PRINTER'S NO. 2009
No. 207 Session of 1997
INTRODUCED BY O'BRIEN, OLIVER, MICOZZIE AND COLAFELLA, JUNE 10, 1997
REFERRED TO COMMITTEE ON RULES, JUNE 10, 1997
A RESOLUTION 1 Calling for the Legislative Budget and Finance Committee to 2 conduct an immediate study of the physical health component 3 of the HealthChoices program administered by the Department 4 of Public Welfare in order to evaluate the adequacy of rates 5 for managed care organizations under HealthChoices. 6 WHEREAS, The Department of Public Welfare has contracted with 7 managed care organizations to provide physical health managed 8 care services to eligible medical assistance recipients in 9 southeastern Pennsylvania, with initial program implementation 10 on February 1, 1997; and 11 WHEREAS, The mandatory enrollment of medical assistance 12 eligibles has continued throughout 1997 with the last remaining 13 population groups, Supplemental Security Income and general 14 assistance eligibles, required to be enrolled in a managed care 15 organization plan by September 1, 1997; and 16 WHEREAS, The HealthChoices program represents a policy shift 17 in the delivery of health care services for the medical 18 assistance population from fee-for-service to managed care to 19 improve the overall quality of health care services; and
1 WHEREAS, The enrollees in HealthChoices, the providers of 2 services under HealthChoices and the managed care organizations 3 share the physical health program goals of maintaining adequate 4 funding levels necessary to provide all of the medical services 5 to the enrollees in HealthChoices; therefore be it 6 RESOLVED, That the House of Representatives call for the 7 Legislative Budget and Finance Committee to conduct an immediate 8 study of the physical health component of the HealthChoices 9 program in southeastern Pennsylvania in order to ascertain the 10 adequacy of the rates contained in contracts between the 11 Department of Public Welfare and managed care organizations; and 12 be it further 13 RESOLVED, That the House of Representatives believe that the 14 Legislative Budget and Finance Committee's report should include 15 an evaluation of the adequacy of the physical health rate 16 categories under HealthChoices conducted by an independent 17 actuary with experience in evaluating Medicaid managed care; and 18 be it further 19 RESOLVED, That the actuarial study should include an 20 evaluation of all of the rate categories under HealthChoices and 21 include specific evaluations of the following issues: 22 (1) A comparison of the methodology and assumptions used 23 by the Department of Public Welfare with relationship to the 24 fee-for-service adjustments, managed care adjustment factors 25 and other assumptions made in determining the rates for the 26 managed care organizations under HealthChoices. 27 (2) An evaluation of the assumed utilization, average 28 unit cost and cost per member per month of special needs 29 populations, including children with disabilities, 30 Supplemental Security Income eligibles and individuals with 19970H0207R2009 - 2 -
1 HIV/AIDS. 2 (3) An evaluation of the Department of Public Welfare's 3 range of assumptions on adjustment factors for 4 disproportionate share and medical education costs to 5 determine whether those assumptions are accurate within the 6 marketplace. 7 (4) An analysis of whether the Department of Public 8 Welfare's interpretation of medically necessary services 9 under HealthChoices has resulted in an expansion of managed 10 care organization responsibility under HealthChoices and 11 whether the rates accurately reflect the service level. 12 (5) An evaluation of the recovery of the full range of 13 administrative costs associated with implementation of the 14 physical health HealthChoices program. 15 (6) An analysis of whether the risk adjustments properly 16 account for demographics and health status in establishing 17 the rates; 18 and be it further 19 RESOLVED, That the Legislative Budget and Finance Committee 20 report its findings to the House of Representatives by September 21 30, 1997. F9L82JRW/19970H0207R2009 - 3 -