And Then There Were 10: Reducing the Number of MCOs?

And the mental health system spirals downward….

There is talk that Western Highlands, the Managed Care Organization (MCO) currently servicing eight Western North Carolina counties, Buncombe, Henderson, Madison, Mitchell, Polk, Rutherford, Transylvania and Yancey, will be the next casualty to the MCOs.

The MCOs, formerly called local management entities, are the regionally-based agencies that receive a set monthly payment from the state to provide both state- and Medicaid-paid services. With that money, the MCOs must allot services for everyone under their care.

Rumors at the Capitol is that Western Highlands may be swallowed up by Smoky Mountain Center, the MCO regionally adjacent to Western and servicing 15 counties.

Currently, Western Highlands has no CEO.  No Chief Financial Officer.  And the Chief Medical Director is near-retiring.

But the lack of leadership is not the only issue with Western.

Health care providers have complained that the majority of authorizations for new services or renewed services are being denied by Western.

The whole point of the MCO-based Medicaid system is to allow the state to dole out chunks of Medicaid funds to each MCO.  Then the MCO approves services for Medicaid recipients until the money runs out.

Considering this is only the 2nd year Western Highlands has been servicing  the 8 counties, it seems a bit odd to be denying so many services, if this is actually happening.

Here are the current MCO jurisdictions:


Another rumor is that the goal is for the number of MCOs to be in the single digits.  Who is next???

If the next casualty MCO is the MCO least-competent, maybe NC leaders should begin planning for a different mental health system….without MCOs.

So far, it appears that MCOs have all the Medicaid funds for mental health with zero guidance from the state.  See my blog: “NC MCOs: Accountability Must Be Somewhere.”

So is it good or bad that Western Highlands may be swallowed up? I don’t know. How competent is Smokey Mountain Center?

About kemanuel

Medicare and Medicaid Regulatory Compliance Litigator

Posted on March 8, 2013, in Affordable Care Act and tagged , , , , , , . Bookmark the permalink. 11 Comments.

  1. Personsally, I have believed for some time that until we have a small enough number that the Division and DHHS can maintain accountability for management results (in terms of service outcomes and service AND OTHER COSTS), we will remain at risk of being spanked big time by CMS. I know there have been others in the administration who have felt the same who are no longer working in Raleigh. Historically, our state has a poor track record for accountable, transparent, effective management–or for demanding the same from the LMEs. Minimizing numbers of MCOs and allowing ONLY THE BEST to continue–will at least improve our odds.

    Excited to see this blog site!

  2. Thanks, Laurie. I completely agree as to the need for the Division to be able to provide proper supervision.

  3. Leslie G. Huntley

    Since Laurie C has no inside information as to the events that brought WHN to this point, it would be nice if she could restrain herself from comment. Unless and until the blogger also has detailed information, perhaps she should restrain herself from commenting.

  4. Leslie G. Huntley

    Go right ahead, but do talk to folks at WHN.

  5. Questions have emerged in the ‘Comments’ section of this blog as to whether “Smoky Mountain Center LME will be able to handle Western Highlands Network’s deconstruction” (to put it subtly). I have no ties w/ either LME. I am a psychologist provider who has interfaced w/ both entities for over 10 years.

    Here is my experience: WHN LME: excellent board; obstreperous board’s attorney who tried to silence me during board meeting of WHN LME summer of 2012 when I named names within WHN LME associated with people that would not return phone calls and were not helpful; extreme inability to interface efficiently with anyone working there. It took WHN LME over one year to process this 10 yr Medicaid provider’s reapplication for a lesser status Out of Network Provider application. Two weeks ago, WHN LME sent me a letter demanding that they ‘come to my office and look it over.’ In that I see my clients in their homes, I invited them to come with me to see a client or two. They have more recently asked me to sign a new contract with them and this is, of course, associated with the change in the CPT codes which were created by the American Medical Association as of 1.1.2013. I have not signed it as I have an In Network Provider status with SMC LME.

    Here’s my experience w/ SMC LME: years ago, as associated with the state funded client brouhaha, I had a state funded client (remember: NC Mental Health Reform was to create coverage for ALL NC citizens) that they ran me around on re: simply not wanting to pay for her mental health therapy. I became so disgusted with their treatment of the client and myself that I took the mental health records to the house of the Social Security Administration adjudicator so that she could receive Medicaid. She did. I swore I would have as little to do w/ SMC LME as possible. However, SMC LME, as do all the other LME’s now manage NC Medicaid re: mental health services. With Brian Ingraham as CEO (I have no ties w/ him..have never met him) at the helm, SMC LME has done an excellent job of informing providers of what’s getting ready to take place; they quickly and efficiently processed my Medicaid provider re-application; they have assigned all providers a point person who quickly answers questions. YES, they should be taking over WHN LME.

