Managed care mess: Providers struggle with new reality of serving Medicaid recipients

YARMOUTH, Maine - The increasing number of states turning to managed care to run their Medicaid programs is creating a logistical nightmare for providers.

Many of the respondents to a recent HME Newspoll report that working with managed care companies can mean a cumbersome prior authorization process, slow payments, irregular policies and inconsistent reimbursement rates.

“They're very slow to pay, if at all,” wrote in Steve Williams of Motion Mobility in Canton, Ohio. “Prior authorizations are challenged when a claim is submitted. There's lost paperwork and poor customer service. Approvals are given with no dollar amounts listed. Dealer invoice is requested frequently, even for coded items.”

Unfortunately, for most respondents, this is the new reality of serving Medicaid recipients. Eighty-four percent of respondents say their states have turned to managed care to run their Medicaid programs and 11% say if they haven't made the move yet, they're thinking about it.

Having to work with more than one managed care company in each state and having to deal with Medicaid recipients switching from company to company at will compounds the problem, respondents say.

“There has been a huge increase in administrative burden,” wrote in William Hill of Mediquip Homecare in Bethpage, N.Y. “We had to hire a person dedicated to managing the managed care contracts and vagaries of billing from each one.”

It'd be one thing if the extra work meant better reimbursement, but that hasn't been the case, respondents say.

“I owned a large DME business in Pennsylvania when it switched over from traditional Medicaid to an MCO model,” said Scott Dinning of Hometown Oxygen in Charlotte, N.C. “This resulted in a reduction averaging 35% of the traditional fee schedule amount, which was very disruptive to the services and products we could afford to provide.”

Respondents say what they're experiencing with managed care companies pales in comparison to what's being felt by Medicaid recipients.

“Patients have to find out who can help them, then wait for an auth, and then wait for the product to be shipped to them if their provider is out of town,” wrote in Jeremy Lloyd of Perkins Medical Supply in Vero Beach, Fla. “As a company, we can overcome the reimbursement challenge, but patients are being affected negatively.”