Family Planning and Medicaid Managed Care: Improving Access


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Family Planning and Medicaid Managed Care: Improving Access and Quality Through Integration
Phase One Report
June 2021
Sara Rosenbaum, JD Peter Shin, PhD, MPH
Maria Casoni, MPH Morgan Handley, JD Rebecca Morris, MPP Caitlin Murphy, MPA-PNP Jessica Sharac, PhD, MSc, MPH Akosua Tuoffer, JD Devon Minnick, JD
In collaboration with Health Management Associates

Acknowledgements
We are very grateful for the time we received from the state Medicaid agency leaders who participated in this study, and the expertise and insights provided by our advisory committee, whose members are listed in the Appendix. We deeply appreciate our colleagues at Health Management Associates (Donna Checkett, Rebecca Kellenberg, and Carrie Rosensweig), who collaborated with us throughout this study and continue to advise the project.
We are also so grateful to FAIR Health for providing us with healthcare claims data from the private insurance market, which we used to analyze current practices among private insurers.
We are, of course, especially grateful to Arnold Ventures for its ongoing support.

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Executive Summary
State agencies, managed care plans, and public health experts are increasingly focused on how Medicaid managed care — a foundational part of most state Medicaid programs — can address whole-person health needs. Given its documented impact on patient and population health, high-quality family planning is essential to a comprehensive managed care strategy.
For a half-century, family planning has been a mandatory Medicaid service. Furthermore, family planning has been deemed so essential that since 1981, federal law has contained a family planning out-of-network safeguard. This safeguard guarantees that members of Medicaid plans can continue to receive family planning services from their Medicaid-qualified provider of choice regardless of whether their provider is part of their plan’s network.
At the same time, however, integration of family planning and managed care is a desirable aim. Good managed care practice means that members should be able to look to their health plans for comprehensive preventive care delivered by a high-performing provider network. Furthermore, family planning visits uncover previously undisclosed physical and mental health conditions requiring follow-up care from other providers. This type of integrated care approach presumably works best when all providers and care managers involved are members of the patient’s network.
This study was undertaken to understand the current status of family planning and managed care integration 40 years after enactment of the “freedom of choice” safeguard, when managed care now enrolls nearly 70 percent of the Medicaid population. The study’s goal is to identify practical, actionable opportunities for greater integration and how managed care

purchasing might be used to strengthen family planning while preserving the “freedom of choice” safeguard.
This report shares findings from the first phase of the study, which consisted of a review of state purchasing documents related to comprehensive managed care, and in-depth interviews with senior Medicaid officials in 10 states. During Phase Two, we will conduct similar in-depth interviews with managed care plans and family planning providers.
Key findings include:
 All states using comprehensive managed care treat family planning as a fundamental system feature. State officials emphasized their expectations that contractors will fully meet members’ family planning needs.
 State purchasing documents codify the “freedom of choice” safeguard to some degree, but relatively few explicitly require contractors to inform members regarding the existence of their access safeguard.
 No state viewed the “freedom of choice” safeguard as imposing any real policy or operational burden; indeed, nearly all agreements address their obligation through provisions requiring contractors to cover and pay for family planning services regardless of a provider’s network status.
 States can do more to promote family planning and managed care integration. Areas of priority focus include: clarifying the scope of family planning services to which the “freedom of choice” safeguard should apply, more detailed specifications regarding contraceptive coverage, emphasis on building strong family planning provider networks to minimize reliance on out-of-

