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OCR for page 180
Safety NQt Populations with
SPQCIO~ Health And OCCQSS NQQ~S
This chapter reviews how changes in Medicaid policy, the growth in
enrollment in managed care, and the changes in the marketplace are affect-
ing those Americans with serious chronic illnesses or disabilities as well
as those who have experienced social dislocation (e.g., homeless people).
These populations (hereafter referred to as special-needs populations)
have special health care and access needs and are often viewed as particu-
larly medically and economically vulnerable. The committee wanted to
take a closer look at this group because it provides a unique opportunity
to understand how the changing health care environment might affect the
safety net and the people it serves. Policies that negatively affect those
individuals with special needs are likely to have adverse effects on many
other patients. Similarly, policies that serve the needs of people with
special health needs are likely to positively affect other patients. The fail-
ures and successes of Medicaid policy changes, managed care, and the
health care marketplace are likely to be more quickly apparent for those
with special needs, such as people with serious mental illness or human
immunodeficiency virus (HIV) infection/acquired immune deficiency
syndrome (AIDS). Thus, the special-needs populations may provide early
insights that can be generalized to all populations in the safety net system.
Special-needs populations also receive attention in this report because
they account for a disproportionate share of medical expenditures and
they bring into greater focus a number of the challenges in the further
expansion of Medicaid managed care. A closer look at this important
subset of the safety net population helps illuminate issues related to con-
180
OCR for page 181
POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
181
tracting, financing mechanisms, adequate information systems, integra-
tion and coordination of care, and the need to bundle health care and
enabling services.
This chapter examines two categories of special-needs populations:
(1) nonelderly adults and children with chronic illnesses and disabilities
who qualify for Supplemental Security Income (SSI) or who meet a state's
medically needy standard for Medicaid and (2) adults and children who
experience extraordinary access barriers because of social dislocation (e.g.,
homelessness, immigrant status, or language or cultural differences) and
who require specially designed outreach programs to facilitate access to
and utilization of basic health care services.
The committee examined four special-needs populations to highlight
some of the issues related to the changes in the health care marketplace:
children with special needs, people with serious mental illnesses (SMIs),
people living with HIV infection or AIDS, and homeless people. These
groups illustrate some of the major challenges that the chronically ill and
disabled populations in the safety net system bring to the policy debate.
Similarly, the homeless illustrate problems of social dislocation, that is,
difficult-to-reach populations, who traditionally are cared for by safety
net providers.
This chapter also brings into bold relief the fact that people with
special needs are often served by specialty providers in the safety net,
providers who are not well linked to the primary care providers in the
system. Special-needs populations in the safety net require complex health
care services and enabling or social services. Funding for the care of people
with special needs is fragmented and is dependent on the annual appro-
priations process, contributing to a service system that has traditionally
been plagued with problems of coordination and a lack of continuity
between primary care and specialty care services. To successfully care for
these populations, policies must ensure access to necessary and appropri-
ate specialty medical and enabling services for this population while also
bridging the gap between the primary and specialty safety net systems.
PEOPLE WITH SPECIAL NEEDS
People with Chronic Illnesses and Disabilities
Approximately 14.5 percent of the U.S. population has a disability
covered by the Americans with Disabilities Act (ADA), including 6.1 per-
cent of children under the age of 18 (Wenger et al., 1997~. Any number of
conditions may cause a person to be disabled, but disability is less about
disease or diagnosis and more about functional capacity. Functional limi-
tations include those things that negatively influence participation in
OCR for page 182
182 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
work, school, leisure, family, and community life. People with disabilities
use a wide spectrum of health and enabling services including primary
care, acute care, rehabilitation, mental health, addiction, respite care, and
long-term-care services. The service requirements are as diverse as the
individuals who need them and may vary among those with the same
conditions. There are no simple formulas for predicting service utiliza-
tion, but clearly, care for the disabled population is more costly than care
for the general population.
People with disabilities are broadly defined as those with limitations
in human actions or life activities due to physical or mental impairments
(Americans with Disabilities Act [ADA; P.L. 101-336~) (LaPlante, 1991~.
There is no single, up-to-date source of disability rates by diagnosis or
special population, nor is there a single, comprehensive, up-to-date com-
pilation of expenditures by diagnosis group.
People with disabilities are much more likely than their nondisabled
counterparts to have publicly funded health care coverage. Half of all
medical expenditures for people with disabilities are covered by public
programs, including 30 percent by Medicare, 10 percent by Medicaid, and
10 percent by other public programs. This compares to a rate of publicly
funded health care of only 20 percent for the nondisabled population. In
addition, although it is likely that people with disabilities have some type
of public insurance, many others are nevertheless uninsured. Almost 10
percent of children who need help with activities of daily living are unin-
sured, as are 12 to 13 percent of disabled adults (LaPlante et al., 1993;
Trupin et al., 1995~.
