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Highly Touted Medicaid Privatization Pilot Program Struggling

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The Associated Press

Published: January 29, 2009

Updated: 01/29/2009 11:11 pm

MIAMI - A Medicaid privatization program former Gov. Jeb Bush touted as a national model for improving care while limiting state costs is foundering, with nearly a quarter of the participating doctors leaving over payments and the inability to treat patients as they see fit.

Patients say the 2-year-old Medicaid Reform pilot is mired in bureaucracy and that they struggle to get appointments.

According to records obtained by The Associated Press, the number of participating primary care providers in Broward and Duval counties has dropped about 25 percent from 4,250 to 3,253 in the past year-and-a half. And the five-county pilot's largest private provider has admitted stealing money from the state in other programs.

"You are killing people with red tape in the Medicaid reform counties," said Richard Stein, whose ailing live-in girlfriend has had trouble getting appointments and medicine.

Despite the decrease in doctors, the number of providers is "adequate to meet all of the health care needs of Medicaid beneficiaries enrolled in the plans," said Christine Osterlund, the state's assistant deputy secretary for Medicaid operations. The state said Thursday some of the decrease was due to a less accurate number of its initial count of participating doctors. They did not provide revised figures.

Florida has about 2.26 million people on Medicaid, which provides health care for the poor and elderly, spending about $15 billion annually. Patients typically see their own doctors, who are then reimbursed by the government.

Under the pilot program, the government pays private companies a set amount for handling a specific number of residents in the counties — similar to an HMO in the private sector. The companies, in turn, decide how to care for the person, including which doctors they can see and what medicines and treatments can be prescribed.

Proponents say the plans offer patients more customized benefits, but patients complain they often have to pick between plans that cover either their doctors or medicines — not both.

Critic Laura Goodhue, executive director of Florida CHAIN, a health care advocacy group, said the pilot allows private providers unprecedented levels of flexibility with little accountability. They can decide how much "to siphon off from patient care for the benefit of stockholders," she said.

Toni Woods blames flaws in the program for the death of her 76-year-old father. James Waters had been scheduled to undergo heart surgery in Duval County, but his doctor felt the operation was too risky and should be performed by a specialist in Alachua County, which isn't in the pilot. The hospital there refused to accept him.

Woods tried to switch her father to regular Medicaid, but he died abruptly on Thanksgiving Day 2006 before the surgery could be done.

"It is a matter of life and death sometimes. Sometimes you can't wait two or three weeks," Woods said. "When it comes to something like health care you can't treat it like signing up for cable."

The program was approved by the Legislature in December 2005 after state spending on Medicaid nearly doubled in seven years to $13.8 billion. It's expected to exceed $15 billion during the next fiscal year — or about 20 percent of the state's budget.

"What the Legislature has done today is the single biggest change and the boldest reform since the beginning of Medicaid," Bush said after the bill passed during a December 2005 special session. He added: "We have to prove this now."

The Agency for Health Care Administration, which runs Florida's Medicaid program, says it has no specific figures on how much money has been spent on the pilot program and has given no evidence it's saving the state money. Still, AHCA has asked to expand the program to 20 more counties, including Miami-Dade, the state's most populous.

"It hasn't saved money and it hasn't improved care," said state Senator Dan Gelber, D-Miami Beach.

Problems arose shortly after the program began in 2006. Many patients didn't know they were enrolled in plans, they were denied drugs they'd taken for years and couldn't see their doctors as often as they had or, in some cases, at all.

Florida Legal Services, flooded with patients facing restrictions to doctors and medicine in pilot counties, has worked on behalf of patients like Annie Youngblood and Luisa Guerrero.

Youngblood, a Duval County diabetic, was in a plan that didn't have any endocrinologists in network. While waiting for an appointment with an out-of-network specialist, she suffered a stroke.

Guerrero was three months pregnant when she learned she was enrolled in a plan and could no longer be treated at the health department that cares for patients who only have Medicaid. The Duval County mother-to-be was later denied an appointment with an obstetrician because it hadn't been recommended by a primary care physician. She eventually switched to a new plan, but had to wait weeks until it took effect so she could make an appointment. While waiting for care, she went to the hospital and delivered her daughter, who died several days later.

Mentally ill patients are frequently denied services, doctors say.

The Florida Council for Community Mental Health, which represents the state's largest programs, estimates a 50 percent decrease in mental health services since the pilot, CEO Bob Sharpe said.

"So many of the medications are requiring prior authorization and then you get a denial and then you do an appeal and meanwhile you have somebody who's not getting medication," said Dr. Andrea Katz, CEO of Archways, a Broward County mental health facility that is part of the pilot program.

Doctors say they're paying for the drugs themselves or using samples to get patients their medication. Others are getting out of the Medicaid program, with some treating the pilot patients for free. According to a Georgetown University study of the pilot counties, 47 percent of doctors said the pilot made Medicaid worse.

Dr. Tad Fisher, who retired recently as executive vice president of Florida Academy of Family Physicians, said there has been an "absolute exodus" of doctors from the pilot program. One of the biggest complaints is prior authorization, where a doctor must get medications or procedures approved by the provider network before giving them.

"The barriers are so severe. Prior authorization is one of the most erroneous things you can do to a physician," Fisher said.

Then there is the problem with WellCare, the pilot program's biggest provider.

The company was raided by federal authorities in 2007 and later acknowledged owing the state $35.2 million in refunds for treating patients in non-pilot counties. A WellCare employee pleaded guilty in a scheme to defraud the state of more than $20 million.

Federal authorities said WellCare fraudulently skimmed money from AHCA by claiming it provided patients services it did not.

AHCA Secretary Holly Benson defended keeping the company in the program for now, saying WellCare removed those involved with the scam. She added there may be additional consequences.

"You want to make sure that somebody has actually violated the law before you take extreme action," Benson said. "Up til now they have showed they want to be a good partner in providing quality health care to our beneficiaries."

WellCare declined comment.

With legislative approval, the pilot program could expand statewide by 2011.

Bush declined comment to The Associated Press about the program. But in a column published recently in The Tampa Tribune, he encouraged expansion, arguing the program is more efficient than traditional Medicaid because providers are only paid for "services actually required by the individuals in the plan, not an expansive and expensive menu of services never utilized by healthy patients."

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