Jesson: Health care delivery needs overhaul

DHS commissioner says better  accountability from HMOs is a priority

Minnesota currently sends roughly $3 billion each year to the state’s health maintenance organizations to provide coverage for more than 500,000 of the state’s poorest residents. Critics of the system charge that there is little transparency or accountability in how the dollars are spent. Legislators from both sides of the aisle have introduced proposals to significantly alter the system.

Department of Human Services Commissioner Lucinda Jesson has indicated that HMO reform is also a priority for the Dayton administration. She conspicuously dropped in on a legislative hearing on the issue earlier this month and penned an op-ed piece for the Star Tribune laying out broad guidelines for changes. Capitol Report sat down with Jesson last week to discuss the current HMO system and why it needs to be overhauled.

Capitol Report: The health plans say they file 200 reports to government agencies already. Why doesn’t that add up to transparency and accountability?

Lucinda Jesson: They do file a lot of reports to a lot of different agencies. They file reports with us; they file reports with the Department of Health; they file reports with the Department of Commerce. What we’ve got to do is actually in some ways to simplify that filing and make it meaningful.

I’m a lawyer by training. And I know that you can bury people with information. I’m not saying that it was intentional on their parts because they’re filing things we require as the state. But a lot of paper and a lot of numbers don’t equal transparency. Sometimes you can get buried in it.

Capitol Report: Does part of the fault for that, though, fall on DHS for not having a transparent set of requirements in terms of filing and

accountability?

Jesson: I think we need to think about this as a state as a whole. Remember, the health plans are regulated by Health, by Commerce and by the Department of Human Services. I think we need to do a better job as a state holding them accountable. And that’s going to require more coordination. I think actually we could require fewer reports and get more transparency. And that is something that is going to be one of our major priorities this year – to make sure that that happens.

Capitol Report: In your op-ed piece for the Star Tribune, you used the phrase “an element of competitive bidding” for these plans. What does that mean?

Jesson: In the governor’s budget, we included the fact that we are going to do a pilot project in the metropolitan area – a competitive-bidding pilot project. We want to try it in the metropolitan area first. We think that there’s more competition here, that we’ll be able to make that successful, and that we’ll learn from that. And then, after looking at the lessons that we’ve learned from the competitive bidding, roll it out to parts of the rest of the state.

But we really have to change going forward how we pay for health care, and that’s not just changing the way we do our contracting with managed-care plans. That’s part of it, but we also ought to explore other alternatives. We ought to look at some direct contracting alternatives. In my op-ed piece, I talked about accountable care organizations.

Capitol Report: Accountable care organizations sound like the same thing as health maintenance organizations, but with a different acronym. How are they different?

Jesson: It’s a new concept that incorporates a lot of what we’ve been doing here in Minnesota for years. They can run the gamut, so that’s why I think reading about them is confusing. You could have … a couple of hospitals, some clinics, a nursing facility, a home-health agency, some other home- and community-based services come together and [say] we’re going to agree to provide care for this population – these 5,000, these 10,000 people – and we’re going to provide all their care. And you, payor, whether it’s public or private, agree to pay us a certain amount. But if we provide that care to this group of people and achieve these quality benchmarks – better treatment of diabetes, fewer hospitalizations, all that sort of thing – if we meet the quality standards and we save money, then we share the savings.  So that’s the model.

Now, you could do that obviously with the health plans. But I think our idea is that, while we will continue working with the health plans, we also want to look at options of working with other organizations, including other provider-driven organizations. So I think that’s very different.

Capitol Report: We’re seeing a lot of proposals bubble up from the Legislature. Some of them are in conflict with each other. It’s unclear which ones will get a real vetting. What role does DHS play in shaping that dialogue at the Legislature in terms of HMO reform legislation?

Jesson: We’ve certainly been talking with a number of the legislators about this, as well as a number of health care providers, health care plans. This is the beginning of what I think will be a really exciting conversation about how we change not only our payment structure but really reform our delivery system for Medicaid. So we’re engaged and we think it’s a good conversation to be having.

Capitol Report: The health plans have actually put forth a proposal that would purportedly save $300 million by shifting an additional population – the disabled – into their plans. It’s about 100,000 people. Is that plan under consideration?

Jesson: I am fundamentally troubled by the idea of a wholesale shift of individuals with disabilities into managed care as we know it today.

Capitol Report: Why?

Jesson: I value the idea of care coordination. But I think that for individuals with disabilities, we need to look at that and do it in the right way with the right types of providers. It needs to be done carefully. The use of medical homes, the use of specialty-care coordinators – those are all important things to embed in our system. But I think we need to look at how we do those things, carefully looking at the specific needs of individuals with disabilities who have different types of needs than many of the folks we serve in our traditional programs. So yes, I am very concerned about any proposal to make a wholesale shift.