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network care when possible, policies that encourage contractor use of evidence-based family planning practice guidelines to guide network performance and value-based payments that attract and reward strong network providers, and ongoing work to develop patient and population performance measures.
 More comprehensive federal guidance regarding managed care and family planning integration is of enormous importance, in particular, guidance regarding the scope of family planning services that should be covered by “freedom of choice” safeguard — including sexually transmitted infection (STI) diagnostic and treatment services, HIV assessment and counseling, and immunizations to reduce cancer risk. Classifying these services as part of the family planning bundle for freedom of choice purposes would promote greater consistency between Medicaid and commercial sector practices, where it is common and standard for providers that offer basic family planning services to provide, bill, and receive payment for services such as STI treatment and testing. Such a change in Medicaid managed care practice would also help promote access to treatment for STIs, which have reached public health crisis proportions.
 In addition to clarifying the scope of the “freedom of choice” safeguard, the Centers for Medicare and Medicaid Services (CMS) could spearhead efforts to develop best practice approaches for family planning and managed care integration, including service coverage, network design, access enhancement, team-based care management, and performance measurement and improvement. These efforts can build on landmark Centers for Disease Control (CDC) and HHS Office of Population Affairs (OPA) family planning
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standards of care by translating these standards into managed care operational terms. This comprehensive effort could be carried out in collaboration with state agencies, experts in managed care performance and financing, clinical and family planning practice experts, and experts in public health and population-based health improvement. Of great value would be the inclusion of experts from the CDC and OPA, who led the development of the family planning practice standards. Such an effort would come at a crucial time, as federal agencies simultaneously move to restore the nationwide Title X family planning network, and whose providers play such a crucial access role for the Medicaid population.
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Introduction
This report presents initial findings and recommendations from a two-phase study of family planning and Medicaid managed care. The purpose of the study is to identify strategies and options for strengthening access to high-quality, comprehensive family planning services as a core Medicaid managed care service while at the same time preserving key family planning direct access safeguards that are a longstanding hallmark of federal Medicaid policy.
Over the past 40 years, Medicaid managed care has grown in scope and sophistication, and enrollment in comprehensive managed care plans now accounts for nearly 70 percent of all Medicaid beneficiaries.1 In the modern managed care era, state purchasers, managed care plans, public health and health management experts, providers, and consumers are increasingly focused on putting purchasing strategies to work to address the whole -person health needs of plan members. Given the profound relationship between overall physical and mental health on one hand and reproductive health on the other, family planning emerges as an essential part of such a strategy.
Furthermore, in the U.S. — which has the highest infant and maternal morality rates among wealthy nations, and in which nearly half of all pregnancies are unintended2 — planned pregnancies become a vital tool for ensuring that women enter and go through pregnancy and the postpartum period in optimal health. The argument for a greater focus on high-quality family planning as an explicit, integrated feature of Medicaid managed care is also supported by research showing the large proportion of patients in publicly funded family planning settings — a patient group disproportionately enrolled in Medicaid — whose exams reveal previously unidentified physical and mental health conditions requiring referral and follow-up care.3
For historic reasons explored further below, the

term “family planning” as used in Medicaid is a broad one that has evolved over time to encompass not only routine counseling, exams, contraceptive services, and related follow-up care, but also certain diagnostic and treatment procedures aimed at preventing and treating health conditions that can affect reproductive and overall health. As a result, this report uses the term “family planning” to encompass the full scope of services as this scope has evolved under federal law in response to public health and health care expert recommendations.4
Three major findings emerge from this initial study phase.
 First, states treat family planning as a fundamental element of Medicaid managed care and expect their health plans to fully meet their members’ needs in this regard. In doing so, states have absorbed Medicaid’s special family planning “freedom of choice” access safeguard into basic managed care operations as a core feature of their purchasing systems.
 Second, despite this embrace of family planning as a basic feature of Medicaid managed care, significant ambiguities emerge in how states define and operationalize family planning services in a managed care context. These ambiguities begin with a lack of clarity about what is covered by the “freedom of choice” safeguard. Ambiguities also exist concerning other key aspects of integrating family planning into Medicaid managed care, including strong network and access standards, expectations regarding the level and quality of family planning practice, quality improvement and performance measurement, strategies for follow-up care for family planning patients with additional physical and mental health conditions, and the use of value-based payments to encourage a high-performing network that can reduce reliance on out-ofnetwork care.

