American Health Care Providers
As
of July 1, 2000 American Health Care Provider (AHCP) had over 3,000 eligible
members still active under contracts.
The Illinois HMO Guaranty Association (IHMOGA) is financially
responsible for all covered health care services provided to these remaining
AHCP members.
Claims
for services provided eligible AHCP members after June 30, 2000 should be
submitted directly to AHCP and will be reimbursed at fee for service rates by
the IHMOGA. This also applies to
members receiving services from primary care physicians. Should you have any questions, please
contact AHCP directly at 708.503.5000.
If
claims are sent in error to our MSO, they will be forwarded to AHCP for
payment.
Humana
and BlueCross BlueShield of Illinois have recently issued their policy for
“standing referrals,” in compliance with the Illinois Patient Bill of Rights
that was passed last year. Due to their
length, we are providing each policy without edit at the end of this
newsletter.
As
you read these announcements please keep in mind that, while the applicable
terms of the law do not change, each health plan may have different procedures
for complying with the law. We will
provide information from other plans as we receive it. We will also post this information to our
web page.
A
summary of the provisions of the Managed Care Reform and Patients Rights Act
(Senate Bill 251) is available in our December 1999 newsletter on our web page.
Questions
about referrals may be directed to Barb Rabin at brabin@uic.edu.
The
Office of Managed Care is pleased to announce that the web page is up and
running. It’s available through the
UICMC home page under the UIC Medical
Center menu tab. We invite you to
take a tour.
Managed
care contacts, J-Codes, newsletters and other information are available with a
click of the mouse. In addition, access
to capitated eligibility is provided directly through a link to our MSO’s web
site. (If you’re interested in using
the Metro Prime Care portal, refer to the “Eligibility” section of the web page
for password and ID instructions.)
We
plan to add more elements and features so check out the “What’s New” section
each month. We hope that you find our
web site a useful and friendly resource.
Take a moment to send us some feedback.
We appreciate your comments or suggestions. Ron Plemmons is available at rplemmons@uic.edu.
Over the past six months, business development initiatives have resulted in a number of new or renewed contracts with health plans and physician groups. Final signatures are being put in place and you will be notified of pending implementation dates. Watch for information about the following:
Rush Prudential Health Plans Medical Group Contract Union Health Services Referral Contract
Sinai Medical Group Referral Contract Boulevard Medical Group Referral Contract
Meyer Medical Group Referral Contract Holy Family Health Plus Referral Contract
Midwest Medical Network Referral Contract HFN Hospital Contract Renewal
Cigna Healthcare of Illinois Physician Group Contract First Health (PPO) Hospital/Group Contract
Cigna Healthcare of Illinois Hospital Contract Humana Bone Marrow Transplant Contract
State of Illinois (QCHP) Hospital Contract Renewal Family Medical Network Renewal
Preferred Plan (United Payers and United Providers) Ravenswood Physicians Medical Group
Harper Leather Goods (Direct Contract)
Please keep in mind that these contracts are not yet in effect. Our office will provide information about each plan, including reimbursement rates and claims processing requirements, as the effective dates approach.
The
contracting process at UICMC includes a thorough review of the proposed
contract or agreement by the Contract Review Committee (CRC). Representatives from the hospital and the
Medical Service Plan meet monthly to evaluate the terms and conditions of
contract proposals. Are the
expectations of both parties realistic and appropriate? Can UICMC provide the required scope of
services at the offered reimbursement rates?
Are other terms of the agreement acceptable? These are common contracting issues that are resolved before the
committee approves a contract for processing through the University system with
signoff by the Board of Trustees.
Questions
about contracting should be referred to Vince Savickis at savin@uic.edu.
Questions about implementation should be directed to Jacqueline Petersen
at japeter@uic.edu.
Managed Care – The
Current Paradigm
In response to
requests for basic information about managed care, last month we provided an
introduction to the concept of managed care and presented several kinds of organizations
that fit under the umbrella of managed care.
This article continues with several of the more complex models and
discusses one of the elements of managed care – capitation and risk. In the limited space available in our
current newsletter format only a brief overview of any given topic is
possible. We hope that those of you who
have not had a formal introduction to the concepts of managed care will find it
useful. Contact the editor for
references.
Integrated Models
In managed care, a central theme emerges. The shift from a fee-for-service system reimbursed through indemnity insurance to a system in which the financing and delivery of services is integrated gave rise to a number of organizations in which both patient utilization and provider practices are managed by a third party. Some of the better-known “third parties” are health maintenance organizations (HMOs) and preferred provider organization (PPOs). Some of the newer, more complex models are referred to as integrated deliver networks (IDNs) and provider-sponsored organizations (PSOs).
IDNs. Integrated delivery network is a generic term referring to a joint effort by a number of affiliated organizations that are linked to provide a broader array of health services across the continuum of care, beginning with timely and effective pre-natal care and ending with palliative care in the last days of life. The IDN serves a defined population and is willing to be held clinically and fiscally accountable for the outcomes and the health status of the entire population served.
