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Medicaid Contract Purchasing Specifications

Children with Behavioral Health Needs

Chapter I: “Prime/Prime” Approach

Part 2.
Delivery of Services for Children with Behavioral Health Needs

§201. Enrollment Procedures

§202. Disenrollment Procedures

§203. Information to Enrolled Children

§204. Multidisciplinary Team

§205. Provider Network

§206. Access Standards

§207. Relationships with Other State and Local Agencies

§208. Quality Measurement and Improvement

§209. Data Collection and Reporting

§210. Enrolled Child Safeguards

§211. Remedies for Noncompliance

§212. Other Applicable Federal and State Requirements

§201. Enrollment Procedures

Commentary: Under the “prime/prime” approach, the state Medicaid agency (or an enrollment broker on its behalf) enrolls a Medicaid-eligible child in both an MCO and a BHO, and makes capitation payments to both the MCO and the BHO on behalf of the child. Under the “prime/subprime” approach, in contrast, the state Medicaid agency makes capitation payments only to an MCO, and the MCO in turn subcontracts with one or more BHOs for the provision of behavioral health services to enrolled children who need the BHO’s services.

One of the central design issues in the “prime/prime” approach goes to timing of the enrollment of the child with behavioral health needs in the BHO. In some states, all eligible children are enrolled simultaneously in an MCO and in a BHO, whether or not they have behavioral health needs. In other states, all eligible children are enrolled in an MCO, but only those children identified as having behavioral health needs are enrolled in a BHO as well. The assumption underlying these optional specifications is that a child is enrolled in the BHO only after having been identified as a child with behavioral health needs. It is to these children whom Contractor owes the duties in Part 1 of developing and implementing a treatment plan, case management, etc.

These specifications also assume that the Purchaser (or the state Mental Health agency) – not the Contractor – makes the determination as to whether a child is a child with behavioral health needs. An alternative option would be to require Contractor to make this determination, perhaps using criteria specified by the Purchaser. Note that the Contractor’s application of these criteria may be influenced by the prospect of capitation revenues associated with the enrollment of such children. If capitation rates are relatively low, Contractor will have a financial disincentive to certify children as children with behavioral health needs and enroll them. If capitation rates are relatively high, Contractor will have an incentive to certify children as having behavioral health needs and enroll them.

(a) Enrollment Procedures — Contractor shall comply with the requirements of Part 2 of MEDICAIDSPECS (www.gwu.edu/~chsrp) to the extent such requirements are consistent with the requirements of this section. In the event of an inconsistency, the requirements of this section shall apply.

Commentary: As discussed above, these purchasing specifications assume that a child is enrolled in the BHO "prime" contractor only after having been identified as a child with behavioral health needs. The initial identification of the child is not the responsibility of the BHO, but of the Purchaser. A Purchaser might determine that a child is a child with behavioral health needs from the MCO in which the child is enrolled; from its Medicaid claims data; or from various state agencies, including Mental Health or Substance Abuse, Child Welfare, Juvenile Justice, Education, or the Part C Lead Agency. These identification are not within the scope of these purchasing specifications between the Purchaser and the BHO. The following illustrative language clarifies that the BHO's service duties to a child are triggered upon receipt of notice of the child's enrollment by Purchaser.

(b) Notification of Contractor by Purchaser

(1) Notification — Contractor shall comply with the requirements of §101(a) (relating to Contractor’s service duty) in the case of any child with respect to whom Contractor receives a written notification from Purchaser that the child has been enrolled in Contractor as an enrolled child with behavioral health needs (as defined in §110(f)) effective as of a specified date.

(2) Effective Date — The effective date of Contractor's service duty with respect to such child shall be the effective date of the child's enrollment as set forth in the written notification received from Purchaser under paragraph (1).

(c) Duties Related to Children with Behavioral Health Needs Receiving Treatment at Time of Enrollment

(1) Children under IEP or IFSP — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) who at the time of enrollment is receiving services under an IEP (as defined in §110(h)) or an IFSP (as defined in §110(i)), Contractor shall comply with the requirements of §105A(e).

(2) Children under Child Welfare Agency Plan — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) who at the time of enrollment is, or should be, receiving behavioral health services under [drafter insert reference to treatment plans issued by or at the request of the State Child Welfare Agency], Contractor shall carry out the [drafter insert reference to plan] until Contractor has fully implemented the requirements of §105A (relating to the development of a treatment plan) with respect to the child.

Commentary: The following illustrative language would apply to children who at the time of enrollment are receiving behavioral health services, whether from another BHO or MCO. For illustrative language relating to memoranda of understanding between Contractor and child welfare or other agencies, see §207.

(3) Other Children — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) who is not described in paragraphs (1) or (2) and who at the time of enrollment is receiving behavioral health services, Contractor shall:

(A) comply with the applicable provisions of the joint MCO/BHO protocol under §109; or

(B) in the absence of provisions described in subparagraph (A), reimburse the provider furnishing the behavioral health services to the child in the same amounts, and on the same terms, as Contractor would reimburse a provider participating in Contractor’s provider network for the same services, until Contractor has fully implemented the requirements of §105A (relating to the development of a treatment plan) with respect to the child.

§202. Disenrollment Procedures

Commentary: Under current Medicaid, states have the option of mandating enrollment by Medicaid beneficiaries in BHOs. A recent GAO report found that, among four states with mandatory enrollment, only one offered beneficiaries a choice among BHOs. General Accounting Office, Medicaid Managed Care: Four States' Experiences with Mental Health Carveout Programs (September 1999), GAO/HEHS-99-118, pp. 10-11, www.gao.gov. Purchasers will need to adapt the following illustrative language to their preferred enrollment policy.

(a) Grounds for Voluntary Disenrollment

(1) Inaccurate Provider Information — Consistent with §401(d) of MEDICAIDSPECS (www.gwu.edu/~chsrp), Contractor agrees that Purchaser has the authority and the responsibility to disenroll from Contractor for cause an enrolled child with behavioral health needs (as defined in §110(f)) if Contractor fails to provide to the child (and the child’s family or caregiver) accurate, current information regarding participation of providers in Contractor’s provider network.

(2) No Behavioral Health Provider Accessible31 — If no behavioral health provider (as defined in §110(b)) participating in Contractor's provider network is willing to accept an enrolled child with behavioral health needs (as defined in §110(f)) as a patient and is accessible under §206(c) to the child, Contractor agrees that:

(A) the family or caregiver of the child (or in the case of an adolescent, the adolescent), has the right to request Purchaser to disenroll the child from Contractor for cause; and

(B) Purchaser has the authority and the responsibility to disenroll the child from Contractor for cause.

Commentary: The following illustrative language would prohibit a contracting BHO from requesting that Purchaser involuntarily disenroll a child with behavioral health needs under any circumstances, including: the treatment of a child is too expensive, the child refuses treatment or misses appointments, the child (or the child’s family or caregiver) behaves in ways that are abusive or disruptive, the child (or the child’s family or caregiver) has not filled out the right paperwork, or the child has exercised the child’s rights under a grievance or appeals system. Contractor would be able to request the disenrollment of a child who no longer has behavioral health needs.

(b) Grounds for Involuntary Disenrollment32 — Contractor may not terminate or request the termination of enrollment of any enrolled child with behavioral health needs (as defined in §110(f)) who has not requested to disenroll and who remains eligible for [drafter insert name of state Medicaid program].