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 Third, the federal government similarly has a critical opportunity to clarify and strengthen the policy framework that guides the integration of family planning, Medicaid managed care, and states’ and plans’ efforts to improve quality and accessibility. Of particular importance is the need for greater clarity regarding which family planning services should be classified as family planning for purposes of Medicaid’s special “freedom of choice” safeguard, and guidance on strategies to strengthen managed care performance where family planning is concerned. An initiative to strengthen the bonds between managed care and family planning would come at a crucial time, as the administration works to restore the Title X family planning program and the provider network on which so many Medicaid beneficiaries depend.
A full study methodology, including all of the tables that present the information presented in this report in detailed form, can be found in the Appendix, along with a list of advisors and the states we interviewed.
Overview: Medicaid Managed Care and Family Planning
The starting point for this initial project phase — an in-depth examination of Medicaid managed care purchasing agreements — reflects the evolution of both Medicaid managed care and family planning policy over the decades, virtually from Medicaid’s enactment.
Medicaid managed care
The origins of what we know today as Medicaid managed care date to the original 1965 law, which authorized state agencies to purchase private health insurance as a form of medical assistance benefit.5 Widespread adoption of managed care began in earnest in the early 1980s with the passage of the Omnibus Budget Reconciliation Act of 1981 (OBRA-81).6
Over the ensuing decades, managed care became the Medicaid program’s operational norm, particularly for children and adults whose eligibility
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is tied to low income alone. Enrollment grew significantly in the 1990s as a result of a series of federal Medicaid demonstrations carried out by the Clinton administration under Section 1115 of the Social Security Act. The Clinton demonstrations initially coupled expanded eligibility for low-income working-age adults (a precursor to the 2010 ACA Medicaid expansion) with compulsory enrollment into managed care plans.7 The Balanced Budget Act of 1997 codified mandatory Medicaid managed care as a state option that eliminated the need for special demonstration authority, with enrollment required as a condition of eligibility for most beneficiaries.8
Because of who enrolls in Medicaid — and therefore, who is enrolled in Medicaid managed care — any discussion of Medicaid managed care policy also automatically becomes a discussion of Medicaid and reproductive health policy. Seventyseven percent of women who are of reproductive age and entitled to comprehensive Medicaid coverage are also enrolled in Medicaid managed care. This group includes women eligible under a traditional eligibility category (very low-income parents or caretakers of minor children, people with disabilities, children and adolescents, and women whose eligibility is tied to pregnancy). It also includes women eligible as low-income adults under the ACA Medicaid expansion.9 (As discussed below, certain Medicaid beneficiaries are entitled only to limited family planning benefits and services and generally are not enrolled in Medicaid managed care).
The relevance of Medicaid managed care to reproductive health is not limited to women, of course. Millions of sexually active males — teens, young adults, and, especially in Medicaid expansion states, working-age men who are fathers and sexual partners — depend on Medicaid managed care for a full range of health needs.
In many design and operational aspects, Medicaid managed care parallels private health plans that tie coverage to care through participating provider networks. At the same time, Medicaid managed care is distinct in the degree to which coverage is
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restricted to in-network care. In a typical private insurance plan, an insurer incentivizes in-network care through lower patient cost-sharing and protections against balance billing; members can, if they choose, seek out-of-network care, with coverage at a higher cost-sharing rate. But costsharing financial incentives of any magnitude cannot work for impoverished populations whose access to care is so sensitive to more than nominal cost-sharing.10 For this reason, Medicaid managed care systems utilize closed provider networks subject to strict cost controls.
At the same time, federal law recognizes three exceptions to Medicaid’s tightly controlled network and coverage model:
 Emergency care. Like the Affordable Care Act protections that govern the private insurance and health plan markets,11 federal Medicaid law allows an exception for hospital emergency care using a “prudent layperson standard.”12
 Services exempted from a state’s managed care contract. Most states either partially or wholly exempt certain services from their managed care purchasing agreements, especially benefits related to high cost, high-need health care and care furnished in settings that may not easily fit within a managed care model, such as homeless shelters or schools. Managed care plans may, in some cases, help manage access to these services and perform third-party claims administration functions. However, provider network restrictions would not apply, and members would continue to have access to any qualified Medicaid provider without regard to network status. By law, managed care organizations must inform members about services covered under the state plan but are not included in the service agreement.12
 “Freedom of choice” for family planning services and supplies. As part of OBRA-81, Congress included a special family planning exemption to normal managed care network and access rules. The family planning exemption covers “family planning services and supplies” and guarantees that plan members

