DEPARTMENT OF COMMUNITY HEALTH FY2006 Budget Reductions FY06 Budget Reductions by Cost Driver - Govenor's Recommendations Eligibility 16% Scope 5% Admin 0% Utilization 15% Cost Sharing 0% Cost Settlements 35% Price 29% FY06 Budget Reductions by Provider Type - Govenor's Recommendations Cost Settlements 39% All 17% Dental 1% IP/OP Hospitals 17% Transportation 1% Physician 2% Pharmacy 12% Nursing Home 11% Waiver Program 0% Department of Community Health Proposed Reductions to Medicaid and PeachCare for Kids Gov FY2006 State Funds # # Item Total Funds @105% @100% @97% Utilization 1 5 Implement disease and case management to improve medical $ 39.3 $ 15.5 $ 15.5 $ 15.5 management for the aged, blind, and disabled populations. 2 6 Require prior authorization for more than four brand prescriptions per $ - $ -$ -$ - month. 3 7 Require prior authorization for high cost radiology services. $ 7.6 $ 3.0 $ 3.0 $ 3.0 4 Base Implement pre-certification for hospital admissions for children. Yes - $ 6.9 $ 2.6 $ 2.6 $ 2.6 Reduce base ($2.9 million). 5 Base Strictly enforce orthodontic policies for children. Yes- Reduce base $ 4.8 $ 1.8 $ 1.8 $ 1.8 ($1.8) 6 8 Expand the emergency room utilization control pilot program to $ 5.1 $ 2.0 $ 2.0 $ 2.0 additional hospitals. 7 Base Pursue a more aggressive lock-in program for drugs subject to $ 2.5 $ 1.0 $ 1.0 $ 1.0 abuse. Yes - Reduce base ($1.0) 8 9 Set a fixed expenditure cap for home and community based services $ 2.6 $ -$ 1.0 $ 1.0 provided in the Independent Care Waiver programs. Yes - Redirect funds to add slots for ICWP. subtotal Utilization $ 25.9 $ 26.9 $ 26.9 Governor Recommeded $ 15.5 $ - $ 3.0 Base - #1 Base - #2 $ 2.0 Base - #3 Yes-Redirect $ 20.5 Cost Avoidance 9 Charge premiums for children ages 1 to 5 participating in the $ 16.3 $ PeachCare for Kids program. 10 10 Charge premiums for Katie Beckett children. Charge $200 per $ 3.8 $ month for those who earn over $100,000. ($270,000) subtotal Cost Avoidance $ -$ -$ -$ 4.2 $ -$ 4.2 $ 4.2 $ - 1.5 Yes - cut incl. In base 5.7 $ - Price 11 End supplemental payments to hospitals for neonatal programs. $ 14.0 $ 5.5 $ 5.5 $ 5.5 $ - 12 13 Reduce the percentage applied to supplemental outlier payments $ 5.9 $ 2.3 $ 2.3 $ 2.3 $ 2.3 from 90% to 85.6% for inpatient hospital reimbursement. 13 15 Rebase DRG's and move to a more current grouper. Adjust to Yes Yes ensure budget neutrality. 14 Reduce nursing home reimbursement by adjusting cost center $ 50.9 $ 12.4 $ 20.1 $ 20.1 $ - standards, growth allowance, hospital-based differentials, and efficiency add-ons. 15 17 Reduce Nursing home reimbursement by reducing the growth $ 24.5 $ 9.6 $ 9.6 $ 9.6 $ 9.6 allowance to offset the reduction in expected nursing home provider fees. 16 Reduce reimbursement to nursing homes for residents participating $ - $ -$ -$ -$ - in hospice 17 18 Require Medicare cost avoidance for nursing home care. $ 0.9 $ 0.3 $ 0.3 $ 0.3 $ 0.3 18 19 Utilize FY2003 cost reports to determine nursing home Yes Yes reimbursement. Adjust to ensure budget neutrality.Governor recommendation includes funding see adjustment below. (4.3) 19 14 Reduce facility fees paid for free-standing hospital-based clinics by $ 4.1 $ 1.6 $ 1.6 $ 1.6 $ 1.6 basing reimbursement on two times the fixed amount of facility fees paid to physicians. 20 12 Reduce the cap applied to outpatient hospital reimbursement (based $ 6.6 $ 2.5 $ 2.5 $ 2.6 $ 2.5 on the average inpatient payment per claim.) 21 16 Explore alternative reimbursement methodologies for outpatient Yes Yes hospital services. 22 21 Increase the average wholesale price discount from 11% to 14% for $ 13.4 $ 5.2 $ 5.2 $ 5.2 $ 5.2 pharmacy prescriptions. 23 23 Eliminate the dispensing fee incentive paid for dispensing generic $ 4.8 $ 1.9 $ 1.9 $ 1.9 $ 1.9 drugs. 24 22 Require mininmum bids on discount off AMP for next round of $ 10.2 $ 3.9 $ 3.9 $ 4.0 $ 3.9 supplemental rebates. 25 20 Apply 14% discount to AWP for injectable drugs provided in a $ 3.4 $ 1.3 $ 1.3 $ 1.3 $ 1.3 physician's office. 26 Reduce reimbursement for all categories of services by 3% except $ 60.7 $ 23.6 $ -$ -$ - for hospital, nursing home, and pharmacy services. 27 Require prior authorization of prescriptions for non-perferred drugs $ 25.5 $ -$ 9.8 $ 9.9 $ - where previously the prescription was considered grandfathered for supplemental drug rebate implementation. 28 11 Reimburse ambulatory surgical services provided in outpatient $ 39.4 $ - $ 14.8 $ 14.8 $ 14.8 hospital settings based on two times the rates paid to ambulatory surgical centers. 29 Reduce reimbursement for all categories of services by 5% except $ 106.5 $ - $ 41.5 $ 40.2 $ - for hospital, nursing home, and pharmacy services. subtotal Price $ 70.1 $ 120.3 $ 119.3 $ 43.4 1/27/2005 Page 2 Gov # # Item Department of Community Health Proposed Reductions to Medicaid and PeachCare for Kids FY2006 Total Funds @105% State Funds @100% @97% Governor Recommeded Cost Settlements 30 Base Complete prior year cost settlements for outpatient hospital services. $ 101.6 $ 39.1 $ 39.1 $ 39.2 Base - #4 Yes - Reduces benefit base ($39.1 million) 31 3 Reimburse outpatient hospital services based on interim rates set to $ 50.9 $ 19.6 $ 19.6 $ 19.7 $ 19.7 85.6% of cost. subtotal Cost Settlement $ 58.7 $ 58.7 $ 58.9 $ 19.7 Scope 32 6 Require prior authorization for prescription drugs where an $ 15.0 $ 5.9 $ 5.9 $ 5.9 $ 5.8 equivalent over the counter drug is available. 33 End coverage for preventative maintenance drugs for members who $ 5.5 $ 2.2 $ 2.2 $ 2.2 $ - elect hospice care. 34 Eliminate optional adult dental services. $ 18.3 $ 7.9 $ 7.8 $ 7.2 $ - 35 Eliminate optional adult orthotics and prosthetics. $ 3.9 $ 1.5 $ 1.5 $ 1.5 $ - 36 Eliminate optional adult podiatry services. $ 2.9 $ 1.1 $ 1.1 $ 1.1 $ - 37 4 Change the PeachCare for Kids program to provide the same scope $ 69.2 $ - $ 19.0 $ 19.1 Yes - cut incl. In of services as the State Health Benefit Plan. Governor - Implement base. Texas Dental Model. 38 Eliminate non-emergency transportation for adults. $ - $ -$ -$ -$ - 39 Eliminate emergency ambulance services for adults. $ - $ -$ -$ -$ - 40 Eliminate the hospice program. $ 26.3 $ -$ - $ 10.4 $ - subtotal Scope $ 18.6 $ 37.5 $ 47.4 $ 5.8 Eligibility 41 Base Strictly enforce income requirements for participation in the $ 12.5 $ 3.5 $ 3.5 $ 3.5 PeachCare for Kids program. Yes - Reduce base ($3.5) 42 Base Ensure level of care requirements are met for all long term care $ 6.0 $ 2.4 $ 2.4 $ 2.4 programs where applicable. Yes - Reduce base ($2.4) 43 Base Perform clinical reviews to validate demand for emergency medical $ 7.6 $ 3.0 $ 3.0 $ 3.0 assistance for undocumented aliens. Yes - Reduce base ($3.0) Base - #5 Base - #6 Base - #7 44 Verify continuation of active cancer treatment for women in the $ 3.6 $ breast and cervical cancer program. 45 Base Reflect a FY 2005 change made to consider promissory notes as $ 1.6 $ income in nursing home eligiblilty determination. Yes - Reduce base ($631,040). 46 Limit PeachCare for Kids enrollment in January 05. $ 10.2 $ 47 Eliminate presumptive eligibility for pregnant women. $ - $ 48 Restrict coverage to 185% of the federal poverty level for pregnant $ 12.5 $ women and children; no spenddown allowed. 49 Restrict coverage to 185% of the federal poverty level for PeachCare $ 26.7 $ for Kids. Law change for Board to set eligibility standards. 1.0 $ 0.6 $ -$ -$ -$ -$ 1.0 $ 0.6 $ 2.8 $ -$ -$ 7.4 $ 1.0 $ 0.6 Base - #8 2.8 $ - -$ - 4.9 $ - 7.4 $ - 50 Eliminate spenddown programs for non-categorical members who $ have incomes over the Medicaid income limits. 51 Reduce coverage for aged, blind, and disabled members with $ incomes greater than two-times SSI. 52 Eliminate the breast and cervical cancer program. $ subtotal Eligibility Administration 53 25 Consolidate population-based programs to more appropriately align $ agency business functions. 54 26 Transfer funding for the Marcus Institute to the Department of $ Human Resources. 55 27 Eliminate funding for the Folic Acid initiative. $ 56 Eliminate funding for the Georgia Partnership for Caring. $ 57 Eliminate funding for the Georgia Rural Health Association ($30K). $ Governor recommends -- NO subtotal Administration Total *** See Governor's Yes -- Reduce from Base Items Target Surplus/(Deficit) Adjustments for Governor's Yes to Base Benefits Governor increase in rates for Nursing Homes ($4.3 mil) and Ambulance ($1.1mil) Total Governor's Recommended Reductions Surplus/ (Deficit) ** State fund increase for DCH 82.7 62.6 21.8 0.4 0.2 0.2 0.1 0.0 $ -$ - $ 32.6 $ $ -$ - $ 25.0 $ $ -$ -$ 6.0 $ $ 10.5 $ 20.7 $ 89.2 $ $ 0.4 $ 0.4 $ 0.4 $ $ 0.2 $ 0.2 $ 0.2 $ $ 0.2 $ 0.2 $ 0.2 $ $ 0.1 $ 0.1 $ 0.1 $ $ 0.0 $ 0.0 $ 0.0 $ $ 0.8 $ 0.8 $ 0.8 $ $ 184.7 $ 269.2 $ 348.3 $ $ 182.1 $ 279.1 $ 337.2 $ $ 2.6 $ (9.9) $ 11.1 $ $ $ $ $ - - - 0.4 0.2 0.2 - 0.7 90.1 279.1 (189.0) 58.2 (5.4) 142.9 (136.2) 1/27/2005 Page 3 Department of Community Health FY2006 Budget Reduction Proposal Item: Reimburse outpatient hospital services based on interim rates set to 85.6% of cost. Item 3 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 50,942,603 $ 19,663,855 % Reduction N/A Part I - Methodology/Rationale Current : Pay 88% of operating costs for most hospitals (excluding critical access hospitals, state owned hospitals, and historically minority owned) Proposed: Pay 85.6% of operating costs for most hospitals (excluding critical access hospitals, state owned hospitals, and historically minority owned) Last Change: In July 2004 decreased rate to 88%. Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 55.4% 411,722 57.3% 27,095 66.4% 133,362 46.1% 53,570 99.8% 171,815 43.4% 82,953 59.9% 880,517 Part IV - State Comparison N/A Part V - Administrative Requirements N/A Item 4 Department of Community Health FY2006 Budget Reduction Proposal Item: Change the PeachCare for Kids Dental program to model the same scope of services as the Texas Dental CHIP program. Effective Date: Funds Total: State: 7/1/2005 FY2006 Yes Yes Part I: Methodology/Rationale % Reduction N/A Current: PeachCare benefit package is the same as Medicaid. Proposed: Model PeachCare benefit package after the Texas CHIP dental plan. Last Change: N/A Part II: Member Impact Part III: Benefit Revisions Sub Program Children MF Children Disabled Elderly Adults Members Utilizing Service Percent 0.0% 0.0% 0.0% 0.0% 0.0% Total - PeachCare Total Members 100.0% 13.0% 191,030 191,030 Dental Service Type Adjunctive Services Diagnostic Services Endodontic Services Oral Surgery Services Orthodontic Services Periodontal Services Example Services emergency treatment, hospital call, behavior management oral evaluations root canals extractions, excisions, incisions braces gingivoplasty, periodontal scaling for bone loss Current Proposed PCK PCK Plan Plan not covered limited to routine procedures not covered limited to routine procedures Preventive Services Prosthodontic Services Radiograph Services Restorative Services cleaning (prophylaxis), flouride, sealants, space management dentures x-rays fillings, crowns, surface limited to routine procedures not covered Part IV: State Comparison Alabama - State Medicaid benefit package Florida - MediKids is Medicaid look-alike and Healthy Kids is Commercial Benefit plan with Dental included Kentucky - State Employee benefit plan with additional services that bring it almost to Medicaid level without EPSDT and NET Mississippi - State Employee benefit plan with Dental included North Carolina - State Employee benefit plan with Dental included South Carolina - State Medicaid benefit plan Part V: Administrative Requirements Requires legislative approval Requires a State Plan amendment Will require major claims system changes Department of Community Health Item 5 FY2006 Budget Reduction Proposal Effective Date: 7/1/2005 Item: Implement disease and case management to improve medical management for the aged, blind, and disabled (ABD) populations. Funds Total: FY2006 $ 39,324,327 State: $ 15,509,515 % Reduction* 3.8% Part I - Methodology/Rationale * Based on reduction of annual chronic disease expense Current : No comprehensive disease management programs are currently in place for Medicaid members. DCH contracts case management services for high cost members in the SOURCE program. Proposed: To implement a disease and case management program for chronically ill ABD members, in order to decrease inappropriate utilization of services and improve member outcomes and quality of care. Last Change: DCH has worked with area health education centers (AHEC) to disseminate best practice guidelines for the treatment of pediatric asthma; focusing on several counties in southwest Georgia. Part II - Member Impact Part III - Chronically Ill ABD Members Percent of Total Plan Costs Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Impacted Percent Total 0.0% 8.8% 4,146 30.6% 61,440 23.7% 27,580 0.0% 0.0% 6.3% 93,166 79.0% 21.0% Chronically Ill ABD Member Expenses Total Plan Expenses Disease CHF Diabetes CAD Hypertension COPD Asthma Total % of Total Plan Members Expenses 12,976 26,537 8,955 30,082 8,539 6,077 $202,196,096 $312,919,660 $99,057,242 $270,674,129 $90,406,168 $54,079,640 93,166 $1,029,332,934 6.3% 21.0% Note: Above members have one or more of the following chronic conditions: congestive heart failure (CHF), diabetes, coronary artery disease (CAD), hypertension, chronic obstructive pulmonary disease (COPD), and asthma. Part IV - State Comparison Disease management (DM) has been steadily growing in popularity among state Medicaid programs due to its potential to control costs while not restricting member access to care. The Centers for Medicare & Medicaid Services (CMS) urged states to adopt disease management programs in a February 2004 letter to Medicaid directors. Currently, at least 21 states have a DM program in place, while several others are in the process of development. There are three major DM models: Pay individual providers (PIP)...DCH would contract with individual providers to perform DM services, and create a new category of service for billing. Enhanced primary care case management...DCH would pay PCCM providers an enhanced case management fee for providing DM services, in addition to their regular fee for service (FFS) reimbursement. Contract with a disease management organization...DCH would outsource DM to a "DMO" who typically puts their administrative fees at risk and guarantees a percentage in savings. DMOs make contact with eligible members and coordinate with care providers to ensure that evidence-based medicine is being employed and that chronically ill members understand what they need to do to improve their health and better manage their disease(s). State FL MS NC *TN WV WA TX *OH *WY **Model DMO DMO E-PCCM DMO PIP DMO DMO E-PCCM DMO Scope CHF, diabetes, HIV/AIDS, end stage renal disease (ESRD), hemophilia; also have pharmacy-based DM for CHF, diabetes, hypertension and asthma diabetes, hypertension, asthma CHF, diabetes, asthma, attention deficit hyperactivity disorder CHF, diabetes, CAD, COPD, asthma diabetes CHF, diabetes, asthma, ESRD CHF, diabetes, CAD, COPD and asthma CHF, diabetes, CAD, hypertension, COPD, asthma multiple disease states (to be determined upon RFP award) *Indicates state that is targeting DM efforts on similar member populations **Corresponds to one of the three models described above Part V - Administrative Requirements Requires State Plan Amendment Requires CMS Approval Requires significant Administrative costs; savings are reflective of Administrative fees Item 6 Department of Community Health Effective Date: 4/1/2005 FY2006 Budget Reduction Proposal Funds FY2006 Item: Require prior authorization for prescription drugs where an equivalent over-the-counter drug is available. Total: State: $ 15,000,000 $ 5,820,055 % Reduction 1.1% Part I - Methodology/Rationale Current : Omeprazole 20mg (Proton Pump Inhibitor-PPI or GERD (Gastroesophageal Reflux Disease) medications) and Loratadine (NonSedating Antihistamine-NSA or allergy medications) are available in both OTC and prescription-only versions. These products have the same potency and efficacy. The current State Plan does not allow OTC coverage for either drug class. Proposed: Move OTC omeprazole to coverage with a preferred copayment in addition to the current preferred agents and incorporate OTC omeprazole into the stepped edit approach when the supplemental bids for this class (Proton Pump Inhibitors) are up for review in December 2004, with an effective date of April 2005. Implement a stepped therapy approach for non-sedating antihistamine class drugs. Last Change: N/A Part II - Member Impact - Pharmacy Services Part III - Member Utilization Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 97.6% 725,430 87.2% 41,184 81.7% 164,133 65.0% 75,500 100.0% 172,160 95.3% 182,043 92.5% 1,360,450 Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members PPI Utilization Patients Expenditures 3,620 $1,017,438 353 $135,996 24,426 $15,095,060 8,092 $4,920,700 6,040 $2,149,683 1,304 $441,987 43,835 $23,760,864 NSA Utilization Patients Expenditures 112,137 $8,934,505 1,224 $155,781 21,052 $1,880,486 3,672 $255,738 12,489 $723,455 40,538 $4,187,944 191,112 $16,137,908 Part IV - Prescription Cost GERD Products $140 Cost per Rx Alternative Cost per Rx $120 $100 $80 $60 $40 $20 $Protonix Aciphex Prevacid Nexium Prevacid Prilosec Part V - State Comparisons N/A Allergy Products $C9o5st per Rx Alternative Cost per Rx $80 $65 $50 $35 $20 $5 Rx 12 Claritin-DClaritin D 24 RXAllegra D 120 Zyrtec D Allegra 30Allegra 60 Claritin Rx Allegra 180 Zyrtec Clarinex Part VI - Administrative Requirements Requires State Plan Amendment Department of Community Health FY2006 Budget Reduction Proposal Item: Require prior authorizations for high cost radiology services, excluding services performed in relation to an ER visit or an inpatient admission. Part I - Methodology/Rationale Current : No prior authorization required Proposed: Prior authorization required Last Change: N/A Item 7 Effective Date: 7/1/2005 Funds FY2006 Total: $ 7,641,365 State: $ 2,973,694 % Reduction N/A Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 20.6% 153,161 6.0% 2,833 51.5% 103,497 47.6% 55,260 48.0% 82,643 18.3% 34,911 29.4% 432,305 Part IV - Expenditures by Place of Service 11.4% Part III - Radiology Growth Rate by Fiscal Year 18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% * Annualized 11.9% FY02 Part V - State Comparison N/A 14.5% FY03 16.5% FY04* 88.6% Outpatient Hospital Services Physician Services Part VI - Administrative Requirements Requires State Plan Amendment Would require significant system changes Administrative fees required Department of Community Health FY2006 Budget Reduction Proposal Item: Expand the emergency room utilization control pilot program to additional hospitals. Part I - Description of Service Item 8 Effective Date: 1/1/2004 Funds FY2006 Total: $ 5,094,244 State: $ 1,982,363 % Reduction* 0.7% *Based on reduction of OP hospital In CY 2002, the Department of Community Health paid $90.9 million in claims for emergency room services for members with 3 or more visits to the ER within a year. DCH has implemented a targeted case management program primarily targeting members with 3 or more visits to the ER within a year, but will also provide intervention for other ER users who may be utilizing the ER inappropriately. DCH is modeling its case management program after the existing efforts of Memorial Hospital in Savannah. The department has begun this effort in three counties on a pilot basis: Chatham, Floyd, and Hall counties. Each hospital has a care coordinator to assess the need for intervention for Medicaid users of the ER. Intervention will include face-to-face counseling and possible referral to the member's primary care physician or other case management programs available for specific diseases or conditions (e.g., Asthma). This is an interim effort to control the expenses related to high utilizers of the ER, pending more systemic Medicaid reform. Part II - Member Profile of Use* Members Children # ER Visits # Visits per Member 488,693 0.66 MF Children 35,939 0.76 Disabled 237,456 1.26 Elderly 59,157 0.65 Adults 198,275 1.15 PeachCare 77,766 0.41 Total # Visits 1,097,286 0.77 * Based on CY 2003 data. Part IV - State Comparison N/A Part III - ER Visits Rate/1,000 Eligibles 800 735.8 700 600 530.6 593.7 623.4 18.0% 5.0% 500 11.9% 400 300 200 100 0 *Annualized FY 01 FY 02 FY 03* FY 04* Part V - Administrative Requirements Requires a contractual arrangement with hospitals participating in the initiative Expenses are jointly shared between the health system and DCH A cost benefit study is currently underway Item 9 Department of Community Health FY2006 Budget Reduction Proposal Item: Set a fixed expenditure cap for home and community based services provided in the Independent Care Waiver Program and redirect savings to add waiver slots. Effective Date: Funds Total: State: % Reduction 7/1/2005 FY2006 Yes Yes N/A Part I - Methodology/Rationale Current : The state does not impose any per member per year expenditure caps for the Independent Care Waiver Program (ICWP). Proposed: The state will set a $50,000 