Department of Health Care Services
February 20, 2019
Ms. Elaine M. Howle
California State Auditor
621 Capitol Mall, Suite 1200
Sacramento, CA 95814
Dear Ms. Howle:
The California Department of Health Care Services (DHCS) hereby provides responses to the draft findings of the California State Auditor's (CSA) report entitled, California Department of Health Care Services: Millions of Children in Medi-Cal Are Not Receiving Preventative Health Services. The CSA conducted this audit and issued eight findings and 14 recommendations.
DHCS fully agrees with recommendations two, five, six, seven, nine through eleven, and fourteen. DHCS partially agrees with recommendations three, four, eight, twelve, and thirteen. DHCS does not agree with recommendation one.
DHCS has prepared corrective actions plans for all eight findings. DHCS appreciates the work performed by CSA and the opportunity to respond to the findings. If you have any questions, please contact Ms. Nicole Jacot, External Audit Manager, at (916) 713-8812.
The Department of Health Care Services' (DHCS) Response to The California State
Auditor's (CSA) Draft Report Entitled, California Department of Health Care Services:
Millions of Children in Medi-Cal Are Not Receiving Preventative Health Services
Report Number: 2018-111 (18-16)
California does not always ensure children in Medi-Cal receive preventive health services, and that plans provide adequate access to health care providers who serve children in Medi-Cal. DHCS does not require plans to implement a Corrective Action Plan (CAP) until the plan has failed to meet the same minimum performance.
|Finding Agreement:||Partially Agrees with Finding|
|Recommendation 1:||To increase access to preventive health services for children in areas where they are needed most, DHCS should identify by September 2019 where more providers who see children are needed and propose to the Legislature funding increases to recruit more providers in these areas.|
With respect to the finding, DHCS has three trigger types which may result in a Medi-Cal Managed Care Health Plan (MCP) having a CAP imposed on it, as opposed to only requiring a CAP after the plan has failed to meet the same minimum performance. These include not meeting the Minimum Performance Level (MPL) in three consecutive years for an External Accountability (EAS) measure; having 50 percent or more of EAS measures in a given operating area below the MPL in a given year; or at the discretion of DHCS.
DHCS does not agree with this recommendation. DHCS agrees that increasing the number of physicians that practice in California would be beneficial for all health care delivery systems and the Department has been actively involved in implementing a physician and dental provider loan repayment program using Proposition 56 funds as authorized and approved in the Budget Act of 2018. These loan repayments will be targeted specifically at newly-practicing providers that agree to see a specific percentage of Medi-Cal patients in their practice (at least 30 percent) and maintain that commitment for at least five years. These loans will be open to both pediatric and adult providers and additional criteria will include providers that are practicing in high-need specialty areas such as child psychiatry or practicing in a medically underserved area.
As required by federal and state laws and regulations, DHCS annually validates whether its MCPs have adequate networks based on a projection of future enrollment. Should a MCP demonstrate non-compliance with the certification, a CAP is imposed. Should the MCP not come into compliance with a CAP, sanctions are imposed.
Finally, DHCS has received its first year's analysis of the Timely Access Survey. This survey, which is completed quarterly by the External Quality Review Organization (EQRO), collects real time information about beneficiary experiences when scheduling pediatric and adult appointments. Information will be reported publicly. This data assists DHCS with monitoring beneficiary timely access to care.
|Finding 2:||DHCS does not provide adequate information to plans, providers, and beneficiaries about the services it expects children to receive. DHCS provides limited information to the families of children in Medi-Cal about the services they can and should receive.|
|Finding Agreement:||Partially Agrees with Finding|
|Recommendation 2:||To ensure children in Medi-Cal have access to all the preventive services for which they are eligible, DHCS should modify by May 2019 its contracts to make it clear to plans and providers that they are required to provide services according to Bright Futures.|
DHCS partially agrees with the finding. DHCS has issued guidance to Medi-Cal MCPs pertaining to the services that it expects children to receive, including an All-Plan Letter (APL) in 2014 and again in 2018 by APL 18-007.
