Health-Based Payment for HIV/AIDS in Medicaid Managed Care Programs

Health Care Financing Review, Spring, 1998 by Richard Conviser, Sandy Gamliel, Lynda Honberg

(1) Per member per month, paid by the State.

(2) Inpatient care is capitated at an additional $657 per person per month. This expected inpatient hospitalization amount is placed in a risk pool, and any savings from the pool are divided between the State and the AIDS Healthcare Foundation.

(3) Enrollees may choose between a public and a commercial plan.

(4) This is the rate paid for AIDS patients to participating MCOs by CalOPTIMA, but CalOPTIMA does not receive this amount from the State.

(5) For the program's second year, which began July 1998, rates have been cut 25 percent, and the State is exploring adopting an HIV capitation rate.

(6) See Technical Note for lists of ICD-9 codes corresponding to definitions of active and advanced AIDS.

(7) See Technical Note for list of AIDS-defining ICD-9 codes,

(8) See Table 2.

(9) To be voluntary for the first 2 years of the program, then mandatory.

(10) Columbus and Cincinnati; Cleveland was also in the program originally but dropped out.

(11) There are 7 payment categories geared to prior year's expenditures for enrollee.

NOTES: AIDS is acquired immunodeficiency syndrome. CDC is Centers for Disease Control and Prevention SNF is skilled nursing facility HIV is human immunodeficiency virus, ICD-9 is the International Classification of Diseases, 9th Revision. MCO is managed care organization.

SOURCE: Conviser, R., Health Resources and Services Administration, Rockville, MD, 1998,

Massachusetts' program is the only one currently paying different capitation rates for people at different stages of AIDS. In general, clinical markers that indicate health status and that may be predictive of care costs for PLWH include CD4 cell counts and percentages (i.e., the proportion of all CD cells that are CD4 cells) as well as viral-load measurements. Historic information about enrollees' opportunistic infections can also be useful, along with information about comorbidities, including substance use, mental illness, and homelessness. Massachusetts' criteria for its AIDS rates include CD4 counts and percentages, as well as diagnoses of specific opportunistic infections, but not comorbidities; the one mental condition included in the criteria is AIDS dementia complex. More specifically, for MCOs to receive AIDS rates, they must document that enrollees have positive HIV antibody test results and CD4 counts below 200 or CD4 percentages below 14 percent, and the enrollees must have received treatment within the past 12 months for certain AIDS-related conditions. The State's distinctions between active AIDS, with a capitation rate of $2,300 per member per month, and advanced AIDS, with a rate of $2,998, are based on the conditions for which enrollees have received treatment, corresponding to specific lists of ICD-9 diagnostic codes (see Technical Note).

There is substantial variation in the rates shown in Table 1. Some reflects regional differences in health care costs, and some results from the inclusion or exclusion of protease-inhibitor combination therapies in the capitation rates. Maryland has excluded both the therapies and associated viral-load tests from its AIDS capitation rates--paying for these on a FFS basis--because it: had no historical data on which to base estimates. (In Arizona's Medicaid managed care program, which does not have a special AIDS rate, the State pays MCOs $634.50 per month for each enrollee with HIV documented to be receiving the them, pies and viral-load tests. In Wisconsin, for AFDC/TANF enrollees with AIDS, the State retrospectively adds FFS costs to the capitation rate it pays MCOs, effectively excluding people with AIDS from the managed care cost structure.)