The pace of movement of people with disabilities into managed care
has been dramatically slower than that of low-income women and chil-
dren. Although the Balanced Budget Act of 1997 allowed states to man-
date enrollment of most Medicaid beneficiaries in qualified managed care
plans, children with special needs and individuals with dual eligibility
(adults who qualify for both Medicaid and Medicare) were exempted. To
enroll such individuals in managed care plans, states still must seek a
federal Medicaid waiver from the Health Care Financing Administration.
Most states did not rush to put their disabled populations into managed
care plans, hoping first to learn lessons in implementing managed care for
women and children before enrolling higher-risk beneficiaries. Nonethe-
less, all but 15 states now enroll at least some of their disabled beneficia-
ries in managed care plans (Figure 6.1), and several are considering doing
so in the near future (Regenstein and Schroer, 1998~.
In addition, all but four states have developed behavioral managed
care programs that cover some combination of primary and specialty
mental health services (Substance Abuse and Mental Health Services
Administration Managed Care Tracking System, 1998~. Early indicators
OCR for page 183
POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
183
~ . at
0 ~
n
Percent of PWD
in Managed Care
(states)
68 to 100 (6)
~ 34 to 67 (10)
· 1 to 33 (20*)
~ 0 (1 5)
FIGURE 6.1 Percentage of nonelderly persons with disabilities (PWD) in Medic-
aid managed care, 1998. Includes District of Columbia. SOURCE: Regenstein
and Schroer (1998~. Reprinted with permission of the Henry l. Kaiser Family
Foundation of Menlo Park, California. The Kaiser Family Foundation is an inde-
pendent health care philanthropy and is not associated with Kaiser Permanente
or Kaiser Industries.
suggest that it is feasible to move disabled populations into managed care
with some degree of success, although the risk of failure is high because
of the potential interruption of essential services to a highly vulnerable
population and the potential of the unraveling of the safety net for the
special-needs population.
Safety net providers for this population are especially skilled in blend-
ing financial resources from multiple funding sources (federal, state, and
local) to support the provision of services for the special-needs popula-
tion, but Medicaid continues to be the bedrock of health care and related
services for this group and provides the infrastructure of services for the
OCR for page 184
184 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
special-needs population. Because disabled special-needs populations
make up only 16 percent of the total Medicaid population but account for
37 percent of Medicaid (Regenstein and Schroer, 1998), states are moving
in the direction of managed care for this group (Figure 6.2~. Several factors
have contributed to states' interest in managed care for this population:
· In comparison with Medicaid beneficiaries who also receive Aid to
Families with Dependent Children, who are now covered under Tempo-
rary Assistance to Needy Families, average spending per beneficiary is
higher for those with disabilities ($1,304 versus $8,168) (Bishop and
Skwara, 1997~.
· Medicaid spending for persons with disabilities grew at an annual
average rate of 14 percent from 1990 to 1994, with growth slowing from a
high of 19 percent in 1990-1991 to 9.5 percent in 1993-1994 (Bishop and
Skwara, 1997~.
· States vary widely in conditions of eligibility and coverage and
cost per beneficiary. For example, in 1996 the annual cost per SSI benefi-
ciary ranged from $2,846 in Tennessee to $13,320 in Connecticut (Bishop
and Skwara, 1997~.
Coo -
80 -
C'
~ 40-
60 -
20 -
O-
51.5
22.3
9.9
16.2
.,
_ _
, ,Y,
, \ _
9.7
15.6
10.9
27.1
33.6
Enrollees Expenditures*
Total = 41.3 million Total = $155.4 billion
people
DSH Payments**
Children
Adults
· Elderly
[I Disabled
FIGURE 6.2 Medicaid enrollees and expenditures by enrollment group, 1996.
Total expenditures exclude administrative expenses. POSH, disproportionate
share hospital payments. SOURCE: The Kaiser Commission on Medicaid and the
Uninsured (1999~. Reprinted with permission of The Kaiser Commission on Med-
icaid and the Uninsured.
OCR for page 185
POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
185
Liska (1997) concludes that the goal of reduced expenditures in Medic-
aid cannot be reached without enrolling special-needs groups in man-
aged care since they account for such a large proportion of total program
expenditures.
Whereas managed care has largely been piloted by the commercial
insurance industry, important legal, structural, operational, and historic
differences between Medicaid managed care and commercial managed
care are highlighted by the care provided for disabled populations. Tradi-
tional insurance plans and managed care organizations do not typically
provide coverage for the essential nonmedical enabling services (e.g.,
social and vocational rehabilitation services, transportation, and case man-
agement) that special-needs populations require and that are often provided
by safety net providers. Such services, although required under Medicaid,
might not be provided by Medicaid managed care plans unless the provi-
sion of such services is explicitly spelled out in the contract and is monitored
through specific quality-improvement standards (Rosenbaum et al., 1998~.