annual per member expenditure cap for patients in the Independent Care Waiver Program. Last Change: Five additional slots in the FY2005 budget. Part II - Member Impact Sub Program Members Utilizing Service Percent Total Children 0.000% MF Children 0.028% 13 Disabled 0.318% 640 Elderly 0.009% 10 Adults 0.000% - PeachCare 0.000% - Total Members* 0.045% 663 *Represent ICWP population in CY2003 Part III - Independent Care Waiver Utilization (ICWP) ICWP (All Members) Net Payments Members Avg PMPY Proposed Cap $ 22,557,738 609 $ 37,041 ICWP (Members subject to cap) $ 8,445,469 116 $ 72,806 $ *FY2003 and FY2004 claims are not complete and will be reprocessed by 12/01/04 50,000 Part IV - State Comparison All southeastern border states offer a waiver program for members in the community with developmental disabilities, spinal cord, and traumatic brain injuries. Part V - Administrative Requirements Requires CMS Waiver Requires System Changes Item 10 Department of Community Health FY2006 Budget Reduction Proposal Item: Katie Beckett - Charge $200 monthly premium to families with annual incomes greater than $100,000 Effective Date: Funds Total: State: % Reduction Part I - Methodology/Rationale The Department of Community Health proposes to require a monthly premium of $200 for families with annual incomes above $100,000. Katie Beckett families have incomes that exceed the limits to qualify for Medicaid as well as Supplemental Security Income. The waiver allows these families to receive services that are not covered by private insurance, in an effort to reduce their out of pocket expenses. The premium projections listed below assume Georgia Katie Beckett members have an income distribution similar to those participating in Arkansas' TEFRA Waiver Model. 7/1/2005 FY2006 Yes Yes N/A Part II - Member Impact Annual Income Range Members by Income Range Low $ $25,001 $50,001 $75,001 $100,001 $125,001 $150,001 $175,000 $200,001 High $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 over % in Income Range 15.97% 45.75% 25.59% 7.93% 2.38% 0.68% 0.79% 0.34% 0.57% FY 2005 Members 997 2,857 1,598 495 149 42 49 21 36 FY 2006 Members 957 2,742 1,534 475 143 41 47 20 34 Premium Projections Annual Premium ($200/month) Kids/Families above $100,000* Annual Projected Premium Collections State Funds *assumes 1 child per family FY 2005 $2,400 297 $713,296 $283,713 FY 2006 $2,400 285 $684,764 $270,071 Part III - Financial Data Measure # of Eligibles Net Payments Cost Per Member Per Month FY 2002 4,624 $30,558,495 $551 FY 2003 5,570 $36,083,430 Projected FY 2004 6,244 $39,607,792 Projected FY 2005 6,244 $40,645,959 $540 $529 $542 Projected FY 2006 5,993 $40,171,842 $559 Item 11 Department of Community Health FY2006 Budget Reduction Proposal Item: Reimburse ambulatory surgery services provided in an outpatient hospital setting based on two times the rate paid to ambulatory surgical centers. Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 39,400,000 $ 14,757,166 Part I - Methodology/Rationale Current : Cost to charge ratio. Proposed: Fixed fee per procedure. Last Change: July 1, 2004 - cost to charge ratio changed from 90% to 85.6%. % Reduction* 5.3% *Based on reduction of OP hospital Part II - Member Impact Sub Program Members Utilizing Service Percent Total Children 2.3% 17,431 MF Children 2.4% 1,147 Disabled 2.8% 5,646 Elderly 2.0% 2,268 Adults 4.2% 7,274 PeachCare 1.8% 3,512 Total Members 2.5% 37,278 Part III - Analysis of Outpatient Payments DCH compared rates for ambulatory surgery services when those surgeries were performed in an outpatient hospital setting compared to the rates paid for the same services in an ambulatory surgical center. % of Allowed Charges Average Allowed per Procedure ASC 14% Provider Outpatient Avg Allowed $ 1,856 All Other OP 86% Ambulatory Surgical Center 487 Part IV - Most Common Units Utilized Procedure Description Create Eardrum Opening Remove Tonsils and Adenoids Upper GI Endoscopy, Biopsy Inject Spine L/S Laparoscopy, Tubal Cautery Diagnostic Colonoscopy Removal of Adenoids Circumcision (not newborn) Cataract Surg w IOL, 1 Stage Change Gastrostomy Tube % of Total Avg Allowed Amt Outpatient Ambulatory Hospital Surgical Center Proposed % of Total by Rate Procedure $ 1,260 $ $ 1,775 $ $ 1,196 $ $ 544 $ $ 2,294 $ $ 853 $ $ 1,661 $ $ 1,957 $ $ 2,400 $ $ 384 $ 544 $ 1,069 512 $ 1,069 420 $ 936 284 $ 544 366 $ 1,069 422 $ 853 451 $ 1,322 292 $ 936 918 $ 1,725 292 $ 384 6.9% 7.3% 3.9% 0.9% 3.5% 1.2% 1.8% 2.0% 2.1% 0.3% 29.9% Item 11 (Continued) Department of Community Health Effective Date: FY2006 Budget Reduction Proposal Funds Item: Reimburse ambulatory surgery services provided in an outpatient hospital setting based on two times the rate paid to ambulatory surgical centers. Total: State: 7/1/2005 FY2006 $ 39,400,000 $ 14,757,166 % Reduction* 5.3% *Based on reduction of OP hospital Part V - State Comparison Reimbursement Methodology of Southeastern States: Mississippi - All outpatient hospital reimbursed at a percent of charges. Florida - All outpatient hospitals reimbursed on a per diem rate for each hospital. Tennessee - All outpatient hospital reimbursement based on the Medicare rates. Alabama - Outpatient surgical services on the ASC procedure list are reimbursed on a global rate for the entire claim. Part VI - Administrative Requirements Requires State Plan Amendment Significant system changes Department of Community Health FY2006 Budget Reduction Proposal Item: Reduce the cap applied to outpatient hospital reimbursement (based on the average inpatient payment per claim.) Item 12 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 6,622,517 $ 2,556,301 % Reduction 0.9% Part I - Methodology/Rationale Current : Reimbursement cannot exceed the average Diagnosis Related Group (DRG) case reimbursement. Proposed: Reimbursement cannot exceed 85.6% of the average DRG case reimbursement. Last Change: The rate changed for inpatient hospital in July 2002. Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 55.4% 411,722 57.3% 27,095 66.4% 133,362 46.1% 53,570 99.8% 171,815 43.4% 82,953 59.9% 880,517 Part IV - State Comparison N/A Part V - Administrative Requirements N/A Department of Community Health FY2006 Budget Reduction Proposal Item: Reduce the percentage applied to supplemental outlier payments from 90% to 85.6% for inpatient hospital reimbursement. Item 13 Effective Date: 7/1/2005 Funds FY2006 Total: $ 5,858,380 State: $ 2,296,506 % Reduction 0.4% Part I - Methodology/Rationale Current : Pay 90% of operational costs of a claim for most hospitals (excluding specialty hospitals). Proposed: Pay 85.6% of operational costs of a claim for all hospitals. Last Change: Converted to 90% of operational costs as of July 1998. Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 12.3% 91,079 10.6% 5,020 21.0% 42,147 19.2% 22,336 44.7% 76,985 1.7% 3,209 16.4% 240,776 Part IV - State Comparison N/A Part V - Administrative Requirements Requires ACS (claims payment system) and Georgia Medical Care Foundation to change procedures. Department of Community Health FY2006 Budget Reduction Proposal Item: Reduce facility fees paid for free-standing hospital-based clinics by basing reimbursement on two times the fixed amount of facility fees paid to physicians. Item 14 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 4,075,395 $ 1,571,830 % Reduction 0.54% Part I - Methodology/Rationale Current : The facility costs for hospital based clinics are paid on a cost to charge ratio compared to a fixed fee for physician based office visits. Proposed: When a hospital bills for a clinic visit on an outpatient hospital claim, set payment at twice the fixed amount of facility fees paid to physicians. Last Change: FY2005 decreased the outpatient cost to charge ratio from 90% to 85.6%. Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 55.4% 411,722 57.3% 27,095 66.4% 133,362 46.1% 53,570 99.8% 171,815 43.4% 82,953 59.9% 880,517 Part III - State Comparison Mississippi does not allow hospital-based clinics to bill facility fees on a UB-92 unless they are a teaching hospital with a resident-to-bed ratio of .25 or greater. Medicare is currently amending their hospital based physician clinic reimbursement methodology to align more closely with the rate paid for services rendered in free standing hospital based clinics. Part IV - Administrative Requirements Requires Systems Change Department of Community Health FY2006 Budget Reduction Proposal Item: Rebase DRG's and move to a more current grouper. Adjust to ensure budget neutrality. Effective Date: Funds Total: State: % Reduction Item 15 7/1/2005 FY2006 Yes Yes N/A Part I - Methodology/Rationale Current : Using Champus (Tricare) Diagnosis Related Group (DRG) Grouper 16. Proposed: Move to Champus (Tricare) DRG Grouper 22 and rebase the DRG weights for a January 2006 effective date. Last Change: Rates were rebased in July 2002. The DRG grouper was updated in October 1999. Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 12.3% 91,079 10.6% 5,020 21.0% 42,147 19.2% 22,336 44.7% 76,985 1.7% 3,209 16.4% 240,776 Part IV - State Comparison N/A Part V - Administrative Requirements Requires contract costs for consulting and technical assistance. Department of Community Health FY2006 Budget Reduction Proposal Item: Explore alternative reimbursement methodologies for outpatient hospital services. Part I - Methodology/Rationale Current : Pay percent of charges and cost settle at the end of the year. Proposed: Explore different reimbursement options. Last Change: N/A Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 55.4% 411,722 57.3% 27,095 66.4% 133,362 46.1% 53,570 99.8% 171,815 43.4% 82,953 59.9% 880,517 Part IV - State Comparison N/A Part V - Administrative Requirements Requires contract costs for consulting and technical assistance. Effective Date: Funds Total: State: % Reduction Item 16 7/1/2005 FY2006 Yes Yes N/A Department of Community Health FY2006 Budget Reduction Proposal Item: Reduce nursing home reimbursement by reducing the growth allowance to offset the reduction in expected nursing home provider fees. Part I - Methodology/Rationale Current : Use FY2002 cost reports to set rates with growth allowance of 6.16% Proposed: Use FY2003 cost reports and reduce the growth allowance. Last Change: N/A Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 0.0% 0.2% 117 6.9% 13,900 46.9% 54,449 0.0% 0.0% 4.7% 68,466 Part IV - State Comparison N/A Part V - Administrative Requirements N/A Item 17 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 24,524,047 $ 9,628,141 % Reduction 2.4% Item 18 Department of Community Health FY2006 Budget Reduction Proposal Item: Require Medicare cost avoidance for nursing home care. Effective Date: Funds Total: $ State: $ 7/1/2005 FY2006 858,795 338,709 % Reduction 0.1% Part I - Methodology/Rationale Current : There are several Long Term Care facilities that have not received Medicare certification and therefore are unable to bill Medicare for nursing home care expenses. In CY2003 many of these facilities had at least one dually eligible members that DCH could have cost avoided on. Proposed: Require all Long Term Care facilities to become Medicare certified, thereby allowing Medicaid to cost avoid on Medicare eligible claims. Last Change: N/A Part II - Member Impact Sub Program Members Utilizing Service Percent Total Children 0.0% - MF Children 0.0% - Disabled 0.0% - Elderly* 0.3% 354 Adults 0.0% - PeachCare 0.0% - Total Members 0.0% 354 * Members who meet all Medicare qualifying criteria. Part IV - State Comparison N/A Part V - Administrative Requirements Requires State Plan Amendment Requires Systems Change Part III -To Qualify for Medicare Skilled Nursing Facility (all must be met) 1. Have Medicare Part A and days left in the Medicare benefit period to use. 2. Have a qualifying hospital stay of 3 consecutive days or more and must enter SNF within 30 days of leaving the hospital. 