Medicaid and Innovation in Healthcare

Conversation between Vinu Aulik and Adamika Arthur

Date: 11/28/2023

That worked well. Welcome. We're excited to have you all here today. This is our second time doing Medicaid ends, and it's heartwarming to see this many people excited about Medicaid and trying to find innovative solutions for. So thank you for being here. My name is Vinu Aulik.

I am the Executive Director of the Medicaid Innovation Collaborative. We are a program of Acumen America. Acumen America is a social impact investing firm and a couple of years ago realized how challenging it can be to get innovative solutions adopted in Medicaid. So we started the MIC as a way to align state Medicaid departments with managed care plans and bring innovative solutions to those states.

I know some of you here today that we're working with in New York and Kentucky, so excited to have you all here. We are one of many facilitators who care deeply about Medicaid and making sure the innovations at the health conference make it into the communities where there are some of the largest needs.

I wanted to acknowledge the partners we've been doing this work with. So I wanted to thank and acknowledge Hope Lab Ventures and the California Healthcare Foundation's Innovation Fund, who have provided important funding, support, and brainpower to get this off the ground.

Also, our partners at StartUp Health and Health Tech for Medicaid, who have been helping entrepreneurs in the room understand how to break into Medicaid as well. We're excited to have Manat here today, who you're going to be hearing from to provide some of the content and expertise around Medicaid.

And then also wanted to acknowledge Town Hall Ventures and our team at Acumen America. So, thank you. I also wanted to make sure I acknowledge Adina Safer, who has pulled all the pieces together. So thank you, Adina, for making sure everything came off smoothly. Our agenda today, so what we're going to do is start with an overview of Medicaid by Kinda Serafie.

After that, you'll have some time to ask questions, but our hope for the day is to make this a very interactive session. We purposefully designed this to not have us speaking all the time but have an opportunity to meet with some experts in the Medicaid space who are on the ground doing this work and get your questions answered.

The people, I just want to do a quick sneak peek. I'm not going to introduce everyone, but for you to get to know who's in the room. We have people from the health plan space. We have folks from the provider community working in Medicaid. We have a few startups who have been able to scale and get some advice on what it takes to scale in Medicaid.

And then we have some great experts who've been working in Medicaid states and have some good content. Adamica is going to help introduce them in a few minutes, but wanted to give a heads up as to who you'll be able to meet with today. So with that, we're going to get started because we have a lot we want to pack in and wanted to introduce you to Kinda, who has been working deeply in the Medicaid space for many years.

She knows everything about the 1115, managed care contracting, basically she's done a lot of strategic counsel, policy work. I'm not going to try and explain it. You'll see how great Kynda is, and so with that, I'll invite Kynda up to start us off. Hi, everybody. Thank you so much. I'm so happy to have you.

Everyone can hear me okay? Yeah? Okay. So what I'm going to do is, I've got about 15 minutes, and after my 15 minutes, we're done with the session of people talking at you, and then it's going to be super collaborative. I'm going to do like a 101 really quick, like three, four minutes.

For those of you who are new to Medicaid, but I doubt most of you are since you're in the room and you're all trying to figure out how this could be a potential place for you to enter. And then I'm going to start teeing up some issue spotting for tech companies interested in entering the market.

As Vinu said, my practice is about 65-70% representing Medicaid agencies around the country. But I also represent providers and tech companies and health plans. I'm going to do is, since we've done so much work advising tech companies on how to pick states to enter into, how to decide how they're going to get reimbursed, how they're going to contract and negotiate with Medicaid managed care plans and with states, I'm going to sort of do some level setting issue spotting for you so that when you enter the tables, you have some questions to begin to tee up with your subject matter experts.

Who are phenomenal. We really have a great room. Okay, so let me start with the basics. As you can tell, I'm a middle-aged woman, I'm right in front of the things so I can see the words, but just the overarching rules around Medicaid, it's a state and federal partnership. The way it works is the federal government sets the statute, regulatory, and sub-regulatory requirements.

