Introduction

Purpose

The purpose of this manual is to provide policies and procedures for the Prepaid Minnesota Health Care Program (PMHCP).

The PMHCP is comprised of:

· PMAP: Prepaid Medical Assistance Program

· PMCRE: Prepaid MinnesotaCare

· MSHO: Minnesota Senior Health Options

· SNBC: Special Needs BasicCare

· PIN: Preferred Integrated Network

This manual may be useful to:

· Minnesota counties

· American Indian Tribes

· Department personnel

· Contracted MCOs

· Others involved in administering the PMHC Program

The PMHC Program is a cost-effective managed care alternative to a fee-for-service system. This Program authorizes the Commissioner of the Department of Human Services (DHS) to select medical vendors to provide the most economical care consistent with high medical standards and, where possible, contract with organizations on a prepaid capitation basis. This program demonstrates the viability of a care management/preventive approach to meeting the medical needs of the MA, NMED, and MinnesotaCare populations. The program also assists the Department in developing a network of providers who are willing to work in partnership with the State to provide quality care management services to MA, NMED and MCRE enrollees.

Authority

· PMAP: MN Statutes, 256B.69 and MN Rules, parts 9500.1450 to 9500.1464

· PMCRE: MN Statutes, 256L.12

· MSHO: MN Statutes, 256B.69, subd. 23

· SNBC: MN Statutes, 256B.69, subd. 28

· PIN: MN Statutes, 245.4682, subd. 3

The Medicaid Managed Care Regulation 42 CFR 438 implemented provisions of the Balanced Budget Act of 1997 (BBA) for the programs listed above.

Federal Waivers

The Centers for Medicare and Medicaid Services (CMS), has granted Minnesota several waivers of Title XIX of the Social Security Act (SSA) to allow implementation of this program. The Department is seeking federal authority to continue the prepaid program on a permanent basis. Under the authority of section 1115(a)(1), the following waivers of provisions of the SSA are in effect to enable the State to carry out the project.

· Section 1902(a)(1) of the SSA as implemented by 42CFR 431.50 and 434.25(a)(2). This waiver exempts the State from the requirement to administer medical assistance uniformly on a statewide basis.

· Section 1902(a)(23) of the SSA and 42 CFR 431.51. This waiver permits the State to restrict the recipients’ freedom-of-choice of provider.

· Section 1902(a)(30) - as implemented by 42CFR 447.361 and Section 1902(a)(4) - as implemented by 42CFR 434.23. This waiver permits the State to prepay for 90 days of nursing facility (NF) care, and vary payment methodologies to provide quality improvement incentives.

· Section 1902(a)(10) of the SSA and 42CFR 440.240(b). This waiver allows differences in the amount, duration, and scope of benefits provided to recipients.

· Section 1902(a)(4)(A) - as implemented by 42 CFR 431.806(a), 431.810-431.816, 431.820-431.822, and 431.865. Section 431.804 is also waived, except that the regulatory definitions of “claims processing error” and “state agency” shall continue to be applicable to the State. “Claims processing error” should also apply for a service not authorized under the terms of the demonstration. This waiver enables the State to employ a Medicaid Eligibility Quality Control (MEQC) system which varies from that required by the cited statute and regulations.

Under the authority of section 1115(a)(2) of the SSA, expenditures made by the State for the items identified below (which are not otherwise included as expenditures under section 1903) shall, for the period of the project, be regarded as expenditures under the State’s Title XIX plan.

· Expenditures for capitation payments provided to managed care organizations which restrict enrollees’ right to disenroll within 90 days of enrollment in a new MCO, as designated under Section 1903(m)(2)(A)(vi) and Section 1932(a)(4). Enrollees may change managed care organizations once within the first year of enrollment, and annually thereafter.

· Expenditures for prepaid capitation payments to non-health maintenance organizations, as designated under Section 1903(m)(2)(A)(i) and 42 CFR 434.20.

· Expenditures to permit Medicaid coverage to children through age 20 and pregnant women with incomes at or below 275 percent of the Federal poverty level, who would not otherwise be eligible for Medicaid.

· Expenditures to permit Medicaid coverage to parents and caretaker relatives of children who are enrolled in this demonstration or under the Medicaid State Plan with family incomes at or below 275 percent of the federal poverty level who would not otherwise be eligible for Medicaid.

· Expenditures for medical assistance provided to medically needy Medical Assistance recipients who are enrolled in this demonstration, who are determined to be eligible for a 12-month period, and who are in recipient household either only receiving unvarying unearned income or income solely from a source which by law cannot be counted as income, to the extent that these individuals would have been ineligible for Medicaid had the State determined their eligibility under a budget period of not more than six months under 42 C.F.R. 435.831(a)(1). This authority will permit FFP in expenditures for these individuals whose ineligibility for reasons other than income might have been detected had they been subject to the normal budget period rules.

· Expenditures to permit Medicaid coverage to families enrolled in the demonstration who have received extended assistance under Section 1925(a) of the Act, to the extent that they would be ineligible for coverage if they were to comply with the quarterly reporting requirements of Section 1925(b)(2)(B) because their income exceeds 185 percent of the gross family earned income, less child care expenses, during the second six-month period.

· Expenditures to permit Medicaid coverage to pregnant women enrolled in the demonstration to the extent that they would be ineligible for automatic eligibility after the end of the postpartum period under Section 1902(e)(4)(5), in that coverage would be provided past the end of the post-partum period to the time of the household’s next regularly scheduled eligibility review date, provided they were eligible for Medical Assistance prior to their pregnancy under another basis or live with other eligible household members subject to the same basis and income limits.

