Richard G. Stefanacci, DO, MGH, MBA, AGSF, CMD

Before the Affordable Care Act was enacted, state Medicaid programs were required to provide coverage to certain categories of low income people, such as children, pregnant women, the disabled, and the elderly. Childless adults under age 65 who were not pregnant or disabled were not required to be covered. A state could extend coverage if it wanted to pay the full cost. There have been wide variations in state Medicaid eligibility standards. For instance, in 2009, Medicaid eligibility thresholds for working parents ranged from a national low in Arkansas of 17 percent of the Federal Poverty Level (FPL) to a high in Minnesota of 215 percent of the FPL, leading to further concern about inequities in access to health care coverage.

Beginning Jan. 1, 2014, the federal government will pay 100 percent of the costs for expanding Medicaid up to 138 percent of FPL for those who are defined as newly eligible — people who would not have been eligible for Medicaid in the state as of Dec. 1, 2009, or were eligible under a waiver but not enrolled because of limits or caps on waiver enrollment.

This increase was expected to add some 17 million beneficiaries to Medicaid, but the Supreme Court has ruled that states can opt out of this expansion. Several states may decide not to move forward with the original ACA Medicaid expansion for political reasons or because of the anticipated financial and administrative burden.

Expected Medicaid enrollment increase

Source: Kaiser Family Foundation

For managed care organizations (MCOs), this change in Medicaid has three significant potential implications.

Depending on the state, there could be significant expansion in membership in Medicaid managed care organizations, but the exact amount depends on whether the state will expand its Medicaid program based on the ACA.

MCOs may have difficulty providing primary care physician (PCP) access for their members because of the increased burden of the Medicaid expansion as well as a shift of other uninsured people into managed care plans through state insurance exchanges. This may be most significant for Medicaid MCOs, given a recently published study in Health Affairs ( that found that 31 percent of physicians were unwilling to accept any new Medicaid patients, but this may shift, given the 2013 increase in Medicaid payments required by the ACA.

In the end, all MCOs will need to understand fully the implications of the ACA, especially with regard to the decrease in the number of uninsured people, as this will affect not only enrollment but provider access as well, which could have unintended consequences for MCOs.

Richard G. Stefanacci, DO, MGH, MBA, AGSF, CMD, is chief medical officer of the Access Group and a member of the Managed Care Editorial Advisory Board.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.