Amid other challenges, Medicaid department conducting massive overhaul

The Ohio Department of Medicaid is working on a complete revamp of the lion’s share of the $27 billion program amid complaints that it hasn’t made much progress on much smaller tasks.

The department is working to “reprocure” the services of the managed-care companies that represent more than 90% of Ohioans receiving benefits from Medicaid — the federal/state health program for the poor. And while the term “reprocurement” might have a bland, bureaucratic sound, the process is intensive, complex and can result in sweeping changes to the state’s most expensive program.

“What reprocurement does is it’s a reset,” said Lorenn Anthes, who leads the Cleveland-based Center for Community Solutions Center for Medicaid Policy. “It lets you create a different type of Medicaid program than had existed.” 

Currently, there are five managed-care companies that contract with Ohio Medicaid. They contract in turn with providers such as hospital systems and primary-care groups to serve Medicaid patients.

The idea is that the companies will use market forces to negotiate better prices. 

“The thing people don’t understand about Medicaid is that it’s highly privatized,” Anthes said.

So far, the Ohio Medicaid department has conducted listening sessions around the state and issued requests for information. Yet to be issued is a request for applications — a document that outlines a vision for the Ohio Medicaid program and asks potential managed-care companies to show how they would realize it. 

The goal now is to complete the process by July 1, 2021.

For the companies and Medicaid, it’s an intensive, time-consuming task. And some fear that if it isn’t done properly, all sorts of problems can ensue — including disruption for a growing number of clients who are buffeted by the coronavirus pandemic and the economic downturn it triggered.

“COVID and the related budget implications fundamentally change the landscape, so I would imagine they’re reassessing that plan to try to understand if now is the right time to proceed with a reboot of 90% of the program,” said Greg Moody, who was director of health transformation for former Gov. John Kasich when he expanded Medicaid and is now Executive-in-Residence at the John Glenn College of Public Affairs at Ohio State. “Going through a procurement under these circumstances has the potential to disrupt services for about 90% of the Medicaid population.”

The Medicaid department on Wednesday said it will move forward with the reprocurement despite the exceptional circumstances.

“Director (Maureen) Corcoran and the (Gov. Mike) DeWine administration are committed to moving forward,” a spokesman, Kevin Walter said in an email. “The director believes that now, more than ever, it makes sense to reimagine the Medicaid program to ensure its ability to weather the current pandemic, while at the same time providing a better program with better health outcomes for the individuals we serve.”

“The pandemic and financial crisis are naturally considerations in our planning, but from the very beginning Ohio Medicaid has been planning and implementing the procurement in a way to minimize any possibility for disruption to members, providers, and any potential vendors,” Walter added.

But in some areas, the department has struggled to execute policies and to be transparent about what’s happening inside the agency.

For example, the state budget passed last summer included $100 million to stabilize Ohio pharmacies with large Medicaid caseloads that say they’ve lost heavily from participating in the program. Distribution of that money was supposed to begin in January, but the department still hasn’t said publicly when — or on what basis — that would happen.

Perhaps more crucially, the department has for months been asked when it will enact a January 2019 law that would enable pharmacists to be paid to consult with patients and help them manage such medical conditions as hypertension and diabetes.

Giving pharmacies that ability took on new urgency with the coronavirus pandemic. Implementation would allow pharmacies to be paid to test one of the state’s most vulnerable populations for the disease. 

Gov. Mike DeWine has said the pharmacies are vital to the testing effort, but the Medicaid department hasn’t responded to repeated questions from the Capital Journal about when — or whether — pharmacists will be paid. The Medicaid department said it’s working on the issue.

“Ohio Medicaid is committed to, and continues to work toward credentialing of pharmacists as providers within their scope, including reimbursement of pharmacies for COVID-19 testing,” Walter said. “We will provide more as developments and progress are made.

Moody, the former Kasich health official, said that enabling pharmacies to bill Medicaid to test for coronavirus “seems like a priority to move to the front of the line.” He added that the Medicaid department should be clearer about what it’s doing in that regard.

“Transparency and communication in the program is critical — both with folks who oversee the program like legislators to make sure they know what’s going on — but also within your own administration because the governor has been making very strong, solid decisions as it relates to COVID,” Moody said. “But there seems to be a disconnect in the Medicaid department’s responsiveness to those priorities.”

Antonio Ciaccia, a spokesman for the Ohio Pharmacists Association, said that the Medicaid department has delivered on some promises to his group, including banning a drug-pricing method it said was dramatically shortchanging Ohio pharmacies. 

However, he said, the department hasn’t been transparent about — much less delivered on — other promises. They include transitioning the Medicaid managed-care program to a single pharmacy benefit manager, which is supposed to occur July 1, he said.

“Ohio pharmacists have been working hard to try to support the public health goals of the state, but a lack of clarity about persistent pharmacy issues makes it a massive struggle for pharmacies to plan their staffing, services, balance sheets, and futures,” he said. “We applaud Gov. DeWine for his push to empower pharmacists to provide needed access to care for Ohioans. The legislature has done the same. Pharmacists can do little besides wait for the department to fulfill that goal.”

And as the Medicaid department contemplates sweeping changes to almost the entirety of its enterprise, there was its inability last year to tell the truth about major changes to a network in just one part of that enterprise.

On Oct. 1, CareSource, Ohio’s largest managed-care provider, formally notified the Medicaid department that Walgreens’ 272 Ohio stores were leaving its pharmacy network. In the following weeks, the department twice denied that it had received the notification even though an open-records request showed top officials discussing it. 

A spokesman for the agency said Director Maureen Corcoran instructed him to make the incorrect statements, but said she might have been confused.

Anthes, the Medicaid expert, said the concept of a Medicaid reprocurement is “100% a good idea” because it’s an opportunity to make the program perform better for Ohio. But he said whether it’s a good idea just now is a “multifactorial” decision.

Those factors include whether enough bidders have sufficient time to apply so the state can get the best possible deals, he said. Others said they also include whether Medicaid officials have sufficient bandwidth to oversee such a complex process.

Even with those considerations, Anthes said, he hopes that if the reprocurement isn’t completed by July 1, 2021, he hopes it’s done shortly thereafter.

“There’s a lot of room for these contracts to be improved to address some of the social drivers of health, whether that’s food insecurity, housing insecurity, systemic racism,” he said. “There are a lot of things other states have done through their Medicaid programs that Ohio could do.”