 people: 178.7

Medical students per 100,000 people: 27.9 (23rd highest)

Percentage without health insurance: 18.9% (7th highest)

Life expectancy: 75.6 years (5th lowest)

Oklahoma has one of the least healthy populations in the country. More than two-thirds of the residents were overweight or obese, and a very small percentage regularly ate the recommended level of fruits or vegetables. Also, the state had the third-largest percentage of residents who smoke. There were just 20.8 doctors in a residency program in the state per 100,000 people, compared with the national rate of 35.8 per 100,000. A New England Journal of Medicine article last year identified thestate as having the least accessible health care. Tulsa World also notes that state medical universities have not increased their enrollment size yet, which could help increase the number of medical students who might eventually become practicing doctors in the state.


7. Nevada

Doctors per 100,000 people: 178.1

Medical students per 100,000 people: 29.4 (21st highest)

Percentage without health insurance: 22.6% (2nd highest)

Life expectancy: 77.6 years (14th lowest)

Although 57.8% of doctors who received a medical education in Nevada worked there — one of the highest rates in the nation — the state still struggled to find doctors. There were just 29.4 medical students per 100,000 people in the state, below the U.S. rate of 31.4 per 100,000 people. Worse still, there were just 10.5 doctors in a residence program per 100,000 people — one of the worst rates in the nation. According to the Las Vegas Sun, this low rate “makes it difficult to train enough doctors in state to meet [patient] demand.” Recruiting American-educated doctors from other states is also difficult. Of Nevada physicians, 27.9% were international medical graduates, one of the highest figures in the nation. Only one state, Texas, had a higher proportion of residents without health insurance than Nevada.

6. Alabama

Doctors per 100,000 people: 178.0

Medical students per 100,000 people: 22.2 (tied-17th lowest)

Percentage without health insurance: 14.6% (23rd highest)

Life expectancy: 75.2 years (3rd lowest)

Alabama’s population is especially unhealthy. About 70% of adults were either overweight or obese, while 13.2%were told by a doctor they had diabetes — both the highest rates in the nation. At 75.2 years, Alabama had the nation’s third-lowest life expectancy. A shortage of doctors makes addressing health concerns within the state difficult. Alabama had just 22.2 medical students and 25.3 doctors in residence programs per 100,000 people, both considerably lower than their respective national rates of 31.4 and 35.8 per 100,000. Currently, there are only two accredited medical schools in Alabama. One of these, the University of Alabama School of Medicine, plans to open to a new regional campus to assist the state in training more doctors.

5. Texas

Doctors per 100,000 people: 176.1

Medical students per 100,000 people: 26.2 (25th lowest)

Percentage without health insurance: 23.7% (the highest)

Life expectancy: 78.3 years (21st lowest)

Texas is currently facing shortages in 36 out of 40 medical specialties, according to D Healthcare Daily. To get moredoctors working sooner, Texas Tech introduced a three-year medical program for students willing to enter patient care in 2011. In addition to potentially saving a year of tuition, students in the first-year program will receive scholarship assistance. Recently, Texas passed legislation requiring foreign-educated doctors to work for three years in medically underserved areas in exchange for a Texas license. Some experts fear this could make Texas’ doctor shortage worse, as international medical graduates — who account for 23.9% of doctors in Texas — go looking for work in other states.

4. Idaho

Doctors per 100,000 people: 172.5

Medical students per 100,000 people: N/A

Percentage without health insurance: 17.7% (11th highest)

Life expectancy: 79.2 years (20th highest)

Although Idaho’s doctor shortage is among the worst in the nation, the state’s lack of medical residents is potentially just as problematic. There are just 3.9 medical residents per 100,000 people in Idaho — the second-worst figure in the United States and well below the national figure of 35.8 per 100,000. In a report on Idaho’s doctor shortage, NPR noted that 41.5% of physicians in the state are 55 and older. Idaho is one of just a few states that has no accredited medical school.

