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Medicaid payment issues plague host of Colorado caregivers and therapists who see low-income and disabled patients

The state Medicaid division is facing complaints about contractors on multiple fronts, from mental health to in-home caregivers for people with disabilities

Carla D’Agostino-Vigil, clinical director at Ignite Counseling Colorado, speaks during an employee meeting Feb. 23, 2022, in Westminister. D’Agostino-Vigil is one of Colorado's mental health providers who has grown frustrated with billing issues with the state Medicaid program. (Hugh Carey, The Colorado Sun)
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Payment issues in Colorado’s Medicaid system extend beyond mental health therapists who’ve been raising alarm for months that they aren’t receiving timely reimbursement for seeing patients who are low-income or have disabilities. 

As the state Department of Health Care Policy and Financing tries to tamp down a string of payment debacles with mental health professionals, some home health caregivers, speech therapists and others say they also have struggled to get authorization, including for services for children with severe disabilities who live at home.

The department, which oversees the state Medicaid government insurance program, held a virtual listening session last week to hear from home health providers who described chaos and frustration that began last year when the department’s new contractor took over. The vendor, a national company called Kepro, handles prior authorization requests submitted by home health providers, speech pathologists, physical therapists and others for the Medicaid program.

Piles of requests have been denied or delayed, the providers say. For now, state Medicaid officials have put the requirement for prior authorization of services on pause while they sort out the reasons for delays and how best to meet federal guidelines, state officials said. The department said only about 10% of claims are getting denied for clinical or administrative reasons, meaning 90% of the claims are processed without issue. 

Home health caregivers who spoke at last week’s meeting with Medicaid officials, and later to The Colorado Sun, said they have little confidence the department is on track to fix the problems. 

In one case, it took a speech language pathologist 50 days to get approval for a prior authorization request, which is required by Medicaid. Instead of leaving the patient, who has a communication disorder, without care, the therapist did 14 therapy visits without knowing whether they would get paid. That was a potential loss of $1,200. The contractor is supposed to respond to prior authorization requests within 10 days.

In several instances, home health providers said that, before the pause on prior authorization requests, they were denied authorization for pediatric nursing services for children and teens who need help eating, bathing and using mechanical lifts to get out of bed. 

The delays and denials aren’t just a headache, but are also affecting kids who often receive two to five visits each day, said David Bolin, with Colorado Long-term Assistance Service Providers, which has home health agencies for adults and children in Grand Junction, Windsor, Greeley, Denver, Colorado Springs and Larimer County. 

“This is a big issue that affects the health of children and could very well put a number of kids in the hospital at a much higher cost than what Kepro is saving,” he said. 

“You need to bring in the experts. You know who the experts are? They’re not at the department.”

Carla D’Agostino-Vigil, clinical director at Ignite Counseling Colorado, goes through her thoughts while speaking during an employee meeting Feb. 23, 2022, in Westminister. D’Agostino-Vigil decided to stop taking Medicaid patients after numerous issues trying to get paid by one of the state regional entities that handles billing. (Hugh Carey, The Colorado Sun)

Within 15 days of the new contractor’s start, many children who had received nursing services for years were denied those services, and for those who received approval, the authorization was limited to 60 days — not a year as had been the case in the past, Bolin said. 

The temporary suspension of prior authorization requirements effective Nov. 1 is for pediatric long-term home health providers, as well as physical, occupational and speech therapists. The fact that authorizations are paused is telling, Bolin said in an interview. 

“Doesn’t that tell you that you’ve got a contractor problem? That’s what it tells me as a taxpayer,” he said. 

Another home health provider, Donna Floyd, told Medicaid officials that families are frightened the delays and denials will cause them to lose services. The transition to the new contract, which began last summer, included no live test to make sure it would work and has been a disaster, she said. 

“This one has been horrifically worse than any before,” said Floyd, who has worked in the industry for 20 years. 

The executive director of the Colorado Department of Health Care Policy and Financing told The Sun that the reason prior authorizations are on pause is that the state is trying to figure out how to stay in compliance with federal guidelines regarding parents who care for children with disabilities. Federal law allows parents to work as certified nursing assistants for their children with disabilities instead of having workers come into their homes multiple times per day. But federal regulations, in place for years, say that parents serving as caregivers cannot receive reimbursement for their children’s personal care.

After prior authorizations for services were on hold during the pandemic, the state is now trying to get back into compliance with federal guidelines and figure out how best to reimburse parents who are working as their children’s caregivers.