(c) Duties Related to Children with Behavioral Health Needs Receiving Treatment at Time of Disenrollment

(1) Children Receiving Treatment at the Time of Voluntary Disenrollment — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) who, at the time of voluntary disenrollment under subsection (a), is under treatment for a particular diagnosis or condition, Contractor shall:33

(A) continue to cover and furnish, or arrange for the furnishing of, the items or services in connection with such treatment, regardless of whether the provider furnishing the item or service participates in Contractor's provider network, and with no increase in cost-sharing obligations under §1003 of Part 10 of MEDICAIDSPECS (www.gwu.edu/~chsrp), until the earlier of the date on which:

(i) the child is enrolled in a successor behavioral health organization;

(ii) Contractor has received notice from Purchaser that a fee-for-service provider has assumed responsibility for the treatment of the child; or

(iii) the child’s treatment has been completed;

(B) arrange at Contractor’s expense, for the transfer of the child’s medical records to the successor behavioral health organization or provider assuming responsibility for care of the child within [ ] days of request by:

(i) the child’s family or caregiver; or

(ii) subject to the written consent of the child’s family or caregiver, the successor behavioral health organization or provider;

(C) ensure that behavioral health providers who were furnishing care to the child at the time of disenrollment are:

(i) notified of the child’s disenrollment within [ ] days of the disenrollment; and

(ii) in the case of a provider that participates in Contractor's provider network, made available for review of the child’s treatment with the successor behavioral health organization or provider assuming responsibility; and

(D) continue to comply with the requirements under §210 relating to enrolled child safeguards.

(2) Children Receiving Treatment at the Time of Involuntary Disenrollment Due to Loss of Eligibility — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) who is involuntarily disenrolled from Contractor under [drafter insert name of purchasing document] because of the loss of eligibility for [drafter insert name of State’s Medicaid program] and who, at the time of involuntary disenrollment, is under treatment, Contractor shall continue to furnish, or arrange for the furnishing of, items and services specified in the child’s treatment plan under §105A for a period of [ ] after the effective date of disenrollment.

(d) Option to Disenroll in the Event of Insolvency

(1) Option — In the event that Contractor files a petition for bankruptcy under Chapter VII or Chapter XI of the Federal Bankruptcy Code, or is subject to [drafter insert reference financial supervision or receivership proceedings under state law], Purchaser shall allow the family or caregiver of an enrolled child with behavioral health needs (as defined in §110(f)) to disenroll the child from Contractor for cause.

(2) Duties of Contractor toward Children Receiving Treatment — In the case of a child who is disenrolled for cause under paragraph (1) and who, at the time of disenrollment, is under treatment, Contractor shall continue to furnish, or arrange for the furnishing of, items and services specified in the child’s treatment plan under §105A for a period of [ ] after the effective date of disenrollment.

§203. Information to Enrolled Children

Commentary: The following illustrative language would require Contractor to provide information to newly enrolled children with behavioral health needs through an enrollee handbook (including the content and understandabilitly requirements), a provider directory, and other means specified in the illustrative language at Part 3 of MEDICAIDSPECS, (www.gwu.edu/~chsrp). Subsection (b) would supplement these generic requirements for an enrollee handbook with additional elements specific to children with behavioral health needs.

(a) In General — Contractor shall comply with the requirements of Part 3 of MEDICAIDSPECS (www.gwu.edu/~chsrp) to the extent consistent with the requirements of this section.

(b) Contents of Enrollee Handbook — Contractor’s enrollee handbook shall contain the following information relating to the delivery of items and services for a child with behavioral health needs (as defined in §110(d)):

(1) items and services covered under §102(a);

(2) items and services that remain the duty of Purchaser or MCO under §102(b);

(3) an explanation of the manner and frequency in which [drafter insert reference to state's Medicaid EPSDT benefit] covered under §102(a) are to be furnished;

(4) specific instructions on how to obtain the items and services covered under §102(a)through the child's multidisciplinary team under §204;

(5) specific instructions on where and how to obtain the items and services that remain the duty of Purchaser or MCO under §102(b), including how transportation is provided;

(6) an explanation of the development and implementation of a treatment plan described in §105A, including provisions for participation by the family or caregiver as a member of the child’s multidisciplinary team;

(7) an explanation of the assistance available from a case manager under §105(c);

(8) an explanation of how to use Contractor’s crisis hotline under §206(b)(1)And Contractor’s crisis services under §103(b);

(9) accommodations made by Contractor as required by the Americans with Disabilities Act, 42 U.S.C. §12101 et seq.;

(10) grievance and appeal procedures under [drafter insert reference to relevant provisions in purchasing document] and state fair hearing rights under §210(g); and

(11) opportunities for participation on the Family Advisory Board established and maintained by Contractor under §101(d)(3).

§204. Multidisciplinary Team

Commentary: As discussed in the commentary before §101, the illustrative language in these "Prime/Prime" specifications does not assume that every Medicaid-eligible child is enrolled in the BHO. Instead, it assumes that the purchaser has decided to enroll Medicaid-eligible children in a BHO only if the children have been identified either by the purchaser or by the other “prime” contractor (e.g., the MCO) as needing behavioral health services. For this reason, the following language would require Contractor to ensure that a multidisciplinary team be assigned to each enrolled child.

Under this approach, a child’s multidisciplinary team would be responsible, under §105A, for the development and implementation of the child’s treatment plan. Each multidisciplinary team would consist of the behavioral health providers appropriate to the child’s needs, and could change in size and composition over time as those needs changed. At a minimum, each team would include the child’s case manager; the child’s family or caregiver (if willing to participate); and one behavioral health provider (as defined under §110(b)) who has authority under state law to assume responsibility for treatment of the enrolled child (including but not limited to a physician). Accountability for the child’s clinical management would rest with the behavioral health provider who has authority under state law to assume responsibility for treatment of the enrolled child; accountability for implementation of the child’s treatment plan would rest with the child’s case manager.

(a) Duty — Contractor shall ensure that, within [ ] of the effective date of enrollment, a multidisciplinary team meeting the requirements of this section is established and maintained for each enrolled child with behavioral health needs (as defined in §110(f)).

(b) Composition — A multidisciplinary team includes, with respect to an enrolled child with behavioral health needs (as defined in §110(f)):

(1) a behavioral health provider (as defined in §110(b)) selected by the child under subsection (c)(1) (or to whom the child is assigned under subsection (c)(2)) who has authority under state law to treat the enrolled child;

(2) the case manager selected by and assigned to the child under §105(b);

(3) if the family or caregiver is willing to participate as a member of the team consistent with §101(d)(1), the family or caregiver of the child;

(4) in the case of an adolescent, the adolescent (if the adolescent is willing to participate as a member of the team);

(5) other behavioral health providers (as defined in §110(b)) appropriate to the behavioral health needs of the child; and

(6) individuals knowledgeable about the behavioral health needs of the child who are staff of, or contractors to, [drafter insert names of Child Welfare Agency or other appropriate state or local agencies, or private child or family service system providers].

(c) Team Behavioral Health Provider

(1) Selection — Contractor shall ensure that an enrolled child with behavioral health needs (as defined in §110(f)) and the child’s family or caregiver (or, in the case of an adolescent, the adolescent) shall be notified in writing of the opportunity to select, within [ ] days of the effective date of enrollment of the child, a behavioral health provider (as defined in §110(b)) from among the providers participating in Contractor’s provider network to participate as a member of the child’s multidisciplinary team under subsection (b).

