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Department defends IBHP rollout after early provider payment problems; contractor subject to liquidated damages
Summary
Officials said the July 2024 transition to the Idaho Behavioral Health Plan required substantial system changes, and the contractor Magellan addressed early payment problems; the department has imposed liquidated damages and corrective action plans while continuing provider outreach.
Department of Health and Welfare officials told JFAC on Feb. 26 that implementation of the Idaho Behavioral Health Plan (IBHP), which went live July 1, 2024, required additional system configuration and provider outreach and that the contractor, Magellan, has been placed on corrective action for payment timeliness and other issues.
"These are costs that have already been incurred for system configuration changes made, and completed around the start of the new IBHP contract," Juliette Sharon, deputy director for Health and Welfare, said when asked about a supplemental to cover system and interface work needed to onboard the IBHP vendor.
Sharon told the committee the scope of the new IBHP contract was larger than the previous contract because services historically paid under fee-for-service and services previously delivered by the Division of Behavioral Health were consolidated into the managed-care contract. That larger scope required additional configuration, interfaces and testing in the Medicaid Management Information System (MMIS), she said.
Senators and representatives asked about persistent provider payment issues. Sharon and Director Alex Adams said some providers experienced payment delays at launch and during early months, but the department and Magellan worked to correct the problems.
"Magellan addressed those very, very quickly in partnership with our team," Sharon said. "We have imposed over $100,000 of liquidated damages with Magellan. Not all of those are related to timeