Read this if you are in a management role at a state Medicaid agency.
States are facing unique pressure on resources and budgets due to the COVID-19 pandemic, coupled with potential uncertainty following an election year. Healthcare innovation and transformation is one route state Medicaid agencies (SMAs) may take to minimize operational costs and improve access to services. Here are some tactics, flexibilities, and practical steps to help realize innovation during this time.
US Supreme Court Justice Louis Brandeis is credited in 1932 with popularizing the phrase that states are the “laboratories of democracy”. In this case, Medicaid may be the ‘laboratory of health policy and innovation", in part as state Medicaid and Children’s Insurance Programs (CHIP) are collectively the largest US healthcare payer, covering 74 million individuals.
In 2020, states have faced the dual challenge of a public health emergency and corresponding state budget uncertainty, squeezing resources just as projected state revenues have dramatically shrunk. SMAs must be creative to meet competing priorities: administering their programs while responding to the public health emergency. Here are some tactics, flexibilities, and practical steps to help realize innovation during this time.
Reimagining funding for state Medicaid agencies
Identifying a source of funding is often challenging. Three options to consider include:
- Advance Planning Documents (APDs)
While strictly for information systems, APDs can unlock 90/10 match for Development, Design, and Implementation (DDI) or a 75/25 match for operations. This funding is above most state Federal Medical Assistance Percentages (FMAPs). Realistically, program changes generally require system changes too. Consider reviewing whether you could tie the initiative to Medicaid Information Technology Architecture (MITA) business process maturity and/or outcomes-based system certification criteria. Linking personnel, training, project management, and any equipment for system needs into an APD can be an effective way to help fund the process and system changes.
- Partnerships
An SMA can look further afield if sister agencies have funds available. This is especially true if braiding federal payment streams is an option. For example, many developments that benefit Medicaid can also help CHIP. The federal matching rate for state CHIP programs is typically about 15 percentage points higher than the Medicaid matching rate.
- Certified Public Expenditures (CPE)
Under 42 CFR § 433.51 and the Social Security Act, another governmental entity besides the SMA can contribute state matches allowing the state to draw Federal Financial Participation (FFP). One option can be another governmental entity using state dollars at the state, county, or even local level, to deliver health services (if covered under the Medicaid state plan) to Medicaid members.
Interagency cooperation to generate savings in the health and human service (HHS) space will be the topic of a forthcoming article.
Getting help: Communications planning and the role of project management
As SMAs pursue more complex initiatives such as addressing Social Determinants of Health (SDoH)—collaborating not just with providers but with other public agencies, community organizations, vendors, federal partners, advocacy groups, and health systems—the need to coordinate such a diverse circle of stakeholders increases. Demonstration projects, system implementation efforts, and major healthcare initiatives in particular, require coordination of stakeholders throughout each project phase.
Health and human services (HHS) organizations sometimes underestimate the role of project management. For example, project management is often seen as simply “making sure things are complete” by the deadline, but there are other advantages such as establishing efficiency, improving the quality of service delivery, controlling costs, and better coordinating staff for the SMA. With stretched public workforces and more tasks in the current business environment, you want to get as much done—preferably faster, cheaper, and with less risk—and deliver the expected benefits.
Guidance on priorities from senior leadership can help organizations establish clear and visible sponsorship to help establish success. Strategic change needs a strong champion within the SMA who has the ability to convene key stakeholders and keep projects on task.
Procuring the tools
After determining funding and before executing a project, you prepare by getting the tools you need—whether tools that involve systems, subject matter experts, or general project assistance. If the Request for Proposal (RFP) process is not an option, consider whether a pre-qualified vendor list or cooperative contract vehicle would work for you. Cooperative contracts are increasingly popular at the federal, state, and local levels. A few cooperative options include:
The solution is strategy
Keeping Medicaid innovation moving forward requires strategic focus that combines funding, communications, project management, and procurement. The strategy you develop can help the outcome of the initiative to be greater than the sum of its parts. By using all available tools, including those discussed here, your SMA can prioritize innovation.
Next steps
- Evaluate your program and identify initiatives to prioritize in the coming year. Ask your CMS contact about the latest applicable guidance.
- Develop APDs to help fund technology needs for initiatives, along with training your SMA team and providers.
- Implement a communications management approach to engage stakeholders.
- Marshal project management resources and develop a realistic and achievable roadmap to success.
- Explore agency contracting vehicles, cooperative contracts, and other procurements tools.
We’re here to help. If you have more questions or want to have an in-depth conversation about your specific situation, please contact the Medicaid consulting team.