(2) Assignment of Non-Selecting Children — In the event that the family or caregiver of an enrolled child with behavioral health needs (as defined in §110(f)) (or in the case of an adolescent, the adolescent) does not select a behavioral health provider under paragraph (1) within [ ] days of notification of the opportunity to make a selection, Contractor shall, within [ ] days of such notification:

(A) assign the child to a behavioral health provider appropriate to the child’s behavioral health needs and accessible to the child under §206(c); and

(B) notify the child and the child’s family or caregiver (or in the case of an adolescent, the adolescent) of the assignment and the manner in which the child may access the services of the behavioral health provider.

(3) Reassignment of a Child with Behavioral Health Needs to Another Team Behavioral Health Provider

(A) Grounds for Reassignment — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) who has selected a behavioral health provider under paragraph (1) or who has been assigned to a behavioral health provider under paragraph (2), Contractor may reassign the child to another behavioral health provider only if one of the following three conditions applies:

(i) the child or the child’s family or caregiver (or, in the case of an adolescent, the adolescent) has requested reassignment to a different behavioral health provider;

(ii) the child’s current behavioral health provider no longer participates in Contractor's provider network;34 or

(iii) the child's current behavioral health provider:

(I) reduces the number of enrolled children the provider will accept as patients for the remaining term of the provider's written agreement with Contractor relating to participation in Contractor's provider network; or

(II) is, after [ ] months of responsibility as a behavioral health provider with respect to the child, no longer willing to assume such responsibility and certifies in the child’s medical record that reassignment of the child to another behavioral health provider will not:

(aa) compromise the treatment of the child’s behavioral health needs; or

(bb) disrupt the child’s access to behavioral health providers (other than the behavioral health provider from whom Contractor is proposing a transfer) or to covered prescription drugs.

(B) Notification — Contractor shall not involuntarily reassign an enrolled child under subparagraph (A) unless Contractor has notified the child (and the child’s family or caregiver) in writing at least [ ] weeks prior to the effective date of the reassignment of:

(i) the effective date of the child’s reassignment to a different behavioral health provider; and

(ii) the name, mailing address, phone number, practice site, practice hours, and the bus or subway line serving the practice sites at which the behavioral health provider furnishes covered items and services.

(C) Standard for Reassignment — Contractor shall not involuntarily reassign an enrolled child under subparagraph (A) unless Subcontractor assigns the child to a behavioral health provider who is:

(i) appropriate to the child’s behavioral health needs; and

(ii) accessible to the child under §206(c).

(d) Team Case Manager — Contractor shall ensure that the child's case manager under §105(b) complies with the duties enumerated under §105(c).

§205. Provider Network

(a) In General — Contractor shall comply with the requirements of Part 535 of MEDICAIDSPECS (www.gwu.edu/~chsrp) to the extent consistent with the requirements of this section.

Commentary: The delivery model assumed in these purchasing specifications relies on a multidisciplinary team. The illustrative language in §204 would require that an enrolled child’s multidisciplinary team consist, at a minimum, of a behavioral health provider and a case manager, both of whom participate in Contractor’s provider network. The following illustrative language relating to the composition of Contractor’s provider network would require that, at a minimum, Contractors have sufficient numbers of physicians, other behavioral health providers, and case managers to ensure the appropriate staffing of the multidisciplinary teams for enrolled children.

These minimum network composition requirements may not ensure that all of the behavioral health disciplines necessary to meet the needs of enrolled children participate in Contractor’s provider network. Purchasers could, at their option, either require the inclusion of additional disciplines in the provider network or require that Contractor make arrangements with out-of-network providers to meet the needs of enrolled children for such practitioners. The illustrative language at subsection (d) would clarify Contractor’s duties regarding such arrangements.

Note that the following illustrative language does not require that physicians, behavioral health providers, or case managers have experience in treating children with behavioral health needs. Instead, the requirement for experience specific to this population is included in the definition of each of these terms in §110.

(b) Composition of Network — Contractor’s provider network (as defined in §110(n)) shall include a sufficient number (as described in subsection (c)) of each of the following types of providers:

(1) physicians (including psychiatrists) who are behavioral health providers (as defined in §110(b));

(2) behavioral health providers (as defined in §110(b)) who are not physicians; and

(3) case managers (as defined in§110(c)); and

(4) [drafter insert other categories of providers as per Purchaser’s policy preferences].36

Commentary: The following illustrative measures of sufficiency are not specific to urban or rural service areas. Instead, this specificity is found in the access requirements referred to in §206(c)

(c) Measures of Sufficiency — Contractor shall include in Contractor’s provider network a number of each type of provider enumerated in subsection (b) that:

(1) is sufficient to staff the multidisciplinary teams for enrolled children with behavioral health needs consistent with the requirements of §204; and

(2) includes at least [ ] providers that meet, with respect to each enrolled child, the travel time and service waiting time requirements of §206(c).

(d) Out-of-Network Arrangements

(1) Insufficient Network Providers— If Contractor is not able to recruit and retain in Contractor’s provider network a number of each type of provider described in subsection (b) to meet the sufficiency requirements of subsection (c), Contractor shall enter into and maintain arrangements that meet the requirements of paragraph (3) with a sufficient number of each type of provider to enable Contractor to meet the requirements of subsection (c).

(2) Additional Provider Types— Contractor shall make arrangements that meet the requirements of paragraph (3) with the following types of providers:

(A) [drafter insert types of behavioral health providers necessary to furnish covered services to enrolled children that are not enumerated under subsection (b)].

(3) Arrangements— Contractor shall ensure that, with respect to each of the providers enumerated in paragraphs (1) or (2) through which Contractor furnishes items or services covered under §102(a) to an enrolled child with behavioral health needs (as defined in §110(f)):

(A) Contractor has on file a letter from the provider representing the provider’s intent to treat enrolled children with behavioral health needs if referred by Contractor or a provider participating in Contractor’s provider network; and

(B) Contractor has verified that the provider holds a valid provider number under [drafter insert name of state Medicaid program].

(e) Provider Selection and Retention — Consistent with §501(c) of MEDICAIDSPECS (www.gwu.edu/~chsrp), Contractor:

(1) shall not discriminate against providers who care for children with behavioral health needs (as defined in §110(d)) in:

(A) selecting or retaining behavioral health providers (as defined in §110(b)) and other providers for participation in Contractor’s provider network; and

(B) referring enrolled children to providers for treatment; and

(2) shall take into account the professional time and skill (and the related costs) attributable to the treatment of enrolled children with behavioral health needs (as defined in §110(f)) in reviewing the practice revenues and expenses (actual or projected) of a behavioral health provider or other provider participating in Contractor’s provider network for purposes of determining:

(A) compensation; or

(B) continued participation in the network.

(f) Reimbursement — Purchasers may find it useful to review Negotiating the New Health System (3rd Ed.) which provides other options relating to payment terms used by state agency purchasers in contracting with Medicaid MCOs in 1996. These options may be found at Table 7.2, Vol. 2, Part 4, pages, 7-94 through 7-174.

(1) In General — Contractor shall comply with the requirements of paragraphs (2) through (4).

