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Changes in the works for Medicaid managed care in Louisiana

Louisiana's health department intends to rework how it pays the private managed-care networks that provide health services to two-thirds of the state's Medicaid patients, Gov. Bobby Jindal's administration told lawmakers Friday.

The changes are planned for the Bayou Health program, an insurance-based model that covers 900,000 of Louisiana's 1.4 million Medicaid recipients, mostly pregnant women and children.

Existing managed-care contracts are expiring, and the Department of Health and Hospitals is readying a request for new bids from companies interested in participating in the program, with new contracts intended to take effect Feb. 1.

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"We believe the changes that we're going to make are going to make it a stronger system for the managed-care organizations, the providers and most importantly the people that we're serving," said DHH Secretary Kathy Kliebert.

Jindal privatized much of the Medicaid program in 2012. Medicaid recipients in Bayou Health choose from — or are assigned to — one of five privately operated networks of primary care doctors, specialists and hospitals.

Currently, Bayou Health has two models. In one model, the state pays companies a monthly premium per Medicaid enrollee and the companies pay healthcare providers for services rendered. In the other model, the state pays companies a smaller management fee to coordinate patient care, but still reimburses health providers directly for services.

DHH intends to only use premium-based health plans in the next contracts, even though the other model has more than half of Bayou Health's enrollees.

Sen. Sherri Smith Buffington, R-Keithville, said doctors prefer the model that is being discarded, in which they get paid directly from the state for their services and don't have to negotiate fees with managed care organizations.

But Kliebert said that model proved to be more expensive, on average $13 more for each Medicaid patient per month.

Louisiana's more than $8 billion Medicaid program, which is paid with state and federal tax dollars, accounts for nearly one-third of the state's budget.

Kliebert said Bayou Health has helped slow the growth of the Medicaid program's costs and also better coordinated care for patients, to help them get more consistent treatment for chronic diseases and wider access to services.

"Every result that we've had is showing that it is working," she said.

Other planned changes include adding hospice care benefits and non-emergency medical transportation for all services provided through Bayou Health.

Sen. Francis Thompson, D-Delhi, said he wanted to make sure the health department offers a diversity of plans so people have enough options to choose from when the Jindal administration enters into the new contracts.

The managed-care networks don't cover disabled and elderly Medicaid recipients who are in nursing homes or who receive home- and community-based care. Kliebert said some people who receive home- and community-based care could choose to get services through the managed-care networks when the new contracts begin in February.

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