Blog Post

Is your medical group ready to manage Medicaid risk?

August 1, 2018

    As the economics of caring for Medicaid patients worsen, several health systems have begun to consider taking on greater Medicaid reimbursement risk. Despite this population's complexity, Medicaid risk can give providers greater flexibility to meet patient needs through better care management.

    How to succeed under Medicaid risk

    Successfully managing Medicaid patients under risk requires a system-wide approach, of course. ED administrators must identify and intervene with "frequent flyers." Health system leaders must find ways to partner with community groups to address non-clinical factors (e.g., housing insecurity, food insecurity, lack of transportation) that influence patients' health outcomes.

    How employed medical groups affect successful Medicaid risk management

    But a big portion of the responsibility for successful Medicaid risk management falls on the employed medical group as well. Two responsibilities are particularly essential for physician groups when it comes to improving Medicaid patient care:

    1. Ensure Medicaid patient access to ambulatory care

    One-quarter of adult Medicaid enrollees report using the ED because other, lower-acuity sites of care are not open. Similarly, 34% of Medicaid enrollees report barriers finding a doctor or delays in getting needed care.

    While studies find that nationally, physicians' participation in Medicaid has stayed constant at around 70% across the last several years, the rate can vary from market to market. And anecdotally, many medical groups report that private practice physicians in their markets have closed to Medicaid patients, increasing the burden on employed providers.

    2. Provide appropriate care management support

    The Medicaid population is diverse, ranging from healthy children to highly complex dual-eligibles. But on the whole, Medicaid patients typically have needs that make them more difficult for physicians to manage than commercial patients, including high rates of behavioral health conditions, co-morbidity, and non-clinical challenges.

    Addressing these needs requires a care management infrastructure that is broader than the models that medical groups may already have built to manage commercial or Medicare patients, incorporating social workers and other non-clinical staff.

    Absent a transition to Medicaid risk, any return on expanded care management will likely accrue elsewhere (e.g., the ED) while the medical group's balance sheet shows only the costs. However, in conjunction with a system-wide shift to Medicaid risk, the employed medical group should play a leadership role in building out the care management model.

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