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TSG Status Report # 1

Appendix

To: Arkansas Health Reform Task Force

Re: Health Care Reform/Medicaid Consulting Services

Da: June 11, 2015

PREPARED BY:

THE STEPHEN GROUP814 Elm Street, Suite 309Manchester, NH, 03102Main: (603)419-9592

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Table of ContentsInitial Financial Assessment.........................................................................................................................3

Profile of Spending by Beneficiary Category............................................................................................3

Profile of Spending by Type of Service.....................................................................................................5

Spending by Beneficiary..........................................................................................................................7

Hospital Spending....................................................................................................................................8

Long Term Care Spending........................................................................................................................9

Mental Health Spending........................................................................................................................11

Pharmaceutical Spending......................................................................................................................12

Private Option.......................................................................................................................................12

Administration Expenses.......................................................................................................................13

Trends in Enrollees................................................................................................................................14

Drivers of Future Spending....................................................................................................................15

The Top 100 Utilizers.............................................................................................................................18

Top 100 Providers..................................................................................................................................19

Comparison to Other State Medicaid Program Spending..........................................................................21

Distribution of Medicaid Spending on Acute Care.................................................................................22

Distribution of State Medicaid Funding on Long Term Care..................................................................22

State Medicaid Spending per Enrollee (Full or Partial Benefit)..............................................................23

Distribution of Acute Care/Long Term Care/DSH Payments..................................................................23

Expenditures per Resident: Total LTSS Costs: FY 2012...........................................................................25

Professional Services Contracts.................................................................................................................26

Health Independence Account..................................................................................................................36

DHS Previous Third Party Liability Cost Savings Initiatives.........................................................................37

Traditional Medicaid: Ten Year History of Arkansas FMAP.......................................................................38

Answers Provided by Blue Cross Blue Shield to TSG Questions Related to Private Option Address Concerns....................................................................................................................................................39

DHS and DMS Organization.......................................................................................................................41

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Initial Financial Assessment

Profile of Spending by Beneficiary CategoryIn SFY 2014, Medicaid expended $5.1 billion in claims and other benefits. The largest aid group is the SSI Disabled at 25% of total expenditures. The second and third largest are Low Income Children and Pregnant Mothers and Medically Needy Aged. The Private Option program was in place for only part of 2014; by 3Q2015, it had grown to 19% of total expenditures.

Medicaid has grown 54% over the period since 2007, from $3.3 billion to $5.1 billion. That is a Compounded Annual Growth Rate (CAGR) of 6.3%. The rate of growth has moderated significantly over the years since 2010. In 2010 the year-over-year growth was 10%, though in 2014 the growth in Traditional Medicaid had moderated to 2% year-over-year. The fastest growth segment of Medicaid was non-claims payments at 8.2% since 2010, 50% faster than the overall growth rate. In 2014, 15% of Medicaid was paid for expenditures other than claims ($983 million).

The five largest categories of beneficiaries account for 93% of traditional Medicaid spending:

SSI Disabled Low Income Children & Pregnant Women Medically Needy Aged Medically Needy Disabled Non Claims Based Payments

Note that Non-Claims payments account for 21% of expenditures and are not actually paid directly on behalf of beneficiaries, but to help reimburse providers for costs—without specific claims. Non-claims-based payments are the largest growth category, at 5.7% year on year growth in 2014. The four largest segments in the list above are actual beneficiaries, and account for 71% of spending.

While growth rates in total Traditional Medicaid have fallen since 2008 (Figure 2), several beneficiary categories have experienced especially noteworthy declines:

SSI Aged and Medically Needy have decreased throughout the period, with a negative growth rate in 2008 through 2014

Spenddown Disabled and Spend down Families and TANF switched from positive to negative growth since 2010

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Table 1 Medicaid Spending by Beneficiary Aid Category, 2007-2014Traditional Medicaid by Aid Category 2007 2008 2009 2010 2011 2012 2013 2014SSI Disabled 893,574,401 962,621,672 1,038,525,114 1,115,243,716 1,186,457,475 1,227,162,474 1,237,330,275 1,268,479,435Low Income Children & Pregnant Women 741,849,649 790,030,989 849,838,765 910,891,848 939,435,605 955,449,212 980,355,271 996,925,440Non Claims Based Payments 461,523,797 528,928,278 535,745,293 716,603,781 792,331,588 884,969,757 930,361,854 983,120,246Medically Needy Aged 526,345,805 543,259,911 567,609,916 604,558,213 647,531,360 676,434,997 670,252,194 675,094,363Medically Needy Disabled 291,546,995 315,695,188 335,948,326 358,710,976 381,640,858 405,336,995 408,310,701 430,435,526ARKids 82,785,549 93,832,491 94,288,627 93,806,499 99,433,709 107,250,848 102,466,259 95,842,949Medically Needy Families & TANF 126,332,652 115,408,056 105,216,606 104,565,066 102,106,795 101,691,877 98,766,537 93,802,812Adoption and Foster Care 57,331,822 62,029,086 62,881,228 64,933,650 70,499,650 72,443,011 73,914,457 77,948,703SSI Aged 42,696,275 39,907,966 41,041,352 42,799,165 43,309,068 40,989,401 38,111,345 36,675,944Spenddown Disabled 41,314,938 45,580,786 45,317,606 50,110,969 56,721,470 48,311,596 45,685,989 34,119,900Spenddown Families & TANF 10,527,052 11,553,456 10,849,555 12,065,943 11,240,340 9,645,954 8,527,439 5,496,067Other 32,871,462 32,898,041 35,847,475 38,113,647 39,315,725 38,547,762 38,569,336 25,895,850Traditional Medicaid 3,308,700,398 3,541,745,921 3,723,109,863 4,112,403,473 4,370,023,643 4,568,233,884 4,632,651,656 4,723,837,235Private Option 366,831,830Total 5,090,669,065

Figure 1 Components of Medicaid Expenditures by Beneficiary Aid Category, 2014. Includes Private Option

Table 2 Growth Rates for Beneficiary Aid CategoriesCAGR

Non-Private Option 2014 Amount 2007-2014 2010-2014 2013-2014Case Management 3,739,954 -5.1% 5.4% 22.6%Hospital Services 1,527,446,947 8.0% 4.9% 3.7%DD 517,366,257 5.5% 4.7% 4.2%Other Medical 207,176,295 6.8% 4.7% -0.4%Mental Health 557,215,870 4.5% 4.1% 1.6%Clinics 34,412,475 7.4% 3.9% -0.9%Other Practitioners 144,149,229 9.0% 3.2% -0.1%Long Term Care 969,481,900 4.3% 3.0% 1.4%Transportation 74,966,307 7.1% 2.2% 2.0%Prescription Drug 361,342,169 1.1% 1.5% 2.8%Medicare Related 25,552,148 1.6% 0.9% -4.7%Physician Services 288,569,521 0.8% -0.7% -2.2%Family Planning 12,418,163 -4.6% -12.6% -43.0%Medicaid-Non PO 4,723,837,235 5.2% 3.5% 2.0%

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Table 3 Year over Year Growth Rates by Beneficiary Aid Category, 2008-2014

Figure 2 Year over Year Growth Rates by Beneficiary Aid Category, 2008-2014

Figure 3 Growth Rate Changes from 2008-2014 Comparing Three Aid Categories with Total

Profile of Spending by Type of ServiceHospital Services is the largest component of Arkansas Medicaid, comprising $1.2 billion (31.7% of total) in 2014. It is also the fastest growing cost segment, with a CAGR since 2010 of 4.9% compared to Total Traditional Medicaid of 3.5%. Developmental Disability (DD) and Mental Health have also been growing

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2008 2009 2010 2011 2012 2013 2014SSI Disabled 7.7% 7.9% 7.4% 6.4% 3.4% 0.8% 2.5%Low Income Children & Pregnant Women 6.5% 7.6% 7.2% 3.1% 1.7% 2.6% 1.7%Non Claims Based Payments 14.6% 1.3% 33.8% 10.6% 11.7% 5.1% 5.7%Medically Needy Aged 3.2% 4.5% 6.5% 7.1% 4.5% -0.9% 0.7%Medically Needy Disabled 8.3% 6.4% 6.8% 6.4% 6.2% 0.7% 5.4%Newly Eligible AdultsARKids 13.3% 0.5% -0.5% 6.0% 7.9% -4.5% -6.5%Medically Needy Families & TANF -8.6% -8.8% -0.6% -2.4% -0.4% -2.9% -5.0%Adoption and Foster Care 8.2% 1.4% 3.3% 8.6% 2.8% 2.0% 5.5%SSI Aged -6.5% 2.8% 4.3% 1.2% -5.4% -7.0% -3.8%Spenddown Disabled 10.3% -0.6% 10.6% 13.2% -14.8% -5.4% -25.3%Spenddown Families & TANF 9.8% -6.1% 11.2% -6.8% -14.2% -11.6% -35.5%Other 0.1% 9.0% 6.3% 3.2% -2.0% 0.1% -32.9%Total 7.0% 5.1% 10.5% 6.3% 4.5% 1.4% 9.9%Total Traditional Medicaid Only 7.0% 5.1% 10.5% 6.3% 4.5% 1.4% 2.0%

faster the 3.5% total annual growth rate, while Long Term Care (LTC), Prescription Drug and Physician Services have grown below that rate. Care costs (besides Private Option premiums) grew at a resurgent rate largely owning to Fee For Services (FFS) costs from Medically Frail, a Private Option population.

Table 4 Traditional Medicaid Spending by Cost Category, 2007-20152007 2008 2009 2010 2011 2012 2013 2014 2015ytd

Hospital Services 891,962,674 995,175,020 1,020,453,833 1,262,316,661 1,353,413,411 1,419,065,867 1,473,084,719 1,527,446,947 1,140,928,476Long Term Care 723,172,373 753,958,290 800,533,234 861,469,322 914,274,028 962,824,362 955,838,732 969,481,900 742,158,374Mental Health 408,921,152 437,427,033 464,819,438 473,959,361 521,530,784 541,593,211 548,697,223 557,215,870 408,777,478DD 354,801,216 371,741,380 397,592,894 430,004,766 465,674,842 493,621,729 496,330,000 517,366,257 409,173,805Prescription Drug 333,914,816 358,393,433 364,081,231 341,071,316 335,632,828 355,049,530 351,415,260 361,342,169 295,065,022Physician Services 273,637,830 279,570,489 285,662,931 296,944,988 305,655,434 294,278,664 295,079,462 288,569,521 217,753,987Other Medical 130,612,934 140,931,542 159,124,736 172,593,608 186,987,313 197,424,164 207,982,093 207,176,295 158,438,191Other Practitioners 78,966,286 88,148,158 102,335,641 126,945,407 129,666,219 148,095,026 144,316,420 144,149,229 113,239,213Transportation 46,259,408 47,803,863 53,636,862 68,605,517 75,091,636 71,702,479 73,511,951 74,966,307 54,896,829Clinics 20,855,243 23,630,269 26,586,151 29,520,781 31,547,318 32,888,669 34,732,325 34,412,475 27,269,996Medicare Related 22,914,572 23,334,519 24,095,489 24,612,023 25,693,456 26,077,351 26,824,815 25,552,148 18,919,700Family Planning 17,282,864 18,257,980 20,914,464 21,323,316 22,151,345 22,732,752 21,788,286 12,418,163 3,986,982Case Management 5,396,852 3,361,741 3,246,030 3,026,370 2,704,666 2,880,080 3,050,369 3,739,954 2,914,312Other 2,178 12,205 26,931 10,037 364 39,497Total Traditional Medicaid 3,308,700,398 3,541,745,921 3,723,109,863 4,112,403,473 4,370,023,643 4,568,233,884 4,632,651,656 4,723,837,235 3,593,561,862Private Option 366,831,830 964,388,067Total Including Private Option 3,308,700,398 3,541,745,921 3,723,109,863 4,112,403,473 4,370,023,643 4,568,233,884 4,632,651,656 5,090,669,065 4,557,949,929