    Remember: WHN LME is the entity that about 8 years ago was caught up in the collapse of a company that was insuring 10,000 lives re: mental health services. They had their CEO, Arthur Carder fired by the board about six months ago due to money issues; there have been nothing but complaints from every single provider with whom I am familiar who interfaces with WHN LME.

    PLEASE allow efficient SMC LME to take over the functioning of the collapsing WHN LME and diminish the suffering of both clients and providers alike.

    Marsha V. Hammond, PhD, Licensed Psychologist, Asheville,NC

    • Dr. Hammond, Thank you for your extremely well-thought-out reply. When I started this blog, I hoped that providers, such as yourself, would make comments. Most likely, you have more experience with both MCOs than those of us located in the middle region of NC. I would love to hear more from you. I’m curious as to the differences in the MCOs across the state. Thank you again.

  6. Dear Ms. Emanuel: thank you for your blog.

    The reason you do not hear from providers is that they are terrified that the LME’s will create problems for them. A case in point re: Western Highlands Network LME and myself: they have done nothing but be obstructionistic re: all paperwork and phone calls and e mails I have made to them. The Board is excellent, this being said. But their hands are tied as to the everyday functioning of the LME. I have no idea how obstructionistic they are towards other providers but I can tell you that providers come to me in private and verify what I am stating on my blog about the dysfunctional system that NC Medicaid has come to be.

    For instance, at a larger level: when Hewlett Packard Enterprises was operating the billing arm of Medicaid—-until about a year or so ago—-, all I had to do was to go online, taking about 5 -10 minutes to fill in almost a month’s worth of Medicaid billing. Voila: off to HP; check dropped into my account as they stated.

    The authorization arm of Medicaid was Value Options. One page needed to be sent to VO after the 8 unmanaged adult visits (more for children/ adolescents and then a necessary authorization request for more sessions). They gave me the sessions I needed for the REST OF THE YEAR. I didn’t always use all of them. I simply put them into place in accord with how I had been seeing the client for the first two months of the year.

    NOW—-under the LME management, I have to go online with some password—to SMC LME or WHN LME (have essentially given up on them)—to an authorization site which last fall DID NOT WORK. So, SMC LME, in its efficiency, told me to fax in the paperwork. I did that they gave me what I asked for.

    But its ALL THE EXTRA STEPS that are now demanded re: Medicaid authorizations that is doing nothing but creating administrative positions and NOT direct care to the clients.. So, the Medicaid money is being devoured by the administrators e.g., the LME’s. Oh, did I tell you that we need a ONE PAYOR SYSTEM? That would be the very efficient Medicare. For everyone.

    ADDITIONALLY, when HP and VO were managing NC Medicaid, there was an automatic wrap-around from Medicare to Medicaid. This meant that my biller needed to submit only one bill. Now, my biller has to submit to Medicare. Then I have to copy the Explanation of Benefits (EOB’s) to my biller who then puts that amount paid into her software and charges me another fee to bill the LME’s. The problem is not with my biller. The problem is with the lack of efficiency which has been mutilated and destroyed.

    And mark my word, when Lanier Cansler did his revolving door thing AGAIN—-as he had just as Perdue was coming in as governor of NC—–he has set up a “consulting company” that is mining all the connections he created when he was head of NC DHHS. Consult my blog for details on that by entering: “Lanier Cansler Madame Defarge” into your search engine. Its documented in the press. I didn’t make it up.

    Marsha V. Hammond, PhD

    • Wow. You and I should talk.

      Fear has been a constant reason that my client-providers have not made a move. They don’t want to “rock the boat” for fear of backlash. But that is not ok. The MCOs need to be supervised and run properly. The health care providers need to be heard. This is the purpose of my blog. I sincerely thank you for commenting and caring.

      BTW: I saw your blog, but I did not see a button that would allow me to follow it. Am I missing something?


  7. First I must say that I thoroughly enjoy your informative blog. Thank you for shedding light on our broken mental health system. Our agency provides services in the east. Let me tell you what our MCO (ECBH) did when they experienced cost overruns. First, they launched an aggressive post payment review campaign to recoup money from their providers. Second they began to deny authorizations. Now the provider network is on life support but no one is talking. Why? Well a number of us were told during a community collaborative meeting last year that “If providers didn’t play ball they’d be kicked off the network.” In our area schools, DJJ, DSS, and most importantly, our individual consumers are frustrated. No one at the Division of Mental health has asked any of us how things are going under the waiver and we haven’t heard a peep from Mercer. The state better get ready to take over the provision of mental health services in our area because ECBH has destroyed this network. I understand one of the purposes of the waiver is to limit/reduce the number of provider agencies. The problem now is even the good providers are going under. Thanks again for your blog!

  8. Thanks for your comment. From what I have been hearing, the MCOs across NC are behaving similarly. Something has to happen. Someone has to challenge the lack of supervision from DMA over the MCOs or, you’re right, thousands of mentally ill Medicaid recipients will have no providers. Shame on DMA for implementing a process in mental health and then walking away, providing no supervision.

Leave a Reply

%d bloggers like this: