September 16, 2019
NC DHHS announced that, due to the NC 2019 budget impasse, instead of a two-phase roll out for Medicaid managed care, the 1115 Medicaid waiver will be implemented statewide on February 1, 2020. While that first phase of two regions may have provided the State some opportunity to resolve glitches without it having widespread impact, there is no getting around the funding that is needed to implement the new way of doing business, aka capitation with five new Prepaid Health Plans (PHPs) at the same time that claims continue to come in through the old way of funding (fee-for-service). The budget also includes important components of the Transformation model like establishing authority around hospital assessments and implementing a premium gross tax for the Prepaid Health Plans.
Impact of Delay
Those Medicaid beneficiaries in Regions 2 and 4 that were set for Phase One roll out will now have an extended open enrollment period through December 13, 2019. For beneficiaries in Regions 1, 3, 5 and 6, open enrollment begins as previously scheduled on October 14, 2019 and also ends on December 13, 2019. Those who already enrolled are still enrolled and do not need to take further action.
NC DHHS will begin the auto-assignment process on December 16, 2019 to assign any Medicaid Standard Plan beneficiary who did not choose a plan during open enrollment. Individuals receiving family planning services are excluded from Medicaid managed care and will remain on NC Medicaid Direct (i.e. fee for service). NC DHHS is updating their communication strategy to include notification to all Medicaid beneficiaries who are in those regions that were originally in Phase One.
Beneficiaries have 90 days after February 1st, to change their plans as many times as they’d like. It is important to note that people enrolled in a managed care plan will not be billed, rather their health plans will be billed. In addition, prior authorization is not initially necessary; however, it is anticipated that this will change throughout the years.
On the September 4th webinar, it was stated that the Phase 1 delay would have no impact on the July 2021 implementation date for the BH/IDD Tailored Plan. On the same webinar, Secretary Cohen noted that a rate floor for the Advanced Medical Home (AMH) has not been set and that NC DHHS will, at this point, leave that negotiation to the PHP and the AMH.
Cohen stated that NC DHHS would like to see more contracts in place between AMHs and PHPs by February 1, 2020. The delay also provides additional time to negotiate contracts between providers, hospitals and Standard Plans. NC DHHS leaders have expressed on their webinars that the number of contracts that have been completed to date is not as robust as they would like to see in the long run.
Finally, the delay allows for additional readiness reviews of the Standard Plans to ensure that the transition will go more smoothly. Secretary Cohen mentioned if the budget is still not passed by the middle of November, more action will need to take place in order to maintain the operational needs of the Medicaid Transformation.
Upcoming Updates on Medicaid Transformation
A new concept paper is expected that will lay out a vision for children in the foster care system. There has been some discussion about a separate specialty plan for foster children that could provide additional supports beyond wha