Figure 4 Medicaid Expenditures by Cost Category, Total and Percent. Traditional Medicaid Only

Table 5 Growth Rates by Cost Category. Traditional Medicaid OnlyCAGR

Non-Private Option 2014 Amount 2007-2014 2010-2014 2013-2014Hospital Services 1,527,446,947 8.0% 4.9% 3.7%Long Term Care 969,481,900 4.3% 3.0% 1.4%Mental Health 557,215,870 4.5% 4.1% 1.6%DD 517,366,257 5.5% 4.7% 4.2%Prescription Drug 361,342,169 1.1% 1.5% 2.8%Physician Services 288,569,521 0.8% -0.7% -2.2%Other Medical 207,176,295 6.8% 4.7% -0.4%Other Practitioners 144,149,229 9.0% 3.2% -0.1%Other 151,089,048 4.3% 0.7% -5.5%Total Traditional Medicaid 4,723,837,235 5.2% 3.5% 2.0%

Table 6 Year over Year Growth Rates by Cost Category, 2008-2014. Traditional Medicaid OnlyYear/Year Growth 2008 2009 2010 2011 2012 2013 2014

Hospital Services 11.6% 2.5% 23.7% 7.2% 4.9% 3.8% 3.7%Long Term Care 4.3% 6.2% 7.6% 6.1% 5.3% -0.7% 1.4%Mental Health 7.0% 6.3% 2.0% 10.0% 3.8% 1.3% 1.6%DD 4.8% 7.0% 8.2% 8.3% 6.0% 0.5% 4.2%Prescription Drug 7.3% 1.6% -6.3% -1.6% 5.8% -1.0% 2.8%Physician Services 2.2% 2.2% 3.9% 2.9% -3.7% 0.3% -2.2%Other Medical 7.9% 12.9% 8.5% 8.3% 5.6% 5.3% -0.4%Other Practitioners 11.6% 16.1% 24.0% 2.1% 14.2% -2.6% -0.1%Other 3.3% 10.4% 14.5% 6.9% -0.6% 2.3% -5.5%Traditional Only 7.0% 5.1% 10.5% 6.3% 4.5% 1.4% 2.0%

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Table 7 Cost Category as a Percent of Traditional Medicaid, 2007-2015ytdCost Category as % of Traditional 2007 2008 2009 2010 2011 2012 2013 2014 2015ytdHospital Services 27.0% 28.1% 27.4% 30.7% 31.0% 31.1% 31.8% 32.3% 31.7%Long Term Care 21.9% 21.3% 21.5% 20.9% 20.9% 21.1% 20.6% 20.5% 20.7%Mental Health 12.4% 12.4% 12.5% 11.5% 11.9% 11.9% 11.8% 11.8% 11.4%DD 10.7% 10.5% 10.7% 10.5% 10.7% 10.8% 10.7% 11.0% 11.4%Prescription Drug 10.1% 10.1% 9.8% 8.3% 7.7% 7.8% 7.6% 7.6% 8.2%Physician Services 8.3% 7.9% 7.7% 7.2% 7.0% 6.4% 6.4% 6.1% 6.1%Other Medical 3.9% 4.0% 4.3% 4.2% 4.3% 4.3% 4.5% 4.4% 4.4%Other Practitioners 2.4% 2.5% 2.7% 3.1% 3.0% 3.2% 3.1% 3.1% 3.2%Other 3.4% 3.3% 3.5% 3.6% 3.6% 3.4% 3.5% 3.2% 3.0%Traditional Only 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

The following table shows the distribution of costs by Aid Category. Note that the largest Beneficiary group is SSI Disabled, which incurs claims spread across Hospital, LTC, Mental Health, DD and Prescriptions. Low Income Children and Pregnant Women incur largely Hospital Services and Mental Health. Not surprisingly, most of the Medically Needy Aged costs are with LTC (and most of that is Nursing Homes). The Medically Needy Disabled incur costs in LTC and DD.

Deserving further consideration are the following observations:

Low level of Prescription Drugs for the Medically Needy Aged What is the $46 million in non-claims based prescriptions? What “other practitioners” are the Low Income Children and Pregnant Women seeing so

frequently ($87 million) Where are the 100 large-claims-amount beneficiaries—are they in Medically Needy Disabled?

That is not a big category

Table 8 Traditional Medicaid Expenditures by Cost Category and Beneficiary Aid Category, 2014

2014 Traditional Medicaid by Cost and Aid Categories SSI Disabled

Low Income Children & Pregnant Women

Non Claims Based

PaymentsMedically

Needy Aged

Medically Needy

Disabled ARKids

Medically Needy

Families & TANF

Adoption and Foster

Care SSI Aged Other TotalHospital Services 210,124,632 256,983,664 934,094,628 21,443,184 30,589,614 14,322,557 23,445,493 6,872,315 4,040,191 25,530,669 1,527,446,947Long Term Care 185,769,968 903,085 2,936,880 614,062,038 134,313,544 21,071 705,221 299,675 26,353,777 4,116,640 969,481,900Mental Health 219,162,501 235,188,002 1,220,569 18,350,434 18,377,469 14,670,057 41,440,065 241,968 8,564,806 557,215,870DD 247,309,169 65,469,538 10,480,765 184,335,927 823 2,016,612 3,759,736 138,648 3,855,041 517,366,257Prescription Drug 160,541,979 95,367,591 46,088,738 769,166 12,050,395 19,857,602 14,178,341 10,703,812 45,286 1,739,260 361,342,169Physician Services 86,546,434 129,642,952 9,965,848 13,816,532 15,404,696 17,682,305 3,096,985 2,071,034 10,342,736 288,569,521Other Medical 87,726,827 67,264,164 5,632,646 22,866,720 5,631,691 6,501,180 7,273,710 1,303,615 2,975,744 207,176,295Other Practitioners 23,438,498 87,626,325 1,917,512 2,293,107 18,127,578 6,995,144 2,787,968 530,176 432,922 144,149,229Transportation 27,620,419 35,357,525 1,093,504 3,244,687 1,132,990 3,792,138 1,197,657 456,212 1,071,176 74,966,307Clinics 8,303,510 18,619,790 692,137 708,271 2,499,289 2,833,279 400,205 167,166 188,829 34,412,475Medicare Related 9,847,548 31,549 6,751,023 7,515,895 14,979 703 1,137,446 253,005 25,552,148Family Planning 617,243 3,878,172 26 26,964 467,076 935,097 60,332 6,433,253 12,418,163Case Management 1,470,707 593,084 1,065,945 323,438 109 32,967 55,540 190,426 7,735 3,739,954Total Traditional 1,268,479,435 996,925,440 983,120,246 675,094,363 430,435,526 95,842,949 93,802,812 77,948,703 36,675,944 65,511,817 4,723,837,235Private Option 366,831,830Total Medicaid 5,090,669,065

Spending by BeneficiaryThe amount spent per beneficiary is obviously affected by increasing expenditures with flat enrollment. The table below estimates claims expenditure per beneficiary per month (e.g. PMPM). This is merely a first estimate, and must be further investigated.

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Table 9 Medicaid Spending PMPMPMPM for Traditional Medicaid* 2007 2008 2009 2010 2011 2012 2013 2014SSI Disabled 763 799 833 865 888 894 890 905Low Income Children & Pregnant Women 231 238 255 267 259 262 269 269Medically Needy Aged 1,015 953 912 948 979 964 914 893Medically Needy Disabled 1,180 1,199 1,172 1,201 1,258 1,247 1,180 1,220ARKids 89 96 96 103 111 116 110 105Medically Needy Families & TANF 224 229 242 267 282 292 291 293Adoption and Foster Care 874 894 887 880 896 862 887 903SSI Aged 345 348 386 441 475 473 475 482Traditional Medicaid 423 444 470 521 536 552 557 565* Calculated by dividing total annual expenditures by enrollment at Mar of each year, by divided by 12 months

Hospital SpendingHospital spending is the largest category of cost, 32% of Traditional Medicaid. The most troubling aspect of hospital services in our initial data review is the large share that is paid outside the claims process. This shifts reimbursement from the rational, contractual or policy-based method of reimbursement to an ad hoc basis that can be driven outside of consistent policy. This subjects Medicaid to pressures other than providing high-quality healthcare. TSG has no indication of any impropriety, only the need to be able to explain to the Task Force what forces are driving this 20% of total Medicaid costs.

Initial observation reveals that of the half of hospital costs that are tied to claims, two thirds are for inpatient services. This seems to be at odds with the long-time, national trend toward more outpatient services. It may suggest a fundamental issue with the manner through which Traditional Medicaid services are provided—more through high-cost, inpatient services.

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Table 10 Hospital Services Costs, 2007-2015ytdHospital Services 2007 2008 2009 2010 2011 2012 2013 2014 2015Inpatient31 - Inpatient Acute Care 161,863,332 173,550,194 180,444,722 178,925,390 176,699,405 182,285,696 186,460,867 193,200,621 142,586,63175 - Pediatric Inpatient 108,091,137 115,608,136 125,867,462 149,451,121 137,833,381 133,267,733 134,748,639 150,619,911 125,016,80887 - Inpatient AR Teaching 45,233,161 54,148,228 49,520,075 71,333,362 79,109,678 76,199,574 70,420,970 73,790,282 61,289,35730 - Inpatient Acute Care Crossover 21,271,373 22,552,024 25,372,776 25,321,064 29,405,218 28,010,827 29,105,441 27,990,350 20,740,423A1 - Inpatient Transplant 5,244,070 4,306,519 5,676,967 5,948,734 8,124,052 7,715,629 10,932,722 10,624,015 6,187,60867 - Inpatient Rehab 2,674,333 3,284,191 3,288,041 3,711,071 4,401,872 3,891,282 4,502,308 3,889,939 3,526,24277 - Rural Inpatient 8,414,814 8,251,147 6,897,586 5,794,973 4,676,937 4,833,085 3,971,389 3,500,377 2,364,02703 - Ambulatory Surgical Centers 3,308,831 3,404,437 3,639,813 3,177,106 3,211,670 3,129,105 3,004,367 3,116,066 7,211,637B2 - Emergency Hospital Services 1,113,772 4,132,551 4,379,610 4,604,666 5,098,689 4,331,71188 - Inpatient AR Teaching Crossover 713,033 1,029,996 936,727 1,067,788 1,704,547 1,453,687 1,651,429 1,625,734 1,047,154D4 - DYS Rehab Services 1,189,519 1,563,299 1,474,569 1,055,048 1,019,575 969,984 923,471 1,189,270 1,290,00584 - Rural Inpatient Crossover 1,623,429 1,681,170 1,393,912 1,379,184 1,237,494 1,111,560 1,094,024 742,709 561,57776 - Pediatric inpatient Crossover 86,081 62,032 48,270 81,022 37,752 47,231 42,980 65,768 48,054

