As the US population ages, it doesn’t take Nostradamus to predict that there will be an increase in demand for Long-Term Services and Supports (LTSS). With Medicaid currently financing approximately 50 percent of all LTTS, it is no surprise that states are increasingly turning to Managed Care Organizations (MCOs) to help manage the growing cost of these services. Today, 19 states offer Managed Long Term Services and Supports (MLTSS), and that number is expected to grow over time – this regardless of how the US healthcare environment might change (or not change) due to health reform.
While many MCOs are eager to participate in the program due to the profit potential, managing LTSS providers and services is not so easy. As one health plan executive commented during a recent conversation, “You see this gray hair? This is all caused by our LTSS providers.”
So what makes this portion of the healthcare pyramid so difficult to manage?
Fragmented market: The LTSS provider market is extraordinarily fragmented, being comprised of small “mom-and-pop” type businesses that provide home health and other services to individuals in need of LTSS. While there are a few national and regional players that exist (Addus, Rescare, to name a few), the delivery of this care is local and community-oriented. As such, the smaller organizations are ones that are most successful at engaging members.
Good ones lack business savvy: Unfortunately, the smaller organizations that tend to be better at management of their patients are usually the ones that are the least business savvy, with an imperfect understanding of how best to run a business. As an example, the prospect of moving from FFS payments by a single entity (the state) to multiple MCOs that are involved in MLTSS has proven to be challenging for these organizations. Many of them have struggled with making the change.
Lack of metrics and measures: There is no database to help health plans (or states) identify which LTSS providers are doing a really good job. Recognizing this, some states have launched initiatives to improve the quality of LTSS. Tennessee’s QuiLTSS initiative is one example. These initiatives are working on metrics and measures that will enable identification of high-performing providers. However, these programs are still in data gathering mode and the ability to identify good LTSS providers remains a significant gap.
Fraud Waste and Abuse (FWA): This area of Medicaid is particularly rife with fraudulent practices. Many states have tried different methodologies to reduce the waste, including electronic visit verification. However, the close patient-caregiver relationship lends itself particularly well to fraud. We have heard stories where patients will dial in their caregiver’s identification number because the patient was asked to do so, despite the lack of a visit. Controlling FWA continues to be a challenge for MCOs, and no one has cracked the nut on how best to tackle this large, expensive problem.
Managing LTSS providers will require health plans to do a few things:
Collect data on LTSS services: Collect information on member interactions, level of FWA, types of services offered, cost, etc. across the LTSS provider population.
Implement quality measures to manage providers: Consider which quality measures can be implemented to help manage the LTSS provider population.
Sculpt the network to deliver the best care to members: Develop a high-trust network based on the information available and continue to mold it over time as the data and quality measures evolve.
Figuring out how best to target and partner with providers to effectively deploy LTSS to members will serve as an ongoing challenge for MCOs and state-based organizations alike. Hopefully the initiation of QuiLTSS and similar databases will contribute to the reduction in appearance of gray hair amongst health plan executives.