Highlight on Georgia: State focused on promoting access to care

Georgians have received several pieces of good health care access news lately as the state works ensure that young adults and those living in rural areas get the care they need. Despite constant financial concerns surrounding health care, the state seems to be making it a priority.

Rural Healthcare 180

Rural Healthcare 180 is an effort to promote the new donation program that gives tax credits to both individuals and corporations that make donations to rural hospitals. Kim Gilman, chief executive of Phoebe Worth Hospital and Southwest Georgia Regional Medical Center, said that the hospitals need to upgrade expensive equipment and provide raises to employees.

In total, 48 rural hospitals are eligible to receive the donations. Tax credits will be supplied for donations of up to $4 million, with caps starting at $50 million in 2017 and increasing by $10 million each year for the next two years until program expiration. The potential of additional funding will hopefully address the crisis, as many rural hospitals seem to be set for the same fate as the five that have closed in the past four years.

Mental health center expansion

A new Atlanta campus of a mental health facility will open in October, adding 32 beds for young adults aged 18 to 26. This Rollins Campus, named for a gift received from the O. Wayne Rollins Foundation, is Skyland Trail’s second Atlanta campus. The nonprofit treatment organization operates 48 beds, and 60 percent of patients treated are young adults. Older adults have found Skyland Trail to be a lifeline, including a 63-year-old physician who reported experiencing her first psychotic episode at 56 years of age. She spent five months at Skyland Trail, where she attended to more than her mental health and was able to lose weight through the organization’s nutritional program.

State could be an example for EpiPens® in schools

In the wake of the EpiPen pricing controversy and stories about children in schools denied access to their own pens, Georgia’s approach may offer solutions to ensure safety in situations where students might be unknowingly exposed to food allergens. Karen Harris, mother to three children with severe allergies, founded Food Allergy Kids of Atlanta (FAKA) in 2007 in order to unite families like her own. Her goal is to ensure that this “first-line treatment” is accessible to everyone with any type of allergies.

In 2013, Georgia Governor Nathan Deal (R) signed the Emergency Epinephrine Act, which was introduced by Senator Chuck Hufstetler (R-Rome) and backed by FAKA. The law encourages (but does not require, unlike some states’ legislation) schools to stock EpiPens for emergency use, and authorizes providers to write a prescription in the name of a school. The law also protects anyone who uses the medication in good faith through its good Samaritan provision. A second piece of state legislation allows professionals to prescribe EpiPens for many public entities, including churches, restaurants, and arenas, provided that they register with the state. According to Georgia Health News, only 12 non-school entities have registered, and the article points out that no discount programs are offered to these entities.

Although some are concerned about parents depending on school-stocked pens and failing to provide for their children’s needs, a Georgia school nurse was thankful that they were able to receive donated pens through Mylan’s school program. She noted that in rural settings, quick access to epinephrine is vital when hospitals are some distance away. She has trained 25 teachers to administer the medication in the event of anaphylaxis.

Georgia Governor Rejects Medicaid Expansion — With One Exception

Recently Georgia Governor Nathan Deal announced that his state would be joining the growing number of states electing not to expand their Medicaid programs pursuant to the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148). During an interview at the GOP Convention in Clearwater, Florida, Deal stated, “No, I do not have any intentions of expanding Medicaid…I think that is something our state cannot afford.” He went on to cite the fact that although the expansion, which would add an estimated 600,000 residents to the program, would be wholly funded by the federal government during the initial three years, subsequently, the state would be on the hook for ten percent of the cost — an estimated $4.5 billion over ten years.

The day after this interview, the governor’s spokesperson, Brian Robinson, was quick to add that the governor’s statement only barred Medicaid expansion under PPACA as the law stands now. Governor Deal would certainly be open to expanding the program if the law was altered to provide block grants to the states, and he was waiting until the results of November’s election to officially make the expansion decision, in hopes that a Romney administration and GOP-led Congress would support block grants. Under the block grant scheme, the federal government would issue each state a set amount of funds designated for Medicaid, which each state would be free to use for their program as it sees fit. Most importantly, the state would not be responsible for paying a portion of that amount to receive the grant.

Critics of the block grant system caution that while states could use the grants for Medicaid expansion, they would also have the freedom to make cuts to their programs by reducing provider payment rates, imposing more stringent eligibility requirements, and limiting beneficiary coverage. Georgia Budget and Policy Institute Director, Tim Sweeney, raised concern that Georgia’s Medicaid program is already underfunded and that the block grant approach would provide the state with less revenue than an expansion under PPACA. “The details are very important,” he stated.

 

Medicaid Whistleblower Leads to $137.5 Million Settlement

Tampa-based managed care company WellCare Health Plans, Inc. recently agreed to pay $137.5 million to settle allegations of fraud and other abuses, the Justice Department announced. The federal government will share the proceeds of the settlement with nine states: Connecticut, Florida, Georgia, Hawaii, Illinois, Indiana, Missouri, New York and Ohio. The for-profit company served about 2.6 million Medicaid beneficiaries as of August 2011. The four relators who brought whistleblower suits against the company will receive about $25 million.

