July 31, 2014

State of Alabama
Press Release: Medicaid

Groups prepare to file applications for RCO probationary status

Representatives of the organizations wishing to apply for status as a probationary Regional Care Organization in Alabama met with Agency officials and consultants in Montgomery on July 22 to review the application process and receive preliminary data. Twelve organizations have submitted a Notice of Intent to apply for Probationary Certification.

Dr.  Don Williamson, chair of the Alabama Medicaid Transition Task Force, provided an update to the group on pending changes to the state’s Administrative Code and on decisions made thus far.  Most recently filed rules include provisions on network adequacy, provider standards committees and reimbursement rates.

Other key decisions have been made as well, he said, noting that a decentralized approach to claims payment and to data collection will be used although the Agency will need to determine how to access that data for its needs.

“We looked at centralizing claims payment and looked at the idea of centralizing data functions. After talking with the people interested in being Probationary Applicants, it was clear that they felt they needed both access to the data and to be able to process claims. Medicaid will need to figure out how to crosswalk that data because we will need access to common data sets so we can compare and contrast across RCOs.”

He also emphasized that RCOs will be required to serve patients throughout a region, and not just a subset of the region. “An RCO has to be able to serve patients region-wide, he said. “That may create some challenges, but it otherwise prevents cherry picking and adverse selection.”

Alabama Medicaid Medical Director Dr. Robert Moon provided clarification on submission deadlines and changes made to the online RCO portal to streamline the application process.         

Applications received by August 1, 2014, are eligible for probationary status as early as October 1, 2014. Applications submitted by September 30, 2014, may be granted probationary status by January 1, 2015, at the Agency’s discretion.

Probationary certification allows applicants to not only demonstrate their commitment to the RCO program, but also to manage a Health Home program in advance of full-risk requirements, Dr. Moon said. Medicaid’s Health Home program currently operates in four regions of the state to help Medicaid recipients with complex or multiple medical conditions improve their health outcomes while reducing the cost of care to the state.

Tim Doyle, senior actuary with Optumas, the Agency’s actuarial consultant, emphasized to the group that Alabama’s RCO program is unique compared to other states, with no other states operating a risk-based program in the same financing environment. 

“I want people to understand that there is a unique balance that we are trying to achieve between CMS requirements and the desire to transform the Alabama Medicaid program,” he said, noting that balance is also needed between federal requirements and the Agency’s financing system.

He also emphasized the dynamic nature of rate development. “There are still a number of components of the RCO program that are still under development. As we go through the rate development process to determine capitation rates, we will be in the in process of incorporating additional decisions so that we can match the rate to the risk,” he said.

  • For more information, visit http://medicaid.alabama.gov
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