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HUSKY Insurance Program Offering A New Option

ARIELLE LEVIN BECKER

December 26, 2009

More than 100,000 state residents in the HUSKY insurance program are getting a new option for their health coverage, a model that takes away the insurance company.

HUSKY Primary Care, a program being rolled out in the Hartford and New Haven areas, centers on having patients' medical care coordinated by doctors or their staffs, rather than by an insurance company.

Most patients in HUSKY, which covers low-income children and their families, sign up with one of three managed care companies, which then, along with the patient's primary care doctor, coordinate care.

Patients in the new program will sign up directly with a primary care provider, who will then play a larger role in coordinating the patient's care. That could mean finding specialists and making appointments, coordinating medical tests, helping the patient manage chronic conditions or arranging transportation to appointments.

For that, the primary care provider will be paid $7.50 a month for each patient who participates, in addition to fees for any medical services they provide.

The program began in February with a small group of health care providers in the Waterbury and Willimantic areas and is now being opened to any HUSKY A recipients who live in Hartford, New Haven or any town that shares a border with them. It is considered a pilot program for the state to evaluate the model.

It might not be possible for everyone to sign up because, so far, only a limited number of health care providers are participating in the program. As of last week, nearly 50 Hartford-area primary care providers and more than 100 in the New Haven area had signed up for the program, although the state Department of Social Services expects to sign up more soon.

At least 29 other states already use the same model, known as primary care case management, to handle some or all of their Medicaid coverage. In Connecticut, patient advocates have long argued for trying the program.

Supporters say it can save the state money that would otherwise go to insurance company administrative costs while allowing doctors, rather than insurance companies, to manage their patients' health. For patients, it will mean having a specific person to get in touch with for any issues related to medical care, they say.

Ellen Andrews, executive director of the Connecticut Health Policy Project and a longtime supporter of the concept, said that experience in other states suggests that the program could attract more health care providers to participate in HUSKY, which would help address concerns that HUSKY recipients struggle to find doctors to see them.

"We really see this as not just a plan B. This is a real innovation for our consumers, and if it makes the HMOs perform better, I'm good with that," Andrews said.

In many ways, the program is an example of two concepts that have been discussed in the debate over health care reform: a "medical home" — in which a patient has a regular source of care and someone to coordinate his or her health care — and a public option that would compete with insurance companies, Andrews said.

State Health Care Advocate Kevin Lembo said the program could also provide an alternative to using managed care companies for HUSKY, giving the state more leverage when it negotiates rates with insurance companies.

"We suffer as a state from a lack of options," Lembo said. "When negotiations go poorly with a carrier in the Medicaid managed care plan or if there is misbehavior and [the state needs] to freeze enrollment and limit one of the company's access to the market, you really and very quickly run up against administrative problems."

An independent audit performed for the state comptroller's office earlier this year found that the rates the state pays to the three managed care companies participating in the HUSKY A program are 5 percent to 6 percent higher than necessary, which amounts to an extra state cost of $41 million to $49 million a year.

The Department of Social Services, which oversees HUSKY, disputed the audit's findings as flawed, but state lawmakers have required the department to renegotiate the rates it pays the managed care companies. The department is now renegotiating rates, with a target of cutting them by 6 percent.

DSS spokesman David Dearborn said that HUSKY Primary Care has the potential to save the state money, but that it's too soon to know until the program has a track record.

Dearborn said the idea that the new model gives the state more leverage in negotiations with insurance companies makes sense in theory, but that for now, it would be difficult to expect HUSKY Primary Care to be able to replace a managed care company.

"The concept is probably sound as the program gets going, but it's way too early for that to be viable," he said. "At the same time, the managed care companies do know, of course, that [primary care case management] is on the map and it's growing as a pilot."

Rita Paradis, CEO of Aetna Better Health, one of the three managed care companies that take part in HUSKY, said that it was too soon to say what effect the program would have on Aetna.

Aetna also coordinates patients' care and has the advantage of a wider network of patients, which allows it to see broader trends and potentially design ways to address them, she said.

Aetna participates in Medicaid in other states that also use both managed care companies and primary care case management. In those states, the program has not significantly changed Aetna's activities, said Tom Kelly, president and CEO of Schaller Anderson, an Aetna subsidiary that administers Medicaid plans in 11 states.

The presence of a primary care case management program often means that more doctors take on a larger role in coordinating all their patients' care, which Kelly said benefits patients even if they are not in the primary care case management program.

But Kelly said that managed care companies are better able to contain costs because they have an additional level of oversight and can influence things beyond the control of primary care doctors. That can include overseeing issues about hospital stays, making sure that patients are on the appropriate and cost-effective medications, and monitoring costly imaging procedures to make sure that they are not unnecessarily duplicated.

"A managed care organization is asked both to help identify, organize, compensate medical homes," Kelly said, "but also look across the range of all the other expenses that are incurred by patients and say, how can we spend as wisely as we can spend?"