“This is a very important issue to us and we want to make sure that we are very responsive,” said Kim Bimestefer, the department’s executive director. 

Kim Bimestefer, the executive director of Colorado’s Department of Health Care Policy and Financing, speaks at a news conference unveiling a report on prescription drug costs, on Dec. 12, 2019. (John Ingold, The Colorado Sun)

She bristled at a question insinuating there were problems with the new contractor’s rollout, saying the issues have to do with staying in federal compliance.

“That’s an assumption,” she said. “I would like to invite you to correct that assumption.” 

The department contracts with private companies to handle administrative and billing for various service providers in Colorado. There is one contractor to process claims from medical offices, another to handle home health and other community therapists, and five regional companies that dispense reimbursements to mental health professionals who care for patients on Medicaid. Kepro, the new contractor for home health and community therapists, took over in March 2021 after the previous vendor, eQHealth, failed to meet contract obligations, the department said. Kepro works with Medicaid services in 30 states.

“We will outsource things when it’s more cost-effective and the expertise is better than if we were to try to build it in house,” Bimestefer said. “Remember we are paid for by taxpayer dollars. We always want to find the efficient way to get the results and functions in the market.” 

The majority of claims are working fine, she said, saying the service providers and therapists who are complaining about billing issues are a small fraction of the 80,000 Medicaid providers in Colorado. The meeting last week for home health workers included 145 participants. It was one of five virtual meetings scheduled with five types of service providers during the past few weeks to discuss processes with the new contractor. 

“We are trying to do the right things,” Bimestefer said. “If we are struggling a little bit, you have our commitment and we’ve made it to our providers, we will get under the hood and figure out what those issues are and address them appropriately.” 

In the past few months, home health providers have been complaining to the Medicaid division and some have written letters to Gov. Jared Polis. In a January response to the providers, the department’s Anne Saumur, who is director of cost control and quality improvement, acknowledged delays occurred when the new contractor started but said the issues were resolved. 

“The department acknowledges that during the initial implementation with Kepro, timeliness standards were not met,” Saumur wrote, saying the delays were due to a large volume of requests. “Kepro quickly addressed and fully resolved timeliness concerns.”

In this week’s meeting with home health workers, department officials said it was unlikely that they would resolve the issues and resume the prior authorization request requirement by June 1 as previously planned. They’re now aiming for August or beyond. 

The problems with Medicaid come at a time when state officials, including the governor, have made it a priority to add low-income Coloradans to the Medicaid program. In the mental health field, frustration has reached a boiling point for many, and some have said they quit accepting patients on Medicaid because they can’t afford the hassle of dealing with the state’s contractors for the behavioral health system, called Regional Accountable Entities.

Sen. Chris Kolker, a Democrat from Centennial, is among those fired up about the billing issues and said he is working on legislation that would set time restrictions on when contractors could try to take back reimbursement they already paid out for services, which one contractor attempted to do last fall. 

The senator sounded off on representatives from the Department of Health Care Policy and Financing as the department asked the legislature’s Joint Tech Committee for funding of various programs. Kolker said he was so upset about the mental health provider issues that he would not vote to approve any requests from the department, although he later clarified that he did not intend to withhold votes over the issues. 

“I’m going to make a suggestion: I’d like to see you pick up the payments to the independent care providers,” said Kolker, who has been meeting with mental health care providers in private practice. “Because this is coming out in the news. They are not being taken care of. Before I vote yes on anything from HCPF, I want that addressed.” 

TODAY’S UNDERWRITER

Department officials told The Sun they are working on a written response to the senator’s complaints and that the Medicaid division “regularly monitors payment cycles and timelines” to make sure the system is working. 

“Claims system issues are going to occur from time to time across all health plans,” department spokeswoman Natalie Coulter said via email. 

The department’s data shows that mental health therapists and counselors are getting reimbursed “well within the timelines required by contract,” she said. In January, the Colorado Community Health Alliance, which processes reimbursements for two regions of the state, paid 97.3% of claims within seven days, according to the state’s data. 

The latest payment issues, however, happened in February, when mental health providers say claims were rejected for no legitimate reason. Coulter said the contractor will pay the disputed claims within the month.

In a statement last week, the health alliance said the billing issue, which affected 7,030 claims, was caused when its system “started erroneously denying” certain codes. This problem has been resolved, the company said. 

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