Federal health policy. Florida

Full Answer Section

         

• Improved Access and Quality of Care: Proponents argued that managed care could enhance access to services by expanding provider networks, improve care coordination, and offer better management of chronic conditions. The shift aimed to move away from fragmented care often associated with fee-for-service.
• Predictability of Costs: Capitated payments to MCOs offer states greater predictability in their Medicaid spending compared to the open-ended nature of fee-for-service.
• Innovation in Service Delivery: Managed care organizations were expected to bring innovative approaches to care delivery, including preventive services, care management, and programs targeting specific high-need populations.

How it was Adopted: Florida's SMMC program was adopted through a multi-year process involving:

• Federal Waivers (Section 1115 Waiver): The core of Florida's Medicaid reform relied heavily on a Section 1115 demonstration waiver from the Centers for Medicare & Medicaid Services (CMS). Section 1115 waivers allow states to test new approaches in Medicaid that are otherwise not permissible under federal law, provided they are budget neutral to the federal government. Florida initially received an 1115 waiver in 2005 for pilot programs in specific counties (e.g., Duval and Broward), testing managed care models. This pilot was extended and eventually expanded statewide.
• State Legislature Passage: The state legislature played a crucial role in enacting the necessary state laws to implement the waiver and establish the framework for the SMMC program. This included authorizing the Agency for Health Care Administration (AHCA) to solicit bids from managed care plans, define service regions, and set regulatory requirements. The move to statewide implementation was approved by CMS in June 2013 and fully rolled out in 2014.

Funding Structure: Medicaid in Florida, like in all other states, is jointly funded by the federal government and the state.

• Federal Medical Assistance Percentage (FMAP): The federal government contributes a significant percentage of Medicaid costs through the FMAP, which varies by state based on per capita income. Florida's FMAP generally means the federal government covers around 50-60% of traditional Medicaid costs.
• State Funds: The remaining portion is covered by state funds, primarily from general revenue (e.g., sales tax).
• Managed Care Payments: Under SMMC, Florida pays MCOs a fixed per-member, per-month capitation rate for each enrollee. These payments cover the comprehensive set of acute care services and, in some cases, long-term care services provided by the MCOs. The federal government then matches the state's expenditure to the MCOs based on the FMAP.

Sample Answer

          Florida has been a significant innovator in health policy, particularly within its Medicaid program. One of its most notable and long-standing reforms has been the statewide implementation of Medicaid Managed Care. This represents a substantial shift from a traditional fee-for-service model to a system where private managed care organizations (MCOs) deliver services to the vast majority of Medicaid beneficiaries. Let's break down this policy reform:  

1. State Health Policy Reform Innovation: Florida's Statewide Medicaid Managed Care Program

  Florida's Statewide Medicaid Managed Care (SMMC) program, fully implemented in 2014, represents a comprehensive reform that transitioned nearly all of Florida's Medicaid beneficiaries into a managed care delivery system. This was a culmination of almost a decade of experimentation with waivers and pilot programs.  

2. Rationale, Adoption, Funding, and Impact

  Rationale for the Policy: The primary rationales for Florida moving to a statewide Medicaid managed care system were multifaceted:

• Cost Containment: Medicaid expenditures had been growing rapidly, placing a significant burden on the state budget. Managed care was envisioned as a way to control costs by providing MCOs with a fixed per-member, per-month payment (capitation) for services, incentivizing them to manage care efficiently and prevent unnecessary utilization.