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care to the State and put even greater pressure for rate increases for these hospitals.   

2-B. Restructuring the Medi-Cal Fee-for-Service Program and Providing a Medical Home

Medical homes are another innovative way of improving how care is delivered in the Medi-Cal program, particularly for the small number of beneficiaries with significant health care needs who account for a large proportion of costs.  Across the nation, other state Medicaid programs also are reconsidering how they provide services to Medicaid’s most chronically ill and disabled populations.  Nationally, the 15 percent of Medicaid beneficiaries with more than $5,000 in annual costs account for more than 75 percent of total Medicaid spending.3

Many states have approached the use of a full-risk capitation managed care model for seniors and people with disabilities (SPD) population with caution.  While providers and advocates often are resistant to any form of full-risk managed care in Medicaid, this resistance is even greater with regard to proposals to move SPD populations into managed care.  The leading concern among those with the responsibility for serving and protecting this most vulnerable population is the potential to limit access to vital and often expensive services.

Given the concerns over full-risk managed care for the SPD population, several states have worked to create innovative programs with a heavy emphasis on creation of a medical home, care management and disease management.  These programs go beyond the traditional Primary Care Case Management (PCCM) model that many states have operated for years.  For many states, seniors and persons with disabilities are seen as the most appropriate population for intensive care management, given that they are more likely to have a number of chronic conditions, to be involved with multiple state programs and to have high psychosocial needs.

The medical home approach provides enrollees with a source of usual care selected by the patient (e.g., large or small medical group, a single practitioner, a community health center, or hospital outpatient clinic). The medical home should function as the central point among all of the various team members, including the patient, family members, other caregivers, primary care providers, specialists, and other health care and non-clinical services as needed and desired by the patient. Patients receive care management plans and these medical homes work in conjunction with disease/care management programs and information systems.  

These programs include various ways to provide additional reimbursement to providers to become a medical home and include managers to oversee and manage the program.  The programs include performance measures and as HEDIS does not address care management, a number of states are developing their own performance measures.  Some states include performance bonuses.  

3  A. Sommers and M. Cohen, Medicaid’s High Cost Enrollees:  How Much Do They Drive Program Spending?  Kaiser Commission on Medicaid and the Uninsured, March 2006.

Health Management Associates/Harbage ConsultingPage 15

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