3. Utah

Doctors per 100,000 people: 169.5

Medical students per 100,000 people: 14.1 (7th lowest)

Percentage without health insurance: 15.3 % (19th highest)

Life expectancy: 80.1 years (8th highest)

In many ways, Utah doesn’t share the characteristics of a state with a low doctor-to-patient ratio. The state’s median household income was about $4,700 higher than the national figure. The state’s uninsured rate was slightly below the national rate of 15.5%. But the state has only one medical school, the University of Utah, and it had to trim enrollment by 20 students a year due to recent federal budget cuts. Meanwhile, Utah’s population has grown faster than all states with the exception of Texas between April 2010 and July 2011. While the state has recruited out-of-state doctors to fill the gap, Sri Koduri of the Utah Medical Education Council recently told the Salt Lake Tribune that Utah doesn’t pay like other states. ”It’s easy to lose our edge with this group,” she said.

2. Arkansas

Doctors per 100,000 people: 169.1

Medical students per 100,000 people: 22.2 (tied-17th lowest)

Percentage without health insurance: 17.5% (12th highest)

Life expectancy: 76.1 years (6th lowest)

Arkansas has only one accredited medical school, the University of Arkansas for Medical Sciences College of Medicine. Of the school’s graduates, 57.6% were active within the state — one of the 10 highest rates in the nation. The state is one of the least healthy in the nation, as 22.9% of adults smoked and 67.2% of adults were either overweight or obese, both among the country’s worst rates. In addition to these health problems, many people in the state did not have insurance. As many as 17.5% of the state’s population were uninsured in 2010. In 2010, median household income in Arkansas was $38,307, the third-lowest in the nation.

1. Mississippi

Doctors per 100,000 people: 159.4

Medical students per 100,000 people: 20.2 (13th lowest)

Percentage without health insurance: 18.2% (9th highest)

Life expectancy: 74.8 years (the lowest)

Mississippi is sorely lacking in doctors. The life expectancy in Mississippi was just 74.8 years, the lowest rate in the country. The state’s overweight or obesity rate was 68.8%, while 12.4% of the state had diabetes, both the second-highest rates in the country. The ruralcare centers in Mississippi are suffering the most, with lawmakers and hospitals working to provide incentives for doctors to relocate to those areas. In 2011, a group of Mississippi legislators proposed a program to provide grants to doctors who work in rural Mississippi for at least five years. That legislation eventually died. Meanwhile, the Appalachian Regional Commission has sponsored a visa-waiver program for years to try and recruit international doctors.

10 states with the most doctors

10. New Jersey

Doctors per 100,000 people: 251.4

Medical students per 100,000 people: 22.4 (18th lowest)

Percentage without health insurance: 13.2% (22nd lowest)

Life expectancy: 79.7 years (tied-13th highest)

Doctors often come to New Jersey after finishing medical school. Although the state is one of the leading employers of physicians, at 251.4 per 100,000 people, it has just 22.4 medical students per 100,000 residents — considerably lower than the national rate of 31.4 students per 100,000. However, the state is a leader in hiring doctors educated outside the United States, who account for 39.1% of all physicians in New Jersey — the highest percentage nationwide. Doctors may be attracted to the state because of itswealth; median household income in New Jersey was $67,681 in 2010, the second-highest in the nation behind Maryland.

9. New Hampshire

Doctors per 100,000 people: 257.4

Medical students per 100,000 people: 28.3 (22nd highest)

Percentage without health insurance: 11.1% (12th lowest)

Life expectancy: 79.7 years (tied-13th highest)

Unlike many of the other states with high doctor-to-population ratios, New Hampshire isn’t flooded with medical schools — the only medical school in the state is the Geisel School of Medicine at Dartmouth College. Just over 28% of students who completed their medical education in New Hampshirepracticed in the state, the lowest percentage of all states. New Hampshire’s population is generally well-insured, as just 11.1% of the state’s population has no health insurance, far less than the 15.5% of the population nationwide. Most resident’s have the means to buy health insurance — a nationwide low of 8.3% of the population is below the poverty line.

8. Hawaii

Doctors per 100,000 people: 265.5

Medical students per 100,000 people: 19.7 (11th lowest)

Percentage without health insurance: 7.9% (2nd lowest)

Life expectancy: 81.5 years (the highest)

Despite its physical distance from the continental United States, Hawaii does not hire very many foreign-educated medical doctors. Such doctors account for just 13.9% of all doctors, or the 15th lowest percentage in the nation. Because the state has less than 20 medical students per 100,000residents, most doctors come to Hawaii only after they have completed medical school. Those who work in Hawaii treat a healthy population with the nation’s highest life expectancy, at 81.5 year and the nation’s lowest adult obesity rate, at 57.2%. Only 7.9% of Hawaiians were uninsured in 2010, the second-best percentage in the nation behind Massachusetts.