There are two ways to accomplish this model. Vertical integration puts hospitals, medical groups, and other elements under one “corporate” umbrella with a unity of purpose and control. Virtual integration can be achieved on a contractual basis without the hierarchies or large bureaucratic structures. A recent trend in this area includes the efforts of large corporations to bypass the insurance industry altogether by negotiating directly with hospitals and medical groups to provide services to a defined population.
PSOs. Provider-sponsored organizations are a variant of the IDN and it is often difficult to differentiate between them. Sometimes called provider services networks (PSNs), they offer counter-balance to the growing market power of national and regional health plans and insurers.
Organizationally, PSOs can be loose affiliations of physicians or highly integrated networks of physicians and hospitals. They sell services to a variety of purchasers including individuals, other health plan and insurance companies, and employer groups accepting a variety of payment mechanisms, from fee-for-service to full capitation.
Another type of PSO, the physician-hospital organization (PHO), became common in the 1990s. PHOs are joint ventures between a hospital and its medical staff to contract with HMOs or self-insuring employers to provide services to a defined population. PHOs typically assume financial risks for services they provide under a capitation arrangement.
Capitation
Webster’s
Dictionary defines capitation as “a tax or fee of so much per head.” It is derived from the Latin word meaning
“head”. Thus, capitation is a means of
paying for health care services “per head,” not “per service.” Specifically, capitation is a managed care
payment system that pays a fixed dollar amount to contracting physicians
(usually on a monthly basis) for providing specified services to those members
who have selected that provider. The
buyers of health services pay a single monthly fee (“premium”) in advance
(“pre-payment”) for each person who may receive medical services during that
month (“per head”).
In
essence, under a capitated system, physicians are paid for their ability and
commitment to provide specified medical services to plan members, not for
actual services provided. The problem
for providers, then, is in determining what services are to be provided and in
what quantity (patient utilization). It
is because of this problem that capitation systems are risk-bearing systems for the provider.
For
a health care provider, risk can be defined as the measure of possibility that
the income will not be sufficient to cover the costs incurred in the delivery
of contractual services. A contract to
provide services under which the provider receives a fixed monthly payment for
members and then is liable for all services regardless of their extent,
expense, or degree is known as a risk contract.
Our series on managed
care will continue in the next edition and present the concept of utilization
management.
Curious to know why some claims are routed to our MSO for adjudication and why some are routed to the health plan? It depends on which entity has the financial risk for providing those patient care services - which entity is responsibility for payment.
When we receive a capitation check to cover the cost of contractually provided services, the monies are disbursed to the providers based on the claims they submit. Our MSO handles the processing of those claims. If a health plan or another medical group is responsible for payment, the claims are sent directly to them.
To illustrate, let’s look at two contracts, HMO Illinois (Blue Cross/Blue Shield) and One Health. The table below shows how the financial risk is shared between UICMC and HMOI for the following sample of services:
|
Type of Service* |
Party at [Financial]Risk |
|
Med/Surg,
Professional |
UIC
Physician Group |
|
Outpatient
Diagnostic |
UIC
Physician Group |
|
Outpatient
Therapeutic |
UIC
Physician Group |
|
Immunizations/Injections |
UIC
Physician Group |
|
Radiation
Therapy |
UIC
Physician Group |
|
Emergency
Room, Professional |
UIC
Physician Group |
|
Emergency
Room, Facility |
HMOI
Illinois |
|
Outpatient
Surgery, Facility |
HMOI
Illinois |
|
Inpatient
Facility |
HMOI
Illinois |
|
Routine
Eye Testing |
HMOI
Illinois |
|
Home
Health |
HMOI
Illinois |
|
DME |
HMOI
Illinois |
|
Substance
Abuse |
HMOI
Illinois |
|
Prescription
Drugs |
HMOI
Illinois |
|
Infertility |
HMOI
Illinois |
|
Organ
Transplants |
HMOI
Illinois |
*The table reflects limited services. For a full list of services please contact the Managed Care Department.
Claims
for services that are the financial responsibility of the UIC Physician Group
are handled by Metro. In the same way,
Metro processes claims for the other capitated products: Campus Care, Alumni
Care, and Humana. Claims that are the
financial responsibility of HMOI are sent to them directly.
In
contrast, One Health is entirely at risk for all services – they are
financially responsible for payment. Thus, One Health processes all claims for
their HMO members. Claims for One
Health HMO members should be sent directly to One Health, not Metro.
The
UIC Physician Group Managed Care Finance Committee determines the reimbursement
rate to MSP departments for professional services that are the financial
responsibility of the group. Currently
the reimbursement rate is 100% of Medicare with a 10% withhold. The reimbursement rate for the One Health
HMO product is determined by through negotiations between One Health and
representatives from business development and the Contract Review Committee.
If you have additional questions please feel free to call Mike Gibbs at x55767.
From the Editor
If all goes according to plan, this will be the last edition of our newsletter distributed by electronic mail. Beginning in August, our newsletter will come to you through our web page. We’re excited about it. A new template and “quick link” features should make it easier to read and navigate.
