Medicaid patients headed to HMOs Legislation to save state money, ensure school clinics survive

April 10, 1996|By Diana K. Sugg | Diana K. Sugg,SUN STAFF

The General Assembly put its imprint on a sweeping health care bill this week, finalizing a detailed plan that will shift tens of thousands of Maryland's poor into HMOs -- and save the state hundreds of millions of dollars.

The legislation lays out how Medicaid patients will get their care. And its specific words will shape which clinics, health plans and physicians get a shot at millions of dollars -- and one of the last untapped markets for health maintenance organizations.

One of the key provisions would ensure the survival of school-based health clinics that have been major sources of care for children in the Medicaid program. Another provision would toughen quality requirements for HMOs that want to serve Medicaid patients.

Almost every state is making a similar move to control Medicaid costs and make sure the poor have access to physicians and coordinated care. In Maryland, although the $2.3 billion Medicaid budget consumes a fifth of the state budget and is growing at 10 percent a year, many people on Medicaid don't have physicians and end up going to the emergency room for a sore throat.

Instead of being able to visit any doctor or hospital, Medicaid recipients will be required to have all their medical care coordinated by HMO doctors and staff. The legislation, however, would initially guarantee that doctors who have been taking care of Medicaid patients could continue for at least one HMO.

The change in Medicaid programs is a microcosm of the revolution shaking the country's health care system.

While many private employers have moved their workers into managed care, or HMOs, the government is just beginning to do the same for the poor and disabled in Medicaid, and the elderly in Medicare.

The move into managed care raises thorny issues for Medicaid recipients, whose poverty and social problems may make it difficult for them to navigate the HMO system. And, like other Americans, they may lose longtime doctors and struggle to adjust to a system with more restrictions on specialists and tests.

"I am worried about the quality," said Melody Fulton, 39, a Baltimore resident and Medicaid recipient who served on a steering committee that developed the proposal.

"You can't go where you need to be. Instead, you have to go where they tell you to."

Protecting patients

Lawmakers inserted provisions in the legislation to protect Medicaid patients, creating an ombudsman who will serve as an advocate for patients and help resolve disputes with HMOs, and establishing economic penalties for health plans that don't remind their patients to get preventive services such as immunizations and Pap smears.

They also agreed to next year consider adding dental services for adults to the list of required health benefits.

Lawmakers held long hearings, listened to dozens of people testify and battled down to the last day. At the heart of the debate was one question: Who should care for the poor? For generations, mostly small clinics and neighborhood doctors have seen these patients. Now, large, for-profit HMOs are getting involved.

Fight over standards

Monday's heated discussion among negotiators from the House and Senate showcased this tension, as they fought over whether the community clinics -- which want to form managed care plans so they can continue to care for Medicaid patients -- would have to meet the same rigorous financial requirements as bigger HMOs.

Clinic advocates said those standards were too high. And Sen. Larry Young, a Baltimore Democrat, didn't want the clinics to have to subcontract with the large HMOs.

"The little person is going to be cared for by the place that's cared for them for the last 20 years," he said.

"These big insurers never cared about the poor before."

But HMO officials said creating a lower standard would pose a risk for taxpayers should one of the new plans go bankrupt.

Lawmakers decided to leave some leeway for the clinics by allowing the state Department of Health and Mental Hygiene to come up with $250,000, and possibly more, of the $1.5 million solvency requirement for these new plans.

The move should help ensure the survival of clinics and other health agencies that care for the uninsured. That's crucial, because if the 714,000 people without health insurance don't have somewhere to go to see a doctor, more will show up in costly hospital emergency rooms -- and the general public will have to foot the bill.

State officials pleased

State health department officials say they're happy with the legislation. Now the agency must get federal approval of its plan to move more Medicaid patients into HMOs.

Roughly a quarter of the state's 467,000 Medicaid recipients are voluntarily enrolled in HMOs. Another 220,000 -- mostly women and children -- will gradually be phased into managed care plans in January 1997.

The remainder of those in the Medicaid program, elderly and disabled who receive both Medicaid and Medicare, and those who are in nursing homes, will be moved into HMOs in the future. The planning for that is just beginning.

Pub Date: 4/10/96

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