Idaho BHTWG Panel

1. Idaho BHTWG Panel March 24, 2010 Steve Holsenbeck, MD ValueOptions Colorado Partnerships

3. Why you should listen to me? • 25 years managing healthcare systems, mostly community based; • Public sector managed care experience: • 11 years as head of regional Colorado managed care operations; • 15 years as medical director for Colorado; • 7 years as National CMO Public Sector for VO; • 8 state or regional public sector managed care program implementations.

4. Colorado Model • Colorado implemented a capitatedmental healthcare carve-out in 1995. • Initially 8 regions; now consolidated to 5 • Single Behavioral Health Organization per region • Membership assigned on county of residence • All Medicaid eligibility and age categories included • Driven by list of Covered Diagnoses (no SA or DD or OBS) • All services and levels of care (except residential x child welfare & youth corrections) • RFP with competitive bidding (rebids every 5 yrs)

5. Colorado Model • Full risk capitation: contractor at risk for ALL covered services to all Medicaid Members within region; • Regions based on historical CMHC catchment areas; • CMHCs eventually involved in BHO governance or ownership in all regions.

6. VO CO Partnerships Profile Customer: Colorado Department of Healthcare Policy and Financing BHO Partnerships: Colorado Health Partnerships, LLC – VO with 8 CMHCs Foothills Behavioral Health Partners, LLC – VO with 2 CMHCs Northeast Behavioral Health Partnership, LLC – VO with 3 CMHCs Each BHO holds contract with CDHCPF for its region. BHOs delegate managed care functions to ValueOptions. BHOs contract with CMHCs as principal, but not sole, providers of non-hospital services. February 2010 combined membership: 307,000 Penetration rates: 13-18%

7. Managed Care Services Provided by ValueOptions • Financial Management • Member and Family Affairs • Quality Management • Information Technology • Data Management and Analysis • Claims • Network Operations • Provider Relations • 24/7 Call Center Operations • Utilization Management • Service System Integration • Medical Management

8. Immediate benefits • Major systemic transformation occurred over first two years of managed care, 1995-1997.

9. Expanded Access • Strategy: Rapidly expand access to effective community-based services in order to reduce reliance on expensive institutional care. • Average Wait to first appointment from >30 days to <7 days. • Crisis access in all counties within first 6 months. • Penetration rate from 9% to 13 %, most increase in children’s services.

10. Colorado Health Networks: Successes • National Outcomes Roundtable 1996 • Rochester Institute of Technology/USA Today Quality Cup 1997 • National Committee for Quality Assurance Full Accreditation 1999 • URAC Full Accreditation 1999 • Eli Lilly Reintegration Award 2002 • American Psychiatric Association Silver Achievement Award 2003

11. Colorado Health Networks: Successes • URAC Full Accreditation 1999 • Eli Lilly Reintegration Award 2002 • American Psychiatric Association Silver Achievement Award 2003

12. Savings • Direct: Capitation rates set at 95% of Medicaid Fee for Service. • Indirect: • Improved access to community based services resulted in natural closure of >120 state hospital beds. • Strengthened safety net resulting in expanded capacity for indigent care, thereby stretching state General Fund dollars to cover more non-Medicaid. • Reduced over-utilization of emergency rooms. • Reduced utilization of residential beds for children and adolescents. • Reduced inpatient utilization. • Shifted savings to community safety net providers. • Prior to 1995: 2/3 of Medicaid Mental Health costs were for institutional care. • By 1997: <10% of Medicaid Mental Health costs were for institutional care.

13. What worked? • Carveout • Full risk capitation for ALL covered services • Regionalization • Population-based Responsibility and Accountability • Defragmentation of system of care • Partnerships between comprehensive (but under-funded) Community Providers and Well-resourced Professional Managed Care Organizations • State transformation “czar”, committed to the vision, with authority to make compromises on behalf of Agencies • Bias for Action at every level • Fueling the recovery movement with inclusiveness and $$ • Incorporating opposing viewpoints in policy making • Crisis intervention and hospital diversion services

14. What worked? • Measuring Successes (occurred mainly at BHO level) • Data mining • PDCA • Driving provider behavior with Data and Dollars • Data: • Move toward standardization of EMRs at major provider level • Standard service definitions and uniform encounter coding • Comparison of providers to standards, to benchmarks, and to each other

15. What doesn’t work (well)? • Diagnosis-based carve-out vs Provider/Service based carve-out • Exclusions for Child Welfare, DD, SA, OBS. Resulted in: • Haves vs Have nots • Conflict over primary diagnoses • Fudging diagnoses • Under-development of workforce to treat excluded diagnoses • Micromanagement of contractors by committees • Process-based contracting • Unilateral mandates • Squabbling between oversight agencies • Holding community providers financially harmless for hospitalization • Crisis assessment (versus crisis intervention) services