Cristal Gary, MPP, FACHE

This is a period of considerable uncertainty in health care. Congress continues its efforts to repeal and replace the Affordable Care Act, roll back the Medicaid expansion and potentially block-grant funding to states. State governments continue to deal with fiscal pressures related to their own budgets and target health care for potential cost savings. This leaves many Medicaid stakeholders wondering what changes will ultimately occur and the impact on their organizations and overall access to care.

Uncertainty poses serious challenges and risks for those within the health care industry. Due to the size of both the Medicaid population and spending the program can have a significant impact on the healthcare ecosystem in most states, even for providers that do not serve a large number of Medicaid patients. How should health plans, hospital systems or community-based organizations approach their budget and strategy development with so many unknowns?

Medicaid is no stranger to uncertainty. Changes in political leadership and policy priorities are ongoing realities for a government program that makes up 1/4 to 1/3 of most State budgets. It's important to keep in mind that states hold, and will continue to hold, most of the responsibility and control for their Medicaid programs. The ACA was widely recognized as the most influential piece of healthcare legislation in the past 40 years, yet it accounts for a small percentage of total Medicaid beneficiaries and budgets. That’s not to belittle the uncertainty created by the expected repeal of the ACA. There will be significant disruption, particularly for those states that adopted the Medicaid expansion and ACA exchanges. However, there are many realities that won't change for State Medicaid programs regardless of what happens in DC. Here are a few trends for those who work with Medicaid programs to keep in mind:

The need for better value from managed care Nationwide nearly 46 million Medicaid beneficiaries (just under 60%) get their health coverage through private managed care organizations (MCOs) As Medicaid programs rely more heavily on MCOs, they are increasingly challenged to ensure that they are getting value out of these plans. States need more sophisticated systems for monitoring and holding MCOs accountable for network adequacy capacity and access; population management and coordination of care; strategies for improving quality of care; and performance improvement.

Several states are also actively moving beyond managed care and implementing Medicaid accountable care organizations as ways to provide better incentives for providers and systems to manage care and improve quality through risk sharing and other alternative payment arrangements.

Better integration of behavioral health Individuals with behavioral health needs make up a significant number of Medicaid beneficiaries and tend to have poorer health status than the general population. The nature of their conditions often results in difficulty finding and accessing traditional health care providers able to meet their physical health needs, which further complicates their care. This is not only harmful to these patients’ health but also can result in increased costs. State Medicaid programs will continue to pursue strategies designed to better integrate behavioral and physical health care in order to improve access and outcomes for the behavioral health population.

Strategies to address social determinants of health The Medicaid program serves a population that is both poorer and sicker than the general population, including a disproportionate share of individuals with chronic, behavioral and long-term care needs. One of the most significant opportunities to improve outcomes and reduce costs in these areas lies in our emerging understanding of the role social determinants have on health status, health care costs and quality. When people don’t have access to adequate food or housing, healthy air or water, they have very little chance of being able to achieve or maintain health. In order to prevent and effectively treat chronic conditions like diabetes, asthma, heart disease and even cancer, we need to make sure people have an environment conducive to health.

Yet, State Medicaid programs have very little ability to address the social determinants that drive 2/3 of health status, even as they are increasingly responsible for providing the full spectrum of medical, behavioral and long-term services and support needs that occur as a result. As more states design holistic approaches to address the social determinants of health, the federal and state administrative structures, as well as providers and external stakeholders, must evolve and develop the necessary capacity and systems.

Aging population Medicaid currently pays for nearly 40 percent of the nation’s long-term care expenses, and that is expected to rise by nearly 50 percent by 2026. The senior and disabled populations are the largest expense in state Medicaid budgets and the expected growth in older adults is a serious concern for states. There is significant need to restructure and strengthen the systems that can allow individuals to age-in-place, such as home and community-based services, “smart homes” and other technological advancements designed to aid aging individuals, and telemedicine to increase access to geriatric care.

Prescription Drug Costs Prescription drugs represent one of the fastest growing line items in Medicaid budgets. States are increasingly concerned about the dramatic growth in prescription drug expenditures, and the statutory limitations they face in addressing this growth. Medicaid programs need better tools to manage their prescription drug spend, including tools to assess the comparative effectiveness of prescription drugs, better transparency of information on prescription drug costs and pricing, and better utilization management strategies.

Cristal Gary, MPP, FACHE

Chicago, Illinois, United States 2K followers 500+ connections

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Centene Corporation

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University of Chicago

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Economic Club of Chicago

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