Instructions by Table: Table 9C - Managed Care Revenue and Expenses

The content of this table has not changed since the 2002 Reporting period.

Table 9C should be completed by all grantees participating in Medicare, Medicaid, commercial, or other managed care plans; it is included only in the Universal Report.  Grantees should also report the number of enrollees (only!) in Primary Care Case Management (PCCM) programs. If the grantee has more than one managed care contract of a particular type with Medicare, Medicaid, commercial, or other insurers, the information for each category should be added together and reported as a total. 

NOTE:  There is one exception to this rule.  Managed care plans covering only dental care, mental health care or pharmacy should not be reported on this table. 

This report includes revenue, expense, enrollment, and utilization information for capitated and fee-for-service managed care plans.  It also includes information on the number of enrollees in PCCM programs, though number of enrollees is the only information collected on these programs.

Capitated (Pre-paid ) Plans - Are defined as plans under which the grantee receives a fixed payment per enrollee (member) per month.  Payment is generally made in advance, generally on a monthly basis, and covers all services included in the plan's contract with the center.  Under capitated arrangements, the grantee may also contract to be at full or partial risk for services beyond traditional primary care services.

Fee-for-Service Plans (FFS) - Are defined as plans under which the grantee receives payment on a fee-for-service basis for enrollees, when the enrollees receive contractually specified services.  As a rule, the provider receives a list of eligible enrollees just as it would for a capitated program and these enrollees must receive all their primary care and other stipulated services from their "Primary Care Provider" or PCP.

Primary Care Case Management Programs - Are defined as arrangements whereby the grantee receives a case management fee, and is expected to serve as gatekeeper for the enrollee, providing referrals to more specialized services.  While PCCM providers generally also provide the primary care services for the patient, this may not be required by the program. Table 9C only requests information on PCCM enrollees, reported on Line 11.  Do not include any revenue or expenditures for PCCM enrollees on this Table.  The nominal fee paid for these PCCM services is reported on Table 9D on Line 1.

Source of Payment - Medicaid and Medicare payments should be reported according to the original source of payment.  For example, if a center has a contract with a private HMO to provide services to enrolled Medicaid patients, this would be reported under Medicaid.  Similarly, S-CHIP programs which are operated by private HMOs are classified under the "Other Public" payment source.

Scope of Project - This table requires the grantee to report on all activities included in their managed care contracts, within the "Scope of Project" in the grantee's application for BPHC funding . The contract the project has with the managed care plan determines the types of services reported on this table.  Ordinarily, the Scope of Project includes all (or virtually all) services included in a grantee's managed care contract.  A small number of grantee's have contracts that include services, which are not included in the grantee's application for BPHC funding (e.g., inpatient hospital services).  These services are considered "outside the scope of the project" and are not reported on this table.

Services Within The Scope Of Project - Services within the scope of BPHC supported projects are often restricted to primary care but in some Centers may include lab, x-ray, pharmacy and/or specialty services. They may be covered by capitation or by fee-for-service payments.  The defining element is whether or not they are included in the funded BPHC project (and its budget) and reported on in the Financial Status Report (FSR). Services within the scope of project are included in all of these documents.  Services outside of scope have not been reported since CY-2000.

REVENUE

Capitation Revenue for Services (Line 1a) - Enter the accrued revenue from capitation for services. This figure is equal to the capitation earned during the calendar year, regardless of when it was received, though capitation is almost always received in the same year that it is earned. This amount generally equals the collection reported in Table 9D Column B minus retroactive and wraparound payments, unless there were late or early capitation payments received.  Report only the capitation earned from the HMO on this line. Other payments are reported below.

Fee-for-Service Revenue for Services (Line 1b) - Enter the "net accrued revenue" from fee-for-service for services. This figure is equal to the income earned during the calendar year, regardless of when it was or will be received.  It is equal to full charges less all actual or anticipated disallowances or allowances except that allowances for anticipated FQHC settlements on these charges are not included here.

Note that a contract may pay a capitation to cover the cost of the basic visit, and pay fee-for-services for other costs such as lab, x-ray and pharmacy.  In this instance the grantee will report income on both line 1a and 1b.

Total Revenue for Services (Line 1) - Enter the sum of Lines 1a and 1b.

Collections from State Medicaid or Federal Medicare Reconciliations or Wrap Around Payments for the current year. (Line 3a) - Enter the (cash) amount received from Medicaid and Medicare reconciliation payments (payments based on the settlement of a cost report) and/or wrap around payments (amounts paid to bring reimbursement to cost or a negotiated fee-per-visit amount) for services rendered in the current (reporting) calendar year.

NOTE: In most circumstances, these cells should equal Table 9D Column c1 totals for managed care.

Collections from State Medicaid or federal Medicare Reconciliations and Wrap Around Payments for a prior Billing period.  (Line 3b) - Enter the (cash) amount received from Medicaid and Medicare reconciliation payments (payments based on the settlement of a cost report) and/or wrap around payments (amounts paid to bring reimbursement to cost or a negotiated fee-per-visit amount) for services which were rendered in prior years.

NOTE: In most circumstances, these cells should equal Table 9D Column C2 totals for managed care.

NOTE :  If reconciliations and/or wrap around payments are made for a grantee's fiscal year, and the fiscal year does not correspond to the calendar year, payments must be allocated between the current and prior calendar years.  Grantees may use a straight line allocation methodology; for example, a grantee receiving reconciliations and/or wrap around payments covering the fiscal year April 1, 2005 - March 31, 2006 would allocate 25 percent of the payment to the current year (i.e., 2006) and 75 percent to the prior year (i.e., 2005).  Grantees with more sophisticated cost allocation systems may use their own systems but be sure to keep documentation.

Collections from Patient Co-payments and from Managed Care Plans for Other Retroactive Payments (Line 3c) - Enter the (cash) amount received from patient co-payments and from other retroactive payments such as risk pools, incentives, and withholds.  The income may have been earned in this or any preceding year.

NOTE:  In many instances these cells will not equal Table 9D Column C3 totals for managed care because co-payments are recognized on this line, but are not reported in Column C3 of Table 9D.

Penalties or Paybacks to Managed Care Plans (Line 3d) - Enter the (cash) amount paid during the reporting period as a result of penalties imposed by managed care plans, and FQHC paybacks.  The penalties may have been "earned" in this or any preceding year.

Total Managed Care Revenue (Line 4) - Enter the sum of Lines 1, 3a, 3b, 3c minus Line 3d.

EXPENSES

Expenses as used in this section means "accrued costs."  To the extent it is maintained, grantees should include "Incurred but not reported costs" (IBNR) for the reporting period for which they are liable.  All amounts are reported on a modified accrual basis.

Capitation Expenses for Services (Line 5a) - Enter the cost of providing the capitated services reported, i.e., the visits reported on line 9a and other associated costs (e.g. lab, x-ray, pharmacy, etc.) covered by the capitation.

Fee-for-Service Expenses for Services (Line 5b) - Enter the cost of providing the fee-for-service services reported, i.e., the visits reported on line 9b and other associated costs (e.g. lab, x-ray, pharmacy, etc) covered by the fee-for-service payments.  Note that a contract may pay a capitation for basic visits and pay fee-for-services for other costs such as lab, x-ray and pharmacy.  In this instance the grantee will report associated costs for the "carved out services" separately on line 5b.

Total Expenses for Managed Care Services (Line 5) - Enter the sum of Lines 5a and 5b.

NOTE :  Not all centers formally maintain a cost-accounting system that reports these data in this format.  If this is the case, one of the following methods for calculating these required numbers may be used retrospectively:

1.         Average Cost per Encounter :  Virtually all health centers have a process to develop a Medicaid and/or Medicare approved cost per encounter.   Presuming that the services offered under the managed care program are the same as those in the FQHC program it is simple to take the total number of encounters reported on lines 9a and/or 9b and multiply this number times the average cost per encounter.  The results would be placed on lines 5a and/or 5b.

