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By Howard Shiffman, M.A.

If you thought that pilot projects focused on using managed care models in child welfare were over and done with, think again. Last month, the Georgia Department of Community Health (DCH) announced that it would move away from traditional any-willing-provider, fee-for-service – and selected one of the state’s Medicaid care management organizations (CMO), to provide specialized managed care for children involved in foster care placements, adoption assistance, and the juvenile justice system (Georgia DHC Selects Amerigroup As Medicaid MCO For Children In Child Welfare System all members).

This is a $200 million annual contract to provide specialized managed care for about 27,000 children and youth up to age 21 in foster care placements. Amerigroup will be responsible for providing all state plan medical services as well as enhanced assessment and care coordination.

DCH anticipates that moving these child populations from fee-for-services Medicaid to a specialized statewide CMO will result in improved care continuity and coordination, as well as generate savings of up to $27.5 million over the next five years. For service provider organizations in Georgia serving children, this will up the pressure to optimize their ability to work with managed care organizations – and their performance metrics.

Provider Organization Administrative Capabilities For A Managed Care Environment
Marketing and contracting functions – payer contracting, referral development, and consumer choice
Systems to facilitate administrative processes of FFS managed care and value-based purchasing – preauthorization, continued stay review, documentation, performance measurement
Revenue cycle management – billing and collections for both payer and consumer
Development of services that are customer-preferred in terms of value – both payer and consumer

There are two important strategic implications. First, the child welfare organizations that don’t have solid competence in these four key areas will be at a competitive disadvantage. Great performance and value are keys to future competition.

The second strategic issue is the competition for control of consumer referrals (see Controlling Coordination = Controlling Referrals all members). Care management organizations are willing to accept financial risk to “guarantee” their performance. For service provider organizations to keep control on consumer referrals, they need to develop a similar ability to manage consumer care (see Ready To Be A Medical/Health Home? Take the Test! all members) – or create a collaboration with an organization with those capabilities.

My point? If you’re a social service organization and think that the move to managed care models is going to bypass your market and your organizational development, you need to keep an eye on these system changes and on the new competition.


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