Kaiser Family Foundation Survey on State Medicaid Managed Care ...

Dental care and outpatient and inpatient behavioral health services are the Medicaid services mostoften carved out of MCO contracts. A substantial majority of the states with MCOs (25) reported thatthey carve dental services out of their MCO contracts (Figure 6). Five of these same states also reportedthat they have a dental PHP. Twenty-one states with MCOs reported that they carve out some or alloutpatient and inpatient behavioral health services, respectively. Six of these states reportedcontracting with PHPs for these types of services. In MCO states that do not contract with PHPs toprovide services that are carved out, these services are delivered and financed through the traditionalfee-for-service system.Figure 6Acute-Care Benefit Carve-Outs in Medicaid MCOsDental careOutpatient behavioral healthInpatient behavioral healthOutpatient substance abuseNon-emergency transportationPrescription drugsInpatient detoxificationVision careOtherNumber of states reporting carve-out:Note: 36 states contract with MCOs.SOURCE: KCMU/HMA <strong>Survey</strong> of Medicaid Managed Care, September 2011.512Non-emergency transportation andpharmacy services are also commoncarve-outs. Almost half the states withMCOs provide non-emergencytransportation outside their MCOcontracts, usually on a fee-for-servicebasis or through a brokeragearrangement. Nearly as many reportedthat they carve out prescription drugspartially or completely. For example,California carves out only antipsychoticmedication and HIV/AIDS drugs andKansas carves out only hemophilia factordrugs. Other services reported as carveoutsby a limited number of statesinclude vision care, school-based healthservices, early intervention services, and abortion services. A variety of other carve-outs were alsoreported. For example, Nevada carves out orthodontia services, and Missouri carves out transplantservices, child abuse-related exams and diagnostic studies, environmental lead assessments for childrenwith elevated blood lead levels, and home birth services.Appendix 6 provides state-specific detail on MCO acute-care benefit carve-outs.151617192121Several states with pharmacy or other benefit carve-outs are carving these services back into theirMCO contracts or plan to do so. Because the ACA now permits states to collect rebates on drugspurchased for Medicaid beneficiaries by MCOs, states have less of an incentive to carve out pharmacyservices. Indeed, to improve coordination and integration of care, several states that previously hadpharmacy carve-outs have carved the pharmacy benefit back in or are considering doing so. In 2011,states that plan to reverse a pharmacy carve-out include New York and Ohio. Texas plans to carveprescription drugs back in into MCO contracts in 2012. Some states reported that they were alsoconsidering carving back in other currently carved-out services. For example, West Virginia indicatedthat it was considering including behavioral health services and children’s dental benefits in its MCOcontracts. Similarly, South Carolina reported plans to carve in inpatient behavioral health services inApril 2011 and outpatient behavioral health services beginning April 2012. New York, New Jersey, andTexas also reported plans to move additional services into their capitated plans.MCO network adequacy and access to careFederal regulations require states to ensure that covered services are available and accessible to allMCO (and PHP) enrollees through a requirement that each plan “maintains and monitors a network of2525