Somers and Brodsky (1997) noted that there are few tested models of
the provision of Medicaid managed care to populations with complex
health care needs because of uncertainty on the part of purchasers and
plans about how to design benefits and delivery systems and coordinate
with related funding streams and services for them. Their study also
found inadequate rate-setting and risk-adjustment capacities and warned
that a Revolution of purchasing, administration, and oversight responsi-
bilities to county governments could result in inconsistent purchasing
practices and policies.
Safety net prov~crers tor spec~a~-neecrs populations are at potentially
greater risk in a Medicaid managed care environment for several reasons.
Although some of these providers can offer a comprehensive array of
medical and enabling services, more often a provider of care for a special-
needs population has developed a niche in highly specialized medical or
enabling services funded through a combination of Medicaid and special
programs such as state block grants for mental health and substance abuse
services or Title V Maternal and Child Health Bureau (MCHB) block
grants for children with special needs. These providers may thus be
unable to provide the full range of services required to participate as a
primary care provider. The packaging and financing of their services will
depend on rate-setting and risk-adjustment policies that consider the spe-
cial medical and enabling needs of their populations.
. .
Children with Special Needs
Children with special needs present challenges for managed care
plans with regard to rate setting and projections of service utilization
OCR for page 186
186 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
because of problems with defining, and thus counting, the population.
Moreover, since they represent a group more integrated into the core
safety net than other special-needs groups, their primary and specialty
services illustrate the potential for integrated managed care models of
primary and specialty care services.
Safety net providers for special-needs children include community
health centers, public hospitals, children's hospitals, school-based health
clinics, public health departments, and a number of private not-for-profit
specialty service agencies. Safety net funding sources include Medicaid,
Title V MCHB grants combined with matching funds from the states, the
State Child Health Insurance Program, Individuals with Disabilities Edu-
cation Act funds, and Head Start funds (Institute of Medicine, 1996~.
The two principal sources of funding for special-needs children in the
safety net are Medicaid and Title V MCHB grants. Special-needs children
are more likely to be covered by Medicaid than by private insurance
because of the Early and Periodic Screening, Diagnosis, and Treatment
(EPSDT) program included in the benefits package. The EPSDT program
provides broader coverage for expanded services (e.g., for nonmedical
services or access to other health professionals like nurse practitioners or
nutritionists). Nationally, the average annual cost of EPSDT program ben-
efits for healthy children is about $1,000 to $1,500, whereas it is $5,000 to
$6,000 for special-needs children (Institute of Medicine, 1998~. The average
cost of caring for special-needs children varies greatly by state, region,
and market, as does the average cost per diagnosis or service need (Alli-
ance for Health Reform, 1997~.
Title V MCHB funds are used to provide services not covered by
Medicaid programs for both disabled and nondisabled children, includ-
ing programs offered by local health departments and community and
migrant health centers and for HIV infection prevention and treatment.
Title V MCHB funds are also typically used to strengthen linkages among
variously funded programs to support community-based care for chil-
dren. This is especially important for special-needs children, whose care
would otherwise be fragmented (Institute of Medicine, 1998~.
Because children with special needs have the same need for regular
developmentally appropriate primary care and immunization visits as
nondisabled children, they will more likely receive care from a pediatri-
cian, family practitioner, or some other primary caregiver (Neff and
Anderson, 1995~. In fact, pediatric primary care providers have been
encouraged to play active roles in caring for children with chronic health
conditions by acting as the coordinator of medical and related services,
providing referrals to specialists when necessary, and helping families
manage on a day-to-day basis (Blancquaert et al., 1992; Ireys et al., 1996;
Liptak and Revell, 1989; Young and Schork, 1994~. The integration of
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POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
187
primary and specialty care is prompted by the ongoing need for regular
primary care services as well as the special developmental needs of chil-
dren (Kuhlthau et al., 1998~. However, in some parts of the country,
pediatric subspecialties are located in regional medical centers, making
integration more difficult (Institute of Medicine, 1996; Schlesinger and
Mechanic, 1993~.
The fact that special-needs children suffer from more than 200 condi-
tions, all with a relatively low prevalence, poses special challenges in
defining the population and setting appropriate parameters for the deliv-
ery and financing of care through managed care arrangements. The prob-
lems of definition are so vexing that the MCHB Division of Services for
Children with Special Health Needs established a national consensus
panel, which concluded that this population is best defined by its service
needs rather than by diagnosis or disability per se (McPherson et al.,
1998~. Medical expenditures for special-needs children account for 70 to
80 percent of all medical expenditures for children, and expenses for spe-
cial needs children are, on average, five to six times higher than those for
healthy children (Institute of Medicine, 1998; Neff and Anderson, 1995;
Newacheck and Taylor, 1992~.
By 1998, 38 states had mandated managed care arrangements for at
least some children with special needs (Kaye et al., 1999~. Early imple-
mentation data from programs in California and Massachusetts provide
useful insights (National Governors' Association, 1996~.