2.         Ratio of Charges :  If the center has a cost based fee schedule (and this is necessary to use this method) a more accurate method of calculating costs is possible.  This system would permit the center's cost analysis to be sensitive to different levels of services provided to prepaid patients as compared to others.  (For example, because there is no incentive to multiple visits, a center may try to do more at a single visit than to call the patient back.) 

In this methodology, the center looks at the total charges for services to managed care patients and compares it to the total charges for this same set of services for all patients in the system. This ratio (charges for managed care divided by charges for all patients) is then multiplied times the total cost of providing those services.  The result is a more complex but, theoretically, more accurate statement of expenses.  Note that this has to be done for each type of third party payor on Table 9C.

UTILIZATION DATA

Member Months : A member month is defined as 1 member being enrolled for 1 month.  An individual who is a member of a plan for a full year generates 12 member months; a family of 5 enrolled for 6 months generates (5 X 6) 30 member months.  Member month information can often be obtained from monthly enrollment lists generally supplied by managed care companies to their providers.

Member Months for Managed Care (capitated) (Line 8a) - Enter the total capitated member months by source of payment. This is derived by adding the total enrollment reported by the plan for each month.

Member Months for Managed care (fee-for-service) (Line 8b) - Enter the total fee-for-service member months by source of payment.  A fee-for-service member month is defined as one patient being assigned to a service delivery location for one month during which time the patient may use only that center's services, but for whom the services are paid on a fee-for-service basis.  NOTE: Do not include individuals who receive "carved-out" services under a fee-for-service arrangement if those individuals have already been counted for the same month as a capitated member month.

Total Member Months for Managed Care (Line 8) - Enter the sum of Lines 8a and 8b.

Managed Care Encounters (capitated) (Line 9a) - Enter the total encounters for capitated enrollees by source of payment. 

Managed Care Encounters (fee-for-service) (Line 9b) - Enter the total encounters for fee-for-service enrollees by source of payment.

Total Managed Care Encounters (Line 9) - Enter the sum of Lines 9a and 9b.

Enrollees in Managed Care Plans (capitated) (Line 10a) - Enter the number of capitated enrollees by source of payment as of (i.e., for the month of) December 31 of the reporting period.

Enrollees in Managed Care Plans (fee-for-service) (Line 10b) - Enter the number of fee-for-service enrollees by source of payment as of (i.e., individuals assigned to the grantee for the month of) December 31 of the reporting period.

Total Managed Care Enrollees (Line 10) - Enter the sum of Lines 10a and 10b.

Enrollees in Primary Care Case Management Programs (Line 11) - Enter the number of enrollees in PCCM programs as of December 31 of the reporting period.

Number of Managed Care Contracts (Line 12) - Enter the number of managed care contracts as of December 31 of the reporting period.  If a contract with an HMO covers two different types of patients, e.g., Medicaid and Commercial, count it once in each column.  If a single HMO has different "options" in its contract (e.g., a high benefit vs. a moderate benefit commercial plan) count it only once in the appropriate column.

Questions and Answers for Table 9C

3. Are there any changes to this table?

There are no changes to Table 9C for 2006.

3. What is the difference between a PCCM program and a FFS plan that also pays case management fees?

Under a FFS managed care plan, an entity (e.g., HMO, HIO, provider network, etc.) is capitated and at risk.  This capitated entity is usually (but not always) someone other than the primary care provider (PCP), and contracts with the PCP.  PCCM is almost always a contract between the primary care provider and the State, involves neither risk nor incentives, and generally has no penalties if utilization is excessive.  PCCM rarely involves payment of capitation for primary care services.  

3. We have a capitated managed care contract, but some services are "carved-out" and paid on a fee-for-service basis.  How do we report?

Report revenue and expenses for the carve-out services on the appropriate fee-for-service lines. Report managed care fee-for-service encounters on Line 9b, but do NOT report managed care member months for fee-for-service plans on Line 8b nor enrollees on 10b.  Since these persons have already been reported under capitation, counting them under fee-for-service would result in double counting individuals in the plan.

3. Do we report PCCM contracts on Line 9?

No.

Reporting Period: January 1, 2006 through December 31, 2006             

TABLE 9C - MANAGED CARE REVENUE AND EXPENSES