State documents show little monitoring of Vermont's unique Medicaid managed-care spending

IndustriesAssociated Press

During the past decade, Vermont has spent $675 million setting up Medicaid managed-care programs but has done such a spotty job monitoring them that they can't even be audited.

That's the upshot from a letter state Auditor of Accounts Douglas Hoffer sent to lawmakers last week. It followed up on an internal report in January by the Agency of Human Services detailing gaps in answers to this question: Have the state and federal governments — and taxpayers — been getting their two-thirds of a billion dollars' worth?

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Nearly every Vermonter is touched, or knows someone who is, by the wide range of programs in question, Hoffer said in an interview.

"People with developmental disabilities, mental health issues, poor people who need some assistance, schools — these are programs reaching an awful lot of Vermonters," Hoffer said.

Vermont entered a unique arrangement with the federal government in 2006 called "global commitment," in which as long as it stayed under projected spending caps, the state would be allowed unusual flexibility in how it spent federal Medicaid dollars.

It was an ideal arrangement for a state where many politicians and activists wanted to expand health coverage to the uninsured while holding down costs — Vermont would become a laboratory for health reform.

While those efforts have unfolded, there has been an increasing focus on government accountability — checking up on programs to be sure the money being spent on them is bringing the desired result. The latest such effort was a "results-based accountability" law passed last year.

Last summer, then-Human Services Secretary Doug Racine decided to focus on the state's unique role as a Medicaid managed care organization.

Racine left his job in August, but the review he launched resulted in the internal January report, which was obtained by The Associated Press, showing many instances in which the tools of government accountability — performance benchmarks and data on whether they were being reached — did not exist.

"Good performance measures should be calculated using valid and reliable data available on a timely basis," said the report. Its writers examined practices at the Human Services Agency's departments: Children and Families; Corrections; Disabilities, Aging and Independent Living; Health; Health Access; and Mental Health.

"(Fewer) than half the departments provided results for their performance measures," the report said. The Health Department did so about 90 percent of the time, Mental Health did so 10 percent and Disabilities, Aging and Independent Living never did, it said.

Rep. Anne Donahue, R-Northfield, the ranking member of the House Health Care Committee, mentioned Hoffer's letter during House debate Friday on the state's general fund budget for fiscal 2016.

That "we don't have indicators or we don't even have targets, let alone assessing whether we're meeting those targets, is pretty startling," Donahue said in an interview.

The Department of Mental Health accounted for nearly 40 percent of the grants for "managed-care organization investments" in 2014. It got more than $39 million of $101 million distributed across the Human Services Agency.

The report said that 80 percent of the department's managed-care investments lacked performance targets, which it called "essential to performance measurement and improvement."

Deputy Mental Health Commissioner Frank Reed said the department is working to improve performance measurement. Trying to predict outcomes, and then comparing actual outcomes against predictions, is difficult in many human services fields, but especially when working with people who suffer from severe mental illness, he said.

"It's more challenging. I don't want to say it's impossible but it's more challenging," Reed said.

Susan Wehry, commissioner of Disabilities, Aging and Independent Living, said her department has more robust performance measures in place than it got credit for in the internal report. She said that is especially true for a program designed to help seniors stay in their homes.

Wehry acknowledged that her department has not been able to find reliable performance measures for its programs providing aid to the developmentally disabled.

In his letter to lawmakers summarizing the report, Hoffer said, "The Department of Corrections and Department (for) Children and Families had no targets, but did some tracking of results."

Hoffer concluded: "My office decided not to conduct an audit at this time because the (Human Services) internal review disclosed significant issues that would prevent us from assessing whether (Medicaid managed-care) investments had achieved the purposes outlined" in the state's agreement with the federal government.