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- Cynthia Turnure, Ph.D., Director, Chemical Dependency Division, Minnesota Department of Human Services

Over the past few years, Minnesota has moved forward into State health care reform. I would like to share some of how our agency has been involved in this process. Hopefully, our experience will be helpful to other States as they deal with similar challenges.

Minnesota 's Health Care Reform: A Gradual Process

In 1992, the Minnesota Legislature created the MinnesotaCare program to provide health insurance coverage for low-income, uninsured Minnesotans. MinnesotaCare, originally called " Health Right, " is an expansion of the Children's Health Plan.

MinnesotaCare is designed to supplement– not replace – other programs, such as Medical Assistance (MA), General Assistance Medical Care (GAMC), and private insurance. MinnesotaCare provides benefits for Minnesotans who are not eligible for Medical Assistance or covered by other insurance. The program is funded by a tax on cigarettes and a 2 percent tax on providers.

Original coverage. The original coverage for chemical dependency treatment in MinnesotaCare was quite limited (10 hours of outpatient). Partly because of that, the substance abuse coverage under MinnesotaCare has been closely coordinated with Minnesota's existing Consolidated Chemical Dependency Treatment Fund, which began in 1988. This fund combines a variety of State and Federal funds for chemical dependency treatment for MA-eligible and other low-income Minnesotans. The same assessment criteria, billing and payment system, data collection, and licensing requirements are being used for both programs in order to create a " seamless " system for the client.

Expanded coverage. The chemical dependency coverage under MinnesotaCare was expanded in 1993 to include inpatient and residential treatment, and the outpatient hour limit was removed. The State is in the process of transitioning MinnesotaCare (as well as Medical Assistance and General Assistance Medical Care) from a fee-for-service system to a pre-paid, managed care system. This process should be completed in 1995.

Minnesota is now implementing more comprehensive health care reform that will eventually provide coverage for all Minnesotans through Integrated Service Networks (ISNs) and a Regulated All Payer Option (RAPO). The MinnesotaCare Act lays out the basic framework and timetable for this new system.

Work is now underway to develop a standard universal benefit set, develop " Report Cards " for HMOs, and determine future financing. As part of this overall health care reform effort, all public health care programs, such as Medicaid, GAMC, MinnesotaCare, and Medicare, will be integrated. A waiver has been submitted to the Health Care Financing Administration (HCFA) to facilitate this process.

SSA Involvement in the Reform Process

How has our Single State Agency (SSA) been involved to date, and what does the future hold?

Step 1: Identifying basic principles. One of the first things we did (in response to both State and national health care reform efforts) was to identify some basic " Principles of Health Care Reform." These summarized what we had learned– especially from our experience with the Consolidated Chemical Dependency Treatment Fund– that needed to be taken into account in any new system. These principles, shown in the box below, have been widely distributed to interested groups both within and outside State government.

Step 2: Participating in the planning/policymaking process. We have tried to get involved in as many ways as possible in influencing this new system of health care being designed and implemented in Minnesota. My staff and I are members of the Health Care Reform Policy Review Committee established by our department, which also includes representatives from the Health Department and counties. I am also a member of a new department-wide Health Care Reform Waiver Team that will make basic policy decisions as the HCFA waiver is implemented.

We have worked closely with the chemical dependency field and their associations and lobbyists to ensure that substance abuse issues are addressed in the legislative process. This resulted, for example, in amendments to expand the chemical dependency coverage in MinnesotaCare and to require the use of our statewide assessment and placement criteria, licensing standards, and outcome data collection system in the new system.

We have tried to work closely with those in our department who administer the Medical Assistance, General Assistance Medical Care, and MinnesotaCare programs, as well as the publicly funded prepaid medical assistance plans. This has not been an easy process, despite their being part of the same department. There are differences in language and orientation/training that we 've had to work out. However, this effort has resulted in the same assessment criteria being used in all the public programs, as well as similar data being collected on clients and outcomes, which should help the State measure whether clients with alcohol and drug problems are being adequately served.

Step 3: Making chemical dependency data widely available. We have tried to make widely available the data we have on chemical dependency costs, clients, and outcomes. We want to be seen as an " expert resource " for substance abuse issues related to health care reform. We are fortunate in having a long history of data collection.

Our Drug and Alcohol Normative Evaluation System (DAANES), established in 1983, collects data from all treatment programs in the State, both public and private. Our Treatment Accountability Plan, initiated in 1993, will collect service and outcome data on a sample of clients in all programs. To be licensed in Minnesota, a program is required to participate in both systems. We have distilled what we have learned from our Consolidated Chemical Dependency Treatment Fund, so that our findings can be taken into account in designing the new system. Examples of our findings include:

• The best way to control the costs – both short- and long-term – of this illness is to provide flexible, individualized coverage that is based on standard assessment criteria. You achieve the greatest savings not by imposing artificial caps or limits, but through the proper matching of clients to the most cost-effective program which can meet their needs. We know this in Minnesota because the cost of treatment under the Consolidated Chemical Dependency Treatment Fund increased less than 7 percent between 1989 and 1992, versus a 28 percent increase in other medical costs during that same time period (see the box below).

• There are significant cost-offsets associated with providing adequate substance abuse treatment. As the box below shows, almost 80 percent of the costs of treating Consolidated Fund clients are offset within the first year by reductions in their medical and psychiatric hospitalizations, detox admissions, and arrests.

These results have been shared with our State 's Health Care Access Commission, as well as with other groups involved in health care reform, including Congress.

The Road Ahead in Minnesota

So what does the future hold? Much is still unknown. There will be major changes in the way some (if not all) substance abuse services are funded and delivered in Minnesota. Next year, our legislation will determine the specific coverage to be included in the Universal Standard Benefit Set that all plans, both public and private, must provide. Depending on which services are included, our department will be developing a Supplemental Benefit Set to be purchased for publicly funded clients.

We plan to be involved as these decisions are made. We are also in the process of re-thinking our current program licensing rules to make them more flexible. For example, we may separate housing from services, since these may have different funding sources in the future. And we are trying to get the chemical dependency field in Minnesota ready for the changes that are coming in terms of:

• Exploring alternative models of treatment

• Matching clients to services versus programs

• More individualized and effective treatment in general

The SSA ' s Future Role

It is clear that our role in the future will be different, and that the State will be primarily a purchaser, versus a provider, of substance abuse services. We hope to have a major role in setting requirements for quality assurance for all substance abuse services, establishing managed care contract requirements for all publicly funded clients, and monitoring how well clients are actually being served, using such indicators as referral rates and patterns, as well as treatment outcomes.

Beyond that, our role is unclear. We have just set up an internal health care reform team to map out what may happen over the next 5 to 10 years, depending on when various decisions will be made. We will continue to raise questions and issues that must be dealt with if clients are not to " fall through the cracks. " We are concerned with such issues as:

• How services to American Indians will be delivered

• The role that counties and Indian reservations will play in the new system (they currently perform all assessments for public clients)

• The pros and cons of various models of managed care for special populations

Our goal is to be " at the table " when decisions are made, so that the needs of our clients and our knowledge about the best ways to meet them are taken into account in designing the new system.

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