can continue to receive these services from their Medicaid-qualified provider of choice, regardless of network status. This special exemption, required by federal law, reflects both a Congressional desire to promote access to care and to accommodate managed care participation by religiously-affiliated health plans whose contracts might limit or exclude covered family planning services. The OBRA-81 “freedom of choice” guarantee, a key focus of this study, is distinct from a separate protection added to Medicaid in 1997, which guarantees direct access to in-network women’s health care providers without the need for a referral from their primary care provider. This later protection (discussed further below) would subsequently be extended to insurance plans more generally.
Medicaid family planning benefits
Family planning has been a mandatory Medicaid service for 50 years. In the context of this study, two aspects of the benefit are notable.
First, under federal Medicaid law, the definition of what constitutes “family planning services and supplies” is quite broad. Under longstanding law dating to the original 1972 family planning amendments,14 certain family planning services (examinations and related tests, contraceptives, and counseling) qualify for enhanced federal funding at a 90 percent federal payment rate. But the Affordable Care Act extended and broadened the definition of family planning also to encompass “medical diagnosis and treatment services that are provided pursuant to a family planning service in a family planning setting.”15
In implementing this expanded definition of family planning, the Centers for Medicare and Medicaid Services (CMS) has elected to divide the benefit into two clusters: family planning services and “family planning-related services.” Under CMS guidelines, “family planning services” qualify for 90 percent federal funding, while “related” services are paid at the regular federal medical assistance rate (between 50 percent and 77 percent in 2021). Both types of benefits can be covered for people

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entitled to limited Medicaid benefits for family planning under the ACA’s special Medicaid family planning eligibility option. As of 2021, 26 states provide coverage for this limited benefit group.16
Second, in the case of beneficiaries entitled to full Medicaid benefits, the definition of family planning benefits also can vary. For the traditional population entitled to Medicaid prior to the ACA, the required scope of family planning benefits includes contraceptives whose scope would be governed by Medicaid’s basic test of coverage reasonableness.17 For the ACA adult expansion group, however, contraceptive coverage explicitly includes all FDA-approved contraceptive methods.18 Furthermore, the ACA Medicaid expansion group is entitled to “essential health benefits” under “alternative benefit plans.” The essential health benefit standard also explicitly includes a bundle of services classified as “women’s preventive health services” that includes both benefits considered to be family planning services and supplies as well as other benefits such as screening for interpersonal and domestic violence, preventive exams, and diabetes screening, as

shown in Figure 1 below.
Figure 2 shows the three basic Medicaid eligibility pathways and how family planning benefits can vary by pathway depending on how states implement the family planning coverage requirement.
Regardless of the basis of eligibility, however, it is important to stress that the federal definition of family planning is potentially very broad. CMS provides guidance on which family planning benefits qualify for 90 percent federal funding and which are “related” and qualify for federal payments at the regular FMAP rate and are potentially available to the limited family planning eligibility group. But the guidance is silent on which family planning benefits are covered by Medicaid’s “freedom of choice” safeguard. The assumption appears that the safeguard extends to those benefits recognized as such in 1981 (counseling, contraceptives, exams). The guidance does not consider the interaction between the “freedom of choice” safeguard and the subsequent 2010 amendment that fundamentally altered the

Figure 1. Women’s Preventive Health Services
Source: Health Resources and Services Administration (HRSA)
 Screening for anxiety  Breastfeeding services and supplies  Cervical cancer screening  Screening for cervical cancer  Contraception care including counseling, initiation of contraceptive use,
counseling (all FDA-approved contraceptive methods)  Screening for diabetes both during and after pregnancy  Screening for HIV  Screening for interpersonal and domestic violence  Counseling for sexually transmitted infections  Well women preventive visits  Screening for urinary incontinence

