Updated:

Mar 8, 2018

Original:

Aug 9, 2012

Minnesota pioneering new system for paying Medicaid providers

Minnesota is the first state to gain federal approval of a new system of paying hospitals and clinics that treat Medicaid patients. Officials say the system will reward providers that keep patients healthier and cut costs. When hospitals succeed in saving the taxpayer-funded program money, some of the savings will be shared with the hospitals.

Author:

Minnesota is the first state to gain federal approval of a new system of paying hospitals and clinics that treat Medicaid patients. Officials say the system will reward providers that keep patients healthier and cut costs. When hospitals succeed in saving the taxpayer-funded program money, some of the savings will be shared with the hospitals.

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The number of Minnesotans on Medicaid shot up at nearly twice the national rate over the past two years, while state costs soared by 40 percent to surpass $4 billion for the first time. There now are about 733,000 Minnesotans in the state-federal health insurance program for the poor -- called Medical Assistance in Minnesota -- an increase of 125,000 in two years, according to a new federal study.

The Dayton administration is asking the federal government to approve changes to Minnesota's Medicaid program that could save the state $151 million over five years, the Pioneer Press reports. Some of the savings would come through a proposal that asks the federal government to pay for state costs in mental health care, which the feds may not go for, one observer says.

A new federal analysis of hospitals, clinics, nursing homes and other medical providers ranks Minnesota's health care system the best in the U.S. The Star Tribune reports the state was first in care at medical clinics, fourth in care at hospitals, eighth in nursing homes, but 43rd in home health care. Wisconsin fell to second after it was ranked first last year. Iowa ranked sixth, North Dakota eighth and South Dakota 11th.

Add the Centers for Medicare and Medicaid Services to the list of federal agencies investigating the Medicaid program in Minnesota. The agency that runs the federal government's two key health insurance programs wants answers to questions about how Minnesota sets payment rates for managed care organizations in the state's Medicaid program.

Congress is seeking more information and documents from state officials into whether four HMOs artificially inflated Medicaid costs to illegally receive federal matching dollars.

Two powerful members of Congress sent a sharply worded letter to Minnesota Human Services Commissioner Lucinda Jesson, KSTP reports. They want Jesson to answer some pointed questions about Minnesota's $4 billion Medicaid program. Sen. Charles Grassley, R-Iowa, and Rep. Darrell Issa, R-California, fear the state has improperly received roughly $500 million in federal Medicaid reimbursements in the past decade. Jesson has said an independent auditor will look into it.

Minnesota Human Services Commissioner Lucinda Jesson took aggressive questions from lawmakers of both parties on her visit to Capitol Hill. Jesson was in Washington to defend Minnesota's handling of Medicaid, joint program of the state and federal governments.

Officials expected about 90,000 low-income families to sign up for Medicaid, but that estimate turned out to be too high. But advocates for those families tell the Pioneer Press the savings isn't necessarily a good sign; they say those families still need the help, they're just not getting it.

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