3. Require skilled nursing or rehabilitation care as ordered by a physician. 4. Services must be provided in a Medicare-certified SNF. 5. The services needed are related to a condition treated during a qualifying 3-day hospital stay or Medicare-covered SNF care. Department of Community Health FY2006 Budget Reduction Proposal Item: Utilize FY2003 cost reports to determine nursing home reimbursement. Adjust to ensure budget neutrality. Part I - Methodology/Rationale Current : Using FY2002 cost reports to set provider rates. Proposed: Use FY2003 cost reports to set provider rates. Last Change: Began using FY2002 cost reports in July 2003. Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 0.0% 0.2% 117 6.9% 13,900 46.9% 54,449 0.0% 0.0% 4.7% 68,466 Part IV - State Comparison N/A Part V - Administrative Requirements N/A Item 19 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 10,921,334 $ 4,307,374 % Reduction N/A Department of Community Health FY2006 Budget Reduction Proposal Item: Increase the average wholesale price (AWP) discount from 11% to 14% for injectibles provided through a physician's office. Part I - Methodology/Rationale Current : AWP- 11%. Proposed: AWP- 14%. Last Change: Modified from AWP to AWP-11% in FY2005. Item 20 Effective Date: 7/1/2005 Funds FY2006 Total: State: $ 3,400,000 $ 1,319,212 % Reduction 0.2% Millions Alabama Florida Georgia Kentucky Mississippi North Carolina South Carolina Tennessee Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 97.6% 725,430 87.2% 41,184 81.7% 164,133 65.0% 75,500 100.0% 172,160 95.3% 182,043 92.5% 1,360,450 Part IV - Annual Trend $30.0 $25.0 $20.0 $15.0 $10.0 $10.1 $5.0 $0.0 FY 01 $16.5 FY 02 $22.5 FY 03 $24.8 FY 04 Part III - Top 10 Utilized Procedures in FY 2004 CPT Q0136 J0585 J1100 J0696 J1626 J2405 J9355 J1260 J3301 J0880 Procedure Non ESRD Epoetin Alpha Inj Botulinum Toxin A Per Unit Dexamethasone Sodium Phos Ceftriaxone Sodium Injection Granisetron HCl Injection Ondansetron HCl Injection Trastuzumab Dolasetron Mesylate Triamcinolone Acetonide Inj Darbepoetin Alfa Injection # Units 169,164 71,637 70,902 65,373 21,220 16,664 14,929 13,222 11,939 10,986 Part V - State Comparison- Discount off Average Wholesale Price 0.00% -2.00% -4.00% -6.00% -8.00% -10.00% -10.0% -12.00% -14.00% -13.3% -11.0% -12.0% -10.0% -10.0% -12.0% -13.0% Part VI - Administrative Requirements Requires State Plan Amendment Department of Community Health FY2006 Budget Reduction Proposal Item: Increase the average wholesale price (AWP) discount from 11% to 14% for injectibles provided through a physician's office. Item 20 (continued) Effective Date: 7/1/2005 Funds FY2006 Total: State: $ 3,400,000 $ 1,319,212 % Reduction 0.2% Part VII - Drug Reference Table (See Table III) CPT Q0136 J0585 J1100 J0696 J1626 J2405 J9355 J1260 J3301 J0880 Procedure End Stage Renal Disease Epoetin Alpha Injection Botulinum Toxin A Per Unit Dexamethasone Sodium Phos Ceftriaxone Sodium Injection Granisetron HCl Injection Ondansetron HCl Injection Trastuzumab Dolasetron Mesylate Triamcinolone Acetonide Inj Darbepoetin Alfa Injection Brand Example Treatment of Procrit, Epogen Botox Deradon Procephin Kytril Zofran Herceptin Anzemet Kenalog Aranesp Renal Disease Muscle Disorder Inflammation/Allegic response Antibiotic Nausea Nausea Breast Cancer Post-Operative Nausea Inflammation Anemia caused by Kidney Failure Department of Community Health FY2006 Budget Reduction Proposal Item: Increase the average wholesale price (AWP) discount from 11% to 14% for pharmacy prescriptions. Item 21 Effective Date: 7/1/2005 Funds FY2006 Total: $ 13,387,114 State: $ 5,194,248 % Reduction 1.0% Part I - Methodology/Rationale Current : AWP- 11% or favored nations, whichever is lower (note: favored nations pricing allows DCH to obtain the lowest discount extended by the pharmacy to any other insurer). Proposed: AWP- 14% or favored nations, whichever is lower. Last Change: Modified AWP from -10% to -11% in FY2005. Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 97.6% 725,430 87.2% 41,184 81.7% 164,133 65.0% 75,500 100.0% 172,160 95.3% 182,043 92.5% 1,360,450 $60.0 $50.0 $40.0 $30.0 $20.0 $10.0 $0.0 Part III - Cost per Prescription $43.4 6.2% $46.1 7.3% $49.4 9.1% $53.9 FY01 FY02 FY03 FY04 Alabama Florida Georgia Kentucky Mississippi North Carolina South Carolina Tennessee Part IV - State Comparison - Discount off Average Wholesale Price 0.00% -2.00% -4.00% -6.00% -8.00% -10.00% -12.00% -10.0% -14.00% -13.3% -11.0% -12.0% -12.0% -10.0% -10.0% -13.0% Part V - Administrative Requirements Requires State Plan Amendment Item 22 Department of Community Health Effective Date: FY2006 Budget Reduction Proposal Funds Item: Require minimum bids on discount off AMP (average manufacturer's price) for the next round of supplemental rebates. Total: State: 7/1/2005 FY2006 $ 10,188,487 $ 3,954,273 % Reduction 0.7% Part I - Methodology/Rationale Current : The current discount off AMP from both CMS and Supplemental rebates amounts to approximately 20%. Proposed: This proposal calls for the requirement of a minimum discount off AMP of 29.1% for any manufacturer's product to be evaluated for PDL placement without being subject to a prior authorization. Last Change: N/A Part II - Member Impact Part III - Supplemental Rebates Product Categories Sub Program Members Utilizing Service Percent Total Children MF Children Disabled Elderly 97.6% 87.2% 81.7% 65.0% 725,430 41,184 164,133 75,500 Adults 100.0% 172,160 PeachCare 95.3% 182,043 Total Members 92.5% 1,360,450 Product Categories on Supplemental Rebates Dihydropyridine Calcium Channel Blockers Proton Pump Inhibitors Beta - Adrenergic Agents: Nebs Statins Lipotropics: Cai Bone Ossification Agents Cox II's Ace Inhibitors Ace Inhibitors With Diuretics Atypical Antipsychotics Nasal Steroids Macrolides Angiotensin Receptor Blockers Angiotensin Receptor Blockers & Diuretics Nondihydropyridine Ccb'S Narcotics: Long Acting Antihyperkinesis Inhaled Corticosteroids Nebulized Corticosteroids SSRI'S Insulins Quinolones Cephalosporins Erectile Dysfunction Beta Blockers Biguanide Combinations- Oral Antidiabetic Low Sedating Antihistamines Low Sedating Antihistamines/Decongestant Combinations New Generation Antidepressants Urinary Tract Antispasmodics Part IV - Business Case for Change While the supplemental rebate program has been very effective in obtaining supplemental rebates from manufacturers, the goal it to gain even greater rebate dollars in exchange for preferred drug list placement. Florida has taken a similar approach, and the 29.1% is similar to the requirement in Florida. Under this measure, manufacturers will be required to submit a minimum of 29.1% discount off AMP. Manufacturers who choose not to submit a bid of 29.1% off AMP will not be listed as a preferred product and the medication will be subject to a prior authorization. DCH will reserve the right to allow a lesser bid if exclusion of the medication from the preferred drug list would clearly increase total utilization of other more costly Medicaid health care resources (hospitalizations, ER visits, laboratory costs, etc.). Part V - State Comparison N/A Part VI - Administrative Requirements Requires State Plan Amendment Item 22 (continued) Department of Community Health FY2006 Budget Reduction Proposal Item: Require minimum bids on discount off AMP (average manufacturer's price) for the next round of supplemental rebates. Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 10,188,487 $ 3,954,273 Part VII - Drug Reference Table (See Table III) Product Categories on Supplemental Rebates Calcium Channel Blockers Proton Pump Inhibitors Beta - Adrenergic Agents: Nebs Brand Example Cardene, Cardizem CO, DynaCirc, Norvasc, Plendil Omeprazole, Esomeprazole, Lansoprazole, Aciphex, Prevacid, Xopenex, Duoneb % Reduction 0.7% Treatment of High Blood Pressure (hypertension) Stomach Ulcers and Gastric Reflux Disease Asthma Statins Lipitor, Zocor, Pravachol Cholesterol Nasal Steroids Angiotensin Receptor Blockers: ARBs Angiotensin Receptor Blockers & Diuretics: ARBs Micardis HCI, Benican HCI Narcotics: Long Acting Flonase, Rhinocort Nasal Inhaler Cozaar, Diovan, Avapro, Atacand, Micardis, Teveten, Benicar Hyzaar Avinza, Kadian, Oxycontin, Duragesic Nasal and Sinus Disorders High Blood Pressure (hypertension) High Blood Pressure (hypertension) Chronic Pain Antihyperkinesis Inhaled Corticosteroids SSRI'S Strattera AeroBid, Asmacort, Beclovent, Pulmicort Respules, Qvar, Vanceril Zoloft, Celexa, Paxil CR ADD/ADHD Asthma Depression Insulins Novolin, Humulin, Lantus Diabetes Bone Ossification Agents Fosamax, Actonel Osteoprosis Cox II's Vioxx, Celebrex, Bextra Arthritis/Inflammation Ace Inhibitors Mavic, Aceon High Blood Pressure (hypertension) Ace Inhibitors With Diuretics Atypical Antipsychotics Macrolides Quinolones Cephalosporins Erectile Dysfunction Beta Blockers Oral Antidiabetic Low Sedating Antihistamines Low Sedating Antihistamines/Decongestant Combinations New Generation Antidepressants Urinary Tract Antispasmodics Uniretic, Accuretic High Blood Pressure (hypertension) Zyprexa, Risperdal, Abilsfy, Seroquel Mental Disorders Zithromax, Biaxin Antibotic Cipro, Floxin Ceclor, Cedax, Duricef, Omnicef, Vantin Viagra, Levitra, Cialis Antibotic Antibotic Male impotency Levatol, Visken, Cartrol High Blood Pressure (hypertension) Starlix, Avandia, Prandin Diabetes Zyrtec, Clarinex Allergy Zyrtec D - 12 Hours, Claritin-D Allergy Effexor, Cymbalta Detrol LA, Ditropan XL Depression Overactive Bladder Item C23 Department of Community Health FY2006 Budget Reduction Proposal Item: Eliminate the dispensing fee incentive paid for dispensing generic drugs. Effective Date: 7/1/2005 Funds FY2006 Total: State: $ 4,839,531 $ 1,877,756 % Reduction Part I - Methodology/Rationale Current : DCH pays a $0.50 dispensing fee incentive above and beyond the dispensing fee for branded medications. Proposed: Eliminate dispensing fee incentive. Last Change: May, 2002. 