359,713,112 389,441,375 404,560,921 448,359,635 451,594,132 447,295,001 451,463,274 475,453,731 376,201,234Outpatient51 - Outpatient Hospital 43,744,820 47,607,879 50,541,528 55,054,671 57,349,925 56,404,434 59,589,621 65,235,915 55,361,04550 - Outpatient Crossover 16,499,203 18,577,885 18,712,883 19,283,025 23,065,475 22,339,304 24,454,557 25,027,896 19,398,991PE - Pediatric Outpatient Hospital 10,765,372 11,542,598 13,180,842 14,509,017 15,105,893 15,046,699 15,932,395 16,682,452 12,068,418CA - Critical Access Hospitals INP MED 11,654,588 11,325,169 11,301,708 11,272,945 10,970,722 10,046,729 10,551,406 12,120,385 8,308,473T8 - Outpatient Teaching Hospital 7,763,513 8,021,550 6,704,175 8,557,327 11,115,229 9,969,422 9,878,154 10,648,668 5,691,219CF - Critical Access Hospitals Out Xover 4,535,476 5,780,962 7,010,758 6,894,100 8,587,277 8,489,535 8,546,836 9,046,704 6,678,158CE - Critical Access Hospitals Out Med 5,859,552 6,105,277 6,526,384 7,209,341 7,142,594 6,471,390 6,401,740 7,194,083 6,470,171CB - Critical Access Hospitals Inp Xover 3,057,312 2,742,338 3,262,037 2,898,551 3,366,884 2,910,634 2,923,556 2,641,051 1,934,098D3 - Developmental Rehab Services 1,157,165 1,354,719 1,261,154 1,582,012 1,510,763 1,593,581 1,560,266 1,697,581 1,269,355RC - RSPD/ Residential Rehab Center 1,721,094 2,011,392 1,867,156 1,152,931 1,828,152 1,363,260 1,012,267 827,486 641,218P1 - Outpatient Rehab 208,753 199,503 277,657 245,546 217,236 172,130 213,805 228,828 211,820A3 - Outpatient Transplant Services 233,523 54,430 43,265 28,262 53,909 49,980 62,989 53,438 14,018RH - RSPD Extended Rehab Services 35,937 45,217 31,227 10,626 5,895 11,379

107,236,308 115,368,919 120,720,773 128,698,352 140,319,953 134,868,476 141,127,592 151,404,486 118,046,982Non-claims basedZC - Cost Settlements - Non Claims Based 236,125,800 290,070,247 283,634,179 453,939,936 517,593,874 532,564,247 556,964,847 565,958,065 398,277,160ZA - Buyin - Non Claims Based 125,891,310 134,963,431 137,216,978 148,568,608 168,386,787 167,829,798 166,567,086 171,256,392 128,629,461ZB - Contracts - Non Claims Based 59,998,150 63,741,977 73,923,358 82,460,411 75,761,331 106,800,132 134,235,171 178,205,287 170,355,509ZD - Miscellaneous - Non Claims Based 2,997,994 1,589,071 397,624 289,719 -242,664 29,708,212 22,669,644 18,217,672 15,767,231ZE - HIPP - Non Claims Based 57,104 457,212 565,700

425,013,255 490,364,726 495,172,138 685,258,674 761,499,327 836,902,390 880,493,853 934,094,628 713,595,062Grand Total 891,962,674 995,175,020 1,020,453,833 1,262,316,661 1,353,413,411 1,419,065,867 1,473,084,719 1,560,952,845 1,207,843,278

Long Term Care SpendingLTC accounts for 20.2% of Traditional Medicaid in 2014. Arkansas spends most (over 70%) of its LTC on nursing homes. TSG learned that the state is limits Assisted Living beds to no more than 1,000. As of March 2015 there were only 771 patients being served in Assisted Living facilities. Likewise, Home and Community-based services account for only 25% of LTC.

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Table 11 Long Term Care Expenditures, 2007-2014Long Term Care 2007 2008 2009 2010 2011 2012 2013 2014Nursing Home

58 - Private SNF 485,043,511 500,275,422 517,742,666 537,499,740 565,647,760 586,784,825 581,067,866 595,637,84263 - Public SNF 31,681,001 33,169,836 34,308,939 36,627,967 38,381,265 49,249,322 39,827,057 38,952,792H2 - Nursing Home Hospice 17,022,990 15,727,237 17,645,868 19,550,766 22,560,965 25,950,067 28,278,002 28,308,94759 - Private SNF Crossover 18,684,914 20,707,017 19,937,534 21,621,685 23,876,127 26,234,132 23,948,738 24,558,516H1 - Hospice 4,870,893 4,600,470 4,669,198 5,514,490 5,172,573 4,594,453 6,151,832 5,717,150ZH - Contracts - Non Claims Based 2,571,548 3,133,992 3,297,594 3,104,569 3,185,529 3,610,608 2,999,608 2,936,880Facility-based 559,874,857 577,613,973 597,601,799 623,919,217 658,824,219 696,423,408 682,273,103 696,112,127

Assisted Living FacilityAL - Assisted Living Facility 2,200,572 3,387,613 5,969,322 8,605,465 10,153,982 12,512,144 14,735,866 16,175,328AP - Assisted Living Pharmacist Consultant 6,020 20Assisted Living 2,206,593 3,387,633 5,969,322 8,605,465 10,153,982 12,512,144 14,735,866 16,175,328

Home and Community Based53 - Personal Care - Regular 58,140,915 58,549,945 60,163,107 70,920,813 78,225,964 84,364,958 89,422,882 95,053,29097 - Elders Choices Waiver 38,480,923 43,313,439 51,974,214 62,926,725 66,145,099 64,090,602 59,697,097 53,580,358L1 - APD Attendant Care 30,169,912 30,928,653 32,945,008 32,025,574 29,572,019 26,775,190 23,379,720 21,475,475L4 - APD Agency Attendant Care, Co Employer 1,271,355 4,470,710 7,776,593 10,184,843 13,780,475 18,228,206 21,380,064I0 - Independent Choices Treatment Elderly 3,257,701 4,976,734 8,416,406 12,157,823 15,414,016 17,808,152 19,051,323 17,961,50424 - Home Health Services 12,519,057 14,094,382 14,176,655 16,052,262 16,564,641 16,732,382 17,182,156 15,887,437SR - AR Seniors 5,621,116 5,629,472 5,908,562 5,747,008 6,462,581 6,324,954 6,514,310 6,977,67073 - Private Duty Nursing EPSDT 5,628,506 5,472,443 7,018,515 6,756,373 6,844,447 6,246,596 6,274,980 6,347,820PP - PACE 383,405 1,298,525 1,898,892 3,370,803 5,207,696 5,861,994I1 - Independent Choices Trtmnt Young Disable 1,113,514 1,883,969 3,663,758 5,326,143 5,819,974 5,499,064 5,346,298 5,120,76174 - Private Duty Nursing Services 1,374,056 1,644,137 2,019,954 2,070,096 2,612,279 3,373,672 3,121,790 3,304,176L6 - APD Counseling Case Management 957,658 1,643,897 1,669,035 1,554,702 1,648,498 1,694,977 1,649,267C9 - Personal Care - School Based 79,314 222,775 577,058 683,632 1,009,613I8 - Independent Choices FMS Services 58,464 749,575 954,859 1,050,644 1,053,854 1,062,272 1,003,949L2 - APD-Environmental Adaptations 575,857 451,954 605,110 501,430 366,574 312,375 391,294 657,838I3 - Independent Choices New Trtmnt Yng Dsbl 1,624,921 1,488,533 1,341,686 1,336,466 1,158,422 951,401 741,986 635,144I9 - Independent Choices C/FI 917,116 987,302 415,052 465,654 485,036 413,398 392,838 338,856I2 - Independent Choices New Trtmnt Elderly 1,666,128 1,247,364 1,065,282 855,791 708,052 562,527 432,954 332,071L5 - APD Traditional Agency Attendant Care 31,29123 - Home Health Crossover 1,201 880 1,216 24,156 4,867 2,851 3,354 2,362Home & Community-based 161,090,923 172,956,683 196,962,113 228,944,640 245,295,828 253,888,810 258,829,764 258,610,940Grand Total LTC 723,172,373 753,958,290 800,533,234 861,469,322 914,274,028 962,824,362 955,838,732 970,898,395

By far, the largest sub-segment of LTC is Nursing Homes for the Medically Needy Aged—$457 million or 47% of total LTC.

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Table 12Long Term Care Details of Expenditure by Aid Category, 2014

Cost Category -- SFY2014 Medically Needy Aged

SSI Disabled

Medically Needy Disabled SSI Aged Other

Non Claims Based Payments

Newly Eligible Adults Other Grand Total

58 - Private SNF 457,623,421 55,976,789 73,627,578 7,048,479 1,202,369 150,835 8,371 595,637,84253 - Personal Care - Regular 20,687,925 59,765,187 4,452,772 8,978,677 746,061 193,907 228,760 95,053,29097 - Elders Choices Waiver 42,290,598 6,666,999 4,465,042 157,718 0 53,580,35863 - Public SNF 12,726,229 9,192,743 16,833,559 41,400 158,862 0 38,952,792H2 - Nursing Home Hospice 24,310,442 1,358,558 2,169,064 468,434 1,449 999 28,308,94759 - Private SNF Crossover 16,630,555 2,489,206 4,185,832 1,189,693 38,778 456 23,996 24,558,516L1 - APD Attendant Care 34,925 8,743,595 12,412,463 284,492 0 21,475,475L4 - APD Agency Attendant Care, Co Employer 48,164 7,339,543 13,802,491 180,245 3,520 6,101 21,380,064I0 - Independent Choices Treatment Elderly 11,541,080 4,160,499 52,468 2,106,066 101,445 -54 0 17,961,504AL - Assisted Living Facility 12,053,191 2,033,077 1,089,018 961,554 38,488 0 16,175,32824 - Home Health Services 2,051,457 9,470,693 903,748 809,912 167,051 691,037 1,793,539 15,887,437SR - AR Seniors 6,977,670 0 6,977,67073 - Private Duty Nursing EPSDT 4,664,068 1,373,462 52,258 258,033 6,347,820PP - PACE 5,837,784 10,380 3,451 10,380 0 5,861,994H1 - Hospice 265,072 3,990,873 699,349 3,156 37,477 299,328 421,894 5,717,150I1 - Independent Choices Trtmnt Young Disable 424,290 4,262,243 321,195 17,976 34,351 10,615 50,092 5,120,76174 - Private Duty Nursing Services 74,656 2,655,079 537,688 13,066 23,688 3,304,176ZH - Contracts - Non Claims Based 2,936,880 0 2,936,880L6 - APD Counseling Case Management 3,920 588,280 1,039,357 17,360 70 280 1,649,267C9 - Personal Care - School Based 700,229 276,486 8,288 24,611 1,009,613I8 - Independent Choices FMS Services 386,021 492,007 24,172 91,798 5,895 828 3,227 1,003,949L2 - APD-Environmental Adaptations 15,068 216,128 426,642 0 657,838I3 - Independent Choices New Trtmnt Yng Dsbl 6,798 571,495 49,788 7,062 0 635,144I9 - Independent Choices C/FI 57,071 232,547 6,008 38,520 2,893 630 1,188 338,856I2 - Independent Choices New Trtmnt Elderly 15,701 185,413 122,690 8,267 332,071L5 - APD Traditional Agency Attendant Care 4,337 26,954 0 31,29123 - Home Health Crossover 2,362 2,362Grand Total 614,062,038 185,769,968 134,313,544 26,353,777 3,190,284 2,936,880 1,416,495 2,855,408 970,898,395

Mental Health SpendingMental Health accounts for 19% of total Medicaid (including Private Option). Arkansas has added a number of new service categories to Mental Health since 2007, especially in 2010. Still, in 2014 over half of the category is in two areas: Community Mental Health (RSPMI) and Inpatient Psychiatric. The fastest-growing sub-category is Rehab Services School Based CHMS, which was started in 2012 and has grown to $7.3 million. Notwithstanding the added sub-categories of care, Mental Health has still grown at just over the overall Medicaid pace, 4.3% CAGR since 2010 and 2.1% 2014 over 2013. Of that, Community Mental Health has grown the most, nearly 1/3 since 2007.

