In 2017, the Arkansas legislature approved a new Medicaid program: Provider-Led Arkansas Shared Savings Entities (PASSEs). The purpose was to implement a managed care program, which is basically a private insurance company funded by Medicaid, which is the state-funded insurance program for individuals with low income or disabilities. That means our legislature and governor took public funds that were otherwise used to pay for health care, and they instead used it to fund four private companies in order to pay for the same health care.

The upside for the State has been that the new program’s budget is a predictable lump sum each month regardless of how much care the beneficiaries need. This is possible because the PASSEs are now responsible for individual medical bills, not the state.  Meanwhile, the PASSEs make money when those medical bills are less than expected for a given month.  Their profits are driven by not spending the full lump sum.  Consequently, the proposed upside for the beneficiary is the care coordinator, which is a PASSE employee who drafts a comprehensive plan to make sure that every medical need is covered.  Think of it as a customized insurance policy.

Throughout 2018, the PASSEs were still in “Phase I,” which meant they had yet to take over any responsibility for paying the bills or managing care. Their only job was to develop the necessary infrastructure to do so when the time came. Initially there were four of them: Arkansas Total Care, Summit Community Care, Empower Healthcare Solutions, and ForeverCare.

The PASSEs were expected to begin “Phase II” and assume full responsibility on March 1, 2019. In the months before that, ForeverCare informed DHS that they were not ready. They needed more time. Nevertheless, the deadline remained, and on January 16, 2019, ForeverCare dropped out.

When Phase II began on March 1, ForeverCare seemed prophetic. Before the program had been in existence for a full quarter, public outcry had gotten so intense that legislators were threatening to do away with the entire concept.  We had a client who drove his child to Little Rock (90 miles each way) twice a week because the local therapists all closed after not receiving payment from the PASSEs. That was a mere six weeks after the PASSEs took over.

In the months since, DHS and the PASSEs claim things have improved. However, it is difficult to know whether that is true or if the beneficiaries have simply resigned themselves to a new normal. After all, the terms of their contracts incentivize a lack of transparency. The monthly payment does not account for any profit, so a PASSE only makes money by denying a service that DHS envisioned paying.

For example, the PASSE will be fined if grievances are not resolved according to their policies. However, the grievances only count if they are filed through the PASSEs themselves, and the PASSEs are responsible for reporting their own grievances to DHS.  We have requested those reports, and the results are in the chart below.

 

PASSE Name

March – June July – September  

Total Appeals

Total Complaints
Appeals Complaints Appeals Complaints
AR Total Care 2 5 21 10 7 31
Summit Community Care  

5

 

12

 

3

 

5

 

8

 

17

Empower Healthcare Solutions  

 

106

 

 

112

 

 

49

 

 

83

 

 

155

 

 

195

We’ve had a client who filed 14 complaints in August, and they weren’t to Empower.

That client had to wait six months for the PASSE to acknowledge a prescription. In that time, she had gone through three care coordinators and still did not have an approved plan of care. For six months, her family paid for the necessary item out of their own pockets.

Over the summer, a different client encountered legal problems due to his untreated mental illness. What he needed was therapy. Instead he was sent to jail. We intervened because the prosecutor knew he didn’t belong in jail, but the prosecutor didn’t know how to find another option for him.

We tried to enroll in a PASSE. According to the PASSE Medicaid Manual, enrollment in a PASSE is supposed to be automatic once you are determined eligible based on an independent assessment. It had been months since he was assessed and found eligible. We were told that he had to receive a waiver slot before he could be approved for a PASSE. At that time, he was still on the wait list, a status that notoriously takes several years to change. After consistent advocacy from multiple DRA staff, he was granted an emergency slot. Then we were told that he had to find a provider, while sitting in jail, before he could enroll in a PASSE, an entity responsible for reaching out to providers on his behalf.

Eventually a provider stepped up, and he was able to leave the jail. However, moving into that provider’s facility cancelled his PASSE eligibility. Not long after that, his family moved him out of state to receive care.

Those are merely a few stories that we know about. We’re certain there are countless others. The PASSE contracts have quality assurance measures. However, those measures depend on the PASSEs disclosing their own behavior, which means the health care for thousands of Arkansans is depending on the honor system. There are penalties if the PASSEs underreport or submit false documents, but that assumes the state has a mechanism to know whether the PASSEs are reporting accurate information and adequate staff to investigate the real numbers.

At one time, the General Assembly was considering a return to the old model. We cannot know whether that is the best choice, but we don’t have to know much to acknowledge a desperate need for accountability. Lives are on the line.

Mitchell Harlan is an advocate with Disability Rights Arkansas. Email him at mharlan@disabilityrightsar.org.