PROVIDENCE – Some 30 minutes into the presser held by Gov. Dan McKee and Lt. Sabina Matos on Tuesday, June 22 at the State House, ConvergenceRI finally got to ask a question. The query focused on what promises to become an even bigger scandal than the ever-widening crisis now enveloping Eleanor Slater Hospital: how the social engineering of value-based care envisioned by the Reinvention of Medicaid through what’s known as accountable entities may be about to crash and burn.

The Governor replied that the next 100 days in office would be focused on digging into such problems, inviting ConvergenceRI “to share that information with us,” and then promising that his administration would respond.

“I don’t know the particulars that you are referring to,” Gov. McKee continued. “But yes, the answer is yes, those are important issues to talk about,” health care issues related to Medicaid spending.

ConvergenceRI, a bit stung by the response, suggested that the Governor read the next edition to find out more about the story.

ConvergenceRI then asked, in light of the continuing problems with Eleanor Slater Hospital, if Gov. McKee would consider conducting a state audit of private contractors doing business with R.I. Medicaid.

The entire exchange took less than three minutes; it was swallowed up and then washed away like a piece of kelp on a beach, lost in the news treadmill that is a high carbohydrate diet of a State House news conference. Perhaps it was the wrong place to ask such a question. But if not here, then where?

A school for scandal
The daily revelations of severe problems at Eleanor Slater Hospital keep reverberating, making for great headlines: the potential loss of accreditation by the Joint Commission; conflicting testimony given by doctors in a legislative Oversight hearing; decrepit conditions documented at the hospital buildings, raising safety concerns for the patients; the unauthorized transfer of medical information about a patient without consent; and alleged threats made by a nurse to a patient, including the use of the N-word. When it comes to scandal, who could ask for anything more?

Gov. McKee promised that an action plan, developed in concert with Secretary Womazetta Jones of the R.I. Executive Office of Health and Human Services and Richard Charest, the Govenor’s choice to become the next director at the R.I. Department of Behavioral Healthcare, Developmental Disabilities and Hospitals, will be released this week, in advance of the R.I. General Assembly adjourning its session.

The entire scandal revolving around Eleanor Slater Hospital is, in reality, grounded in problems with state spending on Medicaid. In the current $13.1 billion state budget for spending year 2022, Medicaid spending, including both federal and state dollars, makes up approximately one-third of the entire budget.

And, roughly one-quarter of the Medicaid budget goes to pay for long-term services and support -- to pay for Rhode Island residents in skilled nursing facilities and for community care, according to a state funding year 2019 expenditures report by R.I. EOHHS. [Editor's note: Numbers have been corrected.]

Since 2019, the state has been grappling with the apparent imbalance between psychiatric patients and medical patients at Eleanor Slater Hospital, resulting in the halt in billing to federal Medicaid for roughly $100 million in reimbursements to cover patient care.

In the initial state budget proposed by Gov. McKee, there were savings projected of some $40 million created by the potential reduction in the workforce at Eleanor Slater – savings that Gov. McKee later labeled as a “fairy tale.” [See link below to ConvergenceRI story, “Gov. McKee encounters the limits – call them ‘speed bumps’ – in governing.”]

The patients being served by the hospital system under the direction of R.I. BHDDH are some of the most vulnerable patients in Rhode Island, with the hospital serving as a place of last resort for many aging patients.

The past as prologue
In 2015, in the first signature initiative in the first term of former Gov. Gina Raimondo, the R.I. General Assembly enacted the Reinvention of Medicaid law, calling for the transformation of Medicaid away from a fee-for-service payment system to a value-based system, creating what were known as “accountable entities” for the managed Medicaid population, under the direction of managed care organizations, also known as health insurers.

In 2016, the initiative was funded with nearly $130 million in federal funds from the Centers for Medicare and Medicaid Services, which also expanded the number of managed care organization to include Tufts Health Plan, which joined UnitedHealthcare and Neighborhood Health Plan of Rhode Island as MCOs.

Under the direction of the R.I. Executive Office of Health and Human Services, a number of accountable entities were certified – including Blackstone Valley Community Health Care, the Providence Community Health Centers, an amalgamation of several community health centers, including Thundermist Health Center [which recently announced plans to withdraw from the group], Care New England’s Integra, Coastal Medical [now part of Lifespan], and Prospect Health.

The initiative was structured to be a four-year program, with the third year becoming the time when risk management would be introduced into the equation as a way to reward those accountable entities with the best performance data around quality and cost. That implementation was delayed a year because of COVID. [See link below to ConvergenceRI story, “A finger on the pulse of billions spent on health care in RI.”]

Despite the frequent praise showered on the efforts undertaken by the state agencies in charge of the value-based transformation, those involved with the day-to-day functioning of accountable entities offered a much different view: “Accountable entities give clusterf*** a bad name,” one physician told ConvergenceRI in 2019.

The math doesn’t work
The basic problem, it seems, is that the hospital-based accountable entities, which consistently have had the highest costs per member per month, have the best opportunity to recoup “shared savings,” based upon improvements in costs.

Those accountable entities with the lowest costs per member per month, however, had the least opportunity to achieve “ shared savings” based on improvements in cost – they were already doing a good job, because of years of experience.

Further, efforts to measure “quality” in 2020 as part of the process were disrupted by the coronavirus pandemic, which reduced utilization across the board, making it difficult if not impossible to discern quality measures by utilization.

The major problem with moving forward with accountable entities include:

• Once the initial $130 million in federal funding runs out, will the accountable entity program in Rhode Island be sustainable?

• The biggest component of Medicaid spending, long term services and support, does not have an accountable entity, in apparent contravention of state law.

• The latest data from cost trends analysis compiled by the R.I. Office of the Health Insurance Commissioner did not provide a transparent analysis comparing the performance of the different accountable entities. [See link below to ConvergenceRI story, “What do the cost data on health care really tell us?”]

• The latest data analysis offered by the R.I. Medicaid office on performance measures, shared on Thursday, June 24, appears to be meaningless, obfuscating the results.

As one source explained it, “Because the reference point for each accountable entity is different, and each accountable entity has their own benchmark, any comparison is not apples to apples.”

What needs to be published, and what Gov, McKee and his team need to be looking at carefully, are the benchmarks for each accountable entity -- along with the performance data.

If that were done, it would prove that the accountable entity program is not successful.

Translated, many of the existing accountable entities are actually costing the system money.

In other words, the highest cost accountable entities, which include the hospital-based accountable entities, are still costing the MCOs money relative to what they get paid by R.I. EOHHS.

Where do we go from here?
Even if the issues around Eleanor Slater Hospital are resolved by the Governor’s action plan, the efforts to “reinvent” Medicaid may still crash and burn, because the current system is built to tilt in favor of the higher-cost, hospital-based accountable entities, and punish the lower-cost, community health center accountable entities.

It is complicated, but ConvergenceRI looks forward to an opportunity to explain it in more detail to Gov. McKee, when we meet for a one-on-one, in-person interview.