How Oregon, Nevada Drive Change Through Medicaid Contracts
Oregon and Nevada are among the states pioneering new ways to use Medicaid managed care contracting to pursue whole-person health initiatives. During a recent webinar hosted by Manatt Health, leaders from the two states discussed their strategies.
Mandy Ferguson, a senior manager in Manatt’s Washington, D.C., office, led off the discussion by noting that states are more frequently requiring Medicaid managed care organizations (MCOs) to screen, refer and coordinate members’ social needs as part of an overarching care management strategy. With many states facing homelessness crises, housing was by far the most common drivers of health domain to be addressed in contracts, showing up in all 15 states Manatt recently reviewed. “We also saw that all 15 states had requirements related to health equity. Some states have gone really far to have innovative and progressive requirements related to housing or health equity and some states are just starting to scratch the surface,” she said.
Lori Coyner, senior Medicaid policy advisor to the Oregon Health Authority and former director of Oregon’s Medicaid program, noted that the state has been working on the drivers of health for several years. “It's been incremental. You have to start somewhere, and then just keep building on your initiatives and lessons learned and, and continuing to move work forward,” she said. “We started this work really vigorously back in 2012, so we've been at it for 10 years, working on the concept of health-related services — services that the Coordinated Care Organizations [CCOs] could pay for to improve members’ health, particularly social drivers of health.”
She said that one of the big things they learned was that the Coordinated Care Organizations (CCOs), which are the state’s version of Medicaid ACOs, needed some financial incentives to make investments in health-related services. “We looked closely at our [Medicaid] waiver and made some changes,” Coyner said. “We more clearly defined health-related services and then provided some mechanisms so that if a CCO invests in health-related services, those services count in their medical loss ratio. That would be one example of a financial lever that we used. We also established a performance-based reward system that allows the state to set a variable profit margin for CCOs based on their health-related service spending and some other aspects of cost and quality.”
Oregon also has an incentive metrics program, Coyner explained. “For 2022, we pay out 4.25 percent of the CCO’s budget in incentive metrics. We have three metrics that are related to equity and social drivers of health. They have taken a long time with a lot of coordination between the CCOs to get those over the line. One, for example, is meaningful language access to culturally responsive healthcare services. Having that financial backing behind the work that you want CCOs to do is really important. We're really working to expand the scope of housing and nutrition services. We have a strong focus on building health equity and improving health equity across Oregon and improving access to Medicaid services.”
After meeting some minimal financial standards, the CCOs must spend a portion of their net income or reserves on services to either address health equity or social determinants of health. That spending must align with a Community Health Improvement Plan. “A CCO has to develop a community health improvement plan and update it every year,” she explained. “It has to be in collaboration with our community advisory councils, and the community advisory councils must include at least 50 percent Oregon Health Plan members and, and so they have a large stake in thinking about what the improvement plan looks like.”
For example, Columbia Pacific, which is a small CCO in the northern part of Oregon on the coast, increased tenancy sustaining services through remediation of safe housing conditions. They worked with their housing partners to identify members and others who need remediation to keep their homes safe and healthy.
Stacie Weeks, J.D., deputy administrator of the Nevada Department of Health and Human Services Division of Health Care Financing and Policy, said the effort in Nevada really leverages the purchasing authority to drive change. “It wasn't necessarily legislatively driven, it was very much driven by the administration, and pushing through that purchasing authority in the last procurement, which is exciting,” she said. “One of the biggest things that we're most proud of in the state is the effort around community reinvestment. In our new contracts, we are requiring annually that 3 percent of all pre-tax profits to the MCOs have to be reinvested in their communities into community organizations. This effort has to be tied back to their population health strategies — trying to connect those dots and make sure that the funding is going into the organizations that are trying to address some of these social determinants of health is really exciting.”
Weeks said one piece that was legislatively driven that ties to this work has to do with the community reinvestment advisory committees. The Nevada legislature asked that the state establish advisory committees. “We just kicked off our first advisory committee, which will be advising the health plans and making recommendations about where to put the investment, especially around social determinants of health for housing and other needs in the community. We just had our first meeting in June. At the end of the year, there'll be making recommendations to the health plans.”
She added that a care management program has really been strengthened in the last procurement. It requires and prioritizes the homeless population and justice-involved populations, and allows for plans to put together a multidisciplinary team approach to care management. “So it's not just the case manager, it includes the community health worker and also peer support specialist,” Weeks said. “These individuals are really helpful with the homeless population especially. We prioritize these populations, regardless of whether or not they have presented initially with a medical or mental health or substance use condition. Just being homeless, in and of itself, qualifies them for case management and care coordination services. I think that is good work, and we're early in the stages of this work. We're excited to see what the results might be.”
She said at least three of Nevada’s plans offer some sort of jail transition benefits — connecting folks with employment, job placement, housing, and life skills. “We're also looking at a financing strategy of how to take some of the transitional housing and other services and make them in lieu of services,” Weeks said. “That way, it is going to be covered as part of the capitation payment similar to what California is doing. We are learning from other states. That opens the door to help for MCOs to cover even more services.”
On the quality side, she said Nevada is just starting to stratify its metrics by race and ethnicity, “which I think will really give us a different look at our performance improvement programs," Weeks said. "And we are just starting a pay-for-performance program that we hope to eventually look at metrics by race and ethnicity as well.”