Table 13 Mental Health Details of Expenditure, 2007-2015ytd2007 2008 2009 2010 2011 2012 2013 2014 2015

Mental Health36 - Community Mental Health (RSPMI) 226,147,983 253,514,485 263,125,040 263,031,684 283,965,500 298,624,135 296,465,640 303,452,811 228,217,24033 - Inpatient Psychiatric u-21 132,972,620 131,962,661 138,685,456 141,487,861 155,285,425 154,846,263 156,672,933 150,996,977 103,243,58571 - EPSDT CHMS 47,834,364 50,791,944 61,860,452 59,574,269 51,487,657 55,605,299 61,380,810 60,129,503 43,609,473E4 - Speech and Language Therapy - CHMS 3,440,752 11,906,414 12,329,476 12,986,016 15,602,735 11,884,771E3 - Occupational Therapy - CHMS 2,300,412 8,149,235 9,077,041 10,136,413 12,582,804 9,873,729E2 - Physical Therapy - CHMS 2,029,876 6,854,560 8,137,773 8,940,768 10,543,674 8,243,946D7 - Rehab Servies School Based CHMS 87 1,065 4,936,651 7,294,812D6 - Rehab Services - School Based RSPMI 752,303 2,240,043 1,409,734 480,977 229,832 2,136,55432 - Inpatient Psychiatric Crossover u-21 1,038,481 837,492 909,733 788,454 1,067,022 1,090,211 1,266,720 1,471,325 1,081,978SO - Sexual Offender Program 788,640 230,480 162,676 460,692 450,776 326,960 232,892 150,225 184,184SA - Substance Abuse Treatment Services 3,644 13,102 30,240 79,715T6 - School-Based Mental Health Services 139,064 89,971 76,082 66,889 42,143 68,954 47,498 45,493 27,710E7 - Speech and Language Therapy - RSPMI 26,170 82,009 73,634 72,391 58,475 4,453

408,921,152 437,427,033 464,819,438 473,959,361 521,530,784 541,593,211 548,697,223 560,230,744 415,882,150

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Nearly half (43%) of Mental Health care is in 2 subcategories: Community Mental Health for Low Income Children and Pregnant Women and SSI Disabled. Fully 81% is provided to the two Beneficiary Categories: Low Income Children and Pregnant Women and SSI Disabled.

Table 14 Mental Health Detail Expenditures by Beneficiary Aid Category, 2014

Cost Category -- SFY2014

Low Income

Children & Pregnant Women

SSI Disabled

Adoption and Foster

Care ARKids

Medically Needy

Disabled

Medically Needy

Families & TANF

Newly Eligible Adults Other Total

36 - Community Mental Health (RSPMI) 109,424,592 133,256,831 14,007,633 18,357,531 6,650,589 9,123,065 2,993,034 218,193 303,452,81133 - Inpatient Psychiatric u-21 75,460,832 47,546,366 23,233,391 2,823,305 1,866,931 13,930 52,221 150,996,97771 - EPSDT CHMS 30,656,075 19,722,628 2,546,903 176 4,657,617 2,470,779 9,639,536 60,129,503E4 - Speech and Language Therapy - CHMS 6,868,960 6,487,662 524,121 65 1,313,687 391,360 75,325 15,602,735E3 - Occupational Therapy - CHMS 5,510,146 4,988,394 462,533 1,207,223 403,240 86 12,582,804E2 - Physical Therapy - CHMS 4,530,511 4,262,893 424,261 70 981,850 330,257 0 10,543,674D7 - Rehab Servies School Based CHMS 2,425,070 2,105,652 185,910 148,051 71,968 13,833 4,936,65132 - Inpatient Psychiatric Crossover u-21 685,433 565,299 1,184 1,216 11,269 1,471,325D6 - Rehab Services - School Based RSPMI 108,752 79,710 11,396 13,548 2,676 6,969 6,693 16,880 229,832SO - Sexual Offender Program 112,973 37,252 0 150,225E7 - Speech and Language Therapy - RSPMI 47,788 1,407 4,761 2,667 0 1,853 0 58,475T6 - School-Based Mental Health Services 25,710 18,369 593 138 684 0 45,493SA - Substance Abuse Treatment Services 16,592 7,157 1,313 3,412 1,767 0 30,240Total 235,188,002 219,162,501 41,440,065 18,377,469 18,350,434 14,670,057 3,014,874 10,027,343 560,230,744

Service Category

Pharmaceutical SpendingPharmacy spending is dominated by a single sub-category, Prescription Services. TSG will investigate this is significantly greater detail using forthcoming claims data. All other subcategories are small in not growing.

Table 15 Prescription Drug Spending Details, 2007-2015ytdPrescription Drugs -- SFY2014 2007 2008 2009 2010 2011 2012 2013 2014 201556 - Prescription Services 296,838,509 319,706,344 323,327,891 309,126,170 304,209,866 306,820,398 300,760,205 322,632,210 290,322,986ZF - Clawback - Non Claims Based 31,806,809 33,229,677 34,953,205 25,977,235 25,537,037 42,394,776 44,589,077 43,828,997 31,570,56119 - Family Planning Drugs 3,126,858 3,229,291 3,443,504 3,661,793 3,692,587 3,675,593 3,701,596 3,907,665 3,341,238ZG - Contracts - Non Claims Based 2,132,185 2,199,883 2,322,356 2,263,302 2,109,696 2,061,983 2,279,316 2,259,741 1,613,127AX - Extension of 3 Prescriptions for Assisted Living 8,889 25,906 27,706 39,628 73,026 87,623 80,808 84,921 48,440VA - Vaccine administered in pharmacy 1,566 2,332 6,570 3,187 10,616 9,155 4,257 2,646 4,738Total 333,914,816 358,393,433 364,081,231 341,071,316 335,632,828 355,049,530 351,415,260 372,716,180 326,901,089

By subcategory, Medicaid spends 68% on Prescription Services for SSI Disabled and Low Income Children and Pregnant Women.

Table 16 Prescription Drug Expenditures by Beneficiary Aid Category, 2014

Prescription Meds - SFY2014 SSI Disabled

Low Income Children & Pregnant Women

Non Claims Based

Payments ARKids

Medically Needy

Families & TANF

Medically Needy

DisabledNewly Eligible

AdultsAdoption and

Foster Care Other Total19 - Family Planning Drugs 614,180 1,850,725 711,031 432,497 50,042 175,878 62,803 10,509 3,907,66556 - Prescription Services 159,852,582 93,516,866 19,146,570 13,745,729 11,988,791 11,198,104 10,641,009 2,542,558 322,632,210AX - Extension of 3 Prescriptions for Assisted Living 72,799 11,501 621 84,921VA - Vaccine administered in pharmacy 2,418 115 60 28 24 2,646ZF - Clawback - Non Claims Based 43,828,997 0 43,828,997ZG - Contracts - Non Claims Based 2,259,741 0 2,259,741Total 160,541,979 95,367,591 46,088,738 19,857,602 14,178,341 12,050,395 11,374,010 10,703,812 2,553,712 372,716,180

Private OptionPrivate Option began in 2Q2014. It includes two categories of beneficiaries: Medically Frail and those receiving discounted capitated coverage through one of the “metals” programs.

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Table 17 Private Option Expenditures by Quarter, 2014-2015SFY 2014 Total

Quarter 2 3 4 1 2 3Case Management 53 270 750 885 1,373 323Clinics 689,847 1,638,832 1,511,712 1,572,913 1,382,390 2,328,679DD 14,151 19,309 25,609 34,912 22,012 33,460Family Planning 69,954 343,256 192,878 247,551 167,516 413,210Hospital Services 3,180 6,969,417 26,533,302 23,763,299 24,528,000 18,623,504 33,505,899Long Term Care 254,563 1,161,932 1,191,288 1,318,115 1,407,965 1,416,495Medicare Related 9,038 32,265 51,619 54,057 74,018 41,303Mental Health 829,481 2,185,393 2,254,237 2,481,805 2,368,630 3,014,874Other Medical 1,466,996 4,229,270 4,001,468 4,573,756 3,816,276 5,696,267Other Practitioners 1,379,869 3,192,945 2,996,289 2,707,730 2,207,664 4,572,814Physician Services 1,316 4,372,708 13,797,760 13,540,540 13,695,835 11,665,340 18,171,784Prescription Drug 3,691,441 7,682,569 9,544,699 11,183,648 11,107,721 11,374,010Transportation 2,358 1,780,169 4,119,970 5,666,146 5,075,558 4,568,397 5,902,497Medically Fragile FFS 6,854 21,527,688 64,937,073 64,740,537 67,474,765 57,412,805 86,471,615Private Option Premiums 100,556,715 179,803,499 228,217,284 259,604,987 286,937,689 280,360,215Total Private Option 6,854 122,084,404 244,740,572 292,957,820 327,079,752 344,350,494 366,831,830Enrollees at March 73 198,094 202,289 216,232 228,983 243,615 198,094Private Option per Quarter 94 616 1,210 1,355 1,428 1,414 1,852Private Option per Month (PMPM) 31 205 403 452 476 471 617

2014 2015

Capitated Private OptionThree private insurance carriers provide capitated coverage for a portion of the Private Option beneficiaries. TSG is still working to break apart the capitated and FFS enrollees. Costs are as above.

Medically FrailOn a cost basis, the Medically Frail component of Private Option is $86 million in 2014 and on track for nearly $250K in SFY 2015. Thus, it is running about 17% of total Private Option. TSG will have more information on how to break out Medically Frail from capitated coverage for the next update.

Administration ExpensesAdministration costs $24 million in 2014. This amount is shared 50/50 with CMS.

Table 18 Administration Expenditures, 2014

DMS Administration Expenditures

00 - Regular Salaries 14,906,374 01 - Extra Help 147,438 02 - Maintenance & Operations 3,105,905 03 - Fringe Benefits 5,071,989 06 - Overtime 2 08 - Supplemental Salaries09 - Conference Fees and Travel 114,225 10 - Professional Fees and Services 492,845 11 - Capital Outlay - 44 - Purchase Data Processing 346,682 48 - Respite Care -

Sub-Total 24,185,460

DMS Programs

Private Nursing Home 623,905,366 Prescription Drugs 348,768,244 Hospital/Medical 3,782,334,535 ARKids 94,799,367 Child and Family Institute - Infant Infirmary 24,512,824 Public Nursing Home 188,911,011 Medical Expansion 59,017,945 Nursing Home Quality of Life 100,000 Nursing Home Closure Costs - LTC Facility Receivership -

Sub-Total 5,122,349,292

TOTAL 5,146,534,752

TSG will report more about administration costs in the next update.

