3 care-guiders OK’d for Medicaid group

Three companies have been approved by the Arkansas Insurance Department as provider-led managed-care organizations for Medicaid recipients who are developmentally disabled or mentally ill, Insurance Commissioner Allen Kerr said Monday.

The approved companies will be part of a multiphase effort to reduce the cost of caring for about 30,000 Medicaid recipients with expensive health needs.

Arkansas Advanced Care, one of the approved companies, is owned by The University of Arkansas for Medical Sciences, Arkansas Children’s Hospital, Baptist Health, Arkansas Blue Cross and Blue Shield, and Fort

Smith-based Bost Inc.

The other companies are Arkansas Total Care, owned by St. Louis-based Mercy health system and insurer Centene, and Empower Healthcare Solutions, whose owners include Boston-based Beacon Health Options and Kirksville, Mo.-based Preferred Family Healthcare.

“We know it’s little bit of uncharted waters, but we’re willing to get into it because we think it’s important to the state and important to us,” said Austin Gaines, vice president of government relations for Mercy.

Two other companies have applied for certificates but had not met all the requirements as of Monday, Insurance Department spokesman Ryan James said.

Under the first phase of the managed-care effort, which starts in February, the Medicaid program will pay the providers $173.33 a month for each recipient whose care the company coordinates.

In 2019, the companies will take over responsibility for covering all of the recipients’ health care needs in exchange for larger payments from the Medicaid program.

Those payments, funded by federal and state money, will be subject to the state’s 2.5 percent insurance premium tax, allowing the state to recoup some of what it pays out.

Medicaid recipients who will receive the care coordination include about 22,000 Arkansans with significant mental illnesses and about 8,000 Arkansans with developmental disabilities.

The state Medicaid program, which has a budget this year of about $7.6 billion in state and federal funds, spends about $1 billion a year on medical care and other services for those recipients, Department of Human Services officials have said. The federal government pays about 70 percent of the cost for services for most recipients, with the state paying the rest.

Although the Human Services Department doesn’t have an estimate of the savings it expects the initiative to produce, “we just know that better care coordination and improved patient care will save dollars,” spokesman Brandi Hinkle said.

Act 775, passed by the Legislature this year, requires the managed-care companies to be at least 51 percent owned by health care providers, to contract with providers across the state and have at least $6 million in reserves.

The individual care coordinators must have a caseload of 25 or fewer Medicaid recipients and meet with each one at least once a month, according to the program’s rules.

The coordinators must obtain treatment plans from each of the recipients’ health care providers and identify gaps and unnecessary duplication in the services provided. They must also follow up with a patient within seven business days of a discharge from an emergency room or urgent care clinic.

The provider-led managed-care companies announced their plans to participate in letters to the Insurance Department in June.

According to Arkansas Advanced Care’s letter, Arkansas Blue Cross and Blue Shield owns up to 49 percent of the

company, with the health care providers owning the remaining share.

Arkansas Total Care listed its provider owners as Mercy, which owns hospitals in Arkansas, Kansas, Missouri and Oklahoma, and LifeShare, a Centene subsidiary that provides services to the developmentally disabled.

In addition to Beacon Health Options and Preferred Family Healthcare, Empower Healthcare Solutions said in its letter that its owners include Woodruff Health Group, which was “created to hold the interest of ARcare,” a community health network that includes 36 clinics.

The company’s other owners, according to the letter, include the Arkansas Healthcare Alliance, which is made up of mental health and developmental disabilities service providers; Statera, made up of two companies, Ascribe and Ascribe Health Partners, that own more than 100 nursing homes in Arkansas; Independent Case Management, which serves the developmentally disabled; and Arkansas Community Health Network, a coalition that includes Baxter Regional Health System, North Arkansas Medical System, Unity Health and White River Health System.

The companies that have not yet met all the requirements are Forevercare, owned in part by Pittsburgh-based Gateway Health Plan, and the Arkansas Provider Coalition, which, according to that company’s letter, includes more than 70 providers of mental health and developmental disabilities services.

Amerigroup, a subsidiary of Indianapolis-based Anthem, is also an owner of the company, according to the letter.