0.4% Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 97.6% 725,430 87.2% 41,184 81.7% 164,133 65.0% 75,500 100.0% 172,160 95.3% 182,043 92.5% 1,360,450 Part III - % of Generic and Multi-Source Drugs Dispensed by Fiscal Year 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% 47.3% 1.0% Generic 49.3% 1.5% Multi-Source 51.9% 1.2% 2.0% 1.8% 1.6% 1.4% 1.2% 1.0% 0.8% 0.6% 0.4% 0.2% 0.0% FY02 FY03 FY04 Part IV - Medicaid Prescriptions based on Drug Type Single Source Brands 46.8% Generic 51.9% Multi-Source Brands 1.2% The payment of an additional fee as an incentive to a pharmacist to dispense a generic drug is no longer necessary to promote the use of generic drugs for the following reasons: Georgia has substantially expanded the use of the Maximum Allowable Cost (MAC) program over the past two years, making the dispensing of multi-source brands increasingly improbable. MAC sets a fixed cost, based on the lowest wholesale price for a drug, thereby making it unlikely a more expensive brand will be dispensed. Additionally, an increasing number of pharmacies are not stocking multi-source brands due to a higher inventory expense associated with these drugs. As a result, these pharmacies are much more likely to automatically dispense a generic drug because it is more likely to be in stock. Part V - Business Case for Change Prior to implementation of the generic dispensing fee incentive in May 2002, 48% of the claims were for generic drugs. As of June 2004, the generic dispensing rate was 51%. What movement has occurred is partly due to the subsequent availability of generics for highly utilized branded drugs (e.g. Prilosec). Within the last two years, four major brand drugs have converted to generic status as the drug's patent has expired: Claritin (allergy); Prilosec (anti-ulcer); Paxil (anti-depressant); and Prozac (anti-depressant). Given that the Medicaid program pays for a significant number of prescriptions of these drugs, their transfer to generic status has improved the percentage of generic drugs paid for by the Medicaid program. Additionally, DCH has an edit in place that will not allow a pharmacy to dispense a branded medication when a generic therapeutically equivalent (FDA A-rated) medication is available short of obtaining a prior authorization. Prior authorization requirements are very stringent. Nevertheless, any pharmacy that dispenses a generic medication receives the additional $0.50 even if the physician wrote the prescription generically or the prescription allows the use of generics. Pharmacy providers are being given this "incentive" without regard to any level of action taken on the part of the pharmacist to switch a branded medication to a different medication that is available generically. There are no fields available through NCPDP and ESI claims processing systems to identify when a pharmacy providers claims to have called the physician and received an authorization to switch medications from a brand to another medication available generically. Since the generic incentive fee has not been an effective tool to drive generic utilization, we are recommending it's elimination. Part VI - State Comparison N/A Part VII - Administrative Requirements Requires State Plan Amendment Item 24 Department of Community Health FY2006 Budget Reduction Proposal Item: Consolidate population-based programs to more appropriately align agency business functions. Item 25 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 609,141 $ 362,248 % Reduction N/A Part I - Methodology/Rationale Current : The Department of Community Health supports population-based healthcare through the operation of the Office of Minority Health, the Office of Women's Health, and the Commission on Men's Health. These entities are responsible for developing strategies, polices and programs including community outreach and public/private partnerships to create awareness of the benefits of regular check-ups for early detection, preventive screenings, healthy lifestyle practices and disease management, and to eliminate discrepancies in health status between minority and non-minority populations in Georgia. Proposed: Consolidate all population-based programs to more appropriately align agency business functions and achieve administrative efficiencies. This includes the reduction of eight positions. Last Change: The Office of Women's Health was created in 1999 at the same time DCH was established as a department. The Commission on Men's Health was created in 2000. The Office of Minority Health was established in 1996 as part of the Department of Human Resources, and was transferred to DCH when the department was created in 1999. Part II - Administrative Requirements N/A Department of Community Health FY2006 Budget Reduction Proposal Item: Transfer funding for the Marcus Institute to the Department of Human Resources. Item 26 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 150,000 $ 150,000 % Reduction N/A Part I - Methodology/Rationale Current : The Department of Community Health was appropriated funds in the FY2005 budget to contract with the Marcus Institute. The Marcus Institute offers comprehensive diagnosis, therapy and care management for a wide range of disabilities and learning problems. The funds are used to support the operations of the Institute. Proposed: Transfer funding to the Department of Human resources to appropriately align agency business functions. DHR currently has a contract with the Marcus Institute. Last Change: Funding for the Marcus Institute was first appropriated to DCH in FY2005. Part II - Administrative Requirements None Department of Community Health FY2006 Budget Reduction Proposal Item: Eliminate funding for the Folic Acid initiative. Item 27 Effective Date: Funds Total: State: 7/1/2005 FY2006 $ 200,000 $ 200,000 % Reduction N/A Part I - Methodology/Rationale Current : The Georgia Folic Acid information awareness campaign is designed to increase the consumption of the vitamin folic acid prior to and during pregnancy to prevent birth defects. Information is targeted at women of childbearing age, primary care physicians, midlevel providers as well as working with the Family Health Branch of the DHR Division of Public Health. Proposed: Eliminate funding for the program in the DCH budget. The program is not consistent with the agency's business functions. Last Change: Part II - Administrative Requirements N/A Base Item 1 Department of Community Health FY2006 Budget Reduction Proposal Item: Perform retrospective reviews on non-delivery related hospital admissions for children. Effective Date: Funds Total: State: 7/1/2005 FY2006 Yes Yes Part I - Methodology/Rationale % Reduction* N/A *Based on reduction of Inpatient Hospital Current : No pre-certifications are required for hospital admissions for children. Proposed: Focused retrospective utilization review of physician admission patterns for all children (excluding newborns). Interqual criteria will be used for all retrospective reviews. Last Change: DCH implemented a pre-certification requirement for adult hospital admissions in the early 1990's. Part II - Member Impact Part III - Admissions per 1,000 Children Sub Program Members Utilizing Service Percent Total Children 6.5% 48,482 MF Children 13.9% 6,572 Disabled 0.0% Elderly 0.0% Adults 0.0% PeachCare 1.8% 3,497 Total Members 4.0% 58,551 80 71 73 73 74 73 70 59 60 50 40 30 20 10 0 FY01 FY02 FY03* FY04 FY05 proj FY06 proj *Avg. FY2003 Net Pay per Admission: $5,603 **FY2004 Total Claims Paid: 33,464; Total Net Payments: $187,504,607 Notes: FY2003 and FY2004 claims are not complete and will be reprocessed by 12/01/04 Part IV - 2004 DRGs by net payment and claims paid (excluding deliveries and newborns) (in Millions) Claims Paid $18 $16 The Top 5 DRG's Constitute $15.8 24% of all Net Payments Bronchitis & Asthma $14 Simple Pneumonia & $12 Pleurisy $9.0 $10 $7.8 Other Cardiothoracic $8 $7.6 Proc $6 $5.6 Craniotomy $4 $2 Respiratory System Diagnosis w Vent $0 6,000 5,000 4,000 3,000 2,000 1,000 0 5,426 The Top 5 DRG's Constitute 43% of all Claims Paid 3,050 1,980 1,949 1,918 Bronchitis & Asthma Simple Pneumonia & Pleurisy Esophag, Gastroent & Misc GI Dx Psychoses Nutritional & Misc Metab Disord Part V - State Comparison No other Southeastern states require pre-certification for hospital admissions for children. Retrospective review is unknown. Part VI - Administrative Requirements Requires Systems Change Staffing - 2 RN FTEs @ $100,000; Total Funds = $200,000 Base Item 2 FY2006 Budget Reduction Proposal Item: Strictly enforce orthodontic policies for children. Effective Date: Funds Total: State: 7/1/2004 FY2006 Yes Yes Part I - Methodology/Rationale % Reduction* N/A * Based on reduction of the children's dental program. Current : The state's pediatric dental program offers medically necessary orthodontic services for members with cleft palates and other dentofacial anomalies. The treatment includes one previsit and 24-36 additional visits for orthodontic care. Current orthodontic treatment approval rate is 100%. Proposed: The state utilized a more stringent application and policy compliance form to ensure children had the correct diagnosis before obtaining orthodontic care. The Georgia Medical Care Foundation also applied a new set of clinical guidelines to use when performing reviews. Last Change: N/A Part II - Member Impact Sub Program Children Members Utilizing Service Percent 43.5% Total 323,159 MF Children 37.8% 17,866 Disabled 0.0% - Elderly 0.0% - Adults 0.0% - PeachCare 67.8% 129,608 Total Members 32.0% 470,633 Part III - Orthodontic Treatment Utilization Fiscal Year FY2001 # of Members Payments Avg Pay / Member 249 $ 469,846 $ 1,887 FY2002 914 $ 1,809,664 $ 1,980 FY2003 2,587 $ 5,330,263 $ 2,060 FY2004 3,289 $ 6,888,667 $ 2,094 *FY2003 and FY2004 claims are not complete and will be reprocessed by 12/01/04 Part IV - State Comparison All southeastern border states cover pediatric orthodontic