With respect to the recommendation, DHCS is in full agreement with the exception of the timeline for implementation. DHCS will update its Medi-Cal MCP Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) APL; and draft updated contract language pertaining to EPSDT. DHCS will further detail MCP responsibility to provide services according to Bright Futures in these documents. The mandate for MCPs to provide services according to Bright Futures is currently present in APL 18-007, but DHCS will make the requirement more prominent by adding an additional stand-alone section that focuses on Bright Futures solely. DHCS has authority to mandate contractual requirements through APLs, and as such will utilize the EPSDT APL to set forth a majority of the requirements. APLs take varying periods of time to issue based on their complexity and the need to incorporate stakeholder review. Given this, DHCS anticipates completing this recommendation by November 1, 2019.
|Recommendation 3:||To ensure that all eligible children and their families know about all the preventative services they are entitled to through Medi-Cal, DHCS should include by May 2019 clearer and more comprehensive information about those services in its written materials, and by September 2019 ensure annual follow up with any children and their families who have not used those services.|
DHCS partially agrees with the recommendation as it has already been engaged in many activities to date as described below relative to updating Medi-Cal informing materials about the EPSDT benefit.
DHCS has updated its primary beneficiary publication, entitled “myMedi-Cal” and started a process to make changes in all of its written materials regarding the provision of EPSDT services for beneficiaries and providers. One of the first efforts undertaken was the update to its webpage on December 28, 2018, regarding the provision of EPSDT services. The DHCS EPSDT webpage changes, informed in part by stakeholder review and feedback, include an overview of information regarding the provision of these services for both beneficiaries and providers.
DHCS is also in the process of updating and removing older documents from the DHCS website that reference inaccurate information on EPSDT services and is reviewing and revising, as applicable, program reference materials to reflect the language presented on the EPSDT webpage. Given the enormity of this task, which will include the need to translate the affected documents into the 19 Medi-Cal threshold languages, this task will not be fully completed by September 2019. DHCS will provide an updated timeline of completing this task when it provides its six month update to this recommendation.
In terms of providers, DHCS has revised one section of the Medi-Cal Provider Manual and created a new Preventive Services section. The Preventive Services section, released in January 2019 and updated in February 2019, now specifies applicable billing codes for providers to use when providing preventive and other services listed in the Bright Futures' Periodicity Schedule. The new EPSDT services section will provide a variety of information including a requirement that providers communicate and inform beneficiaries of EPSDT services. This section is expected to publish in spring of 2019.
In addition to the changes above to the provider bulletin, the Department will be providing supplemental payments using Proposition 56 funds on specific preventive codes, many of which are directly applicable to children's' preventive services.
In addition to the provider bulletin, DHCS requires County Welfare Departments (CWDs) to send informing materials to all beneficiaries every year, which includes information on EPSDT. As referenced earlier, “myMedi-Cal” is an informational booklet provided to applicants and includes information regarding the Medi-Cal application process, how to access Medi-Cal benefits and services, including EPSDT services, and certain rights and responsibilities on being enrolled into the Medi-Cal program. DHCS worked extensively with stakeholders to improve the readability and clarity of the EPSDT information included in this document.
Additionally, the language in the myMedi-Cal document leverages the same wording and guidance as the updated DHCS EPSDT webpage. DHCS expects to publish and print copies of the revised document by May 31, 2019.
DHCS will include more comprehensive information about what a beneficiary is entitled to under the EPSDT benefit in its Medi-Cal MCP member materials, including the MCP Member Handbook/Evidence of Coverage (EOC). An updated version of the EOC will be issued to MCPs for translation and distribution by July 1, 2019.