Then, states implement the Medicaid requirements through a series of contracts. That could be through state plan amendments, through 1115 waivers, through other waivers. The way that it works is it's a little bit of mother may I, so the federal government sets the floor, states then say may I please do X, Y, and Z with my Medicaid program, feds agree, and then they get reimbursed.

For every individual enrolled in Medicaid, they get reimbursed based on who they are. So it's like running a Medicaid program, the state gets 50 cents on the dollar, feds pay 50, state pays 50. A child in a Medicaid program could get something like 65 cents from the feds, the remaining comes from state dollars, and if you're an expansion adult, feds pay 90 cents on the dollar, state pays 10.

That's how it works from a financing perspective. There are mandatory populations that Medicaid has to cover: age, blind, disabled, pregnant people, children, low-income parents, and then optional eligibility groups. The big one I want to put on your radar is expansion populations. These are low-income adults who are living their lives. That's a state option. Forty states, as of North Carolina, last week, ten days, now became the fortieth state to have it. Ten states don't. We'll talk about why that's important in just a minute. There's a set of mandatory benefits and optional benefits.

Mandatory benefits are your bread and butter benefits, like commercial plans, what's covered there, what you get through your employer. Then there are additional optional benefits that you can get permission to provide. And then there are things that are not in the statute, not in regulation, like social determinants of health services that are not on the table yet. States are getting 1115 waivers to get permission to draw down Medicaid dollars to do these services like housing, transportation, food, the things that you all know.

Okay. That's the basics. Why should you think about Medicaid? Well, I think you're in the room because you're really considering it, but let me state the obvious. It's the single largest source of healthcare for all Americans in this country. It's great to explore the commercial market, Medicare, but you can't ignore Medicaid as one of the most important markets in this country.

It's risen consistently year over year. It got a huge spike during the public health emergency during the COVID-19 pandemic. It's going to dip because we've had an unwinding based on states redetermining people, but that's going to level off in 2024, 2025. That's going to be your really big constant.

What we have to impart on you is that it's a huge program. 40 percent of all the births in this country are covered by Medicaid. 7 out of 10 low-income children and youth are on Medicaid. That's 70 percent of low-income youth in this country. It is something you can't ignore, and that number is going to keep going up.

I want to do a quick story about why it's important to understand how Medicaid is constructed. Every person gets reimbursed based on a percentage agreed on in the statute and regulation. Every person has a different eligibility level that the state applies. For example, I'm pregnant, married, have two kids. In New York, they'll apply a higher eligibility level for me as a pregnant person, around 200-250 on average.

For my husband, it'll be 138 in an expansion state. If not, he doesn't get health insurance. If I have two children, regardless of income, I'm likely eligible for Medicaid or the Children's Health Insurance Program.

Knowing eligibility levels is important for your clinical model. If your clinical product is entirely for adults, you won't go to a non-expansion state. If it's for low-income or pregnant people, look for states with higher eligibility levels.

That's the 101. Now, some issue spotting for you to tee up conversations at the tables. Most states deliver Medicaid through Medicaid Managed Care, about 80 percent. Connecticut and Montana don't have managed care, but you can deliver through fee-for-service.

If you're thinking about scaling, consider Medicaid Managed Care. States contract with managed care plans, which get a per-member per-month (PMPM) rate. Your entry point can be through natural provider billing or more innovative bundled arrangements.

You can also be an administrative contractor to the Medicaid Managed Care Plan, providing services like care management, quality services, network adequacy, and more. Think about opportunities to contract with providers in the Medicaid space as well. Now, we talked about contracting as a subcontractor with a Medicaid managed care plan.

Either as a provider, with your bundled, also as an admin, and I've even worked with tech companies that do both. They're trying to play the field a little bit, like, I think I'm going to be an admin contractor in this state, but I think I'm going to try to do just one set of services in this state, and it's all, the world is yours.

But if you want to do just the provider, I need to deliver the services directly one on one. Obviously, we have to enroll in Medicaid. Even if your contract is with a Medicaid managed care plan, you have to be enrolled as a Medicaid provider in the state you're in.

