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MEDICAID SUBCOMMITTEE
of the
Joint Appropriations Interim Committee
and the
Joint Labor, Health and
UW Outreach Building May 14, 2002
951 North Poplar Casper, Wyoming
PRESENT: Senator Charles K. Scott, Cochairman;
Representative Mike Baker, Cochairman;
Senators Jim Anderson, Tex Boggs and Rich Cathcart;
Representatives George B. McMurtrey, Carolyn Paseneaux and Harry Tipton.
Legislative Service Office: John H. Rivera, Senior Staff Attorney.
OTHERS: See Appendix A.
AGENDA: See Appendix B.
* * * * * * * * * *
Tuesday
The meeting was called to order at 8:00 a.m., on Tuesday, May 14, 2002, by Chairman Scott. After explaining the Subcommittee would be cochaired by himself and Representative Baker, the following is a summary of Subcommittee proceedings:
1. Muse & Associates Study and Findings
Dr. Garry McKee, Director, Department of Health, introduced Iris Oleske, Roxanne Homar and Dr. Brent Sherard, who would provide a synopsis of the Muse & Associates study and the plan developed by the Department of Health to improve Medicaid patient care and management as required by 2002 Wyoming Session Laws, Chapter 83 in Footnote 8 of the Department of Health budget.
Ms. Oleske distributed a hardcopy of the Power Point presentation presented by Muse & Associates during the recently concluded budget and special session (Appendix C). She explained Muse & Associates, in developing its study, had relied primarily on the most recent quarterly report required by the federal government from the Department of Health's Medicaid program. While summarizing the Muse & Associates power point presentation, Ms. Oleske questioned some of the findings with respect to the drop in aged recipients.
In response to questions from Representative Paseneaux, Ms. Oleske stated since the department had not contracted with Muse & Associates, the department had not discussed any disagreements they have with the Muse findings and may not be able to make Muse rework its numbers.
Ms. Oleske stated the number of disabled on Medicaid had increased as a result of the Weston lawsuit against the Wyoming State Training School. Although the number of eligible individuals dropped during that period, the number of recipients stayed constant as a result of the lawsuit. The increase in Medicaid vendor payments were largely a result of inflation, similar to other states without managed care systems. Since the Means chart stops at 1998, it does not reflect the steep increase in pharmaceutical costs.
Ms. Oleske agreed with Chairman Scott that by holding the Medicaid rate-setting low, costs are shifted to the private sector as a hidden tax. She added medical costs are increasing faster than Medicaid reimbursement rates are. While Wyoming has 100 percent physician enrollment in the Medicaid program, changes are occurring because physicians are not accepting new patients in some cases or the physician is leaving the state.
Dr. Sherard added medical malpractice insurance is becoming a crisis issue in Wyoming as it is throughout the nation. Ms. Wendy Curran, Wyoming Medical Society, explained the malpractice insurance crisis has hit quickly and the Medical Society is trying to define the impact for the Joint Appropriations Interim Committee.
Ms. Homar discussed the pharmaceutical findings of Muse & Associates. She stated the number of patients cited in the Muse report is misleading because each prescription filled is being counted as a unique patient when in fact many patients have multiple prescriptions. She explained the department has a contract with the drug utilization review board which costs approximately $250,000 a year, 75 percent of which is a federal match. She explained the drug utilization review board is under contract with the University of Wyoming. She does not believe it would be cheaper to run the drug utilization review board from within the department.
Dr. Pablo Hernandez, Wyoming State Hospital, advised the discontinuation of, or a change in, a prescription regimen is the biggest cause for readmission of patients to the state hospital. He stated changes in the drug regimen is often the result of visits to emergency rooms or primary care physicians where misprescribing for the overall needs of the mentally ill patient occurs. This happens because modern drugs are more specific in purpose and are often misutilized. He suggested the best solution would be the establishment of critical practice guidelines. Public health has to have high visibility within the medical community, including providing telepsychiatry, to address the needs of mentally ill individuals in the state.
2. Department of Health Plan to Improve Medicaid Patient Care and Management
Director McKee reiterated what Ms. Oleske and Ms. Homar had stated with respect to the Muse report. The ideas proposed by the report are more important than the flawed data.