Finally, DHCS will engage in a targeted outreach campaign to beneficiaries with full-scope Medi-Cal eligibility to inform them about the availability of EPSDT services under Medi-Cal and how to access preventive services. This will include an initial mail and call campaign to beneficiaries and their families which will occur by January 1, 2020. Stakeholders will be engaged as a part of developing these initial outreach materials. All outreach materials will be translated into the 19 threshold languages. DHCS will also contract with an independent entity to conduct surveys of beneficiaries, design outreach materials, and engage with stakeholders, in order to determine the best outreach processes moving forward. It is expected that the independent entity's work will be completed by December 31, 2020.
|Finding 3:||DHCS does not use its utilization management or annual audit processes related to children's preventative services in an effective manner. By failing to determine whether plans are addressing underutilization of children's preventive services, DHCS is missing an opportunity to increase the provisions of these services.|
|Finding Agreement:||Fully Agrees with Finding|
|Recommendation 4:||To improve access and utilization rates, DHCS should establish by March 2020 performance measures that cover Bright Futures services through well-child visits for all age groups, and require plans to track and report the utilization rates on those measures.|
DHCS partially agrees with this recommendation. The metrics for the Bright Futures schedule are led by national organizations such as the National Quality Forum, who in turn, create such metrics and maintain national data to do so including setting benchmarks.
DHCS will add administrative measures from the Centers for Medicare and Medicaid Services (CMS) adult and child core set to the EAS Set, increase the MPL for Medi-Cal MCPs from 25 percent to 50 percent, increase Medi-Cal MCP sanctions (as appropriate), and add early childhood metrics to the Governor's Value Based Purchasing initiative.
DHCS will also work with its EQRO to develop alternative ways of assessing MCP performance for areas of Bright Futures that do not have an identified metric. For example, DHCS is in the process of working with its EQRO to develop its first Preventive Services Report. This report will utilize member and provider data to measure MCP compliance, provider performance, and member utilization of appropriate preventive services. Stakeholders will be engaged when developing this report. The report is expected to be issued in 2020. DHCS will require MCPs to develop plans of action to address findings based on the results of the report. Should an MCP not come into compliance, DHCS will impose additional penalties and/or sanctions.
|Recommendation 5:||To ensure that health plans and providers are adequately delivering children's preventive services, DHCS should implement by September 2019 audit procedures through its annual medical audits that addresses the delivery of EPSDT services to all eligible children for all plans on an annual basis.|
DHCS fully agrees with the recommendation. DHCS will implement new audit procedures to address this recommendation by September 2019.
|Recommendation 6:||To ensure plans address underutilization of children's preventative services, DHCS should require plans by September 2019 to use their utilization management programs to identify barriers to utilization specifically for these services and hold plans accountable to address the barriers they identify.|
DHCS fully agrees with the recommendation. DHCS will work with its EQRO to develop a process to measure MCP utilization. DHCS is in the process of working with its EQRO to develop its first Preventive Services Report. This report will utilize member and provider data to measure MCP compliance, provider performance, and member utilization of appropriate preventive services. Stakeholders will be engaged when developing this report. The report is expected to be issued in 2020. DHCS will require MCPs to develop plans of action to address findings based on the results of the report. Should a MCP not come into compliance, DHCS will impose additional penalties and/or sanctions.
|Finding 4:||DHCS reduces the effectiveness of its oversight by not ensuring plans accurately report the services they provide. DHCS relies on provider information which could be inaccurate, and which could hinder access to care. DHCS is also unable to show that it reviewed all the provider information it claims, reviewed in response to the CSA 2015 audit, DHCS adopted policies and procedures to retain all documentation related to its provider directory reviews for a minimum of three years. However, DHCS was not able to provide the review documentation we requested for this audit for two to four plans because the contract manager for those plans were not able to locate the documents. Instead, DHCS provided the approval forms for those plans' provider directories which a supervisor signs once DHCS has completed its review; however, the portion of the plan was blank.|
|Finding Agreement:||Fully Agrees with Finding|
|Recommendation 7:||To ensure the accuracy of its data and ensure that California receives all available federal Medicaid funding, DHCS should require EQRO to perform its encounter data validation studies annually using the most recent set of data available, and implement recommendations for its EQRO studies.|
DHCS fully agrees with the recommendation. DHCS is compliant with the encounter data monitoring requirements prescribed in the Code of Federal Regulations (CFR) 438.818 and 438.242. Although these requirements became effective July 1, 2017, DHCS has been compliant with many of the requirements since new encounter data monitoring efforts were launched in January 2015.
