CareSource has been asked to delay its collection of millions of dollars in small loans that the Dayton-based insurer made to mental health and addiction treatment providers across the state.
Ohio Medicaid overhauled how it pays for behavioral health benefits like addiction and mental health care when it switched to a new system starting July 1. Instead of the state directly paying for behavioral health, those benefits are now managed by private companies such as CareSource, which already manage payments for physical health benefits.
The switch, however, has been bumpy, and the delay in collecting back the cash advances underlines the rocky start to the program. Some behavioral health providers have complained that they are not being paid fast enough or that they are struggling with the technical changes for submitting claims.
To ease the transition, Ohio Medicaid required a couple of temporary measures, including having the private insurance plans like CareSource give cash advances to providers to help while they adjusted to the new system.
The private plans advanced a total $174 million directly to providers. That includes about $110 million advanced by CareSource, which manages over half of the private Medicaid plans in Ohio. CareSource had $10.4 billion in revenue in 2018 and 2 million members.
The plans are now delayed from collecting back the cash advances “until confidence in claims payment is stabilized and individual providers are at a low risk for claims issues moving forward,” according to a joint letter to providers by Ohio Medicaid Director Maureen Corcoran and Ohio Department of Mental Health and Addiction Services Director Lori Criss.
When asked about whether it affects CareSource that the insurer can’t collect that money back yet, Steve Ringel, CareSource Ohio Market president, said in a statement that CareSource continues to work hand in hand with its behavioral health providers to ensure their financial stability.
He said the insurer chose to expand loan options beyond what was required by the state “to support this important group of providers who play a critical role in our members’ health and well-being.”
He said some of the money had already been repaid and CareSource officials remain hopeful they will see the remaining payment installations begin again as soon as August.
“CareSource is committed to the successful integration of behavioral health, and we will continue to work with those providers who need additional support,” Ringel said.
The state has extended the timeline to repay the cash advances several times.
The largest check the state of Ohio writes each year goes to Dayton-based CareSource, which employs about 2,800 people in Dayton, making it one of the largest employers in the city. The growing company is headquartered downtown and just completed construction on a second office to house about 700 employees.
Teresa Lampl, interim CEO of the Ohio Council of Behavioral Health and Family Services Providers, said the trade group for behavioral health providers appreciates the DeWine administration’s “efforts to stabilize service access and treatment capacity as Ohio responds to the mental health and addiction crisis facing our state.”
“No doubt, the course corrections undertaken by the new leadership at the departments of Medicaid and Mental Health and Addiction Services are encouraging and we agree that timely, accurate and consistent reimbursement of claims payments must occur prior to the repayment of any contingency cash advances so that treatment services are sustained,” she said in a statement.
The redesign of how Ohio Medicaid pays for behavioral health was several years in the making as part of a broader plan to integrate behavioral health care with other types of health care.
Corcoran and Criss said in their letter sent April 19 that both of their departments have heard concerns and the departments are focusing on how to address challenges related to the system changes.
“We understand there are significant financial concerns, workforce shortages, and other issues—all of which can impact services to individuals and families,” they wrote. “We are committed to solving these issues as quickly as possible and communicating regularly on the status of solutions and next steps to mitigate the impact.”
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