This article contains information about Family Care that is pertinent to providers who are making the decision about whether to contract with Family Care/MCOs.  A future article will detail the reimbursement in Managed Care for assisted-living facilities and nursing homes, and other services covered by Family Care.

What is Family Care?

Family Care is a managed-care alternative for long-term care services.  It began in 2005, although there have been five pilot Family Care projects operating since 1999, and is currently being expanded statewide.

Family Care is a Medicaid-waiver program that is replacing the traditional Medicaid-waiver programs – Community Options Program (COP) and Community Integration Program (CIP) – which have been in place and managed primarily by counties in Wisconsin for many years.  Family Care could be a single-county program or a multiple-county program, called a district.  It is unclear how many districts will be formed from region to region in Wisconsin.

For many counties, the implementation of Family Care is several years away, possibly later than 2010.   Many counties will not know whether they are in a district – and if so, with which counties – for several years.

Who does Family Care serve?

The target populations for Family Care, as well as the services provided to those target populations, are limited.  They include services for the Medicaid-eligible elderly, physically disabled, developmentally disabled, and, ultimately, chronically mentally ill.  Family Care is not for younger populations, except for those who are physically disabled.  The primary receiver of Family Care is typically an elderly person.

Many of the Family Care programs that will be implemented over the next several years in Wisconsin will initially only include services for elderly and physically disabled.  Services for the other population groups will come online later, possibly 2-3 years after the program is initially implemented.

Family Care service packages include the traditional Medicaid-waiver services, as well as traditional Medicaid-card services.  Services that are typically covered by Family Care can include the following:

• Transportation and other ancillary services
• Personal care
• Home care
• Assisted living (care portion of the assisted-living rate)
• Nursing home care
• Other long-term care

Family Care does not include reimbursement for acute and primary-care services.  Acute and primary care are covered by other waiver programs, such as Partnership and PACE (Partnership for the All-inclusive Care for the Elderly).  You can find information about these programs on the Department of Health and Family Services website, www.dhfs.state.wi.us.

Managed-Care Organizations

The Family Care service packages are managed, provided, and coordinated by managed-care organizations (MCOs).  MCO is essentially another name for an HMO.  MCOs are responsible for:

• Contracting with the state Medicaid program.
• Providing Family Care benefits.
• Determining financial and functional eligibility for enrollees (the elderly, etc.).
• Providing enrollment system with appeal provisions.
• Assuring access to the system.
• Developing the provider network.
• Assuring that enrollees are provided with choices (i.e., vendors) for services.
• Accepting the financial risk to provide the services within the captitated rate from the state.

Providers contract MCOs directly; consumers (e.g., the elderly) do not.  Consumers’ relationship with the MCO is through the provider.  MCOs are required to identify a vendor network with the county or Family Care district to which they provide services.  MCOs are required to provide choices of vendors to the enrollees.  The network can include:

• Nursing homes
• Adult day care
• Assisted living
• Adult family homes
• At-home care agencies (home health and personal care)
• Transportation
• Many others

MCOs can be public or private entities.  The five pilot projects were all Family Care (Portage, Fond du Lac, Milwaukee, La Crosse, and Richland).  Several private MCOs are operating in Wisconsin.  Wisconsin will likely experience an increasing number of private MCOs taking over the Family Care programs in the future.

Implications for providers

For long-term care providers, including nursing homes, assisted-living facilities, personal-care agencies, home health agencies, and others that provide services for Medicaid-eligible seniors and persons with physical disabilities, there are implications related to the Family Care system. 

Here are some questions providers should answer before contracting with an MCO or before developing new or expanded services and options to contract with the MCO.

• Are the dollars sufficient to cover costs?  If a nursing home or assisted-living facility is contracting with the MCO, does the rate cover fixed and variable costs?
• Will the annual rate increases be sufficient to cover future costs?
• Will the Family Care expansion create extremely competitive environments for assisted-living and other long-term care services?  Will providers be able to compete?
• Can providers manage the 90-day grace period for payment from MCOs?
• Will nursing homes and assisted-living facilities want to contract with MCOs and deal with the requirements, audits, and other issues?
• MCOs will be looking for the lowest-cost options with the highest quality.  Will providers want to begin at-home services and other community-based services?  Can these programs be developed cost-effectively?  Are there sufficient numbers of these vendors available?  Should more options be developed?  Or is the market saturated?
• Can providers provide low-cost care without significantly impacting the high quality of care?
• Will the MCO even contract with the provider, or is the provider considered “higher cost?”
• Will providers be able to recruit and retain staff under the MCO reimbursement rate?
• How will providers deal with multiple MCOs?  If providers have multiple campuses, this may be a reality.
• Contracts may not be negotiable.  Will providers want to participate in an environment where rates are potentially dictated and not negotiated?

These are only a few of the questions relating to the implications of Family Care.  You can learn more about the Family Care program on the DHFS website, http://dhfs.wisconsin.gov/ManagedLTC.

The next article will focus on the reimbursement structure of the Family Care program.

Additional information

If you have questions or would like additional information, please contact Michael Edwin at medwin@wipfli.com or 608.270.2903 or visit www.wipfli.com/healthcare.