As the CSA noted, DHCS expanded its monitoring efforts in the accuracy category through an Encounter Data Validation study. This study will be conducted on an annual basis and brings DHCS into full compliance with the new federal requirements. DHCS has already received the first version of this report. The second report will be completed by March 2020.
DHCS has also launched an additional encounter data monitoring effort that compares the amount of utilization reported through each MCP's Rate Development Template and the amount of encounter data submitted to DHCS. This effort will significantly strengthen DHCS's oversight of MCP encounter data.
CMS has developed a process and a set of metrics to measure state Medicaid agencies on the quality of their encounter data. To date, DHCS has not received any findings or been placed under a CAP by CMS for encounter data quality.
|Recommendation 8:||To ensure plan providers directories are accurate, by September 2019 DHCS should begin using a 95 percent confidence level and not more than a 10 percent margin of error on its statistical sampling tool and should require at least 95 percent accuracy before approving a plan's provider directory. In addition, DHCS should ensure that its staff adhere to its policy to retain all documentation related to its review of provider directories for at least three years.|
DHCS partially agrees with the recommendation. While DHCS cannot agree to change the confidence level to 95 percent, DHCS can review the current provider directory tool and determine the feasibility of changing the confidence level to a level higher than the current 80 percent.
DHCS is exploring other avenues to perform provider directory validation in a more systematic approach, including an increased statistically significant sample size. This effort would engage the Department's EQRO to conduct validation quarterly, significantly strengthening the process in its entirety. It is anticipated that this effort will be implemented by January 1, 2020.
DHCS will adhere to its policies to retain all documentation related to its review of provider directories for at least three years.
|Finding 5:||DHCS is not proactively addressing cultural disparities that exist in the usage of preventive health services. Federal law requires each state to have a plan to identify, evaluate, and reduce—to the extent practicable—health disparities based on various characteristics including race, ethnicity, and primary language. Although DHCS and the three plans reviewed agreed that cultural factors impact utilization and access rates for children's preventive services, DHCS has not effectively mitigated cultural factors' impact on utilization and access rates nor has it ensured that plans consistently mitigate those disparities on their own. DHCS also does not take a proactive role in ensuring that children have access to health care in language of child and the family. Although DHCS monitors utilization rates by language, it does not take proactive steps to increase the availability of providers based on language needs. Instead it relies on parents to request interpreters, and providers to provide the language services that families request.|
|Finding Agreement:||Fully Agrees with Finding|
|Recommendation 9:||To mitigate health disparities for children of differing ethnic backgrounds and language needs, DHCS should revise by September 2019 the methodology for its health disparity study to enable it to better make demographic comparisons, and should use the findings to drive targeted interventions within plan service areas. It should publish this on an annual basis.|
DHCS fully agrees with the recommendation. DHCS published its first health disparities report in 2018. The second health disparities report has been revised to allow for additional metrics and demographic comparisons and will be released in Spring of 2019. The third iteration of this report will be expanded to include revised methodologies specific to demographic comparisons.
The EQRO will continue to produce this report on an annual basis and each iteration will continue to evolve as DHCS identifies opportunities to expand the metrics being analyzed. The health disparities report will be utilized to drive targeted interventions within Medi-Cal MCP service areas. This will occur between Spring of 2019 and the end of the calendar year.
|Recommendation 10:||To ensure plans are effectively mitigating child health disparities in their service area, DHCS should implement by September 2019 a policy to require plans to take action on the most significant findings cited in their Group Needs Assessment (GNA) reports and to regularly follow-up with plans to ensure the plans have addressed the findings.|
DHCS fully agrees with the recommendation. Plan Specific Evaluation Reports (PSERs) are individual Medi-Cal MCP reports which summarize performance and make recommendations pertaining to it. They are issued by the Department's EQRO. DHCS is in the process of incorporating the GNA which addresses plan health disparity approaches into the plan PSERs. The PSERs will be utilized to provide recommendations to plans pertaining to their GNAs. DHCS will follow-up with the plans to ensure they are engaging in efforts to address recommendations. These reports are issued to CMS in April annually. It is too late to incorporate this recommendation into this year's report. It will be incorporated into the next year's report.