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Trends in EnrolleesTable 19 Enrollees in Traditional Medicaid and Private Option by Beneficiary Aid Category, 2006-2015, as of March each year

Enrollees as of March each year* 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Low Income Children & Pregnant Women 267,258 276,605 278,261 283,867 301,923 303,656 303,402 308,984 339,666 352,690SSI Disabled 97,592 100,425 103,863 107,390 111,325 114,384 115,846 116,827 114,596 107,963ARKids 77,504 81,038 81,520 76,016 74,757 76,961 77,709 75,978 69,776 59,322Medically Needy Aged 43,209 47,525 51,838 53,116 55,095 58,477 61,116 62,984 64,375 64,111Medically Needy Families & TANF 47,002 41,950 36,263 32,661 30,220 28,982 28,328 26,690 35,467 39,210Medically Needy Disabled 20,585 21,944 23,894 24,900 25,289 27,091 28,838 29,398 30,860 30,642Adoption and Foster Care 5,466 5,779 5,908 6,151 6,556 7,007 6,944 7,191 7,776 8,258SSI Aged 10,303 9,567 8,849 8,092 7,594 7,223 6,691 6,344 6,042 5,726Other 80,068 76,579 66,478 62,542 64,252 63,337 61,730 60,717 794 738Spenddown Disabled 1,897 1,765 1,749 1,722 1,804 1,777 1,803 1,325 530 106Spenddown Families & TANF 957 912 863 807 813 609 625 455 22 4Non Private Option 651,841 664,089 659,486 657,264 679,628 689,504 693,032 696,893 669,904 668,770Private Option (Medically Fragile and PMPM) 198,094 243,615All Medicaid and Private Option 651,841 664,089 659,486 657,264 679,628 689,504 693,032 696,893 867,998 912,385* March is the most recent month for which we have 2015 data

The trend in enrollees is flat for 2015 compared to either 2006 or 2010 (0.3% and -0.3% respectively). Thus, while the population has been growing at 0.5%, the number of Traditional Medicaid enrollees has not increased. This, however, masks a shift in enrollees. The high-growth areas have not primarily been the aged, rather the medically needed and low income:

Medically Needy Families & TANF Adoption and Foster Care Medically Needy Disabled Low Income Children & Pregnant Women Medically Needy Aged

Services to SSI Aged (as well as ARKids and SSI Disabled) are down significantly since 2010:

Table 20 Enrollment Growth Rates

Total Growth 2006-2015

Percent of Growth

2006-2015CAGR

2006-2015CAGR

2010-20152013-2014

2014-2015

Medically Needy Families & TANF -17% -46% -2.0% 5.3% 9.9% 3.8%Adoption and Foster Care 51% 16% 4.7% 4.7% -1.9% -5.8%Medically Needy Disabled 49% 59% 4.5% 3.9% -8.2% -15.0%Low Income Children & Pregnant Women 32% 505% 3.1% 3.2% 2.2% -0.4%Medically Needy Aged 48% 123% 4.5% 3.1% 32.9% 10.6%SSI Disabled 11% 61% 1.1% -0.6% 5.0% -0.7%ARKids -23% -107% -2.9% -4.5% 8.1% 6.2%SSI Aged -44% -27% -6.3% -5.5% -4.8% -5.2%Spenddown Disabled -94% -11% -27.4% -43.3% -98.7% -7.1%Other -99% -469% -40.6% -59.1% -60.0% -80.0%Spenddown Families & TANF -100% -6% -45.6% -65.5% -95.2% -81.8%Non Private Option 3% 100% 0.3% -0.3% -3.9% -0.2%All Medicaid and Private Option 24.6% 5.1%

Reviewing year over year growth rates since 2007 in the table below suggests some important observations about enrollment:

Except for 2010, growth has been approximately the same as the overall population, 0.5% per year

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Decrease in 2014 suggests a measure of the transfer of beneficiaries from Traditional Medicaid to Private Option

The expected outcome was that Pregnant Women would shift from Traditional Medicaid to Private Option However, instead the Aid category Low Income Children and Pregnant Women grew by 9.9% in 2014

Medically Needy Families and TANF grew significantly in 2014, following years of decline Adoption and Foster Care has increased at a much larger rate over the years 2014 and 2015

compared to history Spenddown is disappearing, presumably those beneficiaries are moving to Private Option

Table 21 Year over Year Enrollment Growth Rates 2007-2015Enrollees as of March each year* 2007 2008 2009 2010 2011 2012 2013 2014 2015Low Income Children & Pregnant Women 3.5% 0.6% 2.0% 6.4% 0.6% -0.1% 1.8% 9.9% 3.8%SSI Disabled 2.9% 3.4% 3.4% 3.7% 2.7% 1.3% 0.8% -1.9% -5.8%ARKids 4.6% 0.6% -6.8% -1.7% 2.9% 1.0% -2.2% -8.2% -15.0%Medically Needy Aged 10.0% 9.1% 2.5% 3.7% 6.1% 4.5% 3.1% 2.2% -0.4%Medically Needy Families & TANF -10.7% -13.6% -9.9% -7.5% -4.1% -2.3% -5.8% 32.9% 10.6%Medically Needy Disabled 6.6% 8.9% 4.2% 1.6% 7.1% 6.4% 1.9% 5.0% -0.7%Adoption and Foster Care 5.7% 2.2% 4.1% 6.6% 6.9% -0.9% 3.6% 8.1% 6.2%SSI Aged -7.1% -7.5% -8.6% -6.2% -4.9% -7.4% -5.2% -4.8% -5.2%Other -4.4% -13.2% -5.9% 2.7% -1.4% -2.5% -1.6% -98.7% -7.1%Spenddown Disabled -7.0% -0.9% -1.5% 4.8% -1.5% 1.5% -26.5% -60.0% -80.0%Spenddown Families & TANF -4.7% -5.4% -6.5% 0.7% -25.1% 2.6% -27.2% -95.2% -81.8%Traditional Medicaid Enrollment 1.9% -0.7% -0.3% 3.4% 1.5% 0.5% 0.6% -3.9% -0.2%

Drivers of Future SpendingThree key drivers could explain changes in Medicaid expenditure: population, provider cost or health coverage. Population accounts for little of Arkansas’ Medicaid growth, as population has grown at a CAGR of 0.4% since 20101.

Table 22 Historical Population of Arkansas compared to US

2010 2011 2012 2013 2014Total

GrowthCAGR

United States 309,347,057 311,721,632 314,112,078 316,497,531 318,857,056 3.1% 0.8%Arkansas 2,922,297 2,938,430 2,949,300 2,958,765 2,966,369 1.5% 0.4%

Geographic AreaPopulation Estimate (as of July 1)

Arkansas’ population demographics are similar to those of the rest of the US on several key dimensions that could drive differences in healthcare: ethnicity, education, foreign birth and age. On the dimension of disabilities, Arkansas has a somewhat higher rate than the US. Thus, aging of the population will drive caseload and budget growth disproportionately in the direction of aging services. In addition, Arkansas will likely see its already-high rate of disabilities to continue due to these demographic shifts.

Arkansas’ population has roughly the same age distribution as the US, with about 1% more over-65 and 1% more under 18 years of age2.

1 UALR Institute for Economic Advancement at http://iea.ualr.edu/population-estimates-a-projections/831-state-level-population-estimates-current-series.html#comphttp://iea.ualr.edu/population-estimates-a-projections/831-state-level-population-estimates-current-series.html#comp2 US Census at http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=PEP_2013_PEPAGESEX&prodType=table

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Table 23 US and Arkansas Population Historic Growth by Age

Population 2010 2011 2012 2013 2010 2011 2012 2013Under 18 years 74,119,556 73,902,222 73,708,179 73,585,872 711,947 710,576 710,471 709,86618-64 years 194,729,527 196,310,829 197,021,761 197,838,893 1,788,806 1,800,064 1,796,785 1,795,087Over 65 40,477,212 41,369,513 43,143,745 44,704,074 421,527 427,866 442,572 454,420

309,326,295 311,582,564 313,873,685 316,128,839 2,922,280 2,938,506 2,949,828 2,959,373PercentageUnder 18 years 24% 24% 23% 23% 24% 24% 24% 24%18-64 years 63% 63% 63% 63% 61% 61% 61% 61%Over 65 13% 13% 14% 14% 14% 15% 15% 15%

100% 100% 100% 100% 100% 100% 100% 100%

US Population Arkansas Population

Forecasts are that the Arkansas’ elder population will grow faster than the rest of the demographic3.

Figure 5 US and Arkansas Population Projected Growth by Age

Thus, the over-65 portion of the population will likely grow from 21% to 24% over the next 5 years4. It is likely that each of the categories of aged services could increase at a slightly higher rate. Increasing at a rate 0.35% faster than population growth would be consistent with shifting the aged population from 21%-24% between 2012 and 20205.

Table 24 Arkansas Project Population Percentages by AgeProjected Arkansas PopulationAge Group 2012 2020 20300 to 19 27% 27% 27%20 to 39 25% 24% 24%40 to 59 27% 25% 24%60+ 21% 24% 26%

100% 100% 100%

Arkansas’ population has higher rate of disabilities than the US average, 16.8% compared to 12.1%. This difference is consistent across age demographic6. Note that growth in the categories of beneficiary

3 Administration on Aging analysis of data from US Census at http://www.aoa.acl.gov/AoA_Programs/HPW/Behavioral/docs2/Arkansas.pdf4 US Administration on Aging analysis of data from US Census at http://www.aoa.acl.gov/AoA_Programs/HPW/Behavioral/docs2/Arkansas.pdf5 Administration on Aging analysis of data from US Census at http://www.aoa.acl.gov/AoA_Programs/HPW/Behavioral/docs2/Arkansas.pdf

6 US Census at http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk

16

already indicate higher growth for DD as well as a higher share than the rest of the US. Accordingly, it seems conservative to forecast DD at the same rate of historic growth.

Table 25 Arkansas and US Disability Populations by Age

DISABILITY STATUS Count Percent Count PercentTotal Civilian Noninstitutionalized Population 2,879,435 306,448,495With a disability 482,558 16.8% 37,168,880 12.1%

Under 18 years 707,821 24.6% 73,735,147 24.1%With a disability 39,721 1.4% 2,972,823 1.0%

18 to 64 years 1,755,753 61.0% 192,168,613 62.7%With a disability 264,304 9.2% 19,403,946 6.3%

65 years and over 415,861 14.4% 40,544,735 13.2%With a disability 178,533 6.2% 14,792,111 4.8%

United StatesArkansas

The ethnicity of Arkansas’ population resembles that of the US in most categories, with slightly more Whites and Black and fewer Asians and Hispanics7.

Table 26 Arkansas and US Population by Percentage Ethnic Group2013 data Arkansas USAWhite alone 79.90% 77.70%Black or African American alone 15.60% 13.20%American Indian and Alaska Native alone 1.00% 1.20%Asian alone 1.50% 5.30%Native Hawaiian and Other Pacific Islander alone 0.30% 0.20%Two or More Races 1.90% 2.40%Hispanic or Latino 6.90% 17.10%White alone, not Hispanic or Latino 73.70% 62.60%

Arkansans have a higher rate of High School graduation, and lower levels of post-secondary education8.