Commentary: The following illustrative language would require Contractor to enter into a written agreement meeting certain minimum standards with each provider participating in Contractor's provider network. For the findings of a survey of such agreements between MCOs and community-based behavioral health providers, see Issue Brief #9: An Evaluation of Agreements Between Managed Care Organizations and Community-Based Mental Illness and Addiction Disorder Treatment and Prevention Providers, (March 2000), GW Center for Health Services Research and Policy, www.samhsa.gov. Illustrative language relating to MCO agreements with participating providers may be found at §501(b) of Part 5 of MEDICAIDSPECS (www.gwu.edu/~chsrp). Additional illustrative language relating to such agreements is set forth in American Medical Association, Model Managed Care Contract, 2nd Ed. (2000), http://www.ama-assn.org/ama/upload/mm/38/mmcmsa.pdf.

(2) Written Agreement with Participating Providers — C ontractor shall enter into and maintain an enforceable written agreement with each provider participating in Contractor’s provider network that:

(A) sets forth the provider’s duties under [drafter insert name of purchasing document];37

(B) requires performance of such duties:

(i) as a condition of participation in Contractor’s provider network; and

(ii) in consideration of payment by Contractor;

(C) requires Contractor to supply, within [ ] days of the effective date of disenrollment of a child with behavioral health care needs under §202(c)(1) (relating to voluntary disenrollment) and under §202(c)(2) (relating to involuntary disenrollment), accurate and complete information to the provider regarding:

(i) the child's disenrollment; and

(ii) the provider's duty, if any, under such sections to continue furnishing items and services to the child; and

Commentary: §1932(f) of the Social Security Act, 42 U.S.C. §1396u-2(f) requires that MCOs pay health care providers for delivering items and services covered under Medicaid risk contracts on a timely basis consistent with §1902(a)(37)(A) of the Act, 42 U.S.C.§1396a(a)(37)(A) (e.g., 90 percent of clean claims are paid within 30 days of receipt), unless the provider and the MCO agree to an alternate payment schedule.

(D) requires Contractor to ensure that in no event shall the payments to the provider be less prompt than required under §1932(f) of the Social Security Act, 42 U.S.C. §1396u-2(f).

(3) Prompt Payment to Providers Not Participating in Contractor’s Provider Network38—" Contractor shall make payment for items and services covered under §102(a) furnished to an enrolled child with behavioral health needs by a provider that does not participate in Contractor’s provider network in a manner that is no less prompt than that required under §1932(f) of the Social Security Act, 42 U.S.C. §1396u-2(f).

Commentary: Federal law limits the extent to which MCOs (or BHOs) contracting with Medicaid on a risk basis are allowed to shift financial risk “downstream” to their physicians. More specifically, an MCO (or BHO) may not make any specific payment either directly or indirectly to a physician or a physician group as an inducement to reduce or limit medically necessary care for an enrollee. In addition, if an MCO (or BHO) places the physician or physician group at “substantial financial risk" – i.e., greater than 25 percent of the physician’s anticipated income under the agreement – then the MCO (or BHO) must provide stop-loss that takes into account the size of the physician practice and the number of enrollees.

SAMHSA’s Guide for public purchasers notes: “Purchasers should be aware that a wide-open policy regarding the transfer of financial risk in subcontracts with providers can result in the [BHO’s] transferring virtually all of the risk associated with the provision of care to providers, thus assuring the BHO of a predictable profit. This situation can be dangerous, because most providers are not likely to have large capital reserves and thus are not likely to be able to absorb large cash flow fluctuations or periods of unusually high utilization; when such providers bear the bulk of the financial risk, their incentives to withhold or minimize services during a financially difficult time could be great.” Stephen Moss, Contracting for Managed Substance Abuse and Mental Health Services: A Guide for Public Purchasers, Center for Substance Abuse Treatment, SAMHSA, Technical Assistance Publication (TAP) Series 22 (1998), p. 166.

The following illustrative language clarifies the application of these requirements to physicians participating in Contractor’s provider network. Interested purchasers may wish to note that federal law does not prohibit purchasers from extending the physician incentive plan requirements to other types of providers participating in a BHO’s provider network, including clinical psychologists and social workers.

(4) Financial Risk— With respect to any arrangement for the compensation of a physician participating in Contractor’s provider network for the furnishing of items and services covered under §102(a)to enrolled children with behavioral health needs (as defined §110(f)), Contractor shall comply with the requirements of §1903(m)(2)(A)(x) of the Social Security Act, 42 U.S.C. §1396b(m)(2)(A)(x), 42 C.F.R. §417.479, relating to physician incentive plans.

§206. Access Standards

Commentary: Many contracts between State Medicaid agencies and MCOs contain language relating to the accessibility of covered services. See CHRSP, Negotiating the New Health System, 3rd Edition (1999), Table 3.7, Volume 3, Part 2, pp. 3-358 - 3-441. For illustrative language on access standards for all populations by type of service (e.g., preventive, routine, and specialty services), see CHSRP, Optional Purchasing Specifications: Access to Services (June 2000), Part A-1. Both references can be found at www.gwu.edu/~chsrp. The following illustrative language is specific to access by children with behavioral health needs to behavioral health providers. It is designed to be incorporated into contractual access provisions of more general applicability.

A number of states have enacted legislation that impose standards on MCOs with respect to patient access to specialists, including behavioral health providers. For a recent summary of these provisions, see Molly Stauffer, National Conference of State Legislatures, 2000 State by State Guide to Managed Care Law (September 1999), Table 2-4, and Families USA Foundation, Hit and Miss: State Managed Care Laws (July 1998), Table 1, www.familiesusa.org. Interested purchasers should consider the following illustrative language in light of any appropriate state law.

(a) In General — Contractor shall comply with the requirements of Part 6 of MEDICAIDSPECS (www.gwu.edu/~chsrp) relating to travel time and service waiting times to the extent the requirements are consistent with this section.

(b) Access to Crisis Behavioral Health Services

(1) Crisis Hotline — Contractor shall:

(A) establish and maintain a telephone line, other than the telephone lines used to administer prior authorization or other medical management procedures, to furnish the telephone crisis services described in §103(b)(1);

(B) ensure that the line is staffed on a 24 hours per day, 7 days per week basis, in such a manner that a caller is able immediately to speak to:

(i) an individual with experience in the behavioral health conditions of children to address inquiries by enrolled children or their families or caregivers regarding appropriate referrals, enrollee safeguards, and other questions relating to accessing items and services; and

(ii) a qualified professional with expertise in behavioral health conditions of children to address directly the needs of an enrolled child with behavioral health needs in crisis.

(2) Availability of Crisis Services — Contractor shall ensure that crisis services under §103(b) are available to an enrolled child with behavioral health needs in crisis (as defined in §103(b)(6)) on a [ ] hour per day, [ ] day per week basis without prior authorization (as provided under §108(c)(1)).

(c) Accessibility of Behavioral Health Providers (1) In General — Contractor shall comply with the requirements of this subsection regarding the accessibility of behavioral health providers (as defined in §110(b)) participating in Contractor's provider network to enrolled children with behavioral health needs (as defined in §110(f)).

(2) Capacity — For purposes of this subsection, a behavioral health provider shall be considered to have the capacity to accept an enrolled child with behavioral health needs as a new patient if the number of patients (whether or not enrolled children) for whose medical or behavioral management the provider is responsible, does not exceed [drafter insert maximum panel size limit].