7. Rhode Island

Doctors per 100,000 people: 269.0

Medical students per 100,000 people: 40.3 (11th highest)

Percentage without health insurance: 12.2% (16th lowest)

Life expectancy: 79.3 years (19th highest)

Rhode Island has 332.6 total active physicians, including patient care and other doctors, for every 100,000 people, which is the fourth-highest rate in the country. The state’s only medical school is Warren Alpert Medical School of Brown University. The university is located in Providence, which has a fair share of medical resources. Although Providence doesn’t have the abundance of medical facilities for residencies and research of nearby Boston, the university partners with seven hospitals within a 15-minute drive of the campus to give students easy access to clinical opportunities.

6. Vermont

Doctors per 100,000 people: 270.7

Medical students per 100,000 people: 77.1 (2nd highest)

Percentage without health insurance: 8.0% (3rd lowest)

Life expectancy: 79.7 years (tied-13th highest)

Vermont is a leading employer of doctors, male and female. According to the AAMC, women accounted for 34.1% of all physicians, the fourth-highest figure in the United States. Aside from hiring, Vermont alsoeducated a large number of doctors. There were 77.1 medical students per 100,000 residents in the state, more than all but one other state in the country. However, only 30.5% of physicians educated in Vermont practice there, the third-lowest rate among all 50 states. Vermont may appeal to doctors looking for security; the state’s population is well-insured, as just 8% did not have health coverage in 2010, the third-lowest percentage in the country.

5. Maine

Doctors per 100,000 people: 272.1

Medical students per 100,000 people: 38.7 (14th highest)

Percentage without health insurance: 10.1% (10th lowest)

Life expectancy: 78.7 years (24th highest)

Maine does not fit the traditional mold of a state with a high ratio of physicians per capita — highest than all but four states. While most states with a high concentration of doctors had relatively wealthy populations, the median income in Maine was just under $46,000, the 19th lowest among states. Also, while a large number of doctors in residency is often indicative of how many doctors will work there, Maine had just 23.6 doctors in residence per 100,000 people, compared with the national rate of 35.8 per 100,000. However, more than half of these residents stayed in the state to practice, one of only 13 states where this was the case.


4. Connecticut

Doctors per 100,000 people: 273.0

Medical students per 100,000 people: 25.0 (23rd lowest)

Percentage without health insurance: 9.1% (5th lowest)

Life expectancy: 80.2 years (5th highest)

After medical school, many potential doctors choose to perform their residency in Connecticut. The state’s residency programs are quite popular, with an estimated 59.7 residents for every 100,000 people in the state — more than in all but three other states. Connecticut’s top hospital, according to U.S. News and World Report, is Yale-New Haven Hospital, which is rated well in 17 specialties. Among the potential appeals of practicing in Connecticut: only 9.1% of people living in the state were uninsured in 2010, one of the lowest rates in the nation.


3. New York

Doctors per 100,000 people: 277.4

Medical students per 100,000 people: 49.4 (7th highest)

Percentage without health insurance: 11.9% (15th lowest)

Life expectancy: 80.4 years (4th highest)

New York is home to 68,042 practicing physicians, 54,306 of whom are active patient-care physicians, more than any state except for California. With its 13 accredited medical schools the state can more easily attracts doctors since these schools provide residency opportunities. New York also has attracted many overseas-trained physicians. Just more than 26,000 of the practicing physicians were trained outside America, accounting for 38.3% of the total physician population. This is the second-highest percentage of overseas-trained doctors after New Jersey’s 39.1%.

2. Maryland

Doctors per 100,000 people: 281.0

Medical students per 100,000 people: 33.8 (17th highest)

Percentage without health insurance: 11.3% (13th lowest)

Life expectancy: 78.1 years (18th lowest)

Maryland hosts three medical schools, including the prestigious Johns Hopkins University. There were 44.6 doctors in the state completing residency or fellowship for every 100,000 people, the eighth-largest ratio in the country. Maryland’s wealthy population is likely very attractive to doctors. Median income in the state was $68,854, nearly $19,000 higher than the U.S. average. Of the state’s physicians, 35.4% were women, a higher percentage than any state but Massachusetts. Despite its high rate of doctors and wealthy population, the state has a higher-than-average rate of deaths due to heartdisease, a higher-than-average infant mortality rate, and a lower-than-average life expectancy.


