The ACTS Response to a Proposal by the Governor’s Ad-hoc Committee Charged with Making Recommendations for Changes to the New York State Medicaid Program and Services

On behalf of the association that I serve as Executive Director, Agencies for Children’s Therapy Services, (ACTS), I want to thank you for your diligent work with “The First 1,000 Days” initiative to improve the Medicaid relationship with providers. ACTS agencies provide nearly 60% of all Early Intervention services statewide each year. Our thirty five agencies operate throughout NYS but mostly in the downstate region.

I have reviewed your draft proposal menu. Some of them are intriguing, but one of them would be very problematic for Early Intervention and that is your proposal #12… the carve-in of Early Intervention into managed care. This is a proposal that my members could not support and in fact would need to oppose vigorously. Let me explain why.

As you know five years ago the billing for reimbursement of Early Intervention services changed radically. Before 2013 Counties were responsible for billing E.I. services and for paying providers. But that year the law changed that shifted the burden of billing insurance onto the shoulders of providers with some assistance from a State Fiscal Agent that was also created that year. In order to comply with this new billing paradigm providers were required to go to great expense and time to hire billing experts and accountants to manage this new task. None of this new expense was or is being reimbursed to providers.

After a tumultuous first year of lengthy delays in payment and many problems with the adjudication of claims, part of the new system began to run more smoothly. That part was the Medicaid claims. The part which continues to be difficult is commercial insurance which denies approximately 85% of the claims submitted to those companies. Their annual aggregate remittance to this $600M annual program is about 2% or roughly $12M. That amount has not changed materially during the whole existence of the Early Intervention program since 1994. Providers, the Department (DOH) and the Fiscal Agent continues to struggle mightily with some of the processes of commercial insurance adjudication which is slow and uneven. Contrast that with Medicaid that approves nearly 80% of the claims submitted to it by providers and remits on those claims in a timely fashion. Those Medicaid remittances account for about 43% of the annual aggregate reimbursement roughly $260M.

Your Managed Care option # 12 would complicate a continuing tenuous situation for providers by removing the reliable insurance provider process of Medicaid billing and create an additional layer of bureaucracy with the commercial insurance private market place which is not working well for providers. Your option # 12 would establish a whole new set of problems, tasks and expenses for already beleaguered billing providers, many of whom have had to exit the E.I. program because the administrative billing workload became too time consuming and too costly to successfully manage along with rendering services.

If anything, providers want to minimize the interaction with commercial insurance in terms of having to bill directly with them and deal with the subsequent inevitable delays and additional requirements demanded by some of those insurers. The thought of providers having to navigate yet another new morass of managed care requirements with brand new financial demands and delays is a very bad prospect. It will cause more provider departures from the E.I. program and a greater capacity problem in finding qualified persons to serve our very vulnerable population of toddlers with special needs. It is a proposal that ACTS must vigorously oppose.

As I said at the outset, I applaud your efforts to streamline the Medicaid process and I understand that these are uncertain times in the health world. However trying to integrate managed care into the Early Intervention world would be like trying to fit a round peg into a square hole, it just does not fit unless you try to force the piece into the slot while having to damage the contours in doing so.

My final word on this subject is that Early Intervention is a cost saver for the state, and not a cost driver. Currently there are about 68,000 children in the E.I. Program each year. Probably more could be served if the state had the capacity to do so. For every child that is successfully served in E.I. by age three, the state saves untold tens of millions of dollars each year in pre-school and school age special education services that is AVOIDED because of the success in Early Intervention. But Early Intervention can only be as successful as the support given by the state to providers who render these critically needed services.

Option # 12 needs to be shelved.

Sincerely,
Steven Sanders
Executive Director– ACTS