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MO HealthNet director shares what he learned about Medicaid from touring state

MO HealthNet director shares what he learned about Medicaid from touring state

March 17th, 2019 by Joe Gamm in Local News

Todd Richardson, former Speaker of the Missouri House of Representatives, who is now director of MO HealthNet, points out the "2006 Medicaid Transformation" binder, which he says is a constant reminder of the task he's undertaken.

Photo by Julie Smith /News Tribune.

Differences in health care between Missouri's urban and rural communities are becoming more pronounced every day.

That was a takeaway from a statewide health care tour MO HealthNet Director Todd Richardson embarked on after his appointment.

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Gov. Mike Parson appointed Richardson to the director's position in October. Richardson, who was then the Missouri House speaker, was completing his fourth term in office and agreed to resign from the House to take up the director's job Nov. 1.

After taking office, Richardson criss-crossed the state to meet with staff and lawmakers, and Medicaid providers, partners and beneficiaries.

"When I started the job, I had this idea in my head about a tour — and then we'd get started into the work," Richardson said. "The reality is — this is going to be an ongoing tour my entire tenure at MO HealthNet, no matter how long that will be."

Early on, it became evident Richardson and his staff would have to remain constantly engaged with all stakeholders in Medicaid in Missouri — especially as they go through trying to implement significant changes to the program, he said.

The tour took in metropolitan areas including St. Louis, Kansas City, Springfield and Columbia. It also included rural communities such as Clinton, Doniphan, Kennett, Richardson's hometown of Poplar Bluff and other towns.

"That diversity — and I've tried to be intentional about picking facilities and hospitals and primary care practices in different parts of the state to get a feel of those differences in different areas — some of the challenges are the same in those areas," Richardson said. "But some of the challenges are very different."

Take Doniphan — a town not dissimilar to his hometown — which until mid-October had a 50-bed hospital. On Oct. 15, the Southeast Health Center closed. It was the second Southeast Missouri hospital to close in six months, after Twin Rivers Regional Medical Center in Kennett closed in June.

"The thing we're going to have to recognize is that the days of there being a 50-bed hospital in a community like Doniphan probably aren't coming back. The economics just don't work the same way they did 30 or 40 years ago for a hospital in a community that size," Richardson said. "That doesn't mean that a community that size doesn't need health care. And it doesn't mean that they don't have a need for emergency department services. It doesn't mean that they don't have a need for in-patient observation."

So the state has to figure out a way to address the unique situations present in rural communities, he added.

The 2018 Medicare and the Health Care Delivery System report — created annually by the Medicare Payment Advisory Commission to advise Congress and released in June — said by 2016, the nationwide urban hospital occupancy rate was 66 percent, while the rate for rural hospitals with 50 beds or more was 40 percent. The rate for rural hospitals with fewer than 50 beds was 31 percent.

The report said closures of rural hospitals were increasing. And 67 rural U.S. hospitals had closed between 2013-17 — before the two Southeast Missouri hospitals closed — in many cases, leaving rural communities 35-plus miles from the nearest hospital.

Financial challenges rural hospitals face include declining populations, declining volumes of patients with commercial insurance, difficulty recruiting physicians, continued uncompensated care costs and patients bypassing rural institutions to receive care at urban facilities.

At the same time, rural emergency room visits — those services that are among the most expensive in health care — continue to rise.

"If we don't (figure out how to address the rural/urban health care divide), what's going to happen is we'll have a collapse of the entire universe of health care providers in those rural regions," Richardson said. "What some of those regions need is robust primary care, urgent care clinics, emergency departments and a little bit of observation in those communities."

By contrast, he said, Kansas City and St. Louis offer all those specialists that can be at the disposal of the state's residents.

"In order to get to that place, where we are ensuring access and good quality of care for people in every community, we're going to have to recognize that the way we pay and the way we reimburse may need to be different in a rural community, versus how we pay a large hospital system," he said. "It doesn't necessarily mean more or less. You've just got to realize there's a difference in the business model between the two facilities."'

How Medicaid pays for medical services primarily falls into two categories — managed care and value-based payments.

Currently, about 75 percent of the state's Medicaid patients are covered by managed care programs, in which patients visit only certain physicians and costs of treatment are monitored by a managing company. Value-based care shifts care delivery focus from volume to value (or outcomes).

Missouri "lags behind" other states in adopting value-based care, which offers savings through better outcomes, Richardson said. But Missouri should not rule out managed care.

Missouri, by lagging behind, has the benefit of being able to see what is working in other states and what is not, he said.

There's been a lot of focus on different rural and urban hospitals' business models nationally as well because people realize rural health care is an issue, he said. A one-size-fits-all approach is not going to work. Richardson is looking strictly at Missouri, and any impacts created by President Donald Trump's proposed budget are unknown.

An approach to health care in Missouri that is working, particularly in rural communities, according to the Rapid Response Review's Assessment of Missouri Medicaid Program, is in-home health care.

Released in February, the review was conducted by McKinsey & Co., the former employer of Missouri Chief Operating Officer Drew Erdmann. It examined the entire Medicaid program, including health outcomes, participant experiences, operational efficiencies and cost of management.

It resulted in the company identifying several dozen "opportunities" for changes within the program that could help it improve sustainability and reduce the rate at which Medicaid grows in the state. The report includes descriptions of the opportunities (with supporting data) and potential initiatives the state may use in shaping its approach to Medicaid.

"What we know is — as the baby boomers continue to get older and their health care needs continue to grow — that there's going to be an increasing need on or a continuing utilization on those long-term services and supports," Richardson said. "We know we're going to have a need for nursing care. We also know the longer you can keep someone in their home — that's where they prefer to be — their outcomes are usually better. And the costs overall are going to be lower."

The state isn't without challenges in its senior health care program. Home health agencies provide in-home care. Services offered vary depending on the agencies, but they may include skilled nursing, physical therapy or home health aide services.

According to a study conducted by the University of Pennsylvania, although Medicare patients discharged from hospitals to receive care at home were more likely to return to the hospital within 30 days than those sent to skilled-nursing facilities, they cost Medicare less money.

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"One of the most emotional visits I had with stakeholders was with the Alzheimer's Association in Columbia. They brought a couple of families to that meeting who had gone through the experiences with (the disease)," Richardson said. "We need to learn from those experiences about where Missouri is getting its home care right and where we're leaving some gaps that need to be filled."

Missouri has a good base for providing home care services, which lead to better outcomes. But that doesn't mean the state should sit on those laurels, he said.

The tour taught him there's room for improvement across the board, he said.

"The complexity of the challenges we have in Missouri is certainly not something I overestimated. I would say I underestimated it — because I knew there were significant challenges, but the complexity of this is significant," Richardson said.

Several moving pieces are working together to improve the state's Medicaid program, he said — staff from MO HealthNet and other agencies, health care providers, the governor and the Legislature.

"When you put all those things together," Richardson said, "Missouri probably has a once-in-a-generation opportunity to build a program that other states are going to look to and say, 'That's a state that's getting it right.'"