Lawmakers mull $69M funding hike for Medicaid
New Mexico lawmakers will enter the 30-day legislative session Tuesday without complete information on Medicaid — one of the largest parts of the state budget.
A joint state and federal program that provides health coverage for low-income Americans, Medicaid constitutes a third of the new money state officials are requesting during this year's session. Yet for years, lawmakers have been unable to get up-to-date information about the population served by the program, what types of health care services they receive and the effectiveness of those services.
This session will be somewhat of an exception. The state Human Services Department in 2013 added new performance measures to the program in an effort to track health care outcomes and hold the program more accountable. But observers say there's still a lack of data.
Staffers for the Legislative Finance Committee wrote in the department's performance report that some measures "are difficult to track" because health care providers have up to 120 days to submit claims data that would show what services they provided to Medicaid patients.
Lawmakers will be deciding whether to appropriate millions of additional taxpayer dollars for the $5 billion program, which continues to grow under the federal health law. And one key legislator is frustrated by a lack of information on the amount of state money that goes to Medicaid patients' insurers.
State Sen. Gerald Ortiz y Pino, D-Albuquerque, who chaired the interim Legislative Health and Human Services Committee, said lawmakers don't have access to the "capitation rate" for managed care organizations, a reference to the percentage of taxpayer money insurers are paid in advance to cover their Medicaid patients.
"The whole thing is just obfuscation," Ortiz y Pino said. "I think HSD knows to the penny how much they paid the MCOs. This should not be an issue."
A spokesman for the department did not reply to a request for a response to the lawmaker's comments.
While some Republican governors across the nation rejected a federally funded expansion of Medicaid under President Barack Obama's Affordable Care Act, Gov. Susana Martinez opted to expand and revamp the program in New Mexico, now called Centennial Care.
The Human Services Department administers Medicaid by distributing funds to managed care companies -- UnitedHealthcare, Blue Cross Blue Shield of New Mexico, Presbyterian Health Plan and Molina Health Care of New Mexico-- so they can reimburse doctors and other health care providers for treating Medicaid patients.
The four managed care companies compete for Medicaid patients under some of the most costly state contracts.
State policymakers aimed to reduce the program's costs by emphasizing preventive care, which ideally would cut costs down the road for expensive treatments and hospital stays.
But legislative policy analysts noted in the recent performance report that the state is now paying more per Medicaid patient than it did before Centennial Care was implemented because "planned cost-saving measures were delayed." Human Services Department data show emergency room visits per 1,000 Medicaid patients decreased by one point -- to 41 ER visits per 1,000 patients in 2015 from 42 in the previous year. The department's target is 40. The rate of hospital readmissions for adults within 30 days of being discharged was 8 percent in 2015, down from the previous year's rate of 11 percent.
Another problem for analysts in evaluating Centennial Care is that the program delivers services under one sweeping agreement with the federal government. The state previously delivered mental health services and physical health services to Medicaid patients under separate agreements. Now, legislative analysts wrote in a recent report, they can't distinguish how much the state is paying for each type of service for a patient.
Managed care organizations provide information on patient outcomes in the form of "health care effectiveness data information sets" -- HEDIS. In a 2015 accountability report, legislative analysts wrote that tracking Medicaid data, such as the cost of treating a patient each month, "is one way of gauging the effectiveness of the Medicaid program."
However, they said, "This is the first set of HEDIS data for the Centennial Care program and we do not have historical data to compare with. HSD has also not established targets for these measures. The data do reveal a notable lag behind available national measures." Still, the report said there was a lot of variation among the managed care organizations.
Cathleen Willging, director and senior research scientist at the Pacific Institute for Research and Evaluation, who has studied the state's mental health system for the federal government, said the lack of data on Medicaid claims "sounds like a recurring problem" decades in the making.
Officials need to get aggressive in filling data gaps in the program, Willging said. "Claims data is really important to analyze the behavioral health system and other public sector systems."
As many state agency budget requests remain flat, Human Services, is requesting an additional $69 million to fund the expanding Medicaid program. Most of that will cover the costs of a decreasing federal match. The government originally funded 100 percent of the state's Medicaid expansion under the Affordable Care Act, but will begin stepping down its contribution.
Next year, the federal government will contribute a 95 percent match.
The increased Medicaid enrollment comes at a cost of "over a billion in state funds each year," the governor's budget recommendation says. Total costs of the program are projected to reach $7 billion by June 2017, when state officials project more than 900,000 New Mexicans, nearly half the population, will be enrolled.
Currently, more than 820,000 New Mexicans, roughly 40 percent of the state's population, receive health coverage through Medicaid. While officials hoped about 150,000 previously uninsured patients would enroll under the expanded Medicaid eligibility rules, Human Services says 220,000 adults have signed on to Medicaid in the past year and a half.
During that time, number of New Mexicans without health insurance dropped by 7 percent, according to the Governor's Office, one of the highest declines in the nation.
Advocates of the Medicaid expansion, such as Bill Jordan of New Mexico Voices for Children, worry that the department will have to cut services to keep up with the enrollment demand.
"Both of the proposed budgets have over $100 million of cost containment built in," Jordan said of budget proposals by the governor and Legislature, "so they're already assuming they're going to find over $100 million in savings somewhere, so that means cuts to something."
Officials are hoping new preventive measures will lead to long-term cost savings.
"Expanded services, improved care coordination and initiatives to pay for performance should, in time, result in better health outcomes," legislative analysts wrote in Human Services's most recent score card.