DCHs Managed Care Plan Alters Traditional Medicaid Practices

By DJ Jeyaram

On July 15, 2006, the Department of Community Health (“DCH”) is scheduled to announce the winners of the Request for Proposal (“RFP”) process for its Georgia Cares managed care program.  Whoever the winners may be, Georgia’s managed care initiative heralds sweeping changes for Georgia’s health care providers and care maintenance organizations (“CMOs”) alike. 

Provider Networks

One of the most significant changes is DCH’s departure from its “any willing provider” enrollment philosophy. The RFP only requires the CMO to maintain a network of providers adequate to ensure access to all covered services while also complying with federal geographic and accessibility requirements. The RFP deviates from “any willing provider” in that it acknowledges the CMO’s right to deny enrollment to otherwise qualified providers. 

However, DCH requires the inclusion of “significant traditional providers” (“STP”) in the CMO networks. A STP is defined as “those providers that provided the top eighty percent (80%) of Medicaid encounters for the GCS-eligible population in the base year of 2004.” 

The RFP requires the CMO to include in its network all STPs in its service region for the first two (2) years of operation under the GCS contract provided that following requirements are met:

1. The provider agrees to participate as a network provider and abide by the provisions of the provider contract;
2. Agrees to accept the Offeror’s provider reimbursement rate for the provider type/class; and
3. Meets the Offeror’s credentialing requirements. 

Despite the seemingly mandatory inclusion of STPs, the above requirements grant CMOs significant leeway in contracting with STPs. As the Contract is currently drafted, if the STP and the CMO are unable to reach an agreement on a reimbursement rate, it appears that the STP need not be included in the CMO’s provider network. 

The RFP also includes provisions regarding particular categories of providers, including the following:

• Pharmacies. The CMO must maintain an adequate network of pharmacies to ensure pharmacies are available and accessible to all members.
• Hospitals. The CMO is required to include in its network all Critical Access Hospitals (CAHs) that are located in the particular service region. 
• Laboratories. The CMO must maintain a provider network of labs that ensures accessibility to all members.  The CMO must also ensure that the lab testing sites providing services under the Contract have either a clinical laboratory (“CLIA”) certificate or a waiver of a certificate of registration, along with a CLIA number pursuant to 42 CFR 49/493.3.
• Community Service Boards. The CMO is required to enroll all Community Service Boards (“CSB”) that meet the CMO’s requirements and are located in its service region.  Again, though it seems that the intent of DCH is to have all CSBs enrolled in the provider network, the language of the Contract allows the CMO to have more stringent requirements for enrollment than DCH and if the CSB does not meet the requirements of the CMO, the CMO may exclude the CSB from its provider network.
• FQHCs and RHCs.  The CMO is required to include in its provider network all federally qualified health centers (“FQHC”) and rural health clinics (“RHC”) in its service region. 
• Family Planning Clinics.  The CMO is required to make a reasonable effort to subcontract with all family planning clinics, including those funded by the Public Health Services Act.  These efforts must be documented and presented to DCH upon request.

Provider Rates and Payment

The RFP provides that in most cases CMOs may to negotiate rates with individual providers.  DCH recommends that CMOs pay providers on a fee for service basis, but does not require this. 

However, with regard to critical access hospitals, the CMO must pay a rate based on an allowable cost incurred by the critical access hospital in accordance with DCH’s Policies and Procedures. When the CMO negotiates with FQHC or a RHC, the CMO must pay rates that are comparable to other similar providers.

The terms “similar providers” or “similar services” are not defined in the RFP and leave some question as to the rates that are to be paid to these entities.  A reasonable expectation would be the prevailing Medicare rates associated with these entities. With regard to prompt payment to providers, the CMO is required to meet the Georgia fifteen (15) calendar days prompt payment requirement for a clean claim. 

Member Enrollment

The RFP provides that DCH will be responsible for member enrollment, including auto assignment of a CMO plan and disenrollment of members. If a member does not choose a CMO, DCH has developed an algorithm to “auto-assign” members to a CMO.

If the member does not have a family member enrolled in a CMO or does not have a previous service relationship with a provider, the member will be auto-assigned to the CMO plan with the lowest capitated rate in the service region. In the Atlanta region, no plan may have more than 50% of eligible members. In the other regions, no single plan may have more than 65% of the eligible members. 

Provider Complaint System

Another significant departure from DCH’s traditional practices involves the delegation of the provider appeals to the CMO. The CMO is required to establish a provider complaint system that allows a provider to dispute the CMO’s policies, procedures or any aspect of the CMO’s administrative functions, including proposed adverse actions by the CMO against the provider. 

Thus, the provider has broad rights under the RFP to challenge CMO policies.  Under the RFP, a provider has forty-five (45) calendar days to file a verbal or written complaint. The full scope of what types of issues that a provider can file a complaint against is unclear. Though, providers can expect more clearly defined guidelines in the contracts they may sign with each CMO.

The RFP mandates designation of a specific staff person to receive and process all provider complaints. The RFP includes no time frame for the investigation or resolution of a complaint, except where the “standard” timeframe would jeopardize the health or safety of a member and expedited review is required. If a provider complaint is not resolved in favor of the provider, and the provider may further appeal the decision to an administrative law judge.

Undoubtedly, the CMO’s contracting process with DCH and with Georgia providers will shed light and lend definition to the full extent of the changes in store for all parties involved.  Stay tuned for more.

For questions or comments about this article please contact the author, D.J. Jeyaram, at 404-995-6792 or dj@jeylaw.com.

About the Author

Deepak (“D.J.”) Jeyaram is the founder of Jeyaram & Associates, a full service health law firm.  He represents a wide variety of healthcare providers including hospitals, nursing homes and physician group practices. He concentrates his practice in healthcare regulatory matters, primarily in administrative appeals and Medicare and Medicaid reimbursement.

His prior experience includes working in-house with Georgia Medicaid, rising to the position of Deputy Director of Legal Services. Later in his career, Jeyaram was an Administrative Law Judge who presided over disputes between the Georgia Department of Community Health and Medicaid providers on issues involving reimbursement, utilization review and provider termination. Jeyaram received his bachelor’s degree, cum laude, from Boston University and his law degree from Emory University.
This article is presented for educational and informational purposes only and is not intended to constitute legal advice.

Jeyaram & Associates is conveniently located in the heart of Buckhead in the Pinnacle building next to Lenox Mall. For a map of the office location, please click here.

For a free consultation, call DJ Jeyaram at 404.995.6792 or send an email to dj@jeylaw.com.

Jeyaram & Associates | 3455 Peachtree Road NE | Suite 500 | Atlanta, GA 30326
Office: 404.995.6792 | Fax: 770.451.7195 | dj@jeylaw.com