This is important. It seems baseline and obvious, but you have to figure it out. It's paperwork. The provider enrollment teams in state agencies, and if there's state agencies here, please don't judge me, are the red stepchildren of the Medicaid agency. They move a little slow, a bit like molasses, they're bureaucrats, but they are the reason whether you become a Medicaid enrolled provider or not.

You've got to provide your MPI, your license number, your address, and what's important here is if you're providing telehealth services, you need to understand if that state is reimbursing your services via telehealth, and with telehealth, whether it's happening through video or if it can be audio-only.

These are really important rules that you have to figure out from the telehealth space. In addition, you also have to know if you have to have a physical presence in that state. Some states say, you can be a telehealth provider, we're going to do full parity as though it's in person, and we're going to reimburse you for the services.

Other states say, we need an address, a brick-and-mortar address, in person. You also have to understand from a telehealth perspective if there needs to be a physical in-person referral. Some states have it, some states don't. I've seen some states that say, you can do video-only telehealth, but you also then have to be able to make a referral for in person.

I also want to put on your radar that some states let you enroll as a Medicaid managed care provider. New York is a great example. California, for some types of providers, where you don't have to go through the Medicaid agency. You have to go through the Medicaid agency, but you can just do the Medicaid managed care route. Just wanted to put that on your radar.

How am I on time? Good. Okay. So I'm going to now hit through four quadrants of evaluation that we put forward. These are a bit basic, but they're issue spotting to get the juices flowing for your conversation around the table. When you're talking to your Medicaid managed care company and you're interested in saying, it's time for us to have a conversation.

I really want to tell you my value, my clinical model value. You need to begin to articulate what it is that you bring to the table. You're not going to necessarily meet all four of these things, but it's important for you to think about as you're trying to demonstrate what you bring.

First, let's talk financing. When you're contracting as a provider, Medicaid managed care plans are looking, remember, PMPM, they're looking to make sure that they're providing quality care within cost containment. Your thumb rule is that you have to come to the table with your contracting plans.

In a way that you're showing that you're bringing value, advancing quality, and helping that plan contain its costs. When you're thinking, and we talked a little bit about this before, you have to evaluate what's your clinical reimbursement model. Are you going to do fee for service? An alternative payment arrangement? A bundle payment? That's part of the conversation. The more innovative you are, the faster you should go to the chief medical officer. If you're more traditional, go right to the provider enrollment division in the Medicaid managed care plan.

Think about how much you have to sell yourself. How different are you than just your traditional provider offering Medicaid services? You're going to say, how much am I going to get reimbursed? Medicaid managed care reimbursement rates are not the highest, but consider what you can provide in terms of volume and alternative payment arrangements.

To see what you can get reimbursed, look at the fee-for-service rates. They are publicly available. Medicaid managed care plans do not post their reimbursement rates for providers right now. There's a proposed rule that we expect to be finalized in 2024, requiring all plans to post rates for behavioral health, physical health, OBGYN, and a specialty service of the state's choice.

Now, number two. What is it that you do that will advance the clinical priorities of the state Medicaid agency and the Medicaid managed care plan? State Medicaid agencies prioritize care quality, and it's crucial to align with their priorities.

Quality measures, HEDIS measures, and performance improvement projects are part of the conversation. This helps you demonstrate how what you're doing brings value to the Medicaid Managed Care Plan, aligning with the state's overall priorities.

Now, onto access to care. Network adequacy is crucial in Medicaid. It's one of the federal government's highest priorities. The proposed rule adds new network adequacy requirements, stating that states have to ensure appointments are made within a certain number of days for physical health, behavioral health, OBGYN, and a specialty service of the choice.

If what you offer helps alleviate workforce constraints and meet provider access standards, you are in a great negotiating position. Finally, consider how members navigate Medicaid managed care. Member access and navigation matter and will be evaluated through star quality measures in the proposed rule to be finalized.

That's it. Thank you so much. I'm going to pass it to Adamika Arthur. Thank you so much.