Orange-based CalOptima is intensifying its work with providers to tackle a tighter government regulatory landscape.
The public-private partnership serves more than 600,000 Orange County residents ranging from seniors to young families to “working poor” people who are receiving health coverage under reform. It pays hospitals and doctors through Medicare and Medi-Cal government health program funding.
“Almost everyone who is on some public insurance product is a CalOptima member now,” said Mike Ruane, the agency’s chief of strategy.
CalOptima is also facing more regulation under federal healthcare reform.
New Department
Steps that CalOptima has taken include creating a new audit and compliance department that will provide a heavier layer of oversight of the 11 networks and more than 6,700 affiliated doctors that care for its members. It previously covered oversight through executives scattered over various departments.
“One of the structures I want to build into the process is obviously doing more oversight and monitoring of our provider networks and ensuring that the provider networks are in compliance with all of our contract requirements, whether federal or state,” said Sun Janicek, the unit’s new director.
“We’re shifting into this new environment where different types of services are being offered to our indigents. With that comes a lot of regulatory oversight,” said Janicek, who started at CalOptima in June. She previously served as director of oversight and compliance at Tampa, Fla.-based WellCare Health Plans Inc.
CalOptima is centralizing its entire audit and monitoring work into Janicek’s department. That includes getting more of what she called “subject matter experts” on aspects of provider networks that will face increased oversight.
Janicek said her department will make sure there are “repercussions” for provider networks that remain noncompliant after intervention.
“We’re going to work with them as much as possible on remediating any type of deficiencies that we find during any type of monitoring or audit activities.
“But obviously, now we have to come into a realm where CMS is coming down on us—we kind of need to roll that down to our providers,” she said, adding that if a provider is noncompliant, unspecified sanctions will be applied.
And CalOptima is putting teeth into its new efforts. It recently warned some of its vendors that they need to improve their performance or possibly lose their contracts. The agency’s board of directors has indicated it will seek repayments from 11 health networks for some costs related to compliance training.
CMS is the federal agency that oversees Medicare and Medicaid, the latter of which also receives federal and state funding and is known as Medi-Cal in California.
“CMS is taking a more aggressive posture in enforcing rules that have been on the books for some time … as well as increasing expectations,” Ruane said.
Regulators “want assurance when they’re not here and they’re not doing an audit, that there’s oversight. That’s really the big shift,” he said, adding that the new conditions are not unlike restaurant inspections.
At the same time, CalOptima wants to reduce the burden on some of its smaller doctors’ groups that are new to CalOptima and may not have experience with multiple insurers.
“We are reliant on an entire network of small, as well as large, groups. We need to bring them all up to the same level,” Ruane said.
Besides regulations, CalOptima has tried to assist its doctor networks with issues such as using funds to provide personal care coordinators who help some of the agency’s more vulnerable patients with things like health insurance and advocating for their needs.
“Coverage doesn’t mean access to the providers who are near to you. You’re challenged with transportation, scheduling,” said Ruane, who pointed out that many CalOptima members don’t have their own cars and are dependent upon public transit.
CalOptima is informing its network doctors about the regulatory landscape through what Ruane characterized as “classic change management.” It has published articles in provider newsletters, met with chief executives and other leaders of its provider networks, and had “frequent, ongoing discussions” at the staff level about the changes.
CalOptima was established in 1993 and is one of six “county organized” health systems in the United States. Besides its networks and affiliated doctors, it also has 30 hospitals that take its patients.
Its membership generally falls below 138% of the federal poverty level and has grown by more than 100,000 members since the start of the year due to federal healthcare reform.
“Most people are not aware in the business community that the poor and indigent in this county are served through a public-private partnership,” Ruane said. “We don’t have a county hospital, we don’t have a public system, and that’s just a given … the environment we’re living in.”
Orange is one of three counties in California without a public hospital.
CalOptima is also not part of Covered California, the statewide insurance exchange, Ruane pointed out.
Its new regulatory department is one of several changes that have taken place at CalOptima in recent months.
It said in March that it was creating the CalOptima Community Network for small providers after it identified the needs of its existing health networks and other stakeholders.
The agency said town-hall-style meetings it held with nonaffiliated doctors “revealed the necessity to reduce complexity in the healthcare systems” for small medical practices and individual doctors.
It said that “by allowing these doctors to contract directly with CalOptima, more doctors may choose to serve patients in managed care.”