(3) Service Waiting Times — In the case of a request for, or referral to, a behavioral health provider (as defined in §110(b)) for an item or service covered under §102(a)that is not a crisis service under subsection (b)(2), Contractor shall ensure that the encounter with the provider is:

(A) in the case of a child with behavioral health needs living in [drafter insert name of urban area(s) within Contractor’s service area], scheduled to occur:

(i) when specified in the child's treatment plan under §105A(c); or

(ii) if not specified in the child's treatment plan, within [ ] days of request by:

(I) an enrolled child with behavioral health needs;

(II) the child’s family or caregiver (or in the case of an adolescent, by the adolescent); or

(III) a member of the child’s multidisciplinary team; and

(B) in the case of a child with behavioral health needs living in [drafter insert name of rural area(s) within Contractor’s service area], scheduled to occur (whether face-to-face or via telemedicine):

(i) when specified in the child's treatment plan under §105A(c); or

(ii) if not specified in the child's treatment plan within [ ] days of request by:

(I) an enrolled child with behavioral health needs;

(II) the child’s family or caregiver (or in the case of an adolescent, by the adolescent); or

(III) a member of the child’s multidisciplinary team.

(4) Travel Time

Commentary: The following illustrative language would establish travel time standards based upon a traditional urban/rural distinction. In states where this distinction is not sufficiently descriptive, purchasers may wish to establish different or additional standards for areas they characterize as "frontier," "suburban," or "border."

(A) Travel Time in Urban Areas — For purposes of this subsection, a behavioral health provider shall be considered to be accessible if, in the case of an enrolled child with behavioral health needs living in [drafter insert name of urban area(s) within Contractor’s service area], the provider is located within [ ] minutes travel time (using ground transportation) of the child.

(B) Travel Time in Rural Areas — For purposes of this subsection, a behavioral health provider shall be considered to be accessible if, in the case of an enrolled child with behavioral health needs living in [drafter insert name of rural area(s) within Contractor’s service area], the provider is:

(i) located at a practice site within:

(I) [drafter insert travel time] of the child using ground transportation; or

(II) if the child's family or caregiver certifies in writing to Contractor that the child is willing to travel for a period of time longer than that specified in subclause (I), such longer period of time; or

(ii) accessible via telemedicine.

(d) Accessibility of Residential Treatment Facility — In the case of the placement of an enrolled child with behavioral health needs (as defined in §110(f)) in a residential treatment facility under §103(d)(1) or §104(f), Contractor shall ensure that the travel time to the facility from the child's home does not exceed [ ] hour(s), regardless of whether the facility participates in Contractor's provider network or whether the facility is located outside of [drafter insert reference to Contractor's service area], unless:

(1) the enrolled child resides in [drafter insert name of rural area(s) within Contractor’s service area]; and

(2) the child's family or caregiver certifies in writing to Contractor that the child and the child's family or caregiver are willing to travel for a period of time longer than that specified in this subsection.

Commentary: The following standards are drawn from a set of core performance measures being developed by the Washington Circle Group, convened by SAMHSA's Center for Substance Abuse Treatment. A number of these performance measures are set forth in the specifications relating to Quality Measurement and Improvement, §208(d). See Report of The Washington Circle Group: Improving Performance Measurement for Alcohol and Drug Abuse Services (March, 2000), www.samhsa.gov.

(e) Access to Substance Abuse Services — Contractor shall ensure that, in the case of an enrolled child with behavioral health needs (as defined in §110(f)) who is diagnosed by a provider participating in Contractor's provider network as having: (1) an index diagnosis of alcohol or other drug abuse, the child begins receiving substance abuse services covered under §104 appropriate to the child's diagnosis within [ ]39 days of the child's diagnosis; and

(2) an index diagnosis of detoxification, the child:

(A) receives detoxification services covered under §104(h) - (j) within [ ] after diagnosis; and

(B) begins receiving other substance abuse services appropriate to the child's needs and covered under §104 within [ ] following detoxification.

§207. Relationships with Other State and Local Agencies

Commentary: This section sets forth illustrative language for memoranda of understanding between contracting MCOs and state agencies other than the purchaser that have responsibility for children with behavioral health needs. These are: state Mental Health and Substance Abuse Agencies and child welfare agencies. There are other state agencies that have responsibility for children with behavioral health needs, including Title V agencies, state educational agencies, and state developmental disabilities agencies. For illustrative language setting forth memoranda of understanding between contractor and these agencies, see §703, §706 and §707, respectively, of Part 7 of MEDICAIDSPECS (www.gwu.edu/~chsrp).

(a) In General — Contractor shall comply with the requirements of Part 7 of MEDICAIDSPECS, to the extent consistent with the requirements of this section.

(b) Relationship with State Mental Health and/or Substance Abuse Services Agency

(1) Referral of Disenrolled Children — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) whose enrollment is terminated due to ineligibility for [drafter insert name of state Medicaid program], Contractor shall at the time of disenrollment notify the child and the child’s family or caregiver in writing of the availability of behavioral health services and case management services from:

(A) [drafter insert name of State Mental Health and/or Substance Abuse Agency]; or

(B) providers subcontracting with or funded by [drafter insert name of State Mental Health and/or Substance Abuse Agency].

(2) Memorandum of Understanding with State Mental Health and/or Substance Abuse Agency

(A) In General — Contractor shall enter into a memorandum of understanding with [drafter insert name of State Mental Health and/or Substance Abuse Agency ] if the Agency is willing to enter into such a memorandum, which shall have the same term as this [drafter insert name of purchasing document], and which shall address the matters enumerated in subparagraph (B).

(B) Elements of Memorandum of Understanding

(i) Coordination of Covered Services — The responsibility of Contractor and the responsibility of the Agency (or the Agency’s grantees or subcontractors) for the furnishing of, and the payment for, items and services that:

(I) are covered under §102(a) with respect to enrolled children with behavioral health needs; and

(II) the Agency routinely furnishes (or arranges through grantees or subcontractors for the furnishing of) to children, including children with behavioral health needs;

(ii) Coordination of Uncovered Services — The responsibility of Contractor and the responsibility of the Agency (or the Agency’s grantees or subcontractors) for the furnishing of, and the payment for, items and services that:

(I) under §102(b) remain the responsibility of Purchaser or of the managed care organization in which an enrolled child with behavioral health needs is also enrolled; and

(II) the Agency routinely furnishes (or arranges through grantees or subcontractors for the furnishing of) to children with behavioral health needs;

(iii) Treatment of Family Member — The responsibility of Contractor and the responsibility of the Agency (or the Agency’s grantees or subcontractors) for payment for treatment furnished in circumstances under which a member of the family or caregiver who is not enrolled under [drafter insert name of purchasing document], requires treatment in order to effectively treat a condition of a child with behavioral health needs;

(iv) Reciprocal Referrals — The responsibility of Contractor and the responsibility of the Agency (or the Agency’s grantees or subcontractors) for the arrangements for referrals between Contractor and the Agency for the purpose of treating enrolled children with behavioral health needs;

(v) Informing Families and Caregivers — The responsibility of Contractor and the responsibility of the Agency for making information regarding the arrangements under clauses (i) through (iv) available to the families and caregivers of enrolled children with behavioral health needs;

(vi) Data and Information — The responsibility of Contractor and the responsibility of the Agency for the exchange of data and information relating to items and services furnished to enrolled children with behavioral health needs;

(vii) Liaison — The responsibility of Contractor and the responsibility of the Agency for the designation of individuals responsible for coordinating the implementation of the memorandum; and

(viii) Resolution of Disputes — The manner in which disputes between Contractor and the Agency regarding the terms of the memorandum will be resolved.