Mary Gibson, Editor
The
Office of Managed Care, University of Illinois at Chicago, College of Medicine,
presents Managed Care
News online. Comments or requests should be addressed
to the editor at mgm@uic.edu.
BlueCross
BlueShield – Policy on Standing Referrals
The
HMOs* of BlueCross BlueShield of Illinois have recently approved a policy for
Standing Referrals, to comply with Senate Bill 251 legislation.
Policy: The HMOs* of BlueCross BlueShild of Illinois will specify how
members may access standing referrals under appropriate clinical circumstances.
Purpose/Objectives: To specify criteria to be met so that a member may obtain a
standing referral and to specify a procedure to initiate and renew a standing
referral.
Definitions: “Standing Referral” means a written referral from the primary
care physician for an ongoing course of treatment pursuant to a treatment plan
specifying needed services and time frames developed by a specialist in
consultation with the primary care physician and in accordance with procedures developed
by the health care plan.
“Ongoing
Course of Treatment” means the treatment of a condition or disease that
requires repeated health care services pursuant to a plan of treatment by a
physician because of the potential for changes in the therapeutic regimen.
Procedure: The PCP may write a single referral, rather than multiple
referrals, to address the needs of a member who has a disease or condition that
requires an ongoing course of treatment of a specialist (or other health care
provider).
If
a member has such a disease or condition, he/she may request a standing
referral from his/her PCP. As
appropriate, the PCP consults a specialist (or other provider) to confirm that
the member’s plan of treatment calls for repeated services most appropriately
provided by that specialist. The PCP,
at his/her discretion, may write a single referral specifying the duration,
type, and frequency of specialist services to complete the member’s ongoing
course of treatment. This standing
referral remains valid for the specified time period or for one year, whichever
comes first. The PCP may renew and
re-renew a standing referral if the member continues to need specialist
services for the same ongoing course of treatment.
In
the event of termination of the member’s benefits or the specialist’s contract,
the standing referral is no longer valid except if all conditions in the
Transition of Care Policy are met. The
medical group must notify the member in a timely manner if the specialist no
longer has a referral arrangement with the medical group. The medical group and the Primary Care
Physician must redirect the member to an appropriate specialist who would
provide services related to the member’s ongoing course of treatment as
specified in the original standing referral.
If
the member changes medical groups the standing referral is no longer
valid. The member must obtain another
standing referral from the PCP in his/her new group. If the member changes PCP’s within the same medical group and
this changes does not affect the medical group’s contractual arrangement with
the specialist, the original standing referral remains valid.
The
Managed Care Reform and Patients Rights Act, also known as Senate Bill 251,
became effective in the state of Illinois January 1, 2000 for all commercial
lines of business, including HMO, Point of Service and Medicaid plan. Over the
past six months, Humana has been working diligently with the State to obtain
clarification on the requirements of this Act. This document outlines the
intent of the Act and the specific requirements that must be adhered to by
Humana and our delegated partners.
Health
Plans and their designees must establish a procedure for reviewing requests
made by members for “ standing referrals”. A standing referral should be
provided in cases in which “ a
condition requires ongoing care from a specialist physician or other healthcare
provider”. Further requirements of this provision include:
·
The
Health Plan determines applicable conditions and as such, Humana has approved a
list of medical conditions that should be automatically approved for standing
referrals. This list includes, but is not limited to:
·
Pregnancy
·
Radiation
Therapy
·
Infertility
·
End
Stage Renal Disease
·
Transplants
·
Chemotherapy
·
If
there is a specialist physician or other health care provider within the
primary care physician’s referral network, the member may be required to use
this provider or select a new primary care physician who has a referral
arrangement with the specialist physician or healthcare provider chosen by the
member. Note: An exception to this is
outlined below.
·
If
there is not a participating specialist physician or other health care provider
within the primary care physician’s referral network, the primary care
physician, in consultation with the member, will arrange for the member to have
access to a qualified participating health care provider within the Health
Plan’s network. This will not require the member to switch their primary care
physician.
·
If
there is not a participating specialist or other healthcare provider within
either the primary care physician’s network or the Health Plan’s network, the
primary care physician will arrange for the member to have access to a
qualified non-participating health care provider within a reasonable distance
and travel time at no additional cost to the member (beyond any copay
requirements.)
·
Exception to the above
requirements:
·
If
a member has a long-standing relationship with his or her primary care
physician (defined as no less than five (5) years; except for children under
five who have had a continuous relationship with a physician since birth) the
member shall not be required to switch primary care physicians should the
member elect to see a specialist who is outside of the primary care physician’s
network, but within the health plans network.
·
The
Health Plan, or its designee, shall be financially responsible for coverage of
the services approved and rendered by this specialist or healthcare provider.
Since Humana holds the contract with the servicing provider, Humana’s designee
responsible for payment of these services may elect to have Humana pay the
claim on their behalf at Humana’s current fee schedule, and deduct from the
designee’s funds.
·
In
all instances addressed above, the member’s primary care physician shall remain
responsible for coordinating the care of the member who is receiving services
from a provider not in a primary care physician’s referring network. All
subsequent referral requests must be reviewed and approved by the primary care
physician.