Illinois is funneling more people into the Medicaid managed-care plan with the highest turnover and lowest scores on state quality measures.
The Illinois Department of Healthcare & Family Services sends 35 percent of new Medicaid enrollees who didn't request a particular plan to NextLevel Health. That ties CountyCare for the highest percentage assigned to any of the state's Medicaid managed-care providers.
NextLevel gets all those new customers despite poor quality grades and high rates of defection among its current members. The plan finished last in the state's latest quality survey, which rated NextLevel "low" or "lowest" in five of six performance metrics. Meanwhile, NextLevel lost customers at twice the rate that patients left the program overall.
NextLevel is run by Dr. Cheryl Whitaker, a longtime healthcare executive whose husband, Dr. Eric Whitaker, is known for his friendship with former President Barack Obama. With 51,000 members and 2 percent of the market, it's one of six private health insurers awarded state contracts to administer Medicaid benefits under a managed-care program intended to improve care and save money. It's one of two plans available only in Cook County.
Both Whitakers declined interview requests. HFS Director Theresa Eagleson says assigning large numbers of enrollees to NextLevel advances the administration's goal of supporting minority-owned businesses that "reflect the diversity of our Medicaid membership," adding, "We were trying to, because they got a late start, help make sure they had the ability to be successful."
Medicaid beneficiaries in Illinois have 30 days to choose a plan. Those who don't—about half—are automatically assigned to an insurer by the state using an algorithm that considers where enrollees live, if their primary care doctor is in network, whether family members are already assigned to a plan, and how much the state pays each plan to cover patients. Illinois' auto-assignment algorithm doesn't take insurers' quality ratings into account.
Auto-assignments offer health plans a significant financial advantage, says Sara Rosenbaum, a health policy expert at George Washington University.
"Auto-assignment is very powerful. . . .It's a huge cash infusion," Rosenbaum says. "Especially because auto-assigned people tend to use less care." A state might choose to send more enrollees to a newer plan that needs help getting off the ground, she adds, especially if that plan is serving a geographic area that doesn't have enough capacity.
Eagleson's agency revamped the auto-assignment algorithm in July, boosting NextLevel's share of auto-assigned members to 35 percent from 22.5 percent in April and 12 percent before that. As NextLevel's auto-assignments were increasing, only 3.3 percent of its new enrollees in July had specifically requested the plan. By comparison, 43.6 percent of July enrollees at CountyCare, the other provider confined to Cook County, requested that plan. CountyCare is run by public hospital network Cook County Health.