(c) Relationship with State Child Welfare Agency

(1) Memorandum of Understanding with State Child Welfare Agency (A) In General — Contractor shall enter into a memorandum of understanding with [drafter insert name of State Child Welfare Agency] if the Agency is willing to enter into such a memorandum, which shall have the same term as [drafter insert name of purchasing document], and which shall address the matters enumerated in subparagraph (B).

(B) Elements of Memorandum of Understanding Relating to Delivery of Services — With respect to enrolled children with behavioral health needs (as defined in §110(f)) for whose welfare the Agency has responsibility under state law:

(i) Access to Covered Services — The responsibility of :

(I) Contractor for the furnishing of, and the payment for, items and services that are covered under §102(a) with respect to such children; and

(II) the Agency for assisting such children in accessing items and services described in subclause (I) through Contractor and the providers participating in Contractor’s provider network;

(ii) Coordination of Treatment Plans — In the case of a child with a [drafter insert reference to treatment plan] issued by the Agency, the responsibility of Contractor and the responsibility of the Agency (or the Agency’s grantees or subcontractors) for implementing, consistent with §201(c)(2), the:

(I) [drafter insert reference to child's treatment plan] issued by Agency; and

(II) the child's treatment plan developed by Contractor under §105(a);

(iii) Access to Uncovered Services — The responsibility of Contractor and the responsibility of the Agency for ensuring access by such children to items and services that under §102(b) remain the responsibility of Purchaser or of the managed care organization in which such child is also enrolled;

(iv) Continuation of Services Upon Disenrollment — The responsibility of Contractor and the responsibility of the Agency under §202(c)And under [purchaser insert reference to relevant provisions of state law] with respect to the continuation of access by such child to needed items and services covered under [drafter insert reference to State Medicaid program] in the event of the voluntary or involuntary disenrollment of such child;

(v) Disposition of Court Orders — In the case of a child with respect to whom a court of jurisdiction has issued an order or directive relating in whole or in part to the provision of behavioral health services, the responsibilities under the order of the Agency and, if any, of Contractor;

(vi) Informing Families and Caregivers — The responsibility of Contractor and the responsibility of the Agency for making information regarding the arrangements under clauses (i) through (v) available to the families and caregivers of enrolled children with behavioral health needs;

(vii) Data and Information — The responsibility of Contractor and the responsibility of the Agency for the exchange of data and information described under §209(c) relating to items and services needed by, and furnished to, such children;

(viii) Liaison — The responsibility of Contractor and the responsibility of the Agency for the designation of individuals responsible for coordinating the implementation of the memorandum; and

(ix) Resolution of Disputes — The manner in which disputes between Contractor and the Agency regarding the terms of the memorandum will be resolved.

§208. Quality Measurement and Improvement

Commentary: A recent GAO report on Medicaid managed behavioral health found that the BHOs they studied were exempted by HCFA from annual external quality reviews, which GAO termed "an important monitoring requirement for Medicaid MCOs." General Accounting Office, Medicaid Managed Care: Four States' Experiences with Mental Health Carveout Programs (September 1999), GAO/HEHS-99-118, p. 24, www.gao.gov. In lieu of external reviews, the four states studied used a variety of approaches to quality assurance. The following illustrative language sets forth two such approaches: studies of quality, and clinical studies. As discussed in the introduction, HCFA is expected to issue a final rule implementing the 1997 BBA Medicaid managed care amendments. If this final rule requires the conduct of annual external quality reviews with respect to BHOs, this section will be revised accordingly.

Purchasers should note that the National Committee on Quality Assurance (NCQA) has released its proposed changes to the Managed Behavioral Health Organization (MBHO) Accreditation Standards for 2001, www.ncqa.org. These changes will, among other things, encourage the use of the Consumer Assessment of Behavioral Health Services (CABHS) survey and revise the standards for treatment records in MBHOs. While NCQA accreditation is not required of Medicaid BHOs under federal law, other private and public purchasers do hold their managed care contractors to NCQA standards.

The following illustrative language assumes that the costs to Contractors of conducting quality measurement and improvement activities, including the clinical focus studies specified by Purchaser, will be factored into the capitation rate paidIn by Purchaser to Contractor on behalf of each enrolled child with special health care needs.

(a) In General — Contractor shall comply with the requirements of Part 8 of MEDICAIDSPECS (www.gwu.edu/~chsrp) to the extent consistent with the requirements of this section.

(b) Studies of Quality of Services Furnished to Enrolled Children with Behavioral Health Needs — Contractor shall conduct on a [ ] basis the following studies relating to the quality of items and services under §102(a) furnished to enrolled children with behavioral health needs (as defined §110(f)):

(1) the extent to which the standards relating to access to behavioral health providers specified in §206 are met;

(2) the extent to which providers participating in Contractor’s provider network are applying the guidelines enumerated in §107 in treating enrolled children with behavioral health needs;

(3) the extent to which the families or caregivers of enrolled children with behavioral health needs participate in multidisciplinary teams under §204(b)(3);

(4) the implementation of treatment plans developed under §105A;

(5) the provision of case management services under §105(c)for enrolled children with behavioral health needs; and

(6) the level of satisfaction of families or caregivers of enrolled children with behavioral health needs (as defined in §110(f)), as measured by [ ]40, with the accessibility and quality of the services covered under [drafter insert name of purchasing document].

Commentary: The following illustrative language would enable Purchaser to specify studies to be performed relating to clinical quality of covered items and services furnished, including the outcomes of Contractor's services among enrolled children. For further information regarding behavioral health outcomes, Purchasers may wish to consult the following references:

  • The Santa Fe Summit on Behavioral Health: Preserving Quality and Value in the Managed Care Equation: 1997 Final Report, The American College of Mental Health Administration, www.acmha.org/summit_97/reports.htm;
  • National Scan of Children's Services Evaluation: The Georgetown TA Center State Survey National Scan Analyses and Trends ,Data Matters #1, Summer 1999, National Technical Assistance Center for Children's Mental Health, Georgetown University Child Development Center, www.dml.georgetown.edu/depts/pediatrics/gucdc/eval.html; and
  • Fitting the Pieces Together: Building Outcome Accountability in Child Mental Health and Child Welfare Systems, 1998, SAMHSA Center for Mental Health Services(CMHS), Outcomes Roundtable for Children and Families. Available from CMHS at 301-443-3343.

(c) Clinical Studies — Contractor shall conduct on an [ ] basis the following studies to assess the clinical quality of the items and services furnished to enrolled children with behavioral health needs (as defined in §110(f)) under [drafter insert name of purchasing document]:

(1) the provision of items and services for the treatment of [drafter specify behavioral health conditions that reflect Purchaser’s research priorities]; and

(2) [drafter insert other study topics reflecting research priorities of state agencies].

Commentary: The Washington Circle Group, convened by SAMHSA's Center for Substance Abuse Treatment, developed a set of core performance measures designed to hold organized systems of care accountable for the process of care for alcohol and other drug abuse disorders (AOD). See The Washington Circle Group Report: Improving Performance Measurement for Alcohol and Other Drug Services (March, 2000), www.samhsa.gov. The following illustrative language sets forth 5 of these performance measures. For additional performance measures, see CHSRP, Negotiating the New Health System: A Nationwide Study of Medicaid Managed Care Contracts, 2nd Ed., Special Report: Mental Illness and Addiction Disorder Treatment and Prevention, Appendix A, pp. A-1 - A-77.

