A study released in January by the Health Research and Educational Trust which examined West Virginia's 2007 Medicaid program overhaul has found that the state's "nudging" plan to decrease emergency room visits backfired - an outcome that could affect how states approach lowering the cost of care under the Affordable Care Act.
The study looked at the impact of the Mountain Health Choices program, which replaced traditional Medicaid plans with two types of plans: basic plans, which offered less coverage than prior Medicaid plans, and advanced plans, which offered more coverage and required participants to agree to program rules that were designed to improve health behaviors. Consumers who opted into advanced plans were asked to sign a member agreement and follow a personalized health plan, while those with basic plans received far less extensive coverage, including a cap on prescriptions and no coverage for substance abuse services and inpatient mental health services.
The study looked at Medicaid recipients who enrolled in coverage between 2005 and 2010. Enrollees select new plans or re-enroll in an existing plan each year, and by mid-2010, only 12 percent of participants had chosen an advanced plan through the new program. The program saw an increase in emergency room visits among those who chose or were automatically enrolled in basic plans and an increase in the average number of non-emergency ER visits for Medicaid recipients overall, despite a decrease among those who opted into an advanced plan.
"Evidence from pre-ACA Medicaid experiments, such as the West Virginia Mountain Health Choices program, can provide insight into the effects of efforts to mitigate costs and improve health outcomes," the study states. "Initial state actions seeking to reduce Medicaid program costs occurred through strategies such as shifts to managed care or restrictions in formularies. But following the passage of the Deficit Reduction Act of 2005, a handful of states experimented with a greater variety of program designs. The West Virginia program was one of the most controversial, as it imposed coverage limits based on member behavior. Assessing the impacts of such efforts is important as states continue to grapple with the goal of reducing costs without causing negative health impacts."
Kosali Simon, a researcher and professor at Indiana University and co-author of the study, said the group chose to study the Mountain Health Choices program for its unique approach to incentivizing care.
"In terms of personal responsibility-based reforms, the one in West Virginia was really of interest to a lot of people," she said. "After the Deficit Reduction Act of 2005, a handful of state started to experiment with program designs then allowed by law, all in an effort to reduce Medicaid program costs. In the past they've tried things like shifts to managed care or restrictions in formularies ... the West Virginia program was seen as going fairly far, because there were coverage limits based on member behavior."
The Mountain Health Choices program is now defunct, but Simon said while it's hard to pinpoint the exact cause of the program's failure, it serves as a reminder of the potential pitfalls of programs like it in trying to encourage better health behaviors.
"Prior to that, there hadn't been much use of these personal responsibility reforms," she said. "In health reform, one of the things we aim to do is have more appropriate use of different types of care. It's this idea of 'triaging' - when you go into the health care system, you should go to the appropriate place ... we're hoping that when more people are insured and have access to medical homes, it will help. The worry, though, is that people will keep going to where they think is the easiest point for care, and the challenge is making sure medical homes are those places."
Reach Lydia Nuzum at lydia.nuzum@wvgazettemail.com, 304-348-5189 or follow @lydianuzum on Twitter.