services with varying policies. Part V - Administrative Requirements GMCF prior authorization staffing Base Item 3 Department of Community Health FY2006 Budget Reduction Proposal Item: Pursue a more aggressive lock-in program for drugs subject to abuse. Effective Date: Funds Total: State: % Reduction 7/1/2005 FY2006 Yes Yes N/A Part I - Methodology/Rationale Current : Patients identified by surveillance reviews are locked into a physician and pharmacy provider who are the exclusive providers for the patient. Proposed: Implement a more aggressive approach to identify potential abusers and hire more Program Integrity staff to oversee the lock-in program. Last Change: N/A Part II - Member Impact Sub Program Members Utilizing Service Percent Total Children 97.6% 725,430 MF Children Disabled Elderly Adults PeachCare Total Members 87.2% 81.7% 65.0% 100.0% 95.3% 92.5% 41,184 164,133 75,500 172,160 182,043 1,360,450 Part III - Drugs Most Frequently Abused: Product Category Hydrocodone/APAP Carisoprodol Alprazolam Diazepam Tylenol/Codeine Brand Name Treatment of Vicodine Soma Xanax Pain Relief Relief of painful muscoloskeletal conditions Panic disorders Valium Anxiety disorders Tylenol/Codeine Pain relief Part IV - State Comparison N/A Part V - Administrative Requirements Program Integrity will need to hire two full time employees: a pharmacist (salary: $80,000) and a pharmacy technician (salary: $25,000 to $28,000). Department of Community Health FY2006 Budget Reduction Proposal Item: Complete prior year cost settlements for outpatient hospital services. Part I - Methodology/Rationale Current : Have been unable to complete cost settlements since fiscal agent system conversion. Proposed: Catch up on one and a half year backlog of cost settlements during FY2006 Effective Date: Funds Total: State: % Reduction Base Item 4 7/1/2005 FY2006 Yes Yes N/A Last Change: N/A Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 55.4% 411,722 57.3% 27,095 66.4% 133,362 46.1% 53,570 99.8% 171,815 43.4% 82,953 59.9% 880,517 Part IV - State Comparison N/A Part V - Administrative Requirements N/A Department of Community Health FY2006 Budget Reduction Proposal Item: Strictly enforce income requirements for participation in the PeachCare for Kids program. Effective Date: Funds Total: State: % Reduction Part I: Methodology/Rationale Current: Income verification is only performed when a PeachCare application comes in through DFCS caseworker. Proposed: Increase efforts to validate PeachCare applicant income. Last Change: N/A Base Item 5 7/1/2005 FY2006 Yes Yes N/A Part II: Proposal Description Option A: Perform data matching audits, using comprehensive income verification, on a monthly basis for a sample or entire population. Require follow up with documentation on discrepant cases Part III - Most Common Services Utilized by Net Payment 13.4% 7.8% 22.6% Option B: Perform data matching via DOL or private vendor wage data on every PeachCare application received by PSI/DHACS and/or DFCS Option C: Require documentation of income (i.e. paycheck stubs) from all new and renewing applicants 17.7% 18.9% 19.5% Pharmacy Dental Physician Services Outpatient Hospital Inpatient Hospital All Other Part IV: State Comparison State Alabama Florida Kentucky Mississippi North Carolina South Carolina Tennessee Type of Income Verification income documentation income documentation income documentation self-declaration with wage data matching income documentation income documentation income documentation Part V: Administrative Requirements Would potentially require state plan amendment Would require PeachCare enrollment system programming changes Options A & B would require some additional staff (either DCH or PSI) to perform follow up functions on applicants with discrepant incomes Option C would require a significant increase in additional staff (PSI) to perform eligibility determination and follow up functions Department of Community Health FY2006 Budget Reduction Proposal Item: Ensure level of care requirements are met for all long term care programs. Part I - Methodology/Rationale Current : Nursing home level of care is determined by multiple entities and may not be uniformely applied. Proposed: Ensure all entities determining level of care uniformely apply level of care requirements. Last Change: N/A Effective Date: Funds Total: State: % Reduction Base Item 6 7/1/2005 FY2006 Yes Yes N/A Part II - Member Impact Part III - Waiver Expense as a Percent of Total Expense Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total 0.0% - 14.1% 6,677 1.7% 3,378 4.9% 5,727 0.0% - 0.0% - 1.1% 15,782 5.6% 94.4% Waiver Expense Total Plan Expense Note: For some eligibles, meeting level of care criteria qualifies the member for Medicaid, whereas they would have not otherwise been eligible. Part IV - State Comparison All states are required to follow Code of Federal Regulations (CFR) when assessing members for institutional or institutional-related care. Part V- Administrative Requirments N/A Base Item 7 Department of Community Health FY2006 Budget Reduction Proposal Item: Perform clinical reviews to validate demand for emergency medical assistance for undocumented aliens. Effective Date: Funds Total: State: % Reduction 7/1/2005 FY2006 Yes Yes N/A Part I - Methodology/Rationale Current : Undocumented aliens are seen by providers who submit a DMA Form 526 to the Department of Family and Children Services athorizing length of eligibility under the emergency medical assistance program. Length of eligibility can be up to three months and after that, another Form 526 must be submitted to renew eligibility. During the eligibility span, a member may receive any covered services. Proposed: Perform clinical reviews to validate demand for emergency medical assistance for undocumented aliens. Last Change: N/A Part II - Member Impact Part III - Most Common Services by Net Payment Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members * Members Utilizing Service Percent Total 0.3% 2,405 0.0% 7 0.2% 444 0.4% 475 11.4% 19,546 0.0% - 1.4% 21,047 * Total members represents average monthly eligibles. Eligibility is determined monthly and thus the unique count of patients in a year can be greater than the average monthly enrollment. 1.6% 4.4% 3.9% 8.5% 17.3% Part IV - Emergency Medical Assistance Expenditures by Diagnosis Related Group Deliveries only All other 64.4% Inpatient Hospital Physician Outpatient Hospital Nurse Midwifery Pharmacy All Other $70.0 $60.0 $50.0 $14.5 (in Millions) $40.0 $30.0 $20.0 $39.2 $10.0 $0.0 FY02 Part V - State Comparison N/A $16.4 $48.6 FY03 $12.8 $45.6 FY04 Part VI - Administrative Requirements Requires State Plan Amendment Base Item 8 Department of Community Health FY2006 Budget Reduction Proposal Item: Reflect an FY2005 change made to consider promissory notes as income in NH elbibility determination. Effective Date: Funds Total: State: % Reduction 7/1/2005 FY2006 Yes Yes N/A Part I - Methodology/Rationale Current : The face value of promissory notes is not counted as an asset in determining nursing home eligibility. The income produced by these notes is counted. Proposed: Count the face value of all promissory notes toward the resource limit in determining eligibility. Last Change: N/A Part II - Member Impact Sub Program Children MF Children Disabled Elderly Adults PeachCare Total Members Members Utilizing Service Percent Total - 0.0% 55 - - - - 0.0% 55 Part III - State Comparison Most states count the face value of promissory notes in the determination of eligibility. Part IV - Administrative Requirements State Plan Amendment Changes to the SUCCESS computer system Medicaid Eligibility Adults and Children (CY2003) Annual Income % of Federal (family size = 3) Poverty Level $36,008 $30,681 $28,376 $20,301 $15,264 $6,088 over 235% 235% FPL 200% FPL 185% FPL 133% FPL 100% FPL Standard of Need Presumptive Eligibility1 Presumptive Eligibility1 Eligibles: 6,600 Payments: $4.9 M Spend Down for Medically Needy Pregnant Women/Children4 Eligibles: 1 Payments: $ 7,000 RSM2 RSM2 Eligibles: 8,000 Payments: $59 M Medicaid or PeachCare for Kids PeachCare for Kids PeachCare for Kids5 Eligibles: 11,000 Payments: $29.3 M Eligibles: 54,300 Payments: $67.5 M Eligibles: 135,900 Payments: $178.6 M RSM2 Newborn Eligibles: 43,600 Payments: $345 M Eligibles: 79,000 Payments: $358.5 M RSM2 Eligibles: 167,000 Payments: $207.6 M RSM2 Eligibles: 232,400 Payments: $305.2 M Low Income Medicaid (LIM)6 Eligibles: 309,000 Payments:$701.5 M Transitional Medical Assistance (TMA)7 Breast and Cervical Cancer Medicaid State Plan Option8 Emergency Medical Aliens Adults and Children9 Eligibles: 58,200 Payments: $102.8 M Eligibles: 1,700 Payments: $ 27 M Eligibles: 3,380 Payments: $ 83.4 M Pregnant Women Pregnant Women3 Infants up to Age 15 Children 1-5 1 Services restricted - no inpatient hospital or delivery 2 Right From The Start Medicaid, coverage for pregnant women also covers newborn child 3 Coverage for pregnant women limited to time of pregnancy and 60 days postpartum 4 Spend down to medically needy level income limit of $507/month for a family of 3 5 For infants not born to pregnant women eligible for Medicaid coverage at the time of birth up to 200% of FPL. 6 Includes adoption supplement and foster care children 7 Covers children & parents who lose LIM due to earnings (limited to one year) 8 Must meet breast/cervical cancer screening requirement, be uninsured, and under 65 years old 9 Includes EMA eligibles that appear in other aid categories as well as being flagged as EMA. Childr 6 - 18 Parents Parents & ChildrenTransitional Medicaid Breast and Cervical Cancer Emergency Medical Aliens Legend Mandatory Optional FY 2005 Eligibility Cut Master Profile - All Revisions - Govenor Recommended-final2.xls 1/27/2005 Medicaid Eligibility Elderly, Disabled Adults, and Medically Fragile Children (CY2003) Annual Income % of SSI1 $19,872 300% Medically Needy in NH2 Eligibles: 1,700 Payments: $38.3 M Annual Income % of FPL8 (family size = 2) $13,248 200% $6,624 100% Medically Needy2 Eligibles: 6,200 Payments: $ 82.7 M Nursing Home3 Eligibles: 26,900 Payments: $927.7 M Community Care Services Program Waiver 3 Elderly & Functionally Impaired Eligibles: 6,100 Payments: $80.7 M Independent Care Waiver Program3 Severely Physically Disabled 21-64 years old Eligibles: 280 Payments: $13.6 M Mental Retardation Waiver Program/ Community Habilitation and Social Services Program3 Diagnosis of Mental Retardation or Developmental Disability Eligibles: 1,200 Payments: $35.2 M Model Waiver3 Medically Fragile Children under 21 who are respirator or