Texas Aims to Improve Care of Medicaid Patients

Texas turns to the private sector to try to cut Medicaid costs. Under a program called Disease Management, a company gets in touch with the 55,000 Medicaid patients who incur the highest expenses and tries to get them to better manage their diseases such as diabetes or high blood pressure. Bill Zeeble of member station KERA in Dallas reports.

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Officials in Texas say 55,000 residents who are chronically ill cost the state half a billion Medicaid dollars per year. Those patients suffer from ailments like diabetes, congestive heart failure and asthma. To save millions of dollars, Texas has now created a program to improve the care of its sickest Medicaid members. Bill Zeeble of member station KERA in Dallas reports.

BILL ZEEBLE reporting:

Struggling to reverse growing Medicaid costs, Texas is trying what's called Disease Management. That combines health-care outreach and intervention for those where self-care matters most, the chronically ill. The Medicaid Enhanced Care Program enrolls these Medicaid members. That's where Kathleen Stipp(ph) comes in. She's a work-at-home agent.

Ms. KATHLEEN STIPP (Work-At-Home Agent): This is Kathleen, and I'm calling on behalf of Texas Medicaid, and I'm calling to follow up on a mailing that I sent to you in regards to our new condition support program.

ZEEBLE: Stipp is a 20-year insurance company veteran who lives in Houston. These days, she supplements her income by calling Medicaid members as a contractor for Plano, Texas-based Working Solutions, a work-at-home company. In one week alone, she recently called 900 Medicaid enrollees. Stipp spent several hours learning program basics.

Ms. STIPP: We always ask them first thing, how are they doing today? How are they feeling? If they are having some problems with the condition, then we are able to transfer them to a triage nurse that would be able to assist them at that time.

ZEEBLE: The nurses on Stipp's referral list work for McKesson Health Solutions, the business chosen to save Texas some Medicaid money. They might suggest newer drugs and other measures for better short- and long-term health. If they succeed, costly emergency room visits should drop. In fact, says legislator Dianne Delisi, who authored the bill, McKesson has guaranteed Texas a 5 percent savings off the state's yearly Medicaid costs.

Ms. DIANNE DELISI (Texas Legislator): I said to them very seriously, `Don't sign this contract unless you can deliver better health outcomes for the state. Don't tell me you can do this if you can't,' and they didn't flinch.

ZEEBLE: According to the contract, Texas will save $28 1/2 million off its Medicaid costs the first year alone or McKesson Health Solutions pays the difference. McKesson vice president, Mike Modiz, is confident it will save the state money and make money for McKesson, even if it initially costs more per patient.

Mr. MIKE MODIZ (Vice President, McKesson Health Solutions): Our service does pay for itself, and that is the reason that the states go into programs like this.

ZEEBLE: But the head of Dallas County's Parkland Hospital, Dr. Ron Anderson, warns that the best disease management programs involve more than work-at-home call center agents and nurses.

Dr. RON ANDERSON (Parkland Hospital): When you're working with a vulnerable population, you can't really just put nurses on the end of a phone and have them case manage through that sort of outreach. You also have to have nurses who--or midlevel practitioners or doctors available to see people rather routinely in the home to reach out and to try to manage their care truly.

ZEEBLE: That's why McKesson also subcontracts with yet another company whose nurses make house calls or arrange for Medicaid patients to see doctors. And with that, Dr. Anderson considers the state's 5 percent savings goal realistic.

Dr. ANDERSON: I think particularly the companies who do this oftentimes go, quote, "at risk," and if they don't get the savings, then they also give up their profit, and so I think that they're starting at a level they pretty much feel they can achieve or they're not going to put themselves at that much risk, and so I think these are doable.

ZEEBLE: Texas is one of just eight states implementing anything like this plan, according to McKesson. The program is still a work in progress and too young yet to evaluate. So far, the state says work-at-home agents have signed up 35,000 Medicaid recipients. For NPR News, I'm Bill Zeeble in Dallas.

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