LINCOLN — Nebraska’s new system for administering the bulk of its Medicaid program has gotten off to a rocky start.

Nearly five months after its launch, the system has left behavioral health and home health providers fuming over unpaid claims and frustrated about getting care authorized for patients.

Unpaid Medicaid claims topped $300,000 for one agency, prompting it to take out a line of credit for the first time in its 44 years.

Providers also are worrying about how long they can afford to keep seeing Medicaid patients.

Annette Dubas, executive director of the Nebraska Association of Behavioral Health Organizations, said the problems have gotten to the point where they are jeopardizing the state’s behavioral health services.

“These are some pretty serious issues that have gone on too long,” she said. “It’s time to pay attention.”

But Calder Lynch, Nebraska’s top Medicaid official, said his staff and the staff at the three managed care plans are working to identify the problems and get them fixed. He rejected the idea that services are in jeopardy.

“I understand the urgency that providers feel when it comes to things like cash flow and ability to serve their clients, and we’re keeping the pressure on ourselves and on the plans” to address issues quickly, Lynch said.

Under the new managed care system, called Heritage Health, the state contracts with three companies to administer physical health, behavioral health and pharmacy services for nearly every Nebraskan covered by Medicaid.

The companies — UnitedHealthcare Community Plan, Nebraska Total Care (Centene) and WellCare of Nebraska — handle some $1.2 billion worth of Medicaid services for nearly 227,000 Nebraskans. As in the private insurance market, these three companies authorize and pay for care.

Managed care is not new for Nebraska Medicaid, either for physical or behavioral health. But Heritage Health marks the first time that the two are being managed together.

Lynch, the director of Medicaid and long-term care services for the Nebraska Department of Health and Human Services, said the goals are to improve care for patients, control the growth of Medicaid costs and make state government more efficient.

He said state officials anticipated the change would be more difficult for behavioral health providers, based on the experiences of other states.

Most of the problems being reported are among behavioral health and home health care providers. But others have experienced difficulties as well, including one rural hospital whose payment check from one of the Medicaid managed care companies bounced.

Andrea Joyce, an Omaha-area mental health therapist who sees mostly foster children and their families, said she has been struggling for months to get paid for her services but is still owed thousands.

“It’s really just random what they decide to pay for,” she said.

More recently, she said, she has started seeing effects on clients, some of whom have stopped taking medications because the drugs were not authorized for payment.

Other clients have not gotten authorization for services required for reunification. In one case, Joyce said, seven members of a family were OK’d for therapy but not the remaining two. While providers can appeal the denials, it takes time to work through the process.

CenterPointe, a behavioral health treatment center with programs in Omaha and Lincoln, has been fighting many of the same battles, according to Chief Executive Officer Topher Hansen. Problems include delayed payments, wrong payments, inconsistent answers about submitting claims and difficulties getting care authorized.

The treatment center is the service provider that had to take out a line of credit after bills went unpaid by the three companies operating Medicaid managed care for Nebraska.

“They’re screwing things up every which way they can,” Hansen said. “The errors are over and over and over again.”

While Joyce has seen impacts on people receiving care, Hansen said he is not aware of clients being affected. Neither is Janet Seelhoff, executive director of the Nebraska Home Care Association.

But Seelhoff said home health care providers have faced problems in getting services authorized and claims paid. She said the problems have gotten to the point that providers asked her to help advocate with the state.

“The top priority for our members is making sure we’re getting reimbursed,” she said. “We don’t want it to get to the point where providers have to stop providing care.”

Cindy Kadavy, senior vice president of the Nebraska Health Care Association, which represents nursing facilities and assisted living facilities, said members have encountered problems getting approval for residents’ physical, occupational and other rehabilitation therapy.

She cited one case in which a patient had to spend extra days in the hospital because of the time it took the managed care plan to authorize therapy in a skilled nursing facility.

Lynch, with HHS, said Medicaid officials know from talking with providers and tracking a multitude of performance measurements that Heritage Health has had problems in some areas.

“Sometimes they’re very discrete. It’s one provider, one claim that we need to get figured out … and get corrected,” he said. “Sometimes it’s a little more systemic. Either way, we’re working with plans on a daily basis.”

But Lynch said he believes that the state and the managed care companies are making progress. When computer problems caused one company to fall behind in paying claims, for example, the company added staff and shifted others to catch up.

Many problems stem from bringing behavioral health under the same umbrella as physical health and from bringing new groups of Medicaid patients into managed care, he said.

As an example, he said home health care providers were affected when people who are eligible for both Medicare and Medicaid were included in the new system for the first time.

Home health care providers used to bill Medicaid directly for certain services, he said, but the three companies were requiring them to bill Medicare first and bill Medicaid only after Medicare denied the claim. Lynch said the state is now directing the three companies to drop the Medicare-first billing requirement.

Lynch said the Heritage Health companies are picking up the pace on claim payments. The companies paid out $120 million through the first three months of the year. As of Friday, just six weeks later, they had paid out an additional $110 million.

But the companies have not done as well with behavioral health. Lynch said the companies are averaging $6.6 million in monthly payments for behavioral health services, well below the $7.5 million average previously, he said.

“I think we’ll work through these issues, the claims system will stabilize and we can refocus on some of the promise of integration,” he said., 402-473-9583

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