October 21, 2011

Here’s a rundown of five Medicaid-related statistics released this week via several different official state sources…and why they matter as the Medicaid budget comes under fire once again:

1.92 million

What it is: The number of Florida Medicaid recipients currently enrolled either in managed care plans like HMOs (enrollment is mandatory in the five-county Medicaid Reform experiment) or the MediPass program, in which primary care providers perform that management function. These recipients are very low-income families with children and SSI recipients (both very low-income and disabled).

Why it’s significant:  This group is the portion (majority) of the Medicaid caseload that is most sensitive to changing economic conditions. The number of all such recipients peaked at 1.97 million in July and has decreased for 3 consecutive months.  Furthermore, current enrollment is only 1 percent higher than it was a year ago.

10.8 percent

What it is: The average increase for the coming year in capitated (per recipient) payments to be made to Medicaid HMOs for the care of recipients in the five-county Medicaid Reform experiment.

Why it’s significant: This compares with an average 1.3 percent rate increase throughout the rest of the state. HMOs explained the disproportionate increase as a function of hospital costs rising faster than actuaries had projected in the Reform counties.  More accurately, actuaries simply were not operating completely in the dark in Medicaid Reform for the first time since its 2006 launch, as “patient encounter data” that was to be used to set payment rates was at least available from hospitals. Even so, other types of encounter data aren’t available or aren’t ready, and the process for setting HMOs’ rates was once again an exercise in “sausage-making” that was completed months behind schedule. The upshot: the unknowns in Medicaid Reform continue to make statewide managed care expansion too risky.

$18

What it is: The average amount set aside for SSI recipients in Medicaid Reform (Broward County) to earn “enhanced benefit” credits as an incentive to perform healthy behaviors during the coming year.

Why it’s significant: One of the few pieces of the Medicaid Reform designed directly to benefit recipients rather than managed care plans was the provision allowing them to earn up to $125 worth of such credits each year. For the first time, the State is only reserving money to fund these credits based on past usage, taking millions of dollars that had been earmarked for recipients and giving them to managed care plans instead. Not only will this reduce opportunities for these patients with chronic health problems to earn credits, it creates a built-in incentive for plans to withhold credits when earned.

$933 million…

What it is:  The projected shortfall of state general revenue funds in Florida’s Medicaid program for 2012-13, according to state economists. The Legislature used short-term federal stimulus funds to replace far more long-term general revenue funding than necessary, putting the program and the Floridians who depend on it in a deep hole when those funds stopped flowing.

…and $135 million

What it is: The amount by which the state general revenue invested in Florida Medicaid four years ago exceeds the GR investment for this year.

Why they’re significant:  The Legislature has already warned that the shortfall will lead to another round of cuts to Medicaid in next year’s state budget. The appropriateness of such cuts as well as the continuing allegations that Medicaid spending remains out of control should be re-evaluated, not only in light of the fact that state GR funding for Medicaid is less in 2011-12 than in 2007-08, but also that that funding supports more than a million more recipients today than it did four years ago.

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