Ms. Oleske explained the Medicaid plan (Appendix D) may not be as specific as the Subcommittee expected. She stated the department needs more direction to develop a disease management program. The purpose of the plan is to provide the Subcommittee with an introduction to disease management. At the next meeting in September, the department will provide more specific objectives for targeted disease management and quantifiable results. At the last meeting the department will request legislation and the budget to implement the targeted disease management program.
Ms. Oleske explained disease management, as proposed by the department, would include the patient as a partner in developing interventions for disease management. She provided a comparison of managed care organizations used by many states with larger populations, primary care case management and fee for service programs such as Wyoming's. Various models for targeted disease management include the Medicaid help outcomes partnerships, the pharmaceutical care model, and the case management model. Ms. Homar described the case management model used by the state of Florida, which has a large diverse elderly population and a significant number of AIDS cases, as a large purchaser of services. Florida has significant leverage with pharmaceutical companies. In Florida, pharmaceutical companies are funding some case management services as a way to avoid paying a rebate on drug sales in the state. Ms. Homar explained the savings do not come quickly. She does not see targeted disease management as a cost saver, but as a means to provide better patient care.
Ms. Homar described the Iowa model for pharmaceutical care. There is a collaborative practice agreement between the pharmacist and physician to manage patient needs rather than specific diseases since co-morbidities often occur with a single patient. She explained the state of Montana had tried the pharmaceutical care model, but failed for lack of an infrastructure. The state of Idaho has a primary care case management model with limited applicability.
Director McKee explained targeted disease management is not the only tool proposed by the department, but the department is pursuing targeted disease management since the Muse report and the legislature seem to prefer that model, and the timeline is short to present a plan to the Subcommittee.
Ms. Oleske stated that the state of Maryland formed a task force which, over the next 18 months, will study disease management as a tool to manage the Medicare program.
Representative Paseneaux inquired if the disease management program proposed for the state is similar to the disease management program being looked at by Medicare. Ms. Homar responded the program is similar, although unlike Medicare, the Medicaid program does pay for pharmaceuticals. Ms. Homar explained the disease management plan for Wyoming is described beginning on page 6 of the department's plan. The targeted disease management program is a halfway point between fee for service health care and a true health maintenance organization environment. Pharmacists, physicians, nurses, case managers and the patients would use the team concept for planning and partnership, although a shortage of professional personnel may compromise the program over the long term. The effectiveness of the program will depend upon the willingness of providers to make a commitment to the process. The process will involve identifying a targeted disease management population that can benefit from the program, identifying target diseases and determining measurable outcomes. The goal is to implement the targeted disease management program initially as pilot projects. The goal ultimately will be to have a full-fledged targeted disease management program by gradually expanding successful pilot projects.
By September 1, 2002, the Department of Health will come up with a detailed plan to be implemented by October 1 with Subcommittee approval.
Members of the Subcommittee questioned why the plan did not list reasonable results to be achieved by September 1 as required in the legislation requiring the department to provide a plan by May 1 with measurable results to be achieved by September 1. In addition to the long-term goals to the long-term goals specified in the plan presented by the department, the plan should have listed short-term results. The demonstration of short-term results will be necessary to convince the legislature the long-term plan may be feasible. The Subcommittee cited several findings in the Muse report that the department could have used to achieve measurable results by September 1.
3. Public Comment
Chairman Scott called for public comment on the plan presented by the department.
Ms. Lynne Schreiner distributed a copy of her testimony to the Subcommittee (Appendix E). She explained she was there on behalf of her companion who has end-stage liver disease. Her testimony indicated the disease management concept has emerged as an effective tool for states to control Medicaid costs and to improve health care quality. Only Wyoming and Nevada do not cover transplants for persons over age 21. She requested the Subcommittee approve a disease management program that will ensure long-term health care coverage for citizens over age 21.
Mr. Bill Thomson, representing PhRNA, stated "prior authorization" recently proposed by the department often costs more than it saves. That is the reason the pharmaceutical companies provided funding for the Muse report, to provide for better long-term Medicaid program management. It is necessary for the department and Muse & Associates to communicate with respect to any disagreements they have over data or findings. He would also like the department to show the cost effectiveness for any proposals it makes before the Subcommittee.
Ms. Curran questioned the objective of targeted disease management. She thinks that cost savings can be done better and sooner employing other means. She is concerned that diverting one percent of the Medicaid budget to develop the plan may be removing necessary funds for patient care from the program. Any plan proposed by the department by September 1 may not get the physician commitment that is necessary for the program to succeed. She stated the department must provide short-term solutions before the long-term targeted disease management program will be accepted by physicians.