oxygen dependent Eligibles: 400 Payments: $31.5 M Hospice4 Terminally Ill Services limited to Hospice Eligibles: 570 Payments: $10.2 M SSI1,6,7 Eligibles: 231,000 Payments: $ 1,889 M Katie Beckett Deeming Waiver 3 Eligibles: 5,900 Payments: $33 M Qualified Individuals - 1 (QI-1)5 Specified Low Income Beneficiary (SLMB) Qualified Medicare Beneficiary (QMB) Eligibles: 44,900 Payments: $30.8 M 135% 120% 100% $16,362 $14,544 $12,484 Elderly, and Disabled not NH Eligible Elderly and Disabled NH Eligible 1 SSI - Supplemental Security Income 2 Spenddown required to medically needy level 3 Nursing Home level of care required 4 Services waiver only, this population becomes eligible via other eligibility groups or waivers 5 Mandatory but limited to state allotment 6 Includes former SSI recipients who remain eligible under Public Laws and Nursing Home SSIs 7 Former SSI Children Hospice Medically Fragile Children Q-Track Medicare Beneficiaries Legend Mandatory Optional Optional, but would transition to nursing home w/o the waivered services FY 2005 Eligibility Cut Master Profile - All Revisions - Govenor Recommended-final2.xls 1/27/2005 Medicaid and PeachCare CY 2003 Expenditures Mandatory and Optional Services Optional Services DMA Children 8% Pharmacy (DCH) 19% Optional Services (DCH) 4% Optional Services (Other Agencies) 6% Mandatory Services (Other Agencies) 2% Mandatory Services (DCH) 61% Mandatory Services State Funds in Department of Community Health Budget Benefit Inpatient Hospital Care Skilled Nursing Facilities (SNF) Physician Services Outpatient Hospital Care Intermediate Care Facilities (ICF) EPSDT Durable Medical Equipment Independent Laboratory Nurse Practitioner Nurse Mid Wife Home Health Federally Qualified Health Centers Physician Assistant Services Intermediate Care for the Mentally Retarded (ICFMR) Hospital Based Rural Health Centers Free Standing Rural Health Centers CY 2003 Expenditures $1,115,635,580 $716,355,597 $636,143,503 $618,085,244 $152,968,537 $46,258,959 $36,651,841 $25,565,942 $17,329,529 $13,526,535 $11,393,881 $9,346,080 $8,210,751 $5,918,505 $4,376,178 $4,153,545 Nursing Facility-based Mental Health services (PASARR) Family Planning Unknown Category of Service Oral Surgery Chiropractic (Medicare only) Rehabilitative Therapy (Medicare only) Physical Therapy (Medicare only) Licensed Clinical Social Work Speech Therapy (Medicare only) Subtotal - Mandatory Benefits $2,908,161 $2,633,939 $382,355 $164,828 $38,257 $24,810 $21,917 $16,048 $664 $3,428,111,188 Mandatory Services Benefit CY 2003 Expenditures State-owned ICFMR (DHR) State-owned SNF (DHR) State-owned ICF (DHR) Subtotal - Mandatory Benefits Total - All Mandatory Benefits $99,096,759 $25,356,388 $1,960,427 $126,413,575 $3,554,524,763 Optional Services State Funds in Department of Community Health Budget Benefit Pharmacy Children's Dental Children Intervention Services Dialysis Services - Technical Hospice Independent Care Waiver Program Psychology SOURCE Case Management Emergency Ambulance Georgia Better Health Care Adult Dental Optometric Pharmacy DME Supplier Orthotics and Prosthetics Ambulatory Surgical Centers GAPP In-Home Private Duty Nuring CY 2003 All Other CY 2003 DMA Children Expenditures Expenditures $777,833,354.79 $257,318,384.15 $52,360,522.02 $122,583,027.94 $3,769,014.77 $46,812,858.31 $29,388,461.83 $285,928.62 $28,525,351.13 $661,334.33 $24,961,213.66 $488,386.68 $4,174,232.05 $19,438,127.82 $22,994,430.53 $383,980.08 $15,846,188.05 $5,762,641.50 $7,988,953.40 $12,101,130.00 $17,249,050.47 $47,379.63 $4,637,346.42 $6,737,059.88 $8,025,905.38 $2,572,232.01 $4,510,253.66 $5,028,880.09 $4,374,625.33 $3,623,952.74 $38,884.00 $7,733,301.89 Model Waiver Program Dedicated Case Management Services Early Intervention Program Perinatal Case Management Podiatry Emergency Air Ambulance Dialysis Services - Professional Pregnancy Related Services Hospital Beds used for SNF services Adults with AIDS Case Management GAAP Medically Fragile Daycare Childbirth Education Subtotal - Optional Benefits $0.00 $5,604,004.37 $41,451.50 $4,234,381.86 $3,260,004.31 $234,001.52 $1,201,238.90 $892,356.36 $443,063.38 $246,098.00 $0.00 $13,677.00 $1,022,848,064.69 $7,064,967.97 $469,000.00 $4,390,751.58 $194,877.94 $651,785.95 $1,095,788.79 $20,345.72 $124,504.95 $406.00 $1,839.00 $53,200.00 $1,263.75 $505,647,337 Optional Services State Funds in Other Agencies' Budgets Benefit Mental Retardation Waiver Program (DHR) Community Mental Health Services (DHR) Therapeutic Residential Intervention Services (DHR) Community Care Services Program (DHR) Community Habilitation and Support Services (DHR) Child Protective Services Case Management (DHR) School-based Children's Intervention Services (DOE) At Risk of Incarceration Case Management (DJJ) Diagnostic, Screening, and Prevention Services (DHR) Adult Protective Services Case Management (DHR) Children at Risk Targeted Case Management (DHR) Subtotal - Optional Benefits CY 2003 All Other CY 2003 DMA Children Expenditures Expenditures $116,986,664 $56,055,115 $176,124 $5,962,844 $36,556,266 $89,304,880 $85,485,062 $1,183,075 $43,747,713 $4,313,404 $45,563 $36,323,944 $1,517,300 $98,853 $11,184,383 $7,223,088 $2,106,205 $3,335,280 $2,794,933 $99,255 $33,539 $309,587,418 $2,532,085 $197,478,157 Total - All Optional Benefits $1,332,435,482 $703,125,495 CY 2003 Total Expenditures Georgia Medicaid CY 2003 Benefits Children Mandatory Optional 40% 796,416,72M4 andatory 528,016,05O0ptional 60% CY 2003 Total Expenditures Top 5 Optional Benefits 1 300 Pharmacy 2 450 Hlth Chk Dental Pgm - under 21 3 870 Therapeutic Residential Interv 4 764 Child Protective Services 5 440 Community Mental Health Svcs $1,324,432,774 2003 Expenditures $191,465,485 $116,120,583 $73,058,771 $34,090,538 $27,528,163 Medically Fragile Children Mandatory Optional 177,330,47M0andatory 175,109,44O5ptional 50% 50% CY 2003 Total Expenditures $352,439,915 Top 5 Optional Benefits 1 300 Pharmacy 2 840 Childrens Intervention Svc 3 870 Therapeutic Residential Interv 4 440 Community Mental Health Svcs 5 971 GAPP In-home Priv Duty Nursing 2003 Expenditures $65,852,899 $29,681,781 $16,246,109 $9,028,103 $7,162,549 Disabled Adults Mandatory Optional 46% Mandatory 988,701,142 829,127,66O1ptional 54% CY 2003 Total Expenditures $1,817,828,803 Top 5 Optional Benefits 1 300 Pharmacy 2 680 Mental Retardation Waiver Pgm 3 440 Community Mental Health Svcs 4 681 Comm Habilitation and Support 5 590 Community Care Services 2003 Expenditures $464,003,293 $116,231,304 $44,325,986 $43,408,309 $37,628,509 Elderly 24% Mandatory Optional Adults 15% Mandatory Optional Mandatory 784,885,167Optional 254,648,009 76% Mandatory 686,181,582Optional 122,147,096 85% CY 2003 Total Expenditures Top 5 Optional Benefits 1 300 Pharmacy 2 590 Community Care Services 3 690 Hospice 4 930 Source 5 720 Dialysis Services - Technical $1,039,533,176 2003 Expenditures $174,310,154 $47,842,907 $14,177,677 $6,564,675 $2,820,504 CY 2003 Total Expenditures $808,328,678 Top 5 Optional Benefits 2003 Expenditures 1 300 Pharmacy $83,597,522 2 460 Adult Dental Program $9,117,468 3 440 Community Mental Health Svcs $7,485,109 4 370 Emergency Ground Ambulance Svc $4,306,315 5 761 Perinatal Targeted Case Mgmt $4,191,492 CY 2002 Total Expenditures Georgia PeachCare CY 2003 Benefits Children Mandatory Optional 51% 121,009,68M6andatory 126,512,71O6ptional 49% CY 2003 Total Expenditures $247,522,402 Top 5 Optional Benefits 1 300 Pharmacy 2 450 Hlth Chk Dental Pgm - under 21 3 570 Psychological Services 4 440 Community Mental Health Svcs 5 840 Childrens Intervention Svc 2002 Expenditures $55,922,387 $48,330,758 $3,967,354 $3,858,584 $3,474,322 Georgia Medicaid and PeachCare CY 2003 (services incurred 1/2003 through 12/2003 and paid through 5/2004) Total Expenditures State Share of Expenditures Federal Share of Expenditures Average PMPM $5,590,085,749 $2,197,071,821 $3,393,013,927 $325.02 Average Monthly Enrollment Outpatient ER visits per 1,000 Members* Inpatient Hospital Admissions per 1,000 Members 1,433,251 765.6 196.6 12% 6% Eligibility by Major Program 13% 53% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 13% 3% PeachCare Children Payments by Major Program 4% 14% 19% 24% 6% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 33% PeachCare Children Category Inpatient Hospital Pharmacy Long Term Care** Physicians Services Outpatient Hospital Dental All Other Total Expenditures by Major Categories of Service CY 02 Expenditures $970,748,589 $860,824,148 $939,688,838 $586,585,384 $527,070,513 $155,924,720 $971,944,431 CY 03 Expenditures $1,115,962,601 $1,045,886,594 $1,001,656,214 $636,451,138 $618,342,489 $192,347,925 $979,438,789 $5,012,786,623 $5,590,085,749 18% 3% 11% 11% 20% 19% 18% Inpatient Hospital Pharmacy Long Term Care** Physicians Services Outpatient Hospital Dental All Other * ER Visits include both outpatient ER visits and ER visits resulting in an inpatient stay. ** Includes private and state run skilled nursing facilities and intermediate care facilities. Data prepared by the GA DCH DSS Analysis Unit, 7/12/2004 Medicaid covers children: Georgia Medicaid Children Under 1 with family income that is no more than 185% of the federal poverty level Under 6 with family income that is no more than 133% of the federal poverty level Under 19 with family income that is no more than 100% of the federal poverty level Under 1 whose Mothers were Medicaid eligible when the child was born In foster care With special needs whose parents are receiving a special adoption supplement Under 1 whose Mothers were Medicaid eligible when the child was born Whose family income is over the limit but who have enough unpaid/incurred medical expenses to "spend down" the excess income and meet the income limit (Medically Needy) Georgia Medicaid Children CY 2003 (services incurred 1/2003 through 12/2003 and paid through 5/2004) Total Expenditures State Share of Expenditures Federal Share of Expenditures Average PMPM $1,324,432,774 $527,256,687 $797,176,086 $148.55 Average Monthly Enrollment Outpatient ER visits per 1,000 Members* Inpatient Hospital Admissions per 1,000 Members 742,996 657.7 132.7 Eligibility by Major Program 13% 12% 6% 53% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 13% 3% PeachCare Children Payments by Major Program 4% 14% 19% 24% 6% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 33% PeachCare Children Category Inpatient Hospital Physician Pharmacy Outpatient Hospital Dental All Other Total Expenditures by Major Categories of Service CY 02 Expenditures $323,373,291 $202,374,583 $141,490,993 $160,640,020 $94,294,438 $273,932,602 