1. Massachusetts

Doctors per 100,000 people: 314.8

Medical students per 100,000 people: 45.0 (8th highest)

Percentage without health insurance: 4.4% (the lowest)

Life expectancy: 80.1 years (6th highest)

Massachusetts has the lowest uninsured rate in the country because of the near-universal health coverage enacted back in 2006. The wide coverage helped attract doctors to practice in the state, since they reap far more money on insured patients than on uninsured ones. Massachusetts also spent more than $9,200 on healthcare for each resident, more than any other state. The state’s residents were clearly healthier than the U.S. population as a whole. Only 14.1% of state residents were smokers, the fourth-lowest percentage in the country. Although about six in 10 adults were either overweight or obese, it was the fifth-lowest rate in America and nearly four percentage points below the national rate.


Dual eligible financing proposals differ from state to state

October 17, 2012 | Anthony Brino – Contributing Writer



State proposals for new dual eligible financial alignment models are currently being considered by the Centers for Medicare & Medicaid Services (CMS), as part of the agency’s efforts to fix costly and fragmented delivery systems for the roughly 9 million Americans eligible for both Medicare and Medicaid.

Nationwide, annual per capita health spending for dual eligibles is around $16,000, more than twice the costs for the average American. In total, dual eligiblepatients are estimated to cost around $300 billion a year.

Only 10 percent of dual eligibles are currently served through managed care organizations, and budget-strapped state governments are increasingly turning to managed care for dual eligibles. The market for managed care services is expected to grow to between $86 billion and $183 billion with the next five years, the consulting firm Booz & Company has estimated.

How much exactly will be spent is an open question, but some of it depends on the financing model states choose. As a recent Kaiser Family Foundation report explains, there are two models CMS has offered to the states, one a capitated model, with a few variations, and another more traditional fee-for-service model.

In the spring of 2012, 26 states submitted proposals to CMS, asking to test either or both of the models. So far, only Massachusetts’ plan has been approved, with a demonstration using community-based managed care and a global capitated payment model.

Of the 26 states, the Kaiser report found, 21 want to use the demonstration plans for all of their dual eligible population. Massachusetts will focus on people ages 21-64. South Carolina’s plan focuses on seniors who are not in nursing homes, and the proposals of Wisconsin, Missouri and New York focus on people with certain conditions and in certain age groups.

Eighteen states want to test the capitated model, five want to test the managed fee-for-service model, and three — New York, Oklahoma and Washington — want to test both, according to the Kaiser report. For the capitated model, CMS will have to approve a prospective blended rate for Medicare-covered services. The capitated rate plan must also provide upfront savings to both CMS and the state.

Only a few states guessed at what they might save from adopting managed care for dual eligibles, according to Kaiser, and only a few have suggested what they’d do with the potential savings. Arizona said it wants to expand Medicaid benefits, reduce drug co-pays and provide care managers. Colorado wants to reinvest its savings, offering more benefits or expandingprovider incentives. Texas wants to reinvest savings in its long-term care services and support programs.

Half of the states propose sharing savings with insurers and organizations running the managed care organizations and half of the statessaid they would share savings with providers.

Hawaii, Massachusetts, Michigan, Minnesota, Tennessee and Wisconsin will require risk provisions like risk corridors or stop loss provisions, and another six states may require risk corridors or other risksharing arrangements. Only one state, Idaho, requires that the plan assume full risk.

Massachusetts, New Mexico, Oregon, Rhode Island and South Carolina will require plans to include community-based healthcare workers in their integrated care teams.

Massachusetts, North Carolina and Ohio will offer independent long-term services and support coordinators.



ACO Report Findings: Readmissions Down, Significant Savings for Dual Eligibles

Written by Alyssa Gerace

October 17, 2012

Senior Housing News

Reimbursing healthcare services based on outcomes rather than volume through an Accountable Care Organization (ACO) payment model produced overall savings while reducing rehospitalization rates, found a recent study conducted by the Dartmouth Institute for Health Policy and Clinical Practice. 

The study looked at cost savings generation by the Physician Group Practice Demonstration, a Medicare program run from 2005 to 2010 that closely resembled today’s ACO model with pay-for-performance and shared savings characteristics. 

The PGPD had a value-based payment model which produced annual savings of $114 per Medicare beneficiary, according to study analysis. For dual eligibles, who qualify for both Medicare and Medicaid, the demonstration realized savings of $532 per beneficiary. 