· Expenditures to permit Medical Assistance payments for the cost of medical education to a medical education trust fund for direct distribution to teaching entities. FFP will be made available once the expenditures have been made distributing the payments to teaching entities.

· Expenditures to permit Medicaid coverage to beneficiaries, enrolled in the demonstration, who receive gifts of money that do not exceed $100 per month, who might not be eligible for coverage if this gift were reported and included as countable income when determining program eligibility.

· Expenditures to permit Medicaid coverage of services to pregnant women described in Section 1902(a)(10)(VII), to the extent that services are provided that are in addition to services related to pregnancy and conditions which may complicate pregnancy. The State has been granted authority to implement the MSHO demonstration project through waivers granted by the United States Department of Health and Human Services, Center for Medicare and Medicaid Services (CMS) under a Medicare waiver under Section 1395b-1 of the Social Security Act and pursuant to Section 402 of the Social Security Act of 1967, as amended by Section 222(b) of the Social Security Act Amendments of 1972, 42 U.S.C. 1395b-1; and has authority to implement voluntary Medicaid managed care waiver under Section 1915(a) of the Social Security Act, 42 U.S.C. 1315 et.seq. County Based Purchasing is authorized by State law and implemented under existing PMAP federal waivers.

Design

In 1997, legislation gave counties authority to choose which type of managed care model would be implemented in their county: Prepaid managed care or County Based Purchasing (CBP). The State contracts with eight MCOs to provide medical services statewide for PMAP and PMCRE enrollees. County Based Purchasing is an option that allows counties to choose to assume the responsibility for purchasing health services for recipients eligible for PMAP. County Based Purchasing provides an opportunity for locally designed service delivery systems that involve the coordinated efforts of counties, providers, and consumers. A community planning process is required by statute. County Based Purchasing requires CMS approval. CMS has approved the following three County Based Purchasing models:

· South Country Health Alliance (SCHA) is available in 12 counties: Brown, Dodge, Freeborn, Goodhue, Kanabec, Morrison, Sibley, Steele, Todd, Wabasha, Wadena, and Waseca. SCHA is the only choice for PMAP in these counties except for Dodge and Wabasha - in which there is also another health plan choice.

· PrimeWest Health System is available in ten counties: Big Stone, Douglas, Grant, McLeod, Meeker, Pipestone, Pope, Renville, Stevens, and Traverse.

· Itasca Medical Care is available in Itasca County. Itasca Medical Care is the only choice for PMAP in Itasca County.

Please refer to the following DHS Maps on e-docs regarding health plans available in each county:

· DHS-4324 Prepaid Medical Assistance Program (PMAP) Health Plan Choices by County

· DHS-4326 MinnesotaCare Health Plan Choices by County

· DHS-4840 Health Plan Choices by County for Minnesota Senior Health Options (MSHO)

· DHS-5218 Health Plan Choices by County for Special Needs BasicCare (SNBC)

MSHO

Minnesota Senior Health Options (MSHO) is a voluntary managed care program. To be eligible for MSHO, a recipient must:

· Be eligible for PMAP

· Be age 65 or over

· Live in the service area

· Have Medicare Part A and Part B

MSHO enrollees receive both Medicare and Medical Assistance services from the chosen MCO.

MSHO includes home and community based services for seniors who are eligible for Elderly Waiver Services. For any recipient who enrolls in MSHO while in a community setting, the MCO shall have financial responsibility for nursing facility services for 180 days.

The Department pays a capitation rate every month to the MCO on behalf of each enrollee. The MCO provides most covered services in exchange for the rate. Rates are determined based on a combination of an actuarial analysis of the State’s historical fee-for-service cost experience with equivalent groups of recipients and other cost and health care utilization factors. Enrollees are assigned rate cells based on several factors:

· Product ID (4 digits)

· County of Residence (3 digits)

· Major Program (2 digits)  

· Eligibility Type (2 digits)

· Gender (1 digit)

· Living Arrangement (2 digits)

· Medicare Coverage (1 digit)

· Rate Cell Category (1 digit)

· Age Range High (3 digits)

Project Administration

The PMHC Program is administered by the Minnesota Department of Human Services.

Department Administrative Responsibilities

State project administration includes:

· Contract negotiation and monitoring

· Rate setting and financial settlement

· Quality improvement, utilization review, and consumer satisfaction analysis

· Program evaluation

· Coordination of the State fair hearing process with the Department of Human Services Appeals Division

· Oversight of the consumer education process

· MCO payment

· Provision of reports to MCOs (e.g., enrollment reports) and counties

· Education of providers, MCOs, advocates and other interested groups

· Coordination with county, MCOs, CMS, and MinnesotaCare staff

· Policy setting and dissemination

· Promulgation of rules

· Reporting to CMS and the state legislature

· Providing information and technical assistance to county staff, community and provider organizations and the general public

County Administrative Responsibilities

Counties are responsible for the following managed care duties:

· Consumer education and enrollment

· Coordination of the program internally with county staff, including training of county workers

· Monitoring and evaluation of the program from the county’s perspective

· Reporting to the county board and county advisory groups

· Coordination with the Department in identifying and responding to problem areas, problem cases, and developing policy

· Providing client advocacy services

· Coordination of the State fair hearing process with the DHS Appeals Division