CY 03 Expenditures $317,182,812 $217,712,397 $193,170,367 $189,257,553 $116,129,713 $290,979,932 $1,196,105,927 $1,324,432,774 22% 24% 9% 14% 15% 16% Inpatient Hospital Physician Pharmacy Outpatient Hospital Dental All Other * ER Visits include both outpatient ER visits and ER visits resulting in an inpatient stay. Data prepared by the GA DCH DSS Analysis Unit, 7/12/2004 Georgia Medicaid Medically Fragile and Disabled Children Medicaid covers medically fragile children who: Receive SSI (Supplemental Security Income) Lost their SSI because of the federal 1996 change in disability requirements but Georgia continues to cover. Are chronically ill and whose parents have income or resources that make the children ineligible for SSI. These children must need a nursing home level of care but have good home care that costs less. Qualify for other Medicaid categories and require special medical services because of the severity of their condition Georgia Medicaid Medically Fragile and Disabled Children CY 2003 (services incurred 1/2003 through 12/2003 and paid through 5/2004) Total Expenditures State Share of Expenditures Federal Share of Expenditures Average PMPM $352,439,915 $140,306,330 $212,133,585 $621.55 Average Monthly Enrollment Outpatient ER visits per 1,000 Members* Inpatient Hospital Admissions per 1,000 Members 47,253 760.6 174.2 12% 6% Eligibility by Major Program 13% 53% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 13% PeachCare Children 3% 14% 19% Payments by Major Program 4% Medicaid Children 24% 6% Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 33% PeachCare Children Expenditures by Major Categories of Service Category Inpatient Hospital Pharmacy Interventional Services** Outpatient Hospital Physician Long Term Care*** All Other Total CY 02 Expenditures $61,623,289 $49,721,722 $68,913,611 $33,004,293 $25,541,580 $9,437,440 $49,117,588 $297,359,523 CY 03 Expenditures $82,703,210 $66,720,249 $62,259,750 $39,232,635 $33,041,094 $7,011,786 $61,471,192 $352,439,915 17% 2% 9% 11% 18% 24% 19% Inpatient Hospital Pharmacy Interventional Services** Outpatient Hospital Physician Long Term Care*** All Other * ER Visits include both outpatient ER visits and ER visits resulting in an inpatient stay. ** Includes waiver programs, children intervention services, community care program, PASARR, SOURCE, etc. Could be understated due to claims payment system issues. *** Includes private and state run skilled nursing facilities and intermediate care facilities. Data prepared by the GA DCH DSS Analysis Unit, 7/12/2004 Georgia Medicaid Disabled Adults Medicaid covers disabled adults (under 65) who: Receive Supplemental Security Income (SSI) Lost their SSI coverage but keep their Medicaid coverage because of federal legislation Reside in the nursing home and meet the nursing home income and resource standards Need a nursing home level of care but can be cared for in the community with special home and community based services Are terminally ill Are entitled to Medicare and meet the income standards. These individuals receive help with their Medicare premiums, co-payments and deductibles only. Whose family income is over the limit but who have enough unpaid/incurred medical expenses to "spend down" the excess income and meet the income limit (Medically Needy) Are uninsured women under 65 and have a diagnosis of breast or cervical cancer Georgia Medicaid Disabled Adults CY 2003 (services incurred 1/2003 through 12/2003 and paid through 5/2004) Total Expenditures $1,817,828,803 Average Monthly Enrollment* State Share of Expenditures $723,677,646 Outpatient ER visits per 1,000 Members** Federal Share of Expenditures $1,094,151,156 Inpatient Hospital Admissions per 1,000 Members Average PMPM $803.38 188,560 1,259.3 340.8 12% 6% Eligibility by Major Program 13% 53% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 13% 3% PeachCare Children Payments by Major Program 4% 14% 19% 24% 6% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults PeachCare Children 33% Category Pharmacy Inpatient Hospital Long Term Care*** Interventional Services**** Outpatient Hospital Physician All Other Total Expenditures by Major Categories of Service CY 02 Expenditures $391,442,665 $298,141,059 $279,025,498 $212,505,394 $155,030,727 $127,656,062 $178,895,146 CY 03 Expenditures $469,263,589 $362,616,170 $285,561,836 $280,183,071 $175,045,042 $131,085,948 $114,073,146 $1,642,696,551 6% 7% 26% 10% 15% 16% 20% $1,817,828,803 Pharmacy Inpatient Hospital Long Term Care*** Interventional Services**** Outpatient Hospital Physician All Other * Excludes SLMB and QI-1 eligibles as Medicaid only pays Medicare premiums for these categories. ** ER Visits include both outpatient ER visits and ER visits resulting in an inpatient stay. *** Includes private and state run skilled nursing facilities and intermediate care facilities. **** Includes waiver programs, children intervention services, community care program, PASARR, SOURCE, etc. Could be understated due to claims payment system issues. Data prepared by the GA DCH DSS Analysis Unit, 7/12/2004 Georgia Medicaid Elderly Medicaid covers the elderly (65 and older) who: Receive Supplemental Security Income (SSI) Lost their SSI coverage but keep their Medicaid coverage because of federal legislation Reside in the nursing home and meet the nursing home income and resource standards Need a nursing home level of care but can be cared for in the community with special home and community based services Are terminally ill Are entitled to Medicare and meet the income standards. These individuals receive help with their Medicare premiums, co-payments and deductibles only. Whose family income is over the limit but who have enough unpaid/incurred medical expenses to "spend down" the excess income and meet the income limit (Medically Needy) Georgia Medicaid Elderly CY 2003 (services incurred 1/2003 through 12/2003 and paid through 5/2004) Total Expenditures State Share of Expenditures Federal Share of Expenditures Average PMPM $1,039,533,176 $413,838,157 $625,695,019 $949.32 Average Monthly Enrollment Outpatient ER visits per 1,000 Members** Inpatient Hospital Admissions per 1,000 Members 91,253 648.3 287.4 Eligibility by Major Program 13% 12% 6% 53% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 13% 3% PeachCare Children Payments by Major Program 4% 14% 19% 24% 6% Medicaid Children Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 33% PeachCare Children Category Long Term Care*** Pharmacy Inpatient Hospital Physician Outpatient Hospital All Other Total Expenditures by Major Categories of Service CY 02 Expenditures $650,871,352 $170,524,317 $35,487,894 $24,550,341 $18,484,885 $107,921,641 $1,007,840,430 CY 03 Expenditures $708,957,822 $175,037,068 $33,633,402 $16,521,190 $17,836,460 $87,547,234 $1,039,533,176 8% 2%2% 3% 17% Long Term Care*** Pharmacy Inpatient Hospital Physician Outpatient Hospital 68% All Other * Excludes SLMB and QI-1 eligibles as Medicaid only pays Medicare premiums for these categories. ** ER Visits include both outpatient ER visits and ER visits resulting in an inpatient stay. *** Includes private and state run skilled nursing facilities and intermediate care facilities. Data prepared by the GA DCH DSS Analysis Unit, 7/12/2004 Georgia Medicaid Adults Medicaid covers the following adults: Pregnant women whose family income is less than 235% of the federal poverty level ($35,880 annual income for a family of three) Pregnant women whose family income is over the limit but who have enough unpaid/incurred medical expenses to "spend down" the excess income and meet the income limit (Medically Needy) Parents in families who have very low income Parents in families who have lost their Medicaid eligibility due to increases in wages or child support Georgia Medicaid Adults CY 2003 (services incurred 1/2003 through 12/2003 and paid through 5/2004) Total Expenditures State Share of Expenditures Federal Share of Expenditures Average PMPM $808,328,678 $321,795,647 $486,533,031 $391.27 Average Monthly Enrollment Outpatient ER visits per 1,000 Members* Inpatient Hospital Admissions per 1,000 Members 172,160 1,151.7 469.6 12% 6% Eligibility by Major Program 13% Medicaid Children 53% Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 13% 3% PeachCare Children 14% 19% Payments by Major Program 4% Medicaid Children 24% Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly 6% Medicaid Adults 33% PeachCare Children Category Inpatient Hospital Physician Outpatient Hospital Pharmacy Dental All Other Total Expenditures by Major Categories of Service CY 02 Expenditures $235,404,227 $166,255,760 $123,142,112 $65,151,558 $9,645,272 $62,203,138 CY 03 Expenditures $300,137,532 $190,972,965 $152,870,572 $85,085,646 $13,044,192 $66,217,772 $661,802,067 $808,328,678 8% 2% 11% 19% 24% 36% Inpatient Hospital Physician Outpatient Hospital Pharmacy Dental All Other * ER Visits include both outpatient ER visits and ER visits resulting in an inpatient stay. Data prepared by the GA DCH DSS Analysis Unit, 7/12/2004 PeachCare covers children: Georgia PeachCare for Kids Under 19 who have family income that is less than 235% of the federal poverty level, who are not eligible for Medicaid or any other health insurance plan and who cannot be covered by the State Health Benefit Plan. Georgia PeachCare for Kids CY 2003 (services incurred 1/2003 through 12/2003 and paid through 5/2004) Total Expenditures State Share of Expenditures Federal Share of Expenditures Average PMPM $247,522,402 $70,197,353 $177,325,049 $107.98 Average Monthly Enrollment Outpatient ER visits per 1,000 Members* Inpatient Hospital Admissions per 1,000 Members 191,030 407.1 18.6 Eligibility by Major Program 13% Medicaid Children 12% 6% 53% Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly Medicaid Adults 13% 3% PeachCare Children Payments by Major Program 4% Medicaid Children 14% 24% Medicaid Medically Fragile Children Medicaid Disabled Adults Medicaid Elderly 19% 6% Medicaid Adults PeachCare Children 33% Expenditures by Major Categories of Service Category Pharmacy Dental Physician Outpatient Hospital Inpatient Hospital All Other Total CY 02 Expenditures $42,492,893 $39,495,385 $40,207,058 $36,768,476 $16,718,829 $31,299,485 $206,982,125 13% 8% 22% 18% 19% 20% CY 03 Expenditures $56,472,956 $48,330,758 $46,809,910 $43,842,983 $19,362,454 $32,703,342 $247,522,402 Pharmacy Dental Physician Outpatient Hospital Inpatient Hospital All Other * ER Visits include both outpatient ER visits and ER visits resulting in an inpatient stay. Data prepared by the GA DCH DSS Analysis Unit, 7/12/2004