Like most other states, California has exempted special-needs chil-
dren from the state's mandatory Medicaid managed care programs to
allow time to demonstrate the feasibility and cost-effectiveness of incor-
porating them into the program. Pilot projects that explore different pro-
vider reimbursement models include full-risk, partial-risk, and fee-for-
service case management with a variety of payment mechanisms:
· capitation payments to primary care providers, under which pro-
viders are capitated for the full scope of services or are capitated for a
specific range of services;
· capitation to all providers; and
· staff model health maintenance organizations with a variety of
physician payment mechanisms.
Alameda County, California, is testing a "special-needs risk factor
scale" to identify Medicaid-eligible children who require additional ser-
vices. The scale ranks a child in three areas: family risks, presence of
medical problems, and involvement with multiple community agencies.
The model seems to differentiate practices with large volumes of special-
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188 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
needs children from practices with small volumes. The former receive
increased capitation payments (National Governors' Association, 1996~.
Massachusetts enrolls children with special needs in the state's Medic-
aid managed care program, MassHealth. Through a grant from MCHB
the state has established the Managed Care Enhancement Project, a coop-
erative effort between the state's Title V staff and Medicaid programs to
improve the health status of special-needs children. The level of reim-
bursement is intended to be commensurate with the increased level of
effort required to serve special-needs children (National Governors' Asso-
ciation, 1996~.
A "special care coordinator" is assigned either to one large physician
practice or to two or more smaller practices to assist with additional case
management functions related to the care of special-needs children. The
grant also helped fund the development of a manual for the families of
special-needs children (National Governors' Association, 1996~.
People with Serious Mental Illnesses
People with SMIs represent a group that is treated in a publicly
financed safety net system that runs parallel to the general health care
safety net. Only 20 percent of people with a mental health problem seek
care through a primary care provider, and these tend to be people with
relatively minor or treatable disorders (Institute of Medicine, 1997~. Those
with more serious mental health problems are cared for in the specialty
mental health system and highlight the need for coordination of services
as well as the difficulties associated with a fragmented service system.
The most serious and disabling mental disorders (schizophrenia,
major depression, and bipolar illness or manic-depressive disorder) affect
about 2 percent of the population annually (Institute of Medicine, 1997~.
Schizophrenia affects more than 2 million Americans over the course of
their lifetimes and accounts for approximately 49 percent of all psychiat-
ric hospitalizations.
Overall, the public sector bears about two-thirds of the costs of pro-
viding care for people with mental health problems, in particular, for
those with the most serious disorders. The costs of treating mental illness
exceed the costs of treating many other diseases and are comparable to
the costs of treating cancer and cardiovascular disease (Institute of Medi-
cine, 1997~. Roughly 25 percent (about 2.6 million) of the population that
qualifies for SSI is eligible because of a serious mental disorder other than
mental retardation (Alliance for Health Reform, 1998~. Payments from
Medicaid account for an estimated 14 percent of all national spending on
mental illness and addiction services, whereas payments for these ser-
vices account for roughly 9.6 to 12.6 percent of Medicaid spending.
OCR for page 189
POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
189
Those with SMIs represent high-need, moderate-cost users for whom
recent advances in pharmacological treatment have been made, for whom
a number of community-based rehabilitation interventions have been
refined and the efficacies of which have been established, and who have
an established need for an extensive network of enabling and case-
management services to maintain or improve community-based func-
tioning.
In general, the public mental health system has encouraged the coor-
dination of medical and enabling services to integrate people with SMIs
into the community. However, the single greatest flaw of the mental
health safety net is its nearly total disconnection from the core safety net
addressed in this study. Managed care holds the potential to achieve
better coordination between the two systems, if not integration of the two
systems.
A wide array of safety net providers serve those with SMI, including
community mental health centers, state and county psychiatric hospitals,
family and social service agencies, transitional living and social programs,
housing and vocational rehabilitation programs, and a number of consumer-
driven self-help programs. The public mental health system, like the
public general health system, has a patchwork of funding streams: fed-
eral, state, and local sources including Medicaid, Medicare, federal block
grants to the states, and a myriad of state and local funds targeted to
various community-based not-for-profit programs. For example, commu-
nity mental health centers serve clients of all income levels regardless of
ability to pay, but the majority of these individuals are uninsured or are
receiving coverage through some public benefit program. More than 70
percent of community mental health center revenues are from public
sources, including 16 percent from Medicaid (Butler, 1993~. A distinguish-
ing feature of the public mental health safety net is that it serves as the
early default system for people whose private insurance benefits run out
in the course of a serious mental illness, a frequent occurrence (Institute of
Medicine, 1997~.
The service system largely comprises publicly funded agencies whose
primary missions are delivery of psychiatric services and coordination of
enabling and other services. This system is supplemented by a community-
based network of private not-for-profit agencies that provide many of the
special enabling services that people with SMIs require: child care, trans-
portation, domestic violence counseling and shelter for those affected by
domestic violence, housing, employment and skills training, and educa-
tion. The mental health community has come to embrace these services as
being equal in importance to more traditional medical services such as
medication and therapy (Institute of Medicine, 1997~. These services are
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19O AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
not routinely provided by traditional managed care plans and must be
carefully delineated in behavioral health managed care contracts.
A recent tracking study prepared for the Substance Abuse and Mental
Health Services Administration Managed Care Tracking System (1998) by
The Lewin Group reports that as of fuly 1998,46 states (the exceptions are
Maine, Mississippi, Nevada, and Wyoming) have implemented some type
of behavioral health managed care, up from 27 states in 1996. The study
indicates that safety net providers have retained a significant role in the
care of people with SMIs in managed care plans. Specialty long-term care
for people with SMIs is generally provided in stand-alone, carve-out, or
partial carve-out plans. More than half the programs are managed by
public-sector agencies or private-public partnerships. More than one-third
of the mental health programs cover residential, crisis, rehabilitation, and
support services. Medicaid acts as the lead agency for more than half the
programs, and more than half the programs target SSI beneficiaries who
qualify by virtue of their mental illness. However, the study also suggests
that in states that opt to integrate services (27 states), safety net providers
may have a decreased presence. Furthermore, integrated managed care
organizations often use a secondary carve-out contract with a behavioral
health managed care organization or safety net provider to shift the finan-
cial risk. Whether or not safety net providers participate in risk contracts,
this approach may increase the downward pressure on rates, threatening
their future viability.
A study from the George Washington University (Rosenbaum et al.,
1998) of Medicaid managed care contracts for behavioral health care found
that contracts show enormous variations in the definition of terms like
outpatient care, urgent care, or emergency care, leaving much room for differ-
ences in actual scope of coverage among organizations with seemingly
similar contracts. In general, state agencies give contractors broad lati-
tude in terms of coverage determination and prior authorization proce-
dures. Many general and managed behavioral care agreements permit
disenrollment of persons who are disruptive; some states specify that this
Stand-alone programs refer to managed behavioral health programs independent of any
other program (i.e., they are not carved out of a physical health program). Carve-out models
completely separate behavioral health services or populations from physical health man-
aged care programs. Partial carve-out models use a combined integrated approach for some
behavioral health services but place other expanded services or populations under a sepa-
rate managed care program. The intent is to provide a basic set of behavioral health benefits
under a comprehensive physical health plan but to supplement them under a separate
program for special populations whose needs go beyond those covered by the basic plan
(Substance Abuse and Mental Health Services Administration Managed Care Tracking Sys-
tem, 1998, p. I-20.
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194 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
infected children, states are interested in managed care to provide quality
care to a high-risk population and contain costs (The Kaiser Commission
on the Future of Medicaid, 1996~. By tune 1996, 35 states reported enroll-
ing people with HIV infection or AIDS in Medicaid managed care pro-
grams (Rawlings-Sekunda and Kaye, 1998~. Several recent reports pro-
vide in-depth case studies of states that have approached managed care
for this population in very different ways, depending on the concentra-
tion of people with HIV infection or AIDS in the area, geography, the
availability of HIV and AIDS specialists, and the availability of cost infor-
mation (Bartlett, 1998; Rawlings-Sekunda and Kaye, 1998; Health Re-
sources and Services Administration, 1997~. Two states illustrate the dif-
ferent challenges facing rural areas (Tennessee) with low concentrations
both of people with HIV infection or AIDS and of specialists in this area of
care and urban areas (Maryland) with high concentrations of both.
Tennessee's AIDS Centers of Excellence model, which is part of its
TennCare program that serves all Medicaid beneficiaries, builds on the
experiences of a few physicians with expertise in HIV infection and AIDS.
Centers are established on the basis of expertise and experience in the
treatment of HIV infection and AIDS and are fee-for-service subcontrac-
tors for all plans on a voluntary basis. There is broad participation of
stakeholders in the establishment and implementation of the authority of
the Centers, with special attention paid to linking medical and enabling
services. Prior authorization procedures are waived for prescriptions and
other treatments, and patients can elect to have the Centers act as their
primary care providers (Rawlings-Sekunda and Kaye, 1998~.
TennCare uses risk pools to protect plans against adverse risk selec-
tion. Each quarter the state calculates the difference between the total cost
of paying for enrollees with specific conditions on the basis of Medicaid
fee-for-service payments and the total amount paid to each plan for pro-
viding services to those enrollees. Each plan is reimbursed the difference
unless the total costs exceed the budget, in which case the money is di-
vided in proportion to each plan's share of the costs (Rawlings-Sekunda
and Kaye, 1998~.
