Mending, not Ending, Fee-for-Service for Children With Medical Complexity Free

Clinical programs have emerged to serve those children with medical complexity (CMC) whose needs are unmet in traditional health systems.¹  However, most payment systems are insufficient to sustain and scale this care model without another source of funds. The passage of the Affordable Care Act and the development of the Center for Medicare and Medicaid Innovation (CMMI) brought hope that newly developed alternative payment models would make complex care more financially viable by moving from fee-for-service payments, which typically pay little for non-face-to-face time, to risk-based payment structures such as shared savings and capitation that would potentially incentivize better care for lower costs.² 

In the current issue of Hospital Pediatrics, Corden and colleagues present a summary of the impact and lessons learned from a CMMI Healthcare Innovation Award to 2 Wisconsin Children’s Hospitals to expand services and develop a sustainable payment model for a subset of CMC with high levels of fragility whose needs were not already being met by another program.³  Using personnel cost information and a time study analysis of the effort required to provide complex care services, Wisconsin Medicaid began paying complex care programs that met specific service criteria $1144.20 for initial intake and $413.56 monthly after that for each enrolled child in addition to existing payments. As a result, the programs nearly quadrupled the number of patients served and became financially self-sufficient without institutional gap funding. The payment system proved durable, in place for 6 years, with rates further increased by 15% in 2022, long after the CMMI grant ended. A medical center not part of the CMMI grant started a new complex care program after Wisconsin began the new payment model. Enrolled families reported high satisfaction, with over 99% stating they would recommend the program to others.

The original intent was to create a shared savings model. However, in the second year of the project, Wisconsin Medicaid concluded that a risk-based payment structure would not work well because this population of CMC has extreme utilization risk that is difficult to forecast with a relatively small number of patients in a predictable way. Nevertheless, the supplemental fee-for-service payment adopted instead had benefits similar to those ascribed to global payments. Freed from the pressure to support the program's costs with episodic encounter billing, providers could devote the non-face-to-face time needed by patients. Despite the lack of risk in this payment model, pre and post methodology suggests savings to Wisconsin Medicaid primarily from a reduction in inpatient days, with caveats that regression to the mean may explain some of the savings. Wisconsin Medicaid acknowledged other potential benefits, such as keeping families in the workforce and children out of foster care.

Wisconsin's level of support for complex care programs may seem aspirational to providers and policymakers in other states. The programs had strong leadership with high levels of institutional support. Critical to success was a close relationship with Wisconsin Medicaid officials, who, through regular joint meetings, site visits, and participation in clinical huddles, saw first-hand the needs of children and families and the impact of complex care. The close working relationship between complex care providers and Medicaid officials in Wisconsin is one that other states should emulate.

The specific way Wisconsin paid for services may provide a path for advocates who wish to increase access to complex care in their states. Wisconsin made “targeted case management” funds available to clinical complex care programs by creating specialized codes that were compatible with existing electronic billing systems. Programs had to provide specific case management services and have monthly contact with enrollees to qualify for the payment. The services provided by the complex care programs were not duplicative of case management services offered elsewhere.

Case management is defined in the Medicaid Act as “services which will assist individuals eligible under the plan in gaining access to needed medical, social, educational, and other services.”⁴  Targeted case management enables a state to focus these services on designated population groups, such as CMC.⁵  These services are mandatory for Medicaid-enrolled children and youth under age 21 when medically necessary because of Medicaid's Early and Periodic Diagnostic, and Treatment (EPSDT) mandate. This mandate, among other things, establishes a national scope of benefits and national medical necessity standard by requiring coverage of “necessary health care, diagnostic services, treatment, and other measures described in [the Medicaid Act] to correct or ameliorate defects and physical and mental illnesses and conditions discovered by the screening services, whether or not such services are covered under the State plan.”⁶  Furthermore, state Medicaid agencies must affirmatively arrange for the services that children need.⁷ 

The tasks performed by the Wisconsin complex care teams included the creation and maintenance of comprehensive care plans, clinical team huddles, ongoing communications with multiple providers, interfacing with schools to arrange appropriate accommodations, and others. These typically unpaid essential services require specialized knowledge and skills⁸  and fall within the federal definition of case management. Indeed, a close examination of the guiding federal laws (eg, 42 U.S.C. § 1396n(g)(2)(A)(ii) and 42 C.F.R. § 440.169 [Table 1]) defines case management to be comprehensive, with child-specific assessment, care planning, and monitoring and follow-up. For children with highly complex and fragile conditions, provider-led case management is necessary to obtain the child-specific components, and it is distinct from case management that is provided by other entities (eg, managed care case management coordinating appointment times and transportation to medical services, Home and Community-Based Service programs arranging home nursing, Title V programs referring to supports and services). Because of the federal EPSDT mandate, case management services, including the type performed by provider teams in Wisconsin, must be covered for all Medicaid-enrolled children who need it.

Some may criticize Wisconsin for a narrow, deep focus on a subset of CMC with exceptionally high needs instead of a broader, but perhaps shallower, approach with a larger population. Indeed, other children also require additional support. However, CMC face disability-based discrimination in health care, fueled by clinician apathy, lack of knowledge, and negative assumptions about quality of life, resulting in substandard care, inaccessible care, and dehumanization.⁹  There is an urgent policy imperative to make the comprehensive care of this population sustainable so that CMC are not dependent on providers to donate time to meet their needs. Wisconsin should be commended for increasing access to complex care even if work remains for other children in the state.

The status quo - that many CMC only receive a medically necessary level of service if a local health system is willing and able to provide financial gap support or successfully adopts a risk-based payment structure - is discriminatory and inconsistent with federal EPSDT provisions. Wisconsin's effective approach of building on existing fee-for-service payment structures instead of waiting for them to be replaced is highly practical and worthy of adoption in other states. Regardless of the specific payment model, the level of service provided in Wisconsin should not be an aspiration, but an expectation, for Children with Medical Complexity.