The alleged fraud, which the company has not admitted, included:

  • inflated reports of the amounts spent on medical care to avoid returning funds to state agencies
  • retention of overpayments
  • operation of a sham special investigation unit
  • cooperating with providers who overbilled for services
  • falsification of records of patients’ medical condition and treatments provided and
  • manipulation of grades of service in reports on the performance of its call center

The company also allegedly violated federal marketing requirements for Medicaid managed care organizations by “cherrypicking” potential members to keep costs down. It was reported that WellCare performed a study of its costs for certain patients and then encouraged patients to disenroll to shift the cost of their care to state Medicaid agencies. A relator who worked undercover to assist in the federal investigation alleged that the company dropped premature infants and terminally ill patients. Arguing that the company’s actions cost the government between $400 and $600 million, the relator initially objected to the settlement; he disbelieved the company’s claim that it could not possibly afford more than $137.5 million.

In 2009, the company paid $80 million—$40 million in restitution and forfeiture of another $40 million—and entered into a Deferred Prosecution Agreement for fraud against the Florida Medicaid program. Thus, according to DOJ, its total recovery against WellCare will exceed $200 million. And if the company is acquired or there is a change of control in the next three years, the company will have to pay an additional $35 million. In April, 2011, the company entered into a corporate integrity agreement with the HHS Office of Inspector General to come into compliance with the law.

In 2009, in a related enforcement action by the Securities and Exchange Commission (SEC), WellCare agreed to pay $10 million to the SEC and return another $1 million in profits. Top-level executives, including the former general counsel, were prosecuted for fraud. One pleaded guilty in 2007; three others are scheduled for trial in 2013. SEC brought a civil suit against the three in January 2012.

In 2011, the company also settled a class action brought by investors alleging misrepresentations in violation of federal securities laws. The $200 million settlement is to be paid with $87.5 million in cash and $112.5 million in bonds. As with the DOJ settlement, if the company is acquired or experiences a change in control within three years of the agreement, it must pay another $25 million.

Florida Health News reports that resolution of its legal difficulties makes WellCare an attractive target for a buyout. Because many states are moving toward mandatory managed care, there are many opportunities to grow its business. One analyst says that the company’s revenue could double. If the Supreme Court upholds the Affordable Care Act, the expansion of Medicaid eligibility will make contracts with Medicaid agencies even more valuable.

Even while the settlement was on hold, the company picked up a contract with the Kentucky Medicaid agency, which began in the fall of 2011. Problems with the roll-out of Kentucky’s managed care program were discussed in an earlier post.

Competition for those Medicaid managed care contracts is fierce. States usually must use competitive bidding. Bidders and their affiliates make large campaign contributions to state officials. In Missouri, Centene donated $50,000 to the governor’s campaign in the two years preceding the contract award and $175,000 to the Democratic governors Association. Centene is based in Missouri but did not have a Medicaid contract previously; Molina, which lost despite 16 years of managed care contracts with the state, sued and asked the court to enjoin the state’s open enrollment, set for April 19, 2012. The case is being litigated at this writing.

According to the Chicago Tribune, in November, 2005, WellCare and its affiliates contributed a total of $100,000 to the reelection campaign of then-Governor Rod Blagojevich. The local affiliate had given him $25,000 earlier in the year.

 According to the Orlando Sentinel, three Medicaid HMOs— Humana, United and WellCare—were among the top 100 spenders for lobbying the Florida legislature in 2011. Humana spent more than $300,000. United and WellCare each spent an amount in the mid-210’s. In addition, the Florida Association of Health Plans, which seeks to influence Medicaid policy, among other issues, spent more than $300,000 on lobbying. Blue Cross Blue Shield, which isn’t a Florida Medicaid contractor but plans to bid, spent just under $300,000.

All the money that any plan spends on fines, unlawful remuneration, campaign contributions or lobbying isn’t going to pay for health care. It’s not paying for quality review, patient education, or even upgrading electronic health record systems. Could these facts be related to the findings of the study described in an earlier post, showing poorer health outcomes for beneficiaries in publicly traded Medicaid managed care organizations?

Connecticut Proposes Deaf Child Bill of Rights to Address Education Gap

Deaf and hard of hearing (HOH) children generally do not differ cognitively from their peers in a way that would prevent them from learning the same material just as well. So why is it that in Connecticut, as well as other locations, children with hearing disabilities appear to be falling behind hearing children in state tests? In 2011, approximately 71 to 81 percent of children with hearing disabilities failed to reach state standards in Connecticut Mastery Tests (CMTs) and Connecticut Academic Performance Tests (CAPTs). Comparatively, between 35 to 58 percent of hearing students failed to meet the goals.

The answer, according to advocates for deaf and HOH persons, is not the disability itself, but the manner in which the children are being taught.  According to Terry Bedard, president of Hear Here Hartford, a deaf advocacy group, “Their needs are not being addressed in the way they should be, and that’s resulting in this wide achievement gap.” Advocates believe that since there is a relatively “low incidence” of hearing disabilities, they are commonly overlooked. In Connecticut, approximately 700 children are registered with the education department as having a hearing disability; however, the number could be greater since such students are not tracked carefully.

Consequently, the Connecticut General Assembly’s education committee will be considering legislation this term to address the gap. “A Deaf Child Bill of Rights,” introduced by the Connecticut Council of Organizations Serving the Deaf, would focus on an individualized education program (IEP) centered around each student’s communication and language needs. Each student’s IEP would be connected to a formal “Language and Communication Plan” that would address that child’s specific needs. The measure would also require that the team implementing the IEP includes at least one educational professional who specializes in hearing disabilities. The bill would compel the state to execute a more specific tracking system in order to better identify hearing disabled children and chart their academic progress.

If the bill is passed, Connecticut will be the 12th state in the country to implement a deaf child bill of rights, joining California, Colorado, Delaware, Georgia, Louisiana, Montana, New Mexico, Pennsylvania, Rhode Island, South Dakota and Texas.