Although the Centers of Excellence model shows promise for rural
and underserved areas, its consensus building and voluntary infrastruc-
ture could disintegrate in the face of uncontrolled or escalating costs asso-
ciated with the treatment of HIV infection and AIDS, a risk which will be
closely monitored by stakeholders.
In fuly 1997, Maryland initiated a Medicaid Section 1115 waiver with
mandatory enrollment of all Medicaid beneficiaries with HIV infection or
AIDS. The state uses a risk-adjusted Ambulatory Care Group (ACG)
reimbursement mechanism with a special capitation mechanism for
people with AIDS but no special rate for those in earlier stages of HIV
OCR for page 195
POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
195
infection. The ACG mechanism assigns rates to non-AIDS patients, includ-
ing those with HIV infection, on the basis of their recent levels of health
care utilization. The rates for people with disabilities range from $95 to
$1,102 per member per month. New enrollees for whom there is no utili-
zation history are assigned rates based on gender, age, and place of resi-
dence (Health Resources and Services Administration, 1997~.
Johns Hopkins University's experience with the ACG rates for HIV-
infected patients was that the average cost of care for these patients is
$1,000 per patient per month, whereas the average reimbursement rate
was only $500 per patient per month (Bartlett, 1998; Johns Hopkins Uni-
versity, 1997~. Care for HIV infection is delivered through a mixed model,
with expertise in HIV infection and AIDS care available in mainstream
plans and centers of excellence in which enrollees may see HIV and AIDS
specialists for both primary and specialty care (Health Resources and
Services Administration, 1997~. Special capitation rates are applied to
patients who meet the Centers for Disease Control and Prevention's 1993
definition of AIDS and are based on historic fee-for-service costs trended
forward. The costs of protease inhibitors, specialty mental health care,
viral load testing, and newly approved HIV-related drugs are carved out
and paid on a fee-for-service basis. In 1998, rates were set at $2,161 for
people living in Baltimore and $1,812 for people living elsewhere in Mary-
land (Health Resources and Services Administration, 1997~.
The Johns Hopkins HIV Care Program, like most urban health care
centers, treats large numbers of people with HIV infection or AIDS who
have multiple comorbidities and complicated health care and enabling
needs. They have had time to examine the process of transition to man-
aged care and have concluded that the learning curve is steep, especially
for academic health centers; that planning and implementing managed
care takes time and requires a dedicated project director; and that
although cost reduction is a clear goal, the kev to success is Drover risk
adjustment and rate setting (Bartlett, 1998~.
Tennessee's model differs from Maryland's in a few important ways.
Tennessee relies on risk pools instead of risk adjustment, plans partici-
pate voluntarily both in subcontracting and in following treatment proto-
cols, and plans use a coordinator to link medical and enabling services
rather than carving out these services.
Homeless People
Homeless people provide an example of a socially dislocated popula-
tion with extraordinary health care access barriers that require special
outreach programs. Because of their extreme poverty, homeless people
undoubtedly qualify for public benefit programs but frequently have dif-
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196 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
ficulty applying for and accessing such programs (Burt, 1992; Rossi,1989~.
Homeless people illustrate the convergence of several important factors
including stigma, extreme poverty, the presence of complex medical and
social needs, and a population that is difficult to track. The homeless use
costly hospital and emergency services for care and can present a public
health risk.
According to the U.S. Department of Housing and Urban Develop-
ment, as many as 7 million Americans, 15 percent of whom are children,
experienced being homeless at least once in the late 1980s, and in 1994, as
many as 600,000 people in the U.S. were homeless on a given night. The
population may have grown since the enactment of welfare reforms in
1996, which have limited access to public assistance (State Health Notes,
1998~.
On any given night one-third to one-half of the estimated 600,000
homeless people will be adults with serious mental illness and/or sub-
stance abuse, and others will have HIV infection or AIDS and resurgent
tuberculosis problems (Burt and Cohen, 1989; U.S. Department of Health
and Human Services, 1992; U.S. Department of Housing and Urban Devel-
opment, 1994~. Such illnesses carry a real public health threat, which only
compounds the stigma already associated with such disorders and with
homelessness itself. Studies have shown that homeless people (in particu-
lar, those with SMIs and women) are more likely to be criminally victim-
ized and that such victimization leads to a cycle of homelessness and
repeated victimization, as well as episodic admissions to hospital emer-
gency and acute care units (Caton et al., 1995; Lam and Rosenheck, 1998;
U.S. Department of Housing and Urban Development, 1994~.
Compared with nonhomeless people, homeless people (1) have a
greater need for psychiatric emergency and inpatient services (Dickey et
al., 1996; Rosenheck and Seibyl, 1998; Wuerker and Keenan,1997~; (2) have
more hospital emergency department and inpatient admissions and longer
lengths of stay attributable to substance abuse, mental illness, trauma,
and respiratory, skin, and infectious disorders (Salit et al., 1998~; and
(3) use more high-cost services. In nearly all cases, inpatient admissions
could have been prevented by earlier intervention and ongoing health
maintenance activities.