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Figure 2. Principal Medicaid Eligibility Pathways and Family Planning Coverage Variation

Eligibility Pathways “Traditional” beneficiaries:  Low-income children
 Very poor parents and caretaker relatives
 Children and adults with disabilities
 Pregnant/postpartum women

Family Planning Coverage
Family planning services and supplies. Federal guidelines that identify which services qualify for 90 percent federal funding define the term as consisting of counseling services and patient education; examination and treatment; laboratory examinations and tests; medically approved methods, procedures, and devices to prevent conception; and certain infertility services. Medically necessary diagnosis and treatment services for conditions found in a family planning visit typically would be covered under the state plan rather than as a family planning service.

ACA expansion beneficiaries:  Low-income, non-elderly adults with
household incomes up to 138% FPL

All essential health benefits, including all FDA-approved contraceptive methods, as well as a broad package of women’s preventive health services — which may extend beyond the Medicaid definition of family planning and related services both in scope and the range of services furnished in a family planning setting (e.g., screening for anxiety and depression).

Beneficiaries eligible for family planning and family planning-related coverage:  Incomes between 138% FPL and
states’ upper-income limit for pregnant women

Family planning services and supplies — defined as including not only contraceptives, tests, and counseling, but medically necessary diagnosis and treatment for conditions disclosed during a family planning visit and furnished in a family planning setting.

definition of family planning services.
Medicaid care and family planning integration
The breadth of family planning services and supplies are foundational to preventive care and can act as a key entry point into health care more generally. This underscores the value and desirability of integrating family planning into comprehensive managed care systems as part of a

“whole person” health strategy improvement strategy. A strong orientation toward integration would emphasize a wide choice of family planning network providers and a comprehensive range of family planning services to encourage early detection of conditions affecting overall reproductive health. Inclusiveness also would emphasize performance standards that include special accessibility efforts reaching all qualified providers in medically underserved communities,

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especially those that offer special programs for hard-to-reach populations such as immigrants, adolescents, or patients with disabilities or underlying behavioral health conditions. In other words, effectively integrating family planning into Medicaid managed care raises a host of important considerations when designing effective systems for a diverse and vulnerable population that go beyond simply covering and paying for family planning services but orienting managed care systems to reach members with complex needs, and to focus special attention on issues such as confidentiality and patient supports. Integration also means incorporating evidence-based practice standards as a network expectation, adopting value -based payment strategies to attract and retain a high-performing network, and developing performance measures that can capture certain outcomes, as well as evidence of basic procedures such as cervical cancer screening for adults19 and

chlamydia screening for adolescent women ages 16-20.20
Models of managed care/family planning integration. The complexity of integration means that managed care and family planning integration can be thought of as happening along a spectrum, from limited integration to comprehensive integration and prioritization. Under limited integration that mainly relies on the “freedom of choice” safeguard to promote access to care, family planning might be covered. Still, only a modest focus would be given to aspects of managed care such as networks, access, performance standards, payment incentives, links between family planning network providers and social services, and quality measurement and performance improvement. Plans essentially would emphasize their role as claims managers, and members would seek care from their provider of choice. Family planning would exist as a covered

Figure 3. Models of Family Planning/Managed Care Integration

Limited

Comprehensive

 Family planning benefits are covered but

 Family planning is specified in detail with

broadly defined

coverage spanning the full range of federally-

 Services covered by the “freedom of choice”

permissible services

exemptions are not defined

 Services covered by the “freedom of choice”

 Contract does not specify family planning-

exemption are defined

focused access or network specifications

 Contract specifies detailed access and network

expectations

 Contract does not specify specific expectations  Contract specifies referral arrangements for

regarding referrals between out-of-network

follow-up care

family planning providers and in-network care  Contract specifies a focus on family planning

 Contract does not incorporate social

patients with social determinants needs

determinants expectations specifically into

 Contract specifies family planning performance

family planning services

expectations and quality improvement goals

 Contract does not specify family planning-

related performance expectations or quality

improvement goals

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Family Planning and Medicaid Managed Care: Improving Access