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Vorys Health Care Advisors

How Ohio’s Behavioral Health Redesign impacts providers

Posted in Behavioral Health

Over the next year, Ohio community behavioral health providers (mental health and substance use addition providers) will be participating in a truly transformational time as a result of a statewide initiative called Ohio’s Behavioral Health Redesign.

Redesign will fundamentally alter the clinical and business processes of community behavioral health providers through the adoption of coding changes, enactment of a completely new service array and the implementation of Medicaid managed care.

In order to be prepared for these changes, many providers are engaged in a process of clinical and business transformation, as well as conducting a legal review of their managed care contracts and other internal and external legal structures in order to assess how the redesign changes will impact their agencies.

Today, over 400,000 adults and children receive services, at a total cost of approximately $900 million dollars. The implications of these changes are far reaching, with clinical, operational, quality and cost considerations.

Throughout health care, the importance of identifying and treating both mental health and substance use disorders is increasingly understood as a key driver of total health care costs and the excessive use of services, such as emergency rooms. The severe and pervasive opioid crisis is daily news. Ohio’s decision to expand Medicaid in 2014 helped to meet the huge demand for behavioral health services, and provided the behavioral health system with needed funding to address the demand.

In addition, in order to battle Ohio’s severe opioid addiction issues, state and federal lawmakers have passed laws increasing service flexibility and funding.

At the same time, the state has been working on the redesign of behavioral health services to improve quality, accountability and transparency of these important Medicaid services.

What is redesign and how does it impact behavioral health providers?

The redesign initiative is the result of the Kasich administration’s commitment to improve access to services and to “modernize” the regulations and business practices of providers. “Modernizing” includes using a more up-to-date menu of service codes and transitioning to national correct health care coding and accountability requirements.

The use of a more ‘up-to-date’ menu of codes sounds deceptively simple. The current menu of service codes provides the building blocks for today’s services and programs. Providers have been engaged in a process of clinical and business transformation; working with behavioral health experts to analyze current services, practitioners and payment rates and assessing the impact of the new requirements.

Individual clinicians and provider agencies are finding that this is a monumental shift in the way that they will operate in the future, causing them to rethink the way that they will provide individual services, and reconfiguring clinical and business processes in order to meet the demands of the new system.

The coding and accountability changes will also fundamentally alter the way that providers will bill for services. For instance, today, in the other parts of the Medicare, Medicaid and commercial insurance, the practitioner providing the service must be identified in order to bill.

In the current behavioral health system, agencies must meet standards and requirements for practitioners, but can bill without including the practitioner’s unique code on the bill.

In the new system, practitioner requirements are being increased and they will be expected to provide services at the “top of their scope of practice.” The new credentialing requirements will provide the system with a higher level of clinical expertise when compared to the current requirements.

While most providers agree that raising the bar and having more highly credentialed staff is an admirable goal for many reasons, some providers have voiced concern about the implementation of the new requirements due to the clinical staff workforce shortage that currently exists even under the broader standard in place today. Other associated coding changes are designed to increase provider accountability and accuracy in billing.

When will the redesign changes take place and how will it work?

As a result of the recently passed biennial state budget, the coding and service redesign changes described above will be effective starting Jan. 1, 2018. The budget bill also provided for the implementation of these same services from the current fee for service payment method into Medicaid managed care.

Providers have been paid under a fee schedule for many years. The General Assembly wanted to delay the managed care implementation until July 1, 2018 to allow the coding and service changes to go into effect before the shift to Medicaid managed care.

Governor John Kasich vetoed the delay provision. However, in an historic action, the General Assembly recently overrode the governor’s veto of the managed care delay. As a result of the veto overrides, Medicaid managed care firms will take responsibility for the new services on July 1, 2018.

Currently, Medicaid managed care firms are holding regional meetings around the state to educate providers about the requirements of each managed care plan to be a part of their network.

Accordingly, providers are engaging experienced advisors to assist with an analysis of the new regulatory landscape, provide advice regarding business considerations, conduct a review of managed care contracts, and analyze potential alliances to better promote efficiencies and advance their sophistication in contract negotiations while being mindful of any antitrust issues that these types of alliances may present.

Providers should be preparing now and consulting with those familiar with the changes in order to be prepared to meet the upcoming challenges associated with this significant transformation of Ohio’s system of mental health and substance use disorder services. Communities, families and individuals lives depend on a smooth transition.