On the rehospitalization side, rates for 30-day medical readmissions decreased 0.67% overall for both populations (Medicare beneficiaries, and dual eligibles) and 1.07% for dual eligibles. 

Surgical readmissions for dual eligibles decreased 2.21% overall.

The findings are “statistically significant,” according to the researchers, because they’re based on an experimental group of nearly a million Medicare, Medicaid, and dual eligibles and a control group consisting of more than 7.5 million beneficiaries. 

“The study shows promise for the new healthcare delivery system reforms,” said Carrie H. Colla, lead author of the study and assistant professor at The Dartmouth Institute for Health Policy and Clinical Practice. “And these reforms should align incentives for payers, providers and patients.”

While the physician groups participating in the PGPD demonstration could receive as much as 80% of the savings they produced, the ACO model savings are slightly less at between 50% to 70%. 

Based on the study, Colla says ACOs have the potential “to improve health care and reduce spending” for dual eligibles. 

“The current fee-for-service payment system has contributed to the fragmented, poorly coordinated care that manypatients, especially those who are sick, experience every day,” said Elliott S. Fisher, M.D., one of the authors of the report, in a statement. “New payment models like ACOs are intended to encourage providers to coordinate care by offering them a share of any savings achieved when they improve care. Theseresults indicate that when organizations really try to adapt to these new models, they can benefit their patients’ lives and their bottom lines.”


Centene to terminate Kentucky Medicaid contract

By David A. Mann, Reporter

Date: Wednesday, October 17, 2012, 12:32pm EDT – Last Modified: Wednesday, October 17, 2012, 1:53pm EDT

Business First


Kentucky Spirit Health Plan has terminated its Medicaid managed-care contract with the Kentucky Cabinet for Health and Family Services. The termination will be effective July 5, 2013, about a year ahead of schedule, according to state officials.

The company, which is a subsidiary of St. Louis, Mo.-based Centene Corp. (NYSE: CNC), also has filed a formal dispute with the cabinet for damages incurred under the contract.

Specific information about the dispute was not immediately available.


In July, Centene reported a second-quarter net loss of $38.8 million on revenue of $2.11 billion, mostly on higher medical costs, including increased medical costs in its Kentucky health plan caused by the retroactive assignment of members and a higher level of non-inpatient claims receipts.


“Since the inception of the contract, we have been in discussions with the cabinet about our concerns with the Medicaid managed-care program but have been unable to resolve our differences.” Jesse Hunter , executive vice president of operations for Centene, said in a news release. “Consequently, we do not believe there is a viable path to a sustainable managed-care program in Kentucky. As a result, we are in the unfortunate position of having to take steps to terminate the contract and exit the market.”


The move will terminate 200 technical and specialized jobs in Lexington, Ky., which represent more than $12 million in annual wages and benefits, said Carol Goldman, executive vice president and chief administrative officer of Centene, told the St. Louis Business Journal.

Centene anticipates recording a pre-tax premium deficiency reserve ranging from $60 million to $70 million related to the Kentucky operations in the quarter ended Sept. 30. Third-quarter results will be released on Oct. 23.


Kentucky Spirit is one of three companies serving Medicaid recipients in 104 Kentucky counties, not including Jefferson County or those immediately surrounding it. CoventryCares of Kentucky and WellCare of Kentucky are the others.


Starting next year the latter two, as well as, Humana Inc. (NYSE: HUM) and Passport Health Plan, also will begin serving Medicaid recipients in the Louisville area.


The cabinet issued its own news release on the contract termination, saying Kentucky Spirit was abandoning its obligation to the commonwealth.


“Our top priority remains the continued health care of Medicaid patients, and we will make sure those patients experience no disruption in health services,” Kentucky Gov. Steve Beshear said in the state’s new release. “However, we are disappointed in Kentucky Spirit’s decision to break its contract. We have worked with the company toaddress its questions since Kentucky Spirit agreed on the contract terms last year. We will continue to work within the contract process to make sure members are provided health care services and providers get the payments they are due. We will hold this company accountable to its contractual commitments through whatever means necessary on behalf of both the members and taxpayers.”


The exact nature of the dispute was not discussed in either release. Phone calls to both Centene and the cabinet were not immediately returned Wednesday afternoon.