Table 27 Arkansas and US Population by Educational Achievement

EDUCATIONAL ATTAINMENT Count Percent Count PercentPopulation 25 years and over 1,936,554 206,587,852Less than 9th grade 118,011 6.1% 12,272,805 5.9%9th to 12th grade, no diploma 197,050 10.2% 16,614,916 8.0%High school graduate (includes equivalency) 679,339 35.1% 58,084,465 28.1%Some college, no degree 433,799 22.4% 43,896,733 21.2%Associate's degree 119,038 6.1% 16,135,795 7.8%Bachelor's degree 257,157 13.3% 37,286,246 18.0%Graduate or professional degree 132,160 6.8% 22,296,892 10.8%


Arkansas’ population includes fewer residents not born in the US (4.6% vs. 13.2%). Of those, a higher portion are not US citizens (70.3% vs. 54.9%)9.

Table 28 Arkansas and US Population by Percent Foreign-born

Count Percent Count PercentForeign-born population 133,397 4.6% 40,341,898 13.2%

Naturalized U.S. citizen 39,680 29.70% 18,206,895 45.10%Not a U.S. citizen 93,717 70.30% 22,135,003 54.90%


7 US Census at http://quickfacts.census.gov/qfd/states/05000.html8 US Census at US Census at http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk9 US Census at US Census at http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk

17

The Top 100 Utilizers Table 29 List of the Top 100 Most Costly Traditional Medicaid Beneficiaries

Ranking Paid Amount1 $5,986,250.952 $1,803,520.543 $1,611,679.324 $1,509,065.765 $1,438,493.576 $1,397,421.297 $1,366,608.488 $1,319,506.959 $1,289,086.7910 $1,217,980.4711 $1,210,710.4812 $1,207,919.9913 $1,203,597.3114 $1,165,083.2215 $1,150,274.8516 $1,121,937.7417 $1,089,139.7918 $1,073,175.6319 $1,015,628.5720 $1,004,087.9021 $983,959.5122 $946,802.4423 $885,818.6324 $881,694.1025 $870,505.9526 $867,785.6427 $864,028.7228 $862,574.8529 $839,848.3230 $839,493.9331 $819,778.4932 $812,529.1133 $777,951.1034 $766,837.9735 $766,490.9936 $766,467.6737 $751,702.5238 $710,572.7239 $708,320.60

40 $691,269.7241 $687,049.6842 $685,318.4343 $671,222.2044 $665,267.2345 $663,715.7246 $663,334.6147 $657,143.0948 $655,646.1249 $648,042.6050 $647,181.7651 $646,521.8252 $630,532.5053 $629,726.7354 $617,030.6955 $596,519.8756 $591,823.8557 $589,062.9258 $585,419.3159 $582,001.8560 $579,281.9361 $577,231.1162 $576,934.4163 $576,016.0764 $570,928.9465 $566,437.2266 $564,047.0067 $561,591.8468 $557,468.6969 $554,062.7470 $551,129.7771 $549,834.4872 $546,075.6473 $545,623.5974 $543,390.7875 $543,221.0576 $542,984.3477 $541,886.3978 $539,921.3079 $539,108.45

18

80 $536,611.0981 $532,210.1082 $532,113.1883 $530,983.6884 $526,803.5885 $522,187.2686 $521,271.5687 $521,053.0188 $519,298.3589 $517,368.0490 $511,442.21

91 $503,411.8892 $494,992.6193 $488,991.2694 $482,922.5095 $479,851.8796 $478,844.7597 $478,061.2598 $474,982.3399 $474,113.05100 $473,237.35

Note: High utilizers included Medically Fragile under Private Option that are on the Traditional Medicaid program per CMS Waiver.

According to Dr. William Golden, Professor of Medicine and Public Health and UAMS, there were 30 hemophilia cases, a few burns, a few severe trauma, a few neonatal prolonged stays, some cystic fibrosis and severe mental illness with hospitalizations. In addition, many on the list have pharmacy cost as a predominant component of their expenses.

TSG is working with DHS to drill down on costs per category of beneficiary as well as diagnosis and treatment modality to get more instructive data here.

Top 100 Providers

Table 30 List of the Top 100 Most Costly Traditional Medicaid BeneficiariesProvider Name Paid AmountArkansas Childrens Hospital $267,649,061.48 Univ Hospitalof Arkansas $129,959,313.20 Conway Human Development Center $97,343,450.76 Arkansas Health Center $57,046,407.96 Baptist Medical Center $44,648,321.25 Independent Choices $33,687,125.01 Medical Collegephysicians Group $31,256,215.73 First Step Inc $30,628,521.84 Childrens University Med Group $30,486,555.53 Bost Inc $28,682,251.27 St Bernards Regional Med Center $28,567,696.72 Arkansas Dept Of Health And Human $27,396,371.19 St Vincent Infirmary Medical Ctr $25,625,211.70 Booneville Human Development Ctr $25,174,627.90 Arkadelphia Human Dev Center $24,188,503.29 United Cerebral Palsy Of Central $21,767,713.32 Fort Smith Hma Llc $21,533,227.55 Independent Case Management Inc $20,865,659.17

Jonesboro Human Development Ctr $20,426,677.42 Mercy Hospital Fort Smith $20,335,610.72 Southeast Arkansas Human Dev Ctr $20,001,741.79 Ozark Guidance Center Inc $19,775,244.96 White County Medical Center $19,460,769.45 Friendship Community Care Inc $19,306,092.55 Caremark Tennessee Specialty Pharm $19,133,432.70 Millcreek Of Arkansas $19,039,037.50 BHC Pinnacle Pointe Hospital Inc $18,705,657.74 Methodist Hospitals Of Memphis $18,173,576.82 Jefferson Regional Medical Center $16,721,269.80 Arkansas Support Network $16,434,208.37 Mercy Hospital Hot Springs $16,389,018.80 White River Medical Center $14,950,020.72 Washington Regional Medical Ctr $14,320,101.76 Piney Ridge Treatment Center $14,240,450.00 Pathfinder Inc $13,761,921.86 Ach Physicians Services $13,326,260.27 Northwest Medical Center $12,916,123.76

19

Community Counseling Services Inc $12,621,352.39 Superior Senior Care Inc $12,582,222.18 Mercy Hospital Rogers L $12,456,674.95 Full Potential Child Development $12,154,303.16 Integrity Inc $11,743,887.88 Abilities Unlimited Jonesboro Inc $11,544,843.98 Baptist Healthmed Ctr Nlr $11,533,139.32 Youth Home Inc $11,529,350.00 Southeastrans Inc $11,073,833.90 Vantage Point Of Northwestarkans $10,983,730.15 Southeastrans Inc $10,604,123.50 United Methodist Behavioral $10,501,257.74 Ar Dept Of Health Home Health $10,401,201.47 Christus St Michael Health System $10,310,361.98 AR State Hospital $10,290,137.05 The Arkansas Hospice $10,273,948.97 St Marys Regional Medical Center $9,836,342.02 UHS Of Benton Inc $9,764,402.55 LeFleur Transportation Of Texas $9,537,261.26 Conway Regional Medical Ctr Inc $9,524,361.44 Trinity Behavioral Health $9,458,750.00 Support Solutions Of Arkansas Llc $9,372,624.44 Baxter County Regional Hospital $9,261,025.83 Arkansas Pediatric Facility $9,239,429.30 Total Life Healthcare Inc $9,168,280.53 United Medical $9,113,065.57 Searcy Health And Rehab Llc $8,885,930.63 Brownwood Lifecare Center $8,884,121.05 Rainbow Of Challenges Inc $8,864,953.88 NW Med Ctr Willow Creek Women Hos $8,785,975.58 Southwest Arkansas Counseling And $8,735,438.19 Network Of Community Options Inc $8,706,937.18

Millcreek Of Arkansas $8,702,866.27 Davis Life Care Center $8,454,977.25 First Step Inc $8,378,011.17 Families Inc Of Arkansas $8,331,879.73 Area Agency On Aging Of Western $8,324,042.09 White River Area Agency On Aging $8,315,817.58 Easter Seals Arkansas $8,315,437.64 Life Strategies Of Arkansas Llc $8,294,892.26 Perspectives Behavioral Health Ma $8,172,722.23 Magnolia Health And Rehab Llc $8,145,247.36 AR Childrens Hospital Pharmacy $8,048,753.68 National Park Medical Center $8,046,739.43 Lakeland Behavioral Health System $8,042,892.31 Centers For Youth & Families Inc $8,002,397.12 Arkansas Enterprises For The Deve $7,845,275.13 Counseling Associates Inc $7,843,595.77 Valley Behavioral Health System $7,725,563.67 Saline Memorial Hospital $7,713,274.03 Easter Seal Arkansas $7,694,257.17 Area Agency On Aging Of Western $7,679,450.70 North Arkansas Regional Medical $7,646,358.53 Valley Behavioral Health System O $7,581,655.96 Woodridge Behavioral Care Of $7,570,979.00 Wadley Regional Medical Center $7,537,167.98 Greene Acres Nursing Home $7,501,933.20 Anr 1 Llc $7,414,629.82 Central Arkansas Radiation Therapy $7,393,636.03 Mid South Health Systems Inc $7,369,908.36 Youth Villages Inc $7,343,411.00 Independent Living Services Inc $7,330,612.79 Absolute Care Management Corp $7,316,935.08

20

Comparison to Other State Medicaid Program Spending

All States’ Distribution of Medicaid Spending on Acute CareState Inpatient Physician

Lab/X-RayOutpatient Prescribed

Drugs & Other Services

Payments to Medicare

Payments to Managed Care Plans

Total

US $59,204B $13,225B $27,323B $48,062B $14,795B $136,230B $298,840B

Arkansas 699,684M 333,147M 342,406M 1,019B 295,856M 13,168M 2,703B

Kansas 239,771M 49,056M 49,728M 83,268M 82,869M 1,358B 1,863B

Louisiana 1,232B 370,221M 423,821M 607,269M 264,739M 1,301B 4,199B

Mississippi 1,206B 226,678M 324,689M 530,538M 203,536M 607,272M 3,099B

Missouri 1,921B 68,072M 1,051B 1,495B 317,508M 1,109B 5,962B

Oklahoma 1,221B 571,452M 671,367M 713,482M 132,788M 187,487M 3,497B

Tennessee 1,070B 27,046M 63,090M 684,246M 340,318M 5,467B 7,652B

Texas 4,292B 1,234B 555,502M 3,403B 1,025B 12,008B 22,518B

Source: Kaiser Family Services: State Health Facts: FY 2013

Note: As part of this project, TSG will be reaching out independently to states and may obtain more updated data, including financial data within the State of Arkansas Medicaid so the use of Kaiser is only to provide the Task Force with some snapshot of comparison without knowing exactly the data sets that Kaiser Family Services used for their State Health Facts report.

