Keeping People at the Center: Medicaid in Missouri
by Bob Hughes

Last month the Missouri Department of Social Services released a 115-page "Rapid Response Review - Assessment of Missouri Medicaid Program," prepared by the consultancy McKinsey & Company. Prompted by predictions of Medicaid's continued growth and impact on the state's budget, the report thoroughly examined its financing and operations and presented numerous opportunities and suggestions for comprehensive improvements. Considering where Missouri is in its ongoing conversation on Medicaid and the benefits it poses to all, I'd like to highlight a few of the review's many findings by putting it in the context of the crucial role Medicaid plays in the health of Missourians.

For anyone interested in the workings of Medicaid, I recommend taking the time to read the report (at least the four-page executive summary). It is clearly written, contains extensive information, and is peppered with suggested improvements. Even the most experienced Medicaid analyst is likely to learn something.

The report does not comment on a topic that is uppermost on the public's mind - who else should be eligible for Medicaid? Missouri's eligibility levels are among the nation's most restrictive, and not expanding the Medicaid program leaves 232,000 poor Missourians in a "coverage gap" without health insurance. How and when program eligibility expansions could influence long-term efforts to fundamentally upgrade the program are complex policy, operational, and fiscal challenges. Nevertheless, a few things do seem clear. Medicaid is the most important program for improving the health of Missourians most in need, the time for initiating basic changes is approaching quickly, and these changes will have profound effects on the health and well-being of fellow Missourians and our communities.

The basic argument in the report is that continuing on the current path is financially unsustainable.
It suggests that Missouri should take a comprehensive look at the program for ways to fundamentally transform it, shifting from outmoded payment systems to value-based approaches. The report documents that the "Missouri Medicaid program is currently outdated in most aspects compared to other peer states," including:
  • Dollars spent are not well aligned with value received from the delivery system
  • Payment methods lack effective quality and cost incentives
  • Outdated information systems
  • Lack of substantial measurement or transparency of outcomes of care
The antiquated business model that Medicaid is currently operating under is not meeting the needs of many people in communities that really depend on it, such as those in rural areas. Missouri's failure to take advantage of the Affordable Care Act resulted in missed opportunities to update the program's core infrastructure, putting the state behind most peers. The report notes Missouri's laggard status has a silver lining - we can learn from best practices implemented in other states. Such practices include investing in management, information technology, and high-quality data to fulfill the state's role of administering a complex program that accounts for about one-third of Missouri's budget. Other needed changes include shifting to "investing in the rural and safety net infrastructure, including primary care and behavioral health."

Among potential initiatives to accomplish this shift are better payments for financially vulnerable rural and safety-net providers and global budgets for rural hospitals. The report notes that about 60 percent of rural hospitals lost money in 2016. Global budgets are an innovative approach being used effectively in Maryland and Pennsylvania that could be used to respond to the dire situation of many rural Missouri hospitals. This is just one example of the report's many ideas for improving virtually every operational aspect of Medicaid.

The report's explicit emphasis on a comprehensive, long-term approach to Medicaid improvement is encouraging. Implicit are the state's responsibilities to care for the most vulnerable Missourians through this program and the need for fundamental improvements in the program's value for the people it serves: low income children, pregnant women, persons with disabilities, and the low-income elderly - in sum, about one in six Missourians, almost 1 million people.

While the financial and administrative implications are two very important aspects to be considered when enhancing our state's Medicaid system, what needs to remain at the forefront is the significance of this program for the people of Missouri. Our communities deserve better health outcomes and relief from the costly burden of care. Ensuring that health care is affordable and accessible to all - especially the neediest - should be our highest priority and something that we're all pushing for.
 







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