Oklahoma takes first step to outsource care for most Medicaid recipients
The agency that oversees the state's Medicaid program published two requests for proposals seeking for-profit companies to oversee medical and dental spending for 773,794 of the state's nearly 1 million Medicaid recipients.
Following direction from Gov.
At least 40 other states have implemented managed care.
With
"It's clear what we've done in the past is not working as well as we desire, and it is time for
Some Republican legislators and medical professionals have expressed early concerns about the proposed changes.
"OHCA has a great track record for delivering low-cost, efficient management of our Medicaid program," she said. "Turning to managed care -- which has shown to be infeasible in
Health care for the estimated 175,000 Oklahomans who will sign up under the expansion will be outsourced.
The authority anticipates contracting with at least two managed care companies, but Corbett said three or four providing coverage options would be optimal.
They will manage care for the following Medicaid populations:
--Children
--Pregnant women
--Parent and caretaker relatives
--Former foster children
--Juveniles in foster care
--Low-income adults who will be covered by Medicaid expansion
Over time, the
Essentially, the state will pay the contracted companies to manage care for the Medicaid recipients. The compensation rate, which will be released at a later point, will be based on the number of enrollees.
Corbett said he doesn't anticipate the change will result in any cost increases to the state.
The set payments drive managed care companies to drive down costs so they can earn profits.
The managed care concept is centered on the idea that if patients get more coordinated care, severe and potentially costly health problems can be caught early or prevented altogether. But critics of the concept say the profit motive can deter companies from doing what's best for patients, especially when a necessary prescription or treatment is costly.
Corbett pointed to
Unlike states, Managed care companies can also offer financial incentives for beneficiaries to keep up with their care, Corbett said. He gave an example of companies giving gift cards to patients who attend preventative care appointments.
Asked whether the quality of care could suffer when Medicaid care is privatized, Corbett said the
"Anytime you are partnering with somebody to take on a part of your business that you have full control of, there is a risk that you need to recognize," he said. "We built in, we believe, a number of safeguards to ensure that there is not a dilution of care."
Over the next year, the
The 400-page request for proposals for medical providers asks for extensive information information from the companies that bid. The contracts are contingent upon funding from the
The chosen companies will offer plans statewide, as opposed to
The companies will also take over management of prescription drugs for most Medicaid beneficiaries.
Some lawmakers sought for pharmaceuticals to be carved out of the managed care contracts because the Legislature recently approved legislation regulating pharmacy benefit managers in order to give Oklahomans more freedom in where they get their prescriptions. In a letter Rep.
"There is a better way to do pharmacy management and we are doing it, already," he wrote. "I urge you to consider
Pharmacy management was included because it's key to the overall coordination of care for the managed care companies, Corbett said.
Contractors will be required to maintain a presence in
The contracts will be for one year with annual options for renewal. Corbett says the agreements will be structured based on a five-year commitment.
"Our intent is for this to be a long-lasting partnership," he said.
The agency plans to award contracts in February. Open enrollment for Medicaid beneficiaries will occur in August and the changes will take effect in
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