Distribution of State Medicaid Funding on Long Term CareState Nursing

FacilitiesICF/ID MH Facilities Home Health–

Personal CareTotal

US $50,769B $12,184B $3,575B $56,488B $123,016B

Arkansas 641,411M 163,192M 159,938M 478,426M 1,443B

Kansas 143,376M 55,240M 18,658M 421,568M 638,842M

Louisiana 921,042M 415,213M 2,384M 842,511M 2,181B

Mississippi 768,640M 260,372M 74,201M 296,027M 1,419B

21

Missouri 983,067M 106,059M 23,130M 1,174B 2,286B

Oklahoma 561,789M 111,612M 72,238M 511,275M 1,257B

Tennessee NA/MC 294,247M 33,892M 699,910M 984,125M

Texas 2,360B 1,064B 20,841M 2,150B 5,594B

Source: Kaiser Family Foundation: State Health Facts: FY 2013


State Medicaid Spending per Enrollee (Full or Partial Benefit)State Aged Individuals

with Disabilities

Adults Children Total

US $13,249 $16,643 $3,247 $2,463 $5,790

Arkansas 12,994 11,564 1,638 2,420 5,264

Kansas 13,643 14,829 3,745 2,212 5,996

Louisiana 9,607 10,769 5,000 2,913 5,937

Mississippi 10,347 10,450 4,084 2,430 5,335

Missouri 14,706 16,401 3,005 2,978 6,488

Oklahoma 10,085 13,820 2,973 2,462 4,782

Tennessee 8,595 11,679 4,731 2,467 5,155

Texas 9,751 15,259 3,263 3,016 5,278

Source: Kaiser Family Foundation: State Health Facts: FY 11


22

Distribution of Acute Care/Long Term Care/DSH PaymentsState Acute Care Long Term Care DSH Payments Total

US 68.2% 28.4% 3.7% 100%

Arkansas 64.2% 34.3% 1.5% 100%

Kansas 72.2% 24.8% 3.7% 100%

Louisiana 58.7% 30.5% 10.7% 100%

Mississippi 65.4% 30% 4.6% 100%

Missouri 66.6% 25.5% 7.9% 100%

Oklahoma 72.9% 26.2% .9% 100%

Tennessee 87.8% 11.3% .8% 100%

Texas 79.5% 19.7% .8% 100%

Source: Kaiser Family Foundation/State Health Facts/FY2013


23

HCBS Spending as a Percent of Total LTSS

Source: Medicaid Expenditures for Long term Services and Supports in FY 2012: CMS/Truven Health Analytics; 4/29/14; p. 6 (FY 2013 data may be available prior to 10/14 and will be adjusted in the TSG Final Report)

Note: As part of this project, TSG will be reaching out independently to states and may obtain more updated data, including financial data within the State of Arkansas Medicaid so the use of Truven’s data analysis is only to provide the Task Force with some snapshot of comparison without knowing exactly the data sets that Truven used for their report.

Expenditures per Resident: Total LTSS Costs: FY 2012State Expenses Per State Rank

24

Resident

Arkansas $606.64 11

Mississippi 505.92 18

Louisiana 488.72 19

Missouri 454.56 23

Kansas 415.29 27

Tennessee 360.82 32

Oklahoma 322.92 37

Texas 291.09 42

US $445.92 NA

(Source: CMS/Truven Health Analytics: 4/28/14)

Note: As part of this project, TSG will be reaching out independently to states and may obtain more updated data, including financial data within the State of Arkansas Medicaid so the use of Truven’s data analysis is only to provide the Task Force with some snapshot of comparison without knowing exactly the data sets that Truven used for their report.

25

Professional Services ContractsContractor Name

Summary 2016Contract Amount

TOTAL CONTRACT AMOUNT

PROC END DATE

ProcurementMethod

ContractService Type

Direct or Indirect Operations (Y or N) *

Arkansas Chapter of the American Academy of Pediatrics (AAP)

Support PCMH Pediatrics

188,470 188,470

6/30/2016 Sole Source Contracts

Professional

N

Arkansas Foundation for Medical Care (AFMC)

Electronic health Record meaningful Use

4,431,722 4,431,722


Professional

Y

AFMC Child Health Management Services (CHMS)

814,182 5,395,0306/30/2017 RFP

amendments to extend

Professional

Y

AFMC Medicaid Provider Representative 2,064,512 10,139,885

6/30/2017 RFP amendments to extend

Professional

Y

AFMC PCMH Practice Transformation for APII

1,300,000 1,300,0006/30/2021 RFQ

amendments to extend

Professional

Y

AFMC Retrospective Reviews of physical, speech, and occupational therapies and PA's for personal care for under age 21

1,151,844 8,062,908


Professional

Y

AFMC To develop, review, implement & update criteria for utilization for PA's and extensions of benefits

6,524,687 39,240,137


Professional

Y

26

Contractor Name



PROC END DATE

ProcurementMethod



AFMC AR Innovative Performance Program (AIPP) for Long Term Care facilities

1,545,508 10,469,618


Professional

N

AFMC Medicaid Beneficiary Relations and Non Emergency Transportation (NET) Administration

4,023,577 16,200,925


Professional

Y

AFMC Child Health Management Services (CHMS) - REVIEW and Analytics Developmental Day Treatment Clinic Services (DDTCS)

703,062 703,062


Professional

N

AFMC Medicaid Quality Improvement 2,729,382 12,000,000


Professional

Y

AR Dept of Health

Medicaid Outreach & Education ConnectCare and provide information in the Primary Care Case Management (PCCM) program & support ARKids 1st info line

2,862,302 6,000,000

6/30/2017 Intergovernmental

Professional

Y

27

Contractor Name



PROC END DATE

ProcurementMethod



AR Healthcare Foundation

Training in nursing homes to reduce antipschotic drugs 200,000 200,000

8/30/2015 Sub-Grant Y

AR Healthcare Foundation

NH Administrator-in-Training Program 58,573 58,573


Professional

Y

AR Medical Society

AR Health Care Payment Improvement Initiative Provider Outreach Specialist Position

134,330 134,330


Professional

N

AR Medical Society

Medicaid PEER Review Committee 21,120 21,120


Professional

N

AR Optometric Association

Medicaid Vision Consultation 26,000 26,000


Professional

Y

AR State Dental Association

Medicaid Dental Consultation 150,000 150,000


Professional

Y

Ar Optometric Association

Visual consultation for Arkansas Medicaid visual program & the ARKids program

26,000 26,000


Professional

N

Bell, Stanley M "Jack"

Medicaid Admin. Hearing Officer 16,850 N/A

6/30/2015 RFQ's Legal/Other

Purchase Order

N

Bock Association/Emeritus

LTC Pre-Admission Screening Assessments

707,400 3,825,570


Professional

Y

Cognosante ICD-10 Federal Mandate

1,511,801 1,511,801 6/30/2016 Sole Source Contracts

Professional

Y

28

Contractor Name



PROC END DATE

ProcurementMethod



Cognosante, LLC

DHS IT Project Management Office

9,642,211 9,642,2116/30/2016 Sole Source

ContractsProfessional

N

Cognosante, LLC

Independent Verification & Validation

1,980,193 1,980,1936/30/2016 Sole Source

ContractsProfessional

N

Cognosante, LLC

MMIS PMO 5,395,727.04

18,134,893.00


Professional

N

Communications Group

ARKids First Media Campaign

125,000.00 875,000.00 6/30/2016 RFP amendments to extend

Professional

Y

Community Care Of North Carolina

Care coordination to Patient Centered Medical Homes (PCMH)

360,000.00 2,450,000.00

6/30/2021 RFQ Professional

Y

Datapath Private Option Health Care Independence Accounts

8,200,000.00

8,200,000.00


Professional

Y

GDIT Analytical Episode 4,330,000.00

30,000,000.00


Professional

Y

Green Dental Laboratory

Adult Dentures 1,835,388.00

N/A 7/31/2016 IFB - Amendment to Extend

Technical Y

Hause Actuarial Solutions

Actuary Services 52,500.00 210,000.00 6/30/2018 IFB - Amendment to Extend

Technical N

Health Information Designs

Retrospective Drug Utilization Review

263,455.00 1,822,070.00


Professional

Y

29

Contractor Name



PROC END DATE

ProcurementMethod



Health Management Systems, Inc.

Third Party Liability & Recovery Services (TPL)

4,707,380.00

29,171,660.00


Professional

Y

Health Services Advisory Group, Inc.

Medicaid Data Mining and Program Evaluation

896,764.00 5,606,984.00


Professional

N

HP Enterprise Services, LLC

MMIS Fiscal Agent 57,106,070.00

200,000,000.00


Professional

N

HP Enterprise Medicaid Management Information System (MMIS)

MMIS Core 27,708,092.06

27,708,092.06

11/30/2021

RFP amendments to extend

Professional

N

James, Robert T.

Medicaid Admin. Hearing Officer

16,850.00 N/A 9/30/2015 RFQ's Legal/Other

PO N

Jewel H. Harper

Medicaid Admin. Hearing Officer

16,850.00 N/A 9/30/2015 RFQ's Legal/Other

PO N

Manatt, Phelps & Phillips LLP

Health Law and Policy Development

1,305,000.00

1,305,000.00


Professional

N

Mckinsey and Company Washington

AR Health Care Payment Improvement Initiative

15,400,000.00

15,400,000.00


Professional

N

Magellan MMIS Pharmacy 7,497,588.00

43,325,000.00


Professional

Y

Myers and Stauffer, LC (PHBV Partners)

Disproportionate Share Hospital Audit (DSH)

46,730.00 347,940.00 6/30/2016 RFP amendments to extend

Professional

N

Myers and Stauffer, LC

Acuity Based Long-Term Care

291,200.00 291,200.00 6/30/2015 Sole Source Contracts

Technical N

30

Contractor Name



PROC END DATE

ProcurementMethod



(PHBV Partners)

Reimbursement

NET 1 - Lefleur Transportation of Texas, Inc.

Non-Emergency Transportation/Region- 1

3,986,235.27

N/A 6/30/2020 NET - RFP amendments to extend

Technical Y

NET 10 - Southwest Arkansas Dev Council, Inc.

Non-Emergency Transportation/Region- 10 X

1,659,569.38


Technical Y

NET 11 - Central Arkansas Development Council, Inc.

Non-Emergency Transportation/Region- 11 XI

1,650,039.73


Technical Y

NET 12 - Logisticare Solutions, LLC.

Non-Emergency Transportation/Region- 12 XII

6,517,683.15


Technical Y

NET 3 - Area Agency on Aging of Western Arkansas

Non-Emergency Transportation/Region- 3 III

5,901,533.94


Technical Y

NET 4 - Southeastrans, Inc.

Non-Emergency Transportation/Region- 4 IV

3,479,423.30

3,479,423.30

12/31/2013

Sole Source Contracts

Technical Y

NET 5 - Area Agency on Aging of Western Arkansas

Non-Emergency Transportation/Region-5 V

4,399,718.26


Technical Y

NET 6 - Area Agency on Aging of Western

Non-Emergency Transportation/Region-6 VI

368,622.25 N/A 6/30/2017 NET - RFP amendments to extend

Technical Y

31

Contractor Name



PROC END DATE

ProcurementMethod



Arkansas

NET 7 - Logisticare Solutions, LLC.

Non-Emergency Transportation/Region-7 VII

881,220.37 N/A 6/30/2017 NET - RFP amendments to extend

Technical Y

NET 8 - Central Arkansas Development Council, Inc.