Mr. Bob Kidd, Wyoming Hospital Association, stated there are other initiatives the department could implement for cost savings. He described the program for intergovernmental transfers whereby counties and hospitals will contribute to the state match for Medicaid in order to receive federal money. After those federal funds are received, the funds would be used to pay 100 percent, rather than the current 70 percent of the Medicaid reimbursement rate. This proposal would not cost the state any money.
Mr. Tom Jones, Wyoming Health Care Association, stated the Hospital Association's plan would leverage state monies to get federal monies, but the feds are smart enough to figure out what is happening. He questions whether such a proposal would be successful.
Ms. Linda Pryor, Phizer Pharmaceuticals, reiterated the pharmaceutical companies do not like the "prior authorization" requirement the department proposed in the past. Each phone call from a doctor's office to obtain prior approval costs approximately $17 even though most prior authorization requests are approved. As a result, prior authorization potentially results in cost shifting to emergency rooms and hospitals. She also requested that the drug utilization review board process be more open so people understand the criteria used by the drug utilization review board.
Chairman Scott made several suggestions to the department including, the department should develop short-term solutions and results, which would require the department to redo its plan and resubmit the plan to the Subcommittee. The cochairs of the Subcommittee would then decide if another meeting of the Subcommittee is necessary to consider approval of the plan.
Ms. Oleske inquired how the Subcommittee would like the department to use one percent of the Medicaid budget authorized under Footnote 8. Chairman Scott stated the money was intended to be used for contracts as necessary to implement the program.
Representative Paseneaux suggested the department develop comprehensive Wyoming data to compare with the data contained in the Muse report. She asked the department take action on some of the identified areas the Muse report addressed.
Representative McMurtrey expressed his discomfort with the "prior authorization" requirement. He was concerned about who actually does the authorization. In his experience, prior authorization is usually provided by a nurse.
Representative Tipton agreed with Representative McMurtrey. He believes physicians will go along with the targeted disease management proposal, but they will need to be convinced by a demonstration of short-term goals that have been achieved.
Senator Anderson stated he would like a more global picture presented through the data to be compiled by the department. He would like to know what the Department of Health is proposing, and also how the Departments of Education, Family Services, and other agency programs may impact health care in Wyoming.
Senator Boggs agreed with the long-term care proposals contained in the department's plan, although he does have some concerns with the case management model. For example, he is concerned with the loss of freedom of choice that may occur. He stated he believed the one percent of the Medicaid budget set aside in the footnote was intended to be an incentive for the department to think outside the box and to use funds more effectively.
After Subcommittee discussion, the department was directed to resubmit its plan by June 15, containing the targeted disease management program and results than can be achieved by September 1. After resubmission, the Cochairs will decide if another meeting is necessary to approve the short-term objectives plan.
5. Other Matters
Representative Ann Robinson distributed a page describing two scenarios whereby Wyoming citizens are falling through the cracks in getting the medical services they need due to a waiver the state received years ago (Appendix F). Both scenarios involve individuals who may receive Medicaid services while a recipient of Supplemental Security Income benefits and lose both SSI and Medicaid upon approval for disability benefits under the Social Security Act. She stated she recognizes the issues she has presented to the Subcommittee may be beyond the scope of the issues the Subcommittee is reviewing.
Chairman Scott asked Mr. Rivera to see if the issues presented by Representative Robinson would be within the scope of approved studies for the Joint Labor, Health and Social Services Interim Committee. In the meantime, he suggested Representative Robinson do some research on the need for legislation and the costs associated with any changes that may be proposed.
Representative Jerry Iekel stated he liked the "education detailers" for physician offices that are being proposed to help the physicians with prescribing problems they may encounter in their practices.
With no further business before the Subcommittee, Chairman Scott adjourned the meeting at 1:05 p.m., Tuesday, May 14, 2002.
Respectfully submitted,
________________________ ___________________________
Senator Charles K. Scott Representative Mike Baker
Cochairman Cochairman
Please Note: Due to the length and complexity of the appendices, the appendices are not being distributed with the summary of proceedings. A copy of the appendices is on file at the Legislative Service Office for anyone wishing to view them.