(d) Core Performance Measures for Substance Abuse Services — Contractor shall report to Purchaser, in such form and manner and for such period as Purchaser specifies, data necessary to enable Purchaser to apply the following performance measures in connection with Contractor's duty to furnish substance abuse services covered under §104 to enrolled children with behavioral health needs (as defined in §110(f)):

(1) number of enrolled children who are diagnosed with alcohol or other substance abuse (whether the diagnosis occurs before or after the child's enrollment in Contractor);

(2) number of enrolled children who:

(A) are diagnosed after enrollment by a provider participating in Contractor's provider network with an index diagnosis of alcohol or other substance abuse; and

(B) consistent with §206(e), receive services appropriate to their needs from among the substance abuse services covered under §104 within [ ]41 days of the diagnosis;

(3) number of enrolled children who:

(A) are diagnosed by a provider participating in Contractor's provider network with index detoxification;

(B) receive detoxification services covered under §104(h) - (j) within [ ] after diagnosis; and

(C) begin receiving other substance abuse services covered under §104 within [ ] following detoxification;

(4) number of enrolled children who receive [ ]42 substance abuse services covered under §104 within [ ]43 days after the first encounter with a provider participating in Contractor's provider network; and

(5) number of enrolled children who receive items and services in accordance with the requirements of an inpatient discharge plan under §105B.

§209. Data Collection and Reporting

Commentary: The following illustrative language would require Contractor to collect and report encounter data through a cross-reference to §907 of MEDICAIDSPECS (www.gwu.edu/~chsrp). In addition, the language would require the collection and reporting of certain specific types of data set forth in subsections (b) and (c). Depending upon the precise content of the encounter data set used by Purchaser and Contractor, the requirements of subsections (b) or (c) may, in whole or in part, duplicate the encounter data; in such cases, the requirements of subsection (b) and (c) should be modified accordingly.

A recent General Accounting Office review of Medicaid BHOs found that encounter data was "untimely, incomplete, and inaccurate." The GAO noted: "Encounter data require adequate information systems, and when data from several systems are combined, both technical and definitional issues must be resolved….If states and plans addressed some of these data problems, encounter data could be used to monitor plan performance…." Medicaid Managed Care: Four States' Experiences with Mental Health Carveout Programs (September 1999), GAO/HEHS-99-118, p. 26, www.gao.gov. For language in state Medicaid MCO or BHO contracts relating to mental health and substance abuse data reporting, see CHSRP, Negotiating the New Health System, 3rd Ed., Volume 2, Part 4, Table 5.3, pp. 5-444 – 5-491, www.gwu.edu/~chsrp.

The impact of inadequate data collection and reporting upon the quality of care is illustrated by a recent report on behavioral health services for Medicaid-eligible children in Arizona: "Significant time, energy, and resources at the state, [regional], and provider levels appear to be devoted to information gathering that has minimal impact on improving performance and fidelity of the system. There is little effective synthesis of the information that is collected. The [state agency's] data system is missing so many fields as to render it relatively useless for many purposes. Essentially, the existing quality assurance systems have little utility for improving practice and results for children -- consuming substantial resources without observed benefits." Human Systems and Outcomes, Inc., Follow-up Review of Behavioral Health Services for Title XIX Eligible Children in Maricopa County, Arizona (June 2000). For a copy of the report, call the Arizona Center for Disability Law at 602-274-6287.

(a) In General — Contractor shall comply with:

(1) the requirements of §907 of MEDICAIDSPECS (relating to encounter data) and the remainder of Part 944 of MEDICAIDSPECS (www.gwu.edu/~chsrp); and

(2) the requirements of subsections (b) and (c), but only to the extent Contractor does not meet such requirements through the data collected and reported under paragraph (1).

(b) Data Specific to Children with Behavioral Health Needs— Contractor shall collect and report to Purchaser, on a [drafter insert frequency] basis, in such form and manner and for such period as Purchaser specifies, the following data:

(1) the number of enrolled children with behavioral health needs (as defined in §110(f)), and the number of families or caregivers of such children;

(2) the number of families or caregivers of enrolled children with behavioral health needs who report through a survey instrument approved by Purchaser that they are satisfied with the accessibility and quality of the services specified in the child’s treatment plan under §105A;

(3) the number of enrolled children with behavioral health needs who are diagnosed with both a mental health condition and with alcohol or other substance abuse;

(4) the number of enrolled children with behavioral health needs who:

(A) were admitted to an inpatient behavioral health facility; and

(B) with respect to whom an inpatient discharge plan was prepared under §105B; (5) the results of quality studies under §208(b) and clinical studies under §208(c);

(6) the number of each of the following types of adverse incidents involving children with behavioral health needs during the period of enrollment:

(A) suicide;

(B) attempted suicide;

(C) drug overdose;

(D) alcohol poisoning; and

(E) erroneous prescription of psychotropic medications;

(7) the number of enrolled children with behavioral health needs who request (or on whose behalf the child’s family or caregiver requests) crisis behavioral health services under §206(b) during the most recent calendar quarter and the number of children who receive such services;

(8) the number of enrolled children with behavioral health needs who are:

(A) discharged from an inpatient behavioral health facility following:

(i) an involuntary admission;

(ii) a voluntary admission;

(B) placed in seclusion during a stay at an inpatient behavioral health facility or a residential treatment center;

(C) subjected to physical or chemical restraint during a stay at an inpatient behavioral health facility or a residential treatment center;

(D) furnished outpatient services covered under §102(a)within [ ]45 days of discharge from an inpatient behavioral health facility;

(E) readmitted to an inpatient behavioral health facility within the following time period of discharge from such a facility:

(i) 7 days;

(ii) 30 days;

(iii) 60 days; and

(iv) 90 days;

(9) the number of enrolled children with behavioral health needs, by [drafter insert racial or ethnic categories appropriate to Contractor's service area], who:

(A) were enrolled for at least [ ] months during the most recent contract year; and

(B) received prior authorization for the use of covered items and services during the most recent contract year; and

(10) [drafter insert other desired data elements].

(c) Data Specific to Children under the Jurisdiction of the State Child Welfare Agency — Contractor shall collect and report to Purchaser the data enumerated in subsection (b) with respect to enrolled children with behavioral health needs who are under the jurisdiction of [drafter insert name of State Child Welfare Agency] as indicated by:

(1) Purchaser; or

(2) the Agency (under the memorandum of understanding in §207(c)).

§210. Enrolled Child Safeguards

(a) In General — Contractor shall comply with the requirements of Part 1046 of MEDICAIDSPECS (www.gwu.edu/~chsrp) to the extent consistent with the requirements of this section.

(b) Confidentiality Safeguards in Data Disclosure — In disclosing data to Purchaser under [drafter insert name of purchasing document], Contractor shall comply with 42 C.F.R. Part 2 pertaining to the confidentiality of data related to alcohol or substance abuse.

(c) Confidentiality Safeguards for Children with IEPs or IFSPs — In the case of an enrolled child with behavioral health needs (as defined in §110(f)) who is receiving services under an IEP (as defined in §110(h)) or IFSP (as defined in §110(i)), Contractor shall comply with:

(1) the requirements of 34 C.F.R. Part 99.31 implementing the Family Educational Rights and Privacy Act (FERPA), 20 U.S.C. §1232(g); and

(2) the confidentiality protections in the Individuals with Disabilities Education Act, 20 U.S.C. §1417(c) (with respect to an IEP), 34 C.F.R. §§300.560 – 300.577, and 20 U.S.C. §1439(a)(2), 34 C.F.R. §§303.400 – 303.425 (with respect to an IFSP).