Like other special-needs populations, homeless people attract cat-
egorical funding streams from both the private and public sectors. Local
independent not-for-profit organizations and the faith community took
the early lead in providing emergency services, including temporary shel-
ter, food, and health services. Most states have relied on these efforts and
modest state funding (only 27 states reported any special assistance [less
than $5 million each] in 1991) for targeted services to the homeless popu-
lation. The federal government started to fill the gap in the early 1980s
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POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
197
with appropriations for the Emergency Food and Shelter Program,
designed to combine federal funds with state and local not-for-profit
organization resources to provide emergency assistance to the homeless
population, and the Temporary Emergency Food Assistance Program.
Other assistance came from the Emergency Assistance Program of the
U.S. Department of Health and Human Services, and the Community
Development Block Grant Program for which emergency services and
shelters were eligible (U.S. Department of Housing and Urban Develop-
ment, 1994~.
The passage of the 1987 Stewart B. McKinney Homeless Assistance
Act increased the federal government's role in addressing homelessness.
More than 20 McKinney Act grant assistance programs fund the provi-
sion of emergency food and shelter, surplus goods, transitional housing,
supportive housing, primary health care services, mental health care,
alcohol and drug abuse treatment, education, and job training (U.S.
Department of Housing and Urban Development, 1994~.
Public hospitals, community health centers, and facilities for veterans
have been the traditional safety net providers for the homeless popula-
tion, but the categorical funding streams noted above have broadened the
safety net considerably to include a wide range of private not-for-profit
agencies in churches and other nontraditional settings.
Successful programs have integrated primary care services (medical,
dental, and behavioral health care services) combined with case manage-
ment, enabling services (such as transportation), and street and shelter
outreach and have effectively created teams of registered nurses, nurse
practitioners, primary care physicians, psychiatrists, dentists, case man-
agers, outreach workers (for enrollment as well as engagement and reten-
tion), and social workers.
The Wasatch Homeless Health Care in Salt Lake City, Utah, is located
across from a park where homeless people congregate and sees about
6,500 homeless individuals each year for a total of about 22,000 "office"
visits. On-site services include primary care and pediatrics, dermatology,
podiatry, eye care, dental care, and physical therapy. In addition to its
staff of 17, the clinic relies on about 30 physician volunteers, AmeriCorps
members, and medical students who run a Saturday clinic.
The Providence Health Care for the Homeless project in Rhode Island
also relies on a combination of paid and volunteer staff from a wide range
of disciplines. It sees about 1,850 homeless people annually, for a total of
approximately 4,500 encounters. A mobile medical van staffed by rota-
tions of more than 100 physicians, nurses, and medical students is the
main outreach vehicle. It makes rounds to area shelters and soup kitchens
in the evening. In addition, the program operates a multiservice center for
clients who need enabling services, a Saturday walk-in clinic staffed by
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198 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
volunteer physicians, a women's program staffed 1 day a week by nurse
practitioners under an agreement with a local nursing college, and a dental
clinic staffed with volunteer dentists. The project relies on two local hos-
pitals to donate laboratory services for diagnostic work and has an agree-
ment with a community mental health center for outreach and referrals
(State Health Notes, 1998~.
LESSONS LEARNED
It appears that special-needs populations are more alike than differ-
ent. These populations present common challenges to managed care pro-
grams challenges that must be systematically evaluated in the context of
geography, resources, demographics, and the availability and accessibility
of special-needs providers before a managed care plan can be designed
and implemented. Although there is no single solution for people with
special needs, some common areas must be addressed by every state,
preferably before moving this group into managed care plans. Special-
needs populations in the safety net are vulnerable, first, by virtue of their
poverty and, second, by virtue of the chronic illness, disability, or social
circumstances that place them at increased risk of falling through the
safety net. Early experience has suggested that slow and cautious movement
toward managed care is the wisest approach to special-needs populations
and that moving too quickly with insufficient planning can compromise
the safety net for special-needs populations and can place consumers at
risk.
The lessons that have been learned from this analysis fall into four
areas: (1) problems of definition and data, (2) the service requirements of
special-needs populations, (3) issues of costs and financing, and (4) the
unique role of the consumer advocacy community.
Definitions and Data
Rates of disability vary from state to state, as do definitions of special
needs. These variations lead to meaningful differences in treatment
standards and the inclusion or exclusion of covered services in managed
care contracts; they make it particularly difficult to track special-needs
populations. Special longitudinal studies that are national in scope could
provide a baseline from which states, managed care organizations, and
providers could tailor their own data elements and studies to better plan,
implement, and evaluate the services that they provide to special-needs
populations. State consensus panels that involve all stakeholders might
be convened to address the issue of definitions to better predict service
need, utilization patterns, and costs.
