As North Carolina Moves Towards Medicaid Managed Care, Its Leaders Approach the Operational Issues

Oct. 11, 2017
As North Carolina moves to transform its Medicaid program into a managed care one, its operations leaders are tackling the process and IT challenges involved, notes Sam Gibbs, a speaker at the upcoming Health IT Summit in Raleigh

The state of North Carolina is progressively and actively working to reform Medicaid services and payment across the healthcare landscape.  That effort inevitably involves many layers and facets, from policy and payment elements, to very operational ones. How is that state’s government moving forward to make the interactions of physicians, clinics and medical groups, hospitals, and other providers, with state government, easier?

Between collaborative payer exchange initiatives, health information exchange (HIE) efforts, and other collaborative approaches, North Carolina is actively creating a network of collaboration between top providers across the diverse regions of the state.  But what is next for these programs?  Where will the state turn its attention next as we move forward?

One absolutely key element in the state government’s overall strategic plan is for the transformation of the North Carolina Medicaid program, with the aim of shifting it into a fully managed-care format, as most state Medicaid programs have been transformed or are in the process of being transformed. On Aug. 8, NCDHHS published its announcement of that plan, inviting public comment. In making that announcement, NCDHHS quoted Mandy Cohen, M.D., Secretary of DHHS, as saying, “We have put forward a detailed proposed design for a Medicaid managed care system that will deliver an innovative, whole-person-centered, well-coordinated system of care. We are grateful for the thoughtful insights provided by hundreds of health care professionals, beneficiaries and other stakeholders, and DHHS welcomes feedback on this proposal,” Dr. Cohen said.

As the announcement noted, “Medicaid managed care will be a significant change for the North Carolina Medicaid system. DHHS is releasing its proposed program design to ensure stakeholders have an opportunity to comment on managed care specifics.” “Our proposed Medicaid managed care program design reflects the specific strengths and needs of North Carolina,” said Dave Richard, deputy secretary for medical assistance, in that announcement. Richard noted that “[T]he proposed design supports: integrating services for physical health, behavioral health, intellectual and developmental disabilities, and substance use disorders; addressing unmet social needs and their effect on overall health; and building on and strengthening what is working well today, such as care management, while supporting providers and beneficiaries through any changes during the transition and beyond.”

Further, the announcement noted, “The proposal touches on a variety of topics related to the design and implementation of Medicaid managed care in North Carolina. The paper lays out a timeline for transition of key functions and highlights how managed care can meet the needs of complex populations (e.g., people dually eligible for Medicaid and Medicare). It discusses how certain aspects of today’s Medicaid program, like beneficiary appeals and care management, will transition under managed care. Further, the program design describes how providers and plans will contract with each other consistent with protections in North Carolina law, how data will move through the system, and how DHHS will hold plans accountable for meeting standards and delivering high quality care.”

Sam C. Gibbs, deputy secretary for technology and operations in the North Carolina Department of Health and Human Services (NCDHHS), and Charles Carter, in the Secretary’s Office, Technology and Policy, at NCDHHS, will share the innovative work that they and their colleagues are pursuing, on October 19, in a spotlight presentation at the Health IT Summit in Raleigh, sponsored by Healthcare Informatics, and to be held at the Sheraton Raleigh Hotel Downtown, on Oct. 19 and 20.

Sam Gibbs

And, in anticipation of that presentation, Gibbs spoke recently with Healthcare Informatics Editor-in-Chief Mark Hagland regarding the innovation taking place in North Carolina government right now. Below are excerpts from that interview.

What are the basic functions that the Technology and Operations division manages, within the Department of Health and Human Services?

In broad-stroke terms, the DHHS in NC has a $20 billion budget per year, and 17,000 employees, and we’re organized into about 30 different divisions that provide services to millions of North Carolinians, from traditional Medicaid health insurance and the services of the Department of Public Health, and the Department of Social Services (including temporary assistance for needy families, support for low-income families, jobs and vocational rehabilitation), the Department of Mental Health—and one of the larger departments is our Department of Health Care Facilities; we run three state mental health facilities, as well as alcoholism and addiction and other services; we’re a provider of services for millions of NCs in needs. And those services are organized under three different deputy secretaries. So we provide all the technology services, grant services, procurement services; it’s a technology and operations component, what my department does.”