|Finding 6:||DHCS can do more to ensure it operates effective incentive programs and implements other best practices to increase access to, and usage of, preventive services for children. DHCS has not evaluated the impact of the program on utilization of children's preventative services, it cannot demonstrate that the auto assignment program leads to improved performance in the included performance measures. DHCS has not tracked the results of its own incentive program nor has it tracked the results of programs that plans have developed independently. Thus it cannot determine which program are most effective or have the most potential to be expanded statewide. DHCS does not facilitate plans sharing of their programs successes.|
|Finding Agreement:||Fully Agrees with Finding|
|Recommendation 11:||To help increase utilization rates, DHCS should begin by September 2019 to monitor and identify effective incentive programs at the plan level and share the results with all plans.|
DHCS fully agrees with the recommendation. DHCS will implement a go forward practice to collect and share plan-identified effective incentive programs that are reported to DHCS as contractually required. DHCS will share the plan identified effective incentive programs with all Medi-Cal MCPs.
|Finding 7:||DHCS has implemented an improvement process for its plans, but does not share the successful results across all plans. DHCS is not doing enough to improve the immunization rates for children in Medi-Cal. It has not been able to meet its target of 80 percent utilization goal because it has not taken sufficient action to address cause of its low immunization rates. DHCS is not maximizing the opportunities for improvement that its current processes provides. If a Plan-Do-Study-Act (PDSA) results in a successful intervention, DHCS does not have policies and procedures in place to share successful interventions with other plans. DHCS did not ensure to share its successful intervention with its own providers, it does not track nor have counties committed to doing so as part of its approved PDSA.|
|Finding Agreement:||Partially Agrees with Finding|
|Recommendation 12:||To improve the usefulness of its PDSA process, DHCS should implement by September 2019 a process to share the results of successful interventions with all plans, and require plans to share these results with providers who would benefit from them.|
DHCS partially agrees with the finding and fully agrees with the recommendation, per the below described activities taken to date pertaining to sharing of best practices amongst plans.
DHCS currently compiles information from Medi-Cal MCP PDSA, performance improvement projects, and CAP submissions to track the types of interventions that MCPs are exploring. DHCS shares promising practices as well as lessons learned based on this information with MCPs through individual MCP technical assistance, Quality Collaborative Teleconferences attended by all MCPs, Quality Improvement Highlights that are sent to all MCPs, and a variety of in person meetings, including the quarterly Medical Directors Meeting.
DHCS also has developed a Quality Improvement Toolkit that allows MCPs to access many applicable resources in one location through an external SharePoint site.
DHCS will engage further with MCPs to share best practices and issue a document summarizing them. DHCS will work with MCPs to identify appropriate best practices to be implemented in their respective geographic areas.
Finally, DHCS is including childhood immunizations as a measure under its Value Based Payment initiative that is being funded by Proposition 56 funds with the intent of driving improvement in reporting and utilization of this metric on a statewide basis.
|Finding 8:||DHCS has not implemented recommendations from its external quality review organizations for improving access to quality care. DHCS did not implement many of its EQRO's recommendations related to children's preventive services. DHCS chose not to implement the recommendation since childhood immunization, rather than well child visit was the focus area at the time. DHCS also failed to fully address a recommendation related to communicating the importance of preventive services. DHCS did not adopt the development screening in the first three years of life as a performance measure.|
|Finding Agreement:||Partially Agrees with Finding|
|Recommendation 13:||To improve its ability to ensure children are receiving recommended preventive health services, DHCS should create by September 2019 an action plan to annually address the EQRO';s recommendations relating to children preventative services, including recommendations left unaddressed from the previous two years' report.|
DHCS partially agrees with the finding and recommendation as it is in compliance with federal CFR requirements pertaining to this issue.