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POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
Service Requirements of Special-Needs Populations
199
People with disabilities and chronic illnesses use a wide spectrum of
health and enabling services, and service requirements can vary consider-
ably among individuals and by diagnostic and disability group. Although
many states have medical necessity laws that mandate the inclusion of
such services, many managed care organizations interpret medical neces-
sity more narrowly. For some groups, the provision of medical and enabling
services is necessary but not sufficient. Those who are socially dislocated,
such as homeless people or immigrants, require active, specially tailored
outreach services. Thus, states should include specific language in con-
tracts to protect consumer access to outreach as well as medical and
enabling services. In most instances, such services have been and should
continue to be provided by safety net providers.
In addition, although special-needs consumers require access to both
primary and specialty care providers, little evidence suggests that the
primary and specialty care safety nets are well coordinated. Single-point
accountability services, such as case management and care coordinators,
provide the glue for an otherwise fragmented system of care, and such
services must be factored into the costs of service delivery. Finally, plans
need to be flexible in defining the primary care providers for these
patients.
Costs and Financing
The states vary widely in coverage and payment mechanisms for
special-needs populations; this variation is so wide that for some condi-
tions, like HIV infection and AIDS, the best predictor of care and out-
comes is the state in which one lives. Rapidly evolving treatment stan-
dards for some special-needs populations render the use of retrospective
cost methodologies ineffective for projecting future costs and payments.
Carve-out and stand-alone models have dominated the market for the
special-needs population, creating multiple tiers of coverage, responsibil-
ity, and accountability, and require new incentives to ensure appropriate
service delivery. Thus, financing (e.g., health-based and service-based rate
adjustment and risk pools), contracting, and regulatory mechanisms are
critical ingredients to successful managed care plans for the special-needs
population.
The Unique Role of Advocacy
It was apparent during the committee's site visits that consumer
advocates, in particular those who represent populations with special
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200 AMERICA'S HEALTH CARE SAFETY NET: INTACT BUT ENDANGERED
needs, have begun to secure an important place in policy making related
to managed care. Advocacy is an important factor in shaping health policy
for special-needs populations. Each special-needs group reviewed in this
chapter has a strong advocacy base that has been successful in marshaling
scarce resources for their constituents' needs. They have won hard-fought
legislative and regulatory battles that have improved access to and parity
in care. In addition, they have contributed to the ongoing discourse about
outcomes evaluation, quality, and effectiveness, with particular emphasis
on measures more sensitive to special-needs populations, better consumer
education on managed care, and better provider education on special
needs. They have argued effectively that consumers and consumer needs
must be represented in the managed care planning process and that
contracts must include a comprehensive array of medically necessary
services.
Sometimes a narrow advocacy focus can result in overly detailed
rules that become counterproductive to the implementation of care and a
burden to safety net providers that wish to serve special-needs consum-
ers. Although advocates might find it difficult to move beyond the nar-
row boundaries of their particular special-needs constituency to the more
inclusive boundaries of special needs in general, managed care will likely
demand such a broadening of views. Advocates and consumers will be
key players in the search for commonality among special-needs groups
and in identifying meaningful differences that must be accommodated
through variations in financing, contracting, or service delivery mecha-
nisms and should be included as essential stakeholders at all stages of
implementation of managed care plans.
GENERALIZATIONS TO THE LARGER SAFETY NET SYSTEM
Many of the lessons that have been learned and described in this
chapter can and should be generalized to the entire safety net system.
Although those with special needs served by the safety net system may be
at higher risk and require the bundling of more services than others served
by the safety net system, they provide a paradigm for the entire safety net
population. For example, the need for comparable data systems that cross
community and state lines is equally acute whether they are for people
with HIV infection or AIDS or poor, uninsured, inner-city mothers. States
must have meaningful data to maintain their authority and contractual
obligations to the populations served by the safety net system. Similarly,
the experiences with special-needs populations underscore the need for
specific language in contract agreements as states undertake enrollment
of safety net populations in managed care plans. The experiences with
special needs populations certainly provide evidence that financing, con-
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POPULATIONS WITH SPECIAL HEALTH AND ACCESS NEEDS
201
tracting, and regulatory mechanisms are essential ingredients in any man-
aged care plan involving safety net populations. Perhaps most important,
this brief examination of special-needs populations emphasizes what
many have long known: primary care and specialty care services in the
safety net system remain fragmented and uncoordinated. As more of
those served by the safety net system, particularly those who require
coordinated or integrated services, are moved into managed care arrange-
ments, the problems associated with fragmentation will become more
acute and will demand solutions such as single-point accountability,
point-of-service, care coordination, and case management. The committee
believes that special-needs populations are the sentinels, and are signal-
ing the effects for all Medicaid and uninsured people. They warrant con-
tinued study as an important barometer of the health of the safety net in
the evolving health care marketplace.
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Representative terms from entire chapter:
hiv infection
