Four Months In, Medicaid Transition Still Bumpy

Aug 4, 2016

Pat Giorgio anticipated some problems with the transition of state-run Medicaid to three private management companies, but she didn't quite anticipate the breadth and depth of the woes the transition would cause for Evergreen Estates, residential communities she founded to serve the elderly in Cedar Rapids.

"Because I heard that it might be a difficult transition, I got a line of credit with my bankers of $100,000. I'm billing roughly $40-50,000 a month to Home and Community Based Services, and I've used up that $100,000 in my line of credit."

Giorgio says before the transition she was paid in eight days or so. Now, she says, 15 percent of her claims from three months ago have not been paid. 

"I look at the way my business is operating and I'm wondering what I'm going to do six months from now if something doesn't improve."

"I have tried to raise alarms with the three MCOs and with DHS and as as result, I've had some success now, I'm getting a number of claims paid, but frankly it's been very very difficult to manage."

August 1 marked four months of management by Amerihealth Caritas, Amerigroup, and UnitedHealthcare. Giorgio, who works with all three Managed Care Organizations, or MCOs, says the system simply isn't working.

"I look at the way my business is operating and I'm wondering what I'm going to do six months from now if something doesn't improve. [...] I'm incurring additional administrative costs that are significant and getting paid less. That is not a business model people are going to jump into."

Amy McCoy, spokeswoman for the Department of Human Services, says the DHS is there to help smooth over those types of bumps.

"Really sorting through: is something a system issue, is it a technology-programming issue, is it call center training? When the issue is happening to you and you're a provider or a member, it's really important to get a response. We've got the ability to escalate issues for our providers and members, and we do absolutely want to hear from them so we can be on top of those issues."

Giorgio says that doesn't quite square with her experience.

"I'm going to be really honest, the MCOs frankly have been more helpful than DHS has for my individual company."

Just last week, Senator Liz Mathis, Democrat from Cedar Rapids, held an out-of-session meeting of the Human Resources Committee. In it, she questioned the three MCOs about billing and other oversight issues, and heard from providers like Giorgio who were having issues with the new system.

"We did hear from Micki Stier, who is the head of the IME [Iowa Medicaid Enterprises], that they were ready to go on January 1st, and then we heard they were ready to go on March 1st, and then on April 1st. And clearly this transition has been pretty bumpy. [...] To try to change a system that is this large between September and December and be ready to go January 1st was an impossibility," says Mathis.

But Amy McCoy says some of that bumpiness was inevitable, regardless of start date.

"Some of the things that we're experiencing right now are really things that you need to be into the transition to iron out, things like particular billing issues. And when we look at our providers, many of our providers are used to billing a number of commercial plans before."

In the meantime, smaller facilities like Pat Giorgio's Evergreen Estates are scrambling to pay their bills while waiting for a change.

"I'm a very big believer in the waiver program; I think it's a social justice issue and I'm very stubborn so I don't want to get out, but things have to improve." 

On this River to River:

  • Heather Young, whose family receives Medicaid,
  • Pat Giorgio, founder and owner of Evergreen Estates, residential care communities that provide services for seniors
  • Amy McCoy, spokeswoman for the Department of Human Services
  • Liz Mathis, Democratic State Senator from Cedar Rapids

Editor's Note:  In the course of the interview, Pat Giorgio said that, to her knowledge, the physicians at UnityPoint Clinics in Cedar Rapids were not taking new Medicaid patients. UnityPoint Clinic has clarified they are currently transitioning their existing patients and will shortly have availability for new patients, per their MCO contract terms.

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