Minnesota’s biggest public health insurance program will take on a new shape after next year, when about 500,000 enrollees will be encouraged to develop a close relationship with a primary care clinic, while doctors, clinics and HMOs will be held more accountable for patient care outcomes.

The broad outlines of the concept, which would take effect for Medicaid patients in the metro area in 2019, were released last week by the Minnesota Department of Human Services. They continue a set of reforms designed to raise quality and cut costs in Medicaid. But they also could shake up the Medicaid market for thousands of people because hospital and clinic systems will have the option of serving patients directly without using an HMO as an intermediary.

“The goal is to strengthen the relationship between provider and the patient,” said Marie Zimmerman, the state’s Medicaid director.

“We want Medicaid recipients to have better health care outcomes,” added Nathan Moracco, assistant commissioner for health care at the Human Services Department.

For most enrollees, the front door to Medicaid has long been selecting one of the available HMOs, which for decades have administered care on behalf of the state. Generally, apart from the elderly and people with disabilities, most Medicaid enrollees were required to pick a managed-care HMO, such as HealthPartners or Blue Plus, to receive Medicaid benefits.

Under the new system, enrollees will first pick a primary care clinic, which in essence will become their medical home. If that clinic is part of one or more Medicaid HMO networks, enrollees will then choose which plan they want.

But clinics also will be able to choose to operate entirely outside of the Medicaid HMO system, instead receiving a monthly payment from the state to manage and coordinate the care of their Medicaid patients.

“In general there is a lot to like here and a lot to build on,” said David Zaffrann, health care program manager at TakeAction Minnesota. “Folks are much more likely to have a preference for their doctor or clinic based on where they live or based on past experience than they are to have a strong preference between big HMOs,” he said.

State Medicaid officials are seeking comments from health plans, health care providers, consumer groups and enrollees, and hope to have the details worked out by next spring, and then will seek proposals from clinics that want to serve Medicaid enrollees directly. Enrollees in MinnesotaCare, the state’s other large public health insurance program, will also be served under the new guidelines.

Expanding patient services

In addition, the state is exploring ways to pay for services not now covered by Medicaid that will help enrollees address some of the barriers that keep them from getting healthy. That could mean some sort of nutrition assistance, but it also could lead to greater use of community health workers, who typically make home visits to check vital signs, ensure patient compliance with medications or help them manage chronic conditions like diabetes.

“I think there is enough scientific evidence out there that they can start paying for that stuff,” said Deanna Mills, a consultant to a group of the state’s safety net clinics.

Another element of the proposal would eliminate the various drug formularies that Medicaid HMOs use in favor of one preferred drug list that all plans and providers would adhere to. That would mean that patients wouldn’t be forced to change drug brands like insulin or antidepressants if they change plans.

“Every time the plan changes, the formulary changes,” said Sue Abderholden, executive director of the National Alliance on Mental Illness-Minnesota. “That would be great because our folks have really suffered through different changes.”

The reforms are a continuation of what the state calls “integrated health partnerships,” or groups of providers working together to improve care. Under the current system, these partnerships are paid using money that first goes to the Medicaid HMOs.

The strategy has already produced significant results — a 7 percent reduction in emergency room visits, a 14 percent decrease in hospital stays — and has saved the state an estimated $213 million over four years.

But research has shown stubborn disparities in care — people on public health programs don’t get the same level of care as those on private commercial insurance.

For example, just 58.3 percent of children on Minnesota public programs received optimal asthma care, compared with 70.5 percent for those in private plans, according to Minnesota Community Measurement, which collects and analyzes data reported by clinics statewide.

Optimal care for diabetes and vascular care show bigger disparities, with 33.6 percent of diabetics on public programs getting optimal care and 52.3 percent of those with vascular problems getting optimal care — in both cases about 15 percentage points lower than similar people on private insurance.