Statewide Medicaid Operator Kentucky Spirit Plans to End Contract Early



WKU Public Radio

11:33 AM WED OCTOBER 17, 2012


Governor Steve Beshear says he’s disappointed that one statewide Medicaid operator has announced it is leaving the state. Kentucky Spirit, part of Centene Corporation from Missouri, announced Wednesday that they would terminate their operations next July, before their contract is up.

Kentucky Spirit is one of the private Medicaid operators that took over the program for the state last year. The company encountered problems, however, and was in dispute with the state and doctors over reimbursement rates and other details of Medicaid operations.

Recently, its CEO blasted Kentucky officials for how they are handing privatized Medicaid.

The company is owned by Missouri-based Centene. In a release, company officials say they’ve notified the state Cabinet for Health and Family Services of their intent. Kentucky Spirit says it will stop working in Kentucky on July 5, 2013.

The company also plans to recover money from the state it says it lost unfairly.

Beshear says the state will help members of Kentucky Spirit transition to the other statewide MCOs, CoventryCares and WellCare, before July.

“There won’t be a problem with folks having the care, I’m just disappointed that a company that ought to know better is stepping up and breaking its contract,” Beshear says.

Kentucky Spirit claims the state isn’t making the Medicaid system affordable for the private companies. Because of that dispute, Kentucky Spirit says it will close it’s Lexington office and eliminate 200 jobs as it exits the state by July 5, 2013.

Beshear says Kentucky Spirit’s decision is likely to end up in court.

“Well Kentucky Spirit is breaking their contract and that will end up in court, because they don’t have a right to break their contract. There’s a dispute system that’s built into the contracts and they could have availed themselves to that. But there’s no right to just arbitrarily quit and go home,” he says.

Beshear says the two other statewide MCOs, CoventryCares and WellCare, will be able to pick up the slack.

In a release, Cabinet for Health and Family Services Secretary Audrey Haynes called Kentucky Spirit’s move “frustrating.”

“I am deeply frustrated that this publicly traded, Fortune 500 company has chosen to put profits above people and will not honor the terms of its contract. The managed care model is working in many states and is working here in Kentucky.  The recent RFP process in Region 3 demonstrated that the managed care market in Kentucky is healthy and viable,” she says.

And the state is unlikely to invite any other private company to bid to finish out Kentucky Spirit’s contract. Instead, Beshear says the state will just send out requests for proposals next year to bid out 2014 to 2016.

That also raises questions about savings in the private operator program, since Kentucky Spirit gave the lowest bid fees of the three original statewide operators.

 Here is the full announcement from Kentucky Spirit:

Kentucky Spirit Health Plan (Kentucky Spirit), a wholly-owned subsidiary of Centene Corporation (NYSE: CNC), has notified the Cabinet for Health and Family Services that it is exercising a contractual right that it believes allows Kentucky Spirit to terminate its Medicaid managed care contract with the Commonwealth of Kentucky effective July 5, 2013. In addition, Kentucky Spirit has filed a formal dispute with the Cabinet for damages incurred under the contract.

Kentucky Spirit entered the market in November 2011 with the intent of helping the Commonwealth achieve a high-quality healthcare program at a significantly reduced cost for tax payers. Since the inception of the contract, there have been concerns about the sustainability of the Commonwealth’s Medicaid managed care program. The decision to terminate the contract comes after months of effort by Kentucky Spirit and the Cabinet to resolve these concerns and only after it has become clear that there is not a viable path to a sustainable Medicaid managed care program in Kentucky,

“We are proud of the outcomes we have achieved in the short time under the contract. In keeping with our mission of providing high-quality, cost-effective care delivered locally to the Medicaid population, Kentucky Spirit has achieved many successes,” said Kentucky Spirit President and CEO Jean Rush. These include: ·

a 30 percent increase in well child visits; · a 53 percent increase in diabetes testing; · a 94 percent decrease in ‘doctor shopping’ for narcotics; · a 30 percent reduction in pharmacy costs; · a 30 percent decrease in one-day hospital admissions; · a 23 percent reduction in hospitalreadmissions; and a 17 percent decrease in medical and surgery costs.

Rush continued, “Kentucky Spirit remains committed to a smooth transition for the more than 140,000 individuals and families it serves.” Centene recognizes that the only way to achieve outcomes like these is through a strong local approach. As a result, Kentucky Spirit created more than 200 high-paying technical and specialized jobs in Lexington in order to meet the health needs of Medicaid recipients across Kentucky.