Commentary: There are circumstances under which parents or caregivers may wish to share, or allow a provider participating in Contractor's network to share, confidential information regarding their child with other service providers or other individuals working with the child outside of Contractor's network. The following illustrative language would allow parents or caregivers to waive the confidentiality requirements in order to facilitate the exchange of information regarding the child to such individuals.

(d) Waiver of Confidentiality Safeguards at Request of Family— The requirements of subsections (b) and (c) may be waived with respect to an enrolled child with behavioral health needs by the child's family or caregiver only if:

(1) the waiver is granted in writing by the family or caregiver [ ] prior to its application;

(2) the waiver specifies the individuals to whom information regarding the child may be made available; and

(3) the waiver applies only with respect to a disclosure or exchange of information specified in the terms of the waiver.

(e) Confidentiality Safeguards for Adolescents— In the case of an enrolled child with behavioral health needs who is an adolescent (as defined in §110(a)), Contractor shall comply with the confidentiality requirements in §1002 of Part 10 of MEDICAIDSPECS (CHSRP) (relating to confidentiality protections for enrolled adolescents).

(f) Unnecessary Inquiries — Consistent with §009(d) of MEDICAIDSPECS (CHSRP), Contractor shall ensure that any communication with an enrolled child with behavioral health needs (as defined in §110(f)) does not make unnecessary inquiries into the existence of a disability in violation of the Americans with Disabilities Act, 42 U.S.C. §12101 et seq.47

Commentary: The following illustrative language would extend the federal statutory and regulatory requirements applicable to state Medicaid agencies relating to due process protections for Medicaid beneficiaries to the BHOs with which those agencies contract. At least one state has already consented to the imposition of more stringent due process protections upon the state Medicaid agency and its contracting MCOs and BHOs. See Revised Consent Decree Governing TennCare Appeals, Grier v. Wadley C.A. No. 79-3107 (M.D. Tenn., Oct. 26, 1999), available from Tennessee Justice Center (615-255-0331).

(g) Due Process 48&#r151;" Contractor shall comply with the requirements of §1902(a)(3) of the Social Security Act, 42 U.S.C. §1396a(a)(3), and implementing regulations at 42 C.F.R. §§431.200 et seq., relating to notice, fair hearing, and continuation of coverage rights of an enrolled child with behavioral health needs (as defined in §110(f)) in the event of:

(1) a denial, termination, or reduction of an item or service covered under §102(a); or

(2) the failure to furnish an item or service covered under §102(a) with reasonable promptness.

(h) Other Rights

(1) Restraints and Seclusion— Contractor shall ensure that any psychiatric hospital used to furnish covered services to an enrolled child with behavioral health needs (as defined in §110(f)) complies with [drafter insert applicable restraint and seclusion protections under state law]49 with respect to the enrolled child.

(2) State Consumer Rights Laws— Contractor shall comply with [drafter insert reference to applicable state statutory or regulatory provisions relating to consumer rights].50

§211. Remedies for Noncompliance

(a) In General — Contractor shall comply with the requirements of Part 12 of MEDICAIDSPECS (CHSRP).

(b) Enrolled Children as Intended Third Party Beneficiaries— Contractor agrees and affirms that an enrolled child with behavioral health needs (as defined in §110(f)) is an intended third-party beneficiary to [drafter insert name of purchasing document], and that such child, and the child’s family or caregiver on the child’s behalf, is entitled to all of the rights and remedies available to third party beneficiaries under state or other law.51

§212. Other Applicable Federal and State Requirements —

Contractor shall comply with the requirements of Part 13 52 of MEDICAIDSPECS (www.gwu.edu/~chsrp).

Part 3. Payment Issues

As noted in the introduction, these purchasing specifications do not address two sets of payment issues: (1) those relating to the determination of capitation rates paid to MCOs by state purchasers on behalf of enrolled children with behavioral health needs; and (2) payment methodologies used by MCOs with respect to network and out-of-network providers. For language used by state purchasers relating to both of these issues, see Table 7.1 (Plan Payment Terms) and Table 7.2 (Provider Payment Terms) in CHSRP's Negotiating the New Health System, 3rd Ed. (1999), Vol. 2, Part 4, www.gwu.edu/~chsrp. In developing language on these issues, purchasers may wish to take into account the following considerations.

Payments to Plans from Purchasers. Federal Medicaid law requires that payment rates in risk contracts between state Medicaid agencies and BHOs or MCOs be set on "an actuarially sound basis," §1903(m)(2)(A)(iii) of the Social Security Act, 42 U.S.C. §1396b(m)(2)(A)(iii). Medicaid-eligible children generally tend to have greater unmet health care needs than other children, and Medicaid-eligible children with behavioral health needs tend to have even higher acuity levels. This means that, in developing "actuarially sound" capitation rates for BHOs or MCOs that enroll such children, state purchasers should ensure that the levels of payment will supply an efficient BHO or MCO with the resources necessary to address the service needs of this population. In short, in order to be "actuarially sound," capitation rates for this population should be adjusted to reflect the higher risk that a BHO or MCO assumes in accepting treatment responsibility for such children.

In a letter to State Medicaid Directors dated October 5, 1998, HCFA notes that “[t]he manner in which States decide to reimburse MCOs and providers for the delivery of services plays a major factor in how those systems of care operate and how enrollees access services.” HCFA suggests that “States should consider…developing rates of payment to MCOs, prior to enrollment of persons with special health care needs, that assure adequate payments.” HCFA also suggests that “States should consider…providing appropriate financial incentives to providers and MCOs to encourage appropriate delivery of care to persons with special health care needs. Such approaches also must recognize that serving individuals with special health care needs takes more time and resources than with healthier patients….”53 These observations have particular application in purchasing agreements that contain detailed and extensive performance requirements along the lines of those suggested in these illustrative purchasing specifications.

Failure to calibrate payment levels accurately, or to track the use of reimbursements, can have important implications for the quality and accessibility of services for children with behavioral health needs. A recent study of managed behavioral health services for Medicaid-eligible children in Arizona found that between 40 and 65 percent of enrolled children were "inappropriately served." Among the explanatory factors cited by the reviewers was the significant proportion of unspent funds: of the $2.8 million received monthly for Medicaid-eligible children, only $1.7 million was actually spent on services for these children. The report concluded: "…it is a reasonable expectation that dollars allocated to services for Title XIX eligible children would be spent on services for this population. It is difficult to justify service denials, gaps in the continuum of care, and the inability to access flexible funds when dollars for a particular population are not being spent accordingly." Human Systems and Outcomes, Inc., Follow-up Review of Behavioral Health Services for Title XIX Eligible Children in Maricopa County, Arizona (June 2000). For a copy of the report, call the Arizona Center for Disability Law at 602-274-6287.

HCFA has not specified, and there is no professional consensus on, a methodology for adjusting capitation payments to Medicaid MCOs enrolling children with special health care needs or subsets of such children. Instead, there is a great deal of experimentation underway at the state level. Among the sources of information that interested purchasers may wish to consult are:

  • National Academy for State Health Pol