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Medicaid usually functions as either fee-for-service or as managed care. Under fee-for-service, the provider submits a bill to Medicaid after providing a service, and Medicaid then pays the provider. In general, though this differs for each state, there are few if any pre-authorization or certification processes for behavioral health, and those that do exist are not rigorous and rarely involve a live review. Medicaid may audit the provider’s records but in general, such audits are relatively rare, involve a relatively small number of records and tend to focus on detecting overt fraud. There is usually no process for ensuring health maintenance or disease prevention. Under Medicaid managed care, the provider submits the bill to an insurance company that contracts with Medicaid, and this company pays the provider. Medicaid pays the company a set amount per member to manage all or part of the health care costs of the member. Preauthorization and certification, which are the rule not the exception for non-outpatient behavioral health services, usually involve a live review between the provider and an employee of the managed care company. Health maintenance and disease prevention are stressed and programs developed to engage members in such programs.
As is often the case, many factors colluded to make change more possible. In the interest of accuracy, two factors other than Medicaid managed care are worth noting. The first was a change in the culture, administration and authority of the quality management department of the medical center. The second was the threat of a Medicare audit. Both of these discrete events occurred concurrent to the initial penetration of Medicaid managed care and allowed for the rapid awakening of the clinic. It was, however, the continued presence of Medicaid managed care which encouraged the clinic to remain awake.
As the company also serves recipients of other publicly-funded programs including Medicare, it is not completely accurate to refer to the company as a Medicaid managed care company. However as of 2007 over 80% of the members served were recipients of solely Medicaid and as such the management of Medicaid benefits is the focus of my work and of this paper.
This Cartesian separation is proximally the result of the psychiatric DRG (diagnosis-related grouping) exemption that occurred in the 1980’s presumably because behavioral health care was believed to require more specialized knowledge and more rigorous controls than did physical health care [2]. The result of this split is that essentially all insurance companies in the United States have a separate system of administration and health care management for behavioral health conditions, a system that runs in parallel and in isolation of the physical health system. The problems inherent with this split are obvious to anyone whose migraines (physical health) worsen when they are anxious (mental health), or whose depression (mental health) recurs when their diabetes (physical health) is not well-controlled. The recognition of these problems has led some managed-care companies to attempt to integrate the management of physical and mental health conditions while at the same time maintaining the necessary administrative split. For instance, the company I work for does not contract out its mental health management to a specialized managed behavioral health company (as do many other insurance companies), but rather manages the behavioral issues ‘in-house’. To ensure that the systems communicate, the company has instituted several policies including a new health care management system called IM3®. There are also weekly joint rounds, joint educational activities and the co-location of all clinical staff. For more on some of the issues surrounding this Cartesian split see [2–5].
Industry—insurance companies, Medicaid, Medicare, state and local offices of health, and hospitals. Some states or hospitals will mandate the criteria used for review.
Interqual®. http://www.interqual.com/
Milliman® Care Guidelines®. http://www.careguidelines.com/
Rounds which occur at minimum weekly involve care managers, case managers (usually social workers who are employed by the MMC company and who work with members in the community to keep them healthy), and at least one or more medical director. The goals of rounds are to communicate information about members’ illnesses and treatments, to identify ways to ensure that currently ill members regain health and remain healthy and to request consultations on challenging cases. Rounds tend to focus on members who are currently in an inpatient setting, though any member’s case may be brought to rounds. For inpatient cases, attempts are made to discuss challenging cases as soon as the member is admitted (so it often occurs outside of rounds) to help determine if there are any opportunities for intervention. Such opportunities may include helping the facility reach the family to set up a meeting, providing the provider with information about resources that could be of help to the member, providing the provider with information about prior treatment history, and so on.
Such a consultation might take the form of an informal call with an expert colleague or a more formal written request to an identified expert who might be paid for the consultation.
This type of denial is known as a medical necessity denial. A physician is required to review and approve all medical necessity denials. The second type of denial is an administrative denial which is any denial that does not involve a decision on medical necessity or medical appropriateness. Administrative denials do not require consultation with a physician. They may, for example, result from the provider not submitting a claim within the specified time-frame or a member requesting a service that is not part of the Medicaid-mandated insurance benefit. For instance, chemical dependency treatment may not be paid for by the MMC company because Medicaid may have declined to have the MMC company cover this benefit. For a list of which states do and do not allow MMC companies to cover such benefits such as chemical dependency see the paper of Ridgely et al. [6].
It is important to note that the denial rate for the relatively small number of peer-reviewed cases is higher than 2%—in my experience it is closer to 30%. Clinicians who are involved in peer-to-peer reviews may experience that, for example, 30% of the cases they review (which is less than 2% of the total number of cases) result in a denial of payment. They may then erroneously conclude that 30% of all cases result in a denial. This erroneous conclusion may be one reason for the discrepancy between the low denial rate and the apparently popular perception that managed care results in excessive denials. For a discussion of other possible reasons for this discrepancy see Koike et al. [7].
When payment for a service is denied usually the provider bears the immediate financial burden of providing the service, should they choose to do so. Generally, by regulation, the provider may not bill the Medicaid member for the service.
I have access to whatever medical history of the member is known by the MMC company. Thus I might be able to provide information to a member’s new psychiatrist about that member’s past response to medications. Obviously this kind of information is especially valuable when the member is perhaps too psychotic to provide the information himself.
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Ekong, J.I. The Role of a Behavioral Health Medical Director in Medicaid Managed Care. Psychiatr Q 79, 33–42 (2008). https://doi.org/10.1007/s11126-007-9065-8
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DOI: https://doi.org/10.1007/s11126-007-9065-8