What are the broad goals involved in this initiative, overall?

North Carolina is one of the last large states to have a FFS Medicaid program. Most of the other larger states have moved to Medicaid managed care; so that’s essentially what we’re doing. And our new Secretary, Dr. Mandy Cohen, is big on the concept of care for the whole person, so as we roll out Medicaid managed care, we want to roll out behavioral care for those individuals, as well as treatment with regard to the opioid crisis. So technologically, we need to migrate our services to managed care payments. So we’re inventorying our existing systems, and seeing which ones need to be tailored or modified for managed care, and on top of that, source new technological capabilities.

Our existing systems will remain for remaining fee-for-service payments. But we’re looking to see what’s available. And CMS is also encouraging states to go to more modular formats. Previously, you’d get one big MMIS system to support all big functions. They want us to go to a more modular system, and to the extent that we can use modular technologies for our Medicaid managed care program, which will be phased in by July 2019, we will do so. So from an IT perspective, we’re changing our payment model to go to managed care, but we’re also modernizing our systems overall.

Can you detail what you mean by modularization, in this context?

When we go to modularization, CMS calls it Medicaid enterprise systems, and they created a standard called “MIDA”—it breaks it down into individual components, so there’ll be a component for managing contracts with providers, a component for managing Medicaid managed care payments, etc. Each component theoretically could be modified over time, so you could modernize in smaller components.

Have you been consulting with Medicaid leaders from other states, as you move forward? And if so, what have you learned from them?

Yes, we’ve been talking to a lot of the other states. Our neighbor to the west, Tennessee, has been pretty successful with this, and we’ve been consulting with them. What we’ve been hearing is that it’s harder than it looks, and you need to make sure you have both a comprehensive plan to roll out, but also that you need contingencies. People have turned the lights off in one room and turned them on in another, and found that there are pitfalls. So having good, solid migration plans is key. And early on, build partnerships with all the stakeholders, including the providers. And we’re calling our provider partners PHPs, preferred healthcare providers. And we produced a 70-page document this summer on what we anticipate managed care to look like. And the other states said, make sure you get as many people on the train as possible before you start going, so we’ve been doing that.

What has the response been from providers, to the announcement of this initiative?

One of the things you consistently hear about is the administrative burden. And as we transition from paying claims to taking capitation payments, the doctors want to make sure they don’t have twice as many tasks to do. And we’ve taken that to heart, so we’re spending a lot of time on our data structures; and we’re going to try as much as possible to have the downstream folks be able to send their information to just one source. And we’re building a roadmap with our statewide HIE; and we’re hoping in three to five years that we can use them as a gateway of sorts.

What should the HIT leaders reading this be thinking and doing right now?

We are endeavoring to make this as seamless as possible for the provider community, because at the end of the day, we’re serving the most vulnerable members of our population. And beneficiaries will have a new card for their services, but we want them to see their same physicians and have access to the same services before. And so instead of the provider community submitting claims to the state, they’ll submit claims to the PHP. And from the perspective of the PHP to the state, we’re working collaboratively with them to make sure we have the systems in place and the data working, to be as seamless as possible. And we won’t be paying directly, the Preferred Health Plan—PHP—will be.

And next spring, we’ll be starting a bidding process for providers to become preferred health plans--PHPs. We want to give beneficiaries choice; right now, you enroll in Medicaid, and there’s only one option. But there’s been interest from providers that offer services out of states. And a physician group is putting an organization together. So we anticipate that in every geography, beneficiaries will have three or four separate plans to choose from. Now, the minimum set of benefits will be mandated; but we hope providers will be able to some enhanced services as well, so that’s going to be new. We want to give beneficiaries a choice of plans. So we’re offering a little bit of choice of providers.

You’re using the term ‘PHP’ to indicate both a plan and a provider?

Yes, that’s correct. A lot of the providers have expressed an interest in providing a cooperative plan themselves. So we’ll have a number of PHPs then.

Is there anything you’d like to add?

We’re looking forward to putting this new Medicaid transformation plan into process. And we’re excited about working with our existing technology vendors to put together a state-of-the-art system, that will meet their needs.