Non-Emergency Transportation/Region-8 VIII

2,452,467.80


Technical Y

NET 9 - Area Agency on Aging of SE Arkansas

Non-Emergency Transportation/Region-9 IX

3,159,263.80


Technical Y

NovaSys AR Safety Net Benefit Program

3,650,440.00

N/A 6/30/2015 Sole Source Contracts

Technical Y

Office Of Health Technology – OHIT

PCMH Model 5,595,610.50

11,191,221.00


Professional

N

Optum MMIS Decision Support System (DSS)

13,690,717.57

13,690,717.57


Technical N

Optumus - Shramm Health Partners LLC

Health Law and Policy Development Data Analysis and Actuarial Services

990,000.00 990,000.00 6/30/2016 Sole Source Contracts

Professional

N

Oregon Health and Science University

Medicaid Evidence-Based Review Project

153,000.00 153,000.00 6/30/2016 Intergovernmental

Professional

N

Oregon Health and Science University

Drug Effectiveness Research Program (DERP)


Professional

N

32

Contractor Name



PROC END DATE

ProcurementMethod



Palco Self Directed Service Budget Counseling Support

9,235,460.00

55,477,760.00


Professional

Y

Palco Self Directed Service Budget Financial Management Services

2,454,600.00

24,112,200.00


Professional

Y

Pine Bluff Psy. Associates

DDS Procurement of Independent Assessors School Age Assessments

930,600.00 6,281,550.00


Professional

Y

Prometric LTC Nursing Assistant Testing

670,000.00 4,830,000.00


Professional

N

Qualis Health PCMH Practice Transformation

1,300,000.00

1,605,000.00

12/31/2014

Sole Source Contracts

Professional

Y

Select Optical Optical Supplies 1,906,572.75

N/A 11/30/2013

IFB - Amendment to Extend

Technical Y

Tri-County Rural Health Network

Community Connector

1,430,027.69

140,027.69 6/30/2016 Sole Source Contracts

Professional

Y

U of Michigan, Institute of Gerontology

LTC Universal Assessment Tool


Professional

N

UAMS College of Medicine

Early Periodic Screening Diagnosis and Treatment (EPSDT) & Third Party Liability Reviews


Professional

Y

33

Contractor Name



PROC END DATE

ProcurementMethod



UAMS College of Medicine (ACHI)

Evaluations to Provide Strategic Direction to Arkansas Medicaid

2,335,549.00

4,680,000.00


Professional

N

UAMS College of Medicine (ACHI)

Evaluate Section 1115 Demonstration Waiver

1,683,914.00

3,100,000.00


Professional

N

UAMS College of Pharmacy

Medicaid Prescription Drug

2,573,897.00

5,200,000.00


Professional

Y

UAMS College of Public Health

Arkansas Payment Improvement Initiative (APII) Long Term Services and Supports (LTSS Liason)


Professional

N

UAMS College of Public Health

Quality Measurement Coordinator - (Cayla Henry)

66,938.00 66,938.00 6/30/2013 MOU MOU N

UAMS Department of Pediatrics

Children with Special Health Care Needs Clinics (CSHCN)

887,104.00 1,774,208.00


Professional

Y

UAMS Dept of Obstetrics & Gynecology

Center for Distance Health - Formally (ANGELS) & (SAVE)

31,372,304.00

31,372,304.00


Professional

Y

UAMS Division of Information Technology

Health Information Management Systems Manager (Bash)

90,463.00 90,463.00 6/30/2013 MOU N

UAMS Physician Program 328,505.00 328,505.00 6/30/2017 Intergovernm Professio N

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Contractor Name



PROC END DATE

ProcurementMethod



Internal Medicine

Development ental nal

UAMS Medical SciencesDepartment of Psychiatry

To provide behavioral health and psychiatric consultation services to DMS (Miller-Simpson)


Professional

N

UAMS,Psych Research I TLC

Psych TeleHealth Liaison Consult (TLC)

1,789,970.56

3,758,938.18


Professional

Y

USAble Corporation

Institutional Cost Report Audit Services

1,062,667.00

3,295,291.00


Professional

N

Value Options Inc.

Mental Health Determination - Outpatient

4,765,593.98

30,614,849.41


Professional

Y

ValueOptions Inc.

Mental Health Determination - Inpatient

27,247,878.24

14,898,575.96


Professional

Y

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Health Independence AccountArkansas Health Independence Accounts SummaryJanuary 1, 2015 - May 21, 2015 Total (note)January, 2015 February, 2015 March, 2015 April, 2015 May, 2015

Transactions:Number of Cards Issued 42,753Number of Cards Activated 10,175Number of Successful Transactions 19,602 3907 4844 4284 3959 2608Amount Applied to Successful Transactions 170,932.26$ 32,505.26$ 42,432.00$ 38,076.00$ 34,090.00$ 23,829.00$

Number of Declined Transactions 18190 3986 3553 4782 3481 2388Amount of Declined Transactions 428,520.56$ 102,456.85$ 87,099.88$ 96,877.09$ 84,858.81$ 57,227.93$

Contributions:Total Contributions 11,042 326 3114 2897 2765 1940

Credit Card Payments 1,448 0 327 492 455 174Checks/Money Order Payments 8,335 189 2385 2124 2048 1589Online eCheck Payments 1,259 137 402 281 262 177contribution amount 147,925.46$ 3,613.00$ 41,163.81$ 39,355.75$ 37,187.39$ 26,605.51$

Call Center ActivityCall Center Operating Hours/days per month M-F 8:00-4:30 PM 22 days 20 days 20 days 22 days 15 daysTotal Calls Received 16,480 6,449 3,217 3,400 2,321 1,093Average per Day 787 293 161 154.5 106 72.9

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DHS Previous Third Party Liability Cost Savings Initiatives Note: This information was provided to TSG by DHS and TSG is still obtaining other cost savings initiatives and attempting to verify same and will report this in future Task Force updates.

Estate Recovery- A decision was made in 2010 to move the Estate Recovery Unit from the Office of Chief Counsel to the Third Party Liability Unit due to the availability of staff and resources. The final year of recoveries from the Office of Chief Counsel saw the recovery of $1.1 million. The first four years of recoveries since moving Estate Recovery to the TPL Unit have averaged $2.4 million per year.

Thus, the movement of Estate Recovery to the Third Party Liability Unit coincided with a $1.3 million per year increase in recoveries.

More recently, the TPL Unit began filing Demands for Notice on Long Term Care cases that has resulted in a dramatic increase in cases referred to the Unit for potential recovery. Another increase in recoveries is expected in the coming years.

Cost Avoidance- The cost avoidance totals for SFY 11 total $24.2 million and for SFY 12-14 increased to an average of $28.9 million per year as the contract was revised to eliminate the cap on the number of insurance policies added to the MMIS system. The contract had been capped at 25,000 insurance policies prior to SFY 11. After the cap was removed the insurance policies added to the MMIS system were doubled. This contract change had a positive impact on cost avoidance amounts.

The removal of the cap on the number of insurance policies added resulted in an increase of cost avoidance amounts of $5.7 million.

Commercial Insurance Recoupments- Since Medicaid is the payer of last resort, insurers and other third parties who are liable for the payment of medical claims are required to reimburse Medicaid for claims that should have been paid by those third parties. Prior to 2008, the TPL Unit and its contractor only pursued recoupments from Medicare resulting in approximately $8.7 million per year in recoupments to the Arkansas Medicaid program. In 2008, with input from Arkansas Children’s Hospital, the decision was made to add commercial insurance to the recoupment function of the TPL Unit and its contractor. This decision resulted in an increase in recoupments to approximately $23 million per year since 2008.

The addition of commercial insurance recoupments has resulted in a $14.3 million per year increase in funds paid to Arkansas Medicaid.

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Traditional Medicaid: Ten Year History of Arkansas FMAPArkansas History of FMAP:

FY: 10/1-9/30 FMAP % Enhanced FMAP%

2016 70% 79% (+100% ACA)

2015 70.88% 79.62%

2014 70.10% 79.07%

2013 70.17% 79.12%

2012 70.71% 79.50%

2011 71.37% 79.96%

2010 72.78% 80.95%

2009 72.81% 80.97%

2008 72.94% 81.06%

2007 73.37% 81.36%

2006 73.77% 81.64%

Source: DHHS, Office of Planning & Evaluation Note: State per capita income is a significant factor in FMAP annual calculations.

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Answers Provided by Blue Cross Blue Shield to TSG Questions Related to Private Option Address Concerns

ABCBS Return Mail Process for Private Option

As of June 9, 2015

The enrollment for PO member starts with the PO member enrolling either at www.healthcare.gov or the DHS site www.accessark.com and then www.insureark.org to shop for a health plan.

PO Eligibility is determined by the State enrollment systems. Letters are sent to the eligible members by DHS confirming eligibility has been approved and to inform the newly eligible member to select a health plan within a set number of days (12) and a subsequent second letter is sent to the newly eligible member by DHS if the member does not select a plan confirming the member’s assignment to a health plan and allowing 30 days for the member to change health plans.

Therefore DHS and HP does have a correct and up to date address at the time of enrollment since any returned mail would most likely be reviewed and the newly eligible member’s information updated before sending to the health plan. When the health plan for the member is determined, then DHS via HP sends an 834 file to the applicable health plan carrier.

NOTE: Providers of services for medical and pharmacy have access to our Provider Web Portal and Pharmacy Portals to both find and verify a PO member’s enrollment and benefit information. This is especially helpful if the member does not have their ID card with them at the time of service.

Questions from TSG:

The current estimate of PO members with a “bad physical address” is 7,000 - 8,000 out of 141,829 PO Members or 5%. This estimate changes monthly based on the 834 audit file with address updates sent by DHS via HP to the health plan carrier.

How often do you send a packet/ID and notice to a new beneficiary given to you by DHS, which has a bad address. Meaning, the mail comes back undelivered. Even an estimate is OK.

We will mail the packet ID a second time based on information provided by the US Post Office.

What steps does BCBS take in trying to locate a beneficiary in this instance? Do you ever get a phone # or other contact info? If not, have you asked DHS?

The current 834 enrollment file received from DHS via HP does not have the phone number as part of the enrollment record sent by DHS via HP to the health plan carrier. The need for the phone number in the record has been identified as an enhancement and discussed with DHS and HP, at this time we do not know when this will be installed.

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http://www.insureark.org/

http://www.accessark.com/

http://www.healthcare.gov/

When do you finally notify DHS you cannot reach a beneficiary and what steps are taken after that? Is DHS usually able to locate?

We have forwarded over 30 reports since January 2014 to the Department of County Operations (DCO) with bad address information from returned mail and send every month reports with members that appear to have an out of state address (physical or mailing) additionally a report for members that have a significant volume of claims from out of state providers (not necessarily bordering the state of Arkansas providers) is sent for research by the DCO. These report provided to DCO includes the PO members SSN to assist DCO in locating the PO member on the DCO system of record. We believe based on the 834 Audit file that DCO is successfully locating and continuously updating addresses. At this time we are anticipating additional instructions from DCO on possible improvements to this reporting process.

Also, our processes include instructing the member when calling one of our Customer Service Representatives to contact their local county office to update their physical address. A carrier cannot update a physical address since the Service Area and associated premium is dependent on the DHS system of record to determine, information is also emailed to the state. Depending on the urgency of the caller needing for example an ID card, we will change the secondary address of the member in order to mail packet/IDs and notices and advise the caller and state to change the physical address upon validation.

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DHS and DMS Organization

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