“We regret the loss of these high quality jobs, which represent over $12 million in annual wages and benefits eliminated from the local economy and state tax base,” said Carol E. Goldman, Executive Vice President and Chief Administrative Officer of Centene. “The company is working closely with its employees to provide them with the appropriate levels of support and resources during this transition.”

Kentucky Spirit also will continue to offer excellent service to its members and healthcare providers through the termination date and will work with the Kentucky Department for Medicaid Services to make sure the transition for members is easy. Members may call Kentucky Spirit’s Member Services at 1.866.643.3153 for more information.


Media: Centene pulls out of Kentucky Medicaid managed care deal

By STAFF | Published: OCTOBER 17, 2012

Provided by 


Just when you thought the Beshear Administration’s Medicaid managed care organization plan couldn’t be a bigger mess, it becomes a bigger mess.

The financial advice website RTT News is reporting St. Louis-based Centene Corp. not only is pulling out of its MCO contract with Kentucky, it’s seeking damages from the state.

From the website:

Centene Corp. (CNC: Quote) announced Wednesday that its subsidiary, Kentucky SpiritHealth Plan, has notified the Cabinet for Health and Family Services that it is exercising a contractual right that it believes allows Kentucky Spirit to terminate its Medicaid managed care contract with the Commonwealth of Kentucky effective July 5, 2013. In addition, Kentucky Spirit has filed a formal dispute with the Cabinet for damages incurred under the contract. ”Since the inception of the contract, we have been in discussions with the Cabinetabout our concerns with the Medicaid managed care program but have been unable to resolve our differences. Consequently, we do not believe there is a viable path to a sustainable managed care program in Kentucky. As a result, we are in the unfortunate position of having to take steps to terminate the contract and exit the market,” said Jesse Hunter, Executive Vice President of Operations for Centene.

RTT also reports Centene execs anticipate losing between $60 million to $70 million in the Kentucky MCO contract through the expiration date of September, 2013.

Centene is one of two MCOs – the other is Bethesda, Md.-based Coventry Cares –  being sued by providers including Appalachian Regional Healthcare in Lexington.

ARH is suing Centene Corp. claiming Kentucky Spirit delayed paying $5.9 million in unchallenged services as of March.

At the same time the insurer is dragging its feet paying, the ARH suit states,Kentucky Spirit is collecting millions monthly in capitated payment from Kentucky Medicaid Assistance Program.

ARH also is claiming that Kentucky Spirit underpays for services, as well as renewing charges that state Medicaid reimbursment methodology is “grossly inadequate.”

Here’s Bloomberg BusinessWeek’s version of events in their post titled, “Medicaid provider to terminate contract with Ky.”

The Bloomberg post makes it clear Centene executives are serious, or at least seriously bluffing, talking about trying to transfer their 200 employees inKentucky (Louisville, specifically) and handing over to another MCO their 140,000 Medicaid members.

The back story on Kentucky’s Medicaid Managed Care Meltdown:

In April, 2011, state officials asked health insurers to submit managed-care proposals for the $6 billion worth of care 800,000 poor and elderly Kentuckians receive annually under the federal/state Medicaid program. At the time, Gov. Steve Beshear touted the switch to managed care from fee-for-services as saving the state $375 million over the life of the initial three-year contracts. Insiders said officials in other states such as Georgia took as long as 18 months to make the change while Kentucky tried to do it in less than six months.

The three companies receiving MCO contracts were Centene, WellCare and CoventryCares, all publicly traded companies. (Passport Health Plan, a Louisville-based non-profit controlled by providers, is the managed care insurer for Jefferson County and 17 surrounding counties.)

Each bid for the Kentucky MCO business was based on per-member, per-month healthcare costs projections. Low-bidder Centene bid $330 per member, per month, according to documents submitted to Insider Louisville. WellCare bid was based on $400 per member per month, and Coventry bid $436 per member per month.

The algorithm state officials used to choose the winners favored the low-cost plans, obviously, because therein lies the savings.

The state methodology initially assigned members to a plan, with the two lowestcost plans getting more members than the highest.

If Centene’s manged care system actually got each member to spend less than $330 per month, they’d make a profit. But crucial to getting costs that low would mean cutting reimbursements to health care providers such as doctors and pharmacies, which meant losing some.