DHCS will develop a process to evaluate recommendations relating to children's preventive services and determine those which the Medi-Cal MCP's should operationalize through an action plan. These findings will be incorporated into the EQRO's annual technical report which is submitted to the CMS in April of each year. DHCS will need approximately eight months to address prior year findings.
|Recommendation 14:||To maximize the benefits of the studies it commissions from its EQRO, DHCS should ensure that by September 2019 the EQRO's annual report includes an assessment of the actions plans have taken to address the EQRO's prior-year recommendations.|
DHCS fully agrees with the recommendation. DHCS will instruct the EQRO to incorporate an assessment of actions taken to address the prior year's recommendation. These reports are issued in April annually to CMS, thus, a new report including these findings will not be possible to complete until April 2020.
CALIFORNIA STATE AUDITOR’S COMMENTS ON THE RESPONSE FROM THE DEPARTMENT OF HEALTH CARE SERVICES
To provide clarity and perspective, we are commenting on DHCS’ response to the audit. The numbers below correspond to the numbers we have placed in the margin of DHCS’ response.
DHCS misstates our finding and misses the larger, more important point. As indicated in Chapter 1, in many cases, DHCS does not require plans to implement a corrective action plan until it has failed to meet minimum performance levels for three years, and most corrective action plans run for five years. As a result, plans have only recently faced any financial penalties for failing to meet minimum performance levels.
In Chapter 1 and in the report draft we provided to DHCS, we acknowledged all three reasons DHCS could impose a corrective action plan if a plan underperforms.
Given its vision to improve the overall health and well-being of all Californians, including children, it is unclear why DHCS disagrees with our recommendation. It acknowledges that more providers would be beneficial and goes on to describe a loan repayment program that we acknowledge it is implementing. However, given the extent of the problems we identified, the impact of children not receiving preventive services, and its inability to improve utilization rates for these services above 50 percent for the past five years, DHCS should try multiple approaches to fixing these problems, not just one.
As we state in Chapter 1, DHCS had never financially sanctioned any plan for uncorrected deficiencies related to access and utilization until it imposed such sanctions in late 2018, after our audit was nearing completion.
As we indicate in footnote 9, the first year’s results of DHCS’ timely access study were not available in time for our review. Further, as we indicated in Chapter 1, DHCS has not yet conducted an in-depth analysis of the alternative access standards requests it approved to determine the areas of the State that are lacking doctors who are able to see children in Medi-Cal because it has only just completed processing the requests for the first time. DHCS should use these new tools to implement our recommendation that it identify where more providers who see children are needed and propose to the Legislature funding increases to recruit more providers in these areas.
As we state in Chapter 2, DHCS’ contracts reference outdated requirements that are not in line with Bright Futures, and as we further state, its most recent all-plan letter for EPSDT services does not explicitly state what services are required by Bright Futures. Because of the importance of the issue, DHCS should make these changes expeditiously. We look forward to DHCS updating us on its progress in implementing the recommendation in its 60-day and six-month responses.
As we state in Chapter 2, federal law requires DHCS to perform annual outreach to children and their families who have not used EPSDT preventive services to inform them of the benefits of preventive health care and how to obtain services under the EPSDT program, but DHCS’ response does not address this requirement. We look forward to DHCS updating us on its progress in implementing the recommendation in its 60-day and six-month responses.
DHCS’ response does not state whether it will establish performance measures that cover well-child visits for all age groups as we recommend. We understand that DHCS may not adopt all HEDIS measures relating to children’s preventive services; however, as we state in Chapter 2, utilization rates are higher for the services for which DHCS has established performance measures and reporting requirements. We look forward to DHCS updating us on its progress in implementing the recommendation in its 60-day and six-month responses.
We stand by our recommendation, and look forward to receiving DHCS’ six-month, 60-day, and one-year responses in which we expect it will update us on its progress in strengthening its reviews of the accuracy of provider directories.
Our finding and recommendation focus on improving DHCS’ ability to provide preventive services to children in Medi-Cal by addressing its EQRO’s recommendations. We made no determination of DHCS’ compliance with federal law with regard to its implementation of its EQRO’s recommendations as its response implies.