MCO readies for drastic cuts in Illinois

SPRINGFIELD, Ill. - IlliniCare Health Plan may be only one Medicaid managed care organization with plans to drastically cut payments for DME in only one state, but when its parent company is Centene Corp., which has MCOs in 28 states, HME providers everywhere take notice.

IlliniCare plans to cut reimbursement for DME up to 50% on Jan. 1, a move delayed from Oct. 1.

“I would say the severity of these cuts is unprecedented in my experience,” said Kam Yuricich, who runs the Great Lakes Home Medical Services Association, which represents providers in Illinois, Indiana and Michigan, and who also runs other state HME associations.

Provider Kevin Stewart took it even further.

“The cuts are almost more severe than those of the Medicare competitive bidding program,” said Stewart, the executive director for DME for St. Vincent Health in neighboring Indiana and president of the association. “At least with bidding, even though the process was flawed, you had a chance to bid. This just came through—this is what you get, sign the contract or not.”

As it stands, reimbursement for CPAP masks will be 50% of the current Medicaid fee schedule if you're a provider caring for a recipient being managed by IlliniCare, one of six MCOs in the state. For enteral nutrition, 70%; for oxygen therapy, 60%; and it goes on.

Stakeholders are doing everything they can to fight the planned cuts, including communicating their concerns to the Illinois Department of Healthcare and Family Services, who they have a good relationship with; raising awareness through stories in local newspapers; and supporting a recently introduced bill in the Senate that would require MCOs in the state to align their rates, at a minimum, with the Medicaid fee schedule.

“There are also discussions for a similar bill in the House,” Yuricich said. “Our message is resonating pretty strongly. Whether or not there's going to be energy thrown behind this, to make sure it doesn't cause access problems, is unknown at this time, but I try to be chronically optimistic.”

While MCOs aren't new to Illinois, the state is now working toward a goal of getting more than 80% of the 3.14 million Medicaid recipients under managed care. So staying on traditional Medicaid will become less and less of an option for many.

“We don't actively encourage them to drop the MCO, but if there's a problem related to coverage, we make sure they know about it,” said Dan Heckman, general manager of Heckman Healthcare in Decatur, Ill., and a member of the board of directors of the Great Lakes Home Medical Services Association. “But I don't know how (staying on traditional Medicaid) is going to work this time around.”

It's hard for providers not to feel like they're being unfairly targeted by a big corporation because of their small size—DME accounts for one half of 1% of the state's total spending on Medicaid, according to estimates

“They assume we're going to be silent and just take it,” Stewart said. “But no, we're talking about mothers with children on vents. That piece of equipment is a big thing in their lives—it is their lives.”

Attempts to speak with a company official at Centene were unsuccessful.