WA Governor Suspends Medicaid Denial Plan, State Considers Physician-Drafted Alternative

March 31, 2012

Washington Gov. Chris Gregoire suspended the April 1 implementation of the Zero Tolerance Policy that would have denied payments for treatment of Medicaid patients that the state retrospectively deemed to be non-emergency visits, according to ACEP member Dr. Nathan Schlicher.
The state legislature is still in special session this week considering its budget, which is now expected to include a physician-penned alternative plan, designed to help the state reach some of its budget tightening goals, but also uphold the national prudent layperson standard.
“We hope that the legislature will close business next week, include in their work our alternative plan that is already drafted into a proviso in the house budget, and let us get to the work of improving the delivery of care,” said Dr. Schlicher, Associate Medical Director at St. Joseph Medical Center in Tacoma, WA and Legislative Affairs Chairman for the Washington ACEP Chapter.

The Washington Health Care Authority (HCA) originally had proposed limiting Medicaid patients to three ED visits that the state determined were not emergencies. But as a legal battle got underway, the state revised their plan and offered the Zero Tolerance Policy.
The HCA planned to use the “Billings algorithm” to deny coverage for emergency department visits based on final diagnosis discharge codes, rather than the patients’ symptoms. Professor John Billings of New York University’s Wagner School of Public Service has said the tool he created was being misused and that it had been developed to evaluate system performance and to assess the effect of interventions to improve primary care services.

The EM Action Fund contributed to the efforts to overturn the HCA plan and has continued to support the chapter, noting that the outcome of the issue in Washington could set a precedent for other states.

“The breakthrough of the leaders of Washington ACEP also reflects on the ability of the EM Action Fund to respond rapidly to legal and regulatory challenges facing emergency physicians nationally,” said Dr. Wes Fields, Chair of the EM Action Fund. 

“The Action Fund committed up to $100,000 to Washington ACEP litigation, underwriting injunctive relief from the original HCA proposal to cap ED visits for Medicaid patients,” he said. “Another $55,000 was committed to new health care policy analysis by top-tier EM researchers, designed to prove that the Billings ED algorithm cannot be safely used to screen or pay for ED visits by Medicaid patients without violating EMTALA or prudent layperson standards.”

"Finally, Washington, D.C.-based consultants and attorneys for the Action Fund gave state and national EM leaders and the ACEP’s DC staff timely access to top administrators of the Centers for Medicare and Medicaid,” Dr. Fields added.

Washington’s physician-authored alternative plan includes strategies such as requiring timely follow-up by primary care physicians, creating a real-time database to track ED visits, and closer case management.

“We are excited about this development as it reflects strongly on the likelihood of our success and recognition of the work of the collaborative efforts of the Emergency Medicine Action Fund, Washington ACEP, the Washington State Hospital Association, the Washington State Medical Association, and many others,” said Dr. Schlicher.
“My deepest appreciation is extended to the many of you that have made this possible from across the country -- ACEP’s DC staff, members of the EM Action Fund, the ACEP Board of Directors, and the many dedicated individuals in Washington ACEP that worked tirelessly on this issue,” he added.

Inclusion of the alternative proposal in Washington’s budget could serve as a resource for dozens of other states considering similar plans to deny Medicaid payments based on retrospective diagnoses.
“If we can be of assistance in sharing our experience, our approach, documents, time, or energy with other chapters, please do not hesitate to contact us,” Dr. Schlicher said. “Hopefully, this will be the start of a rededication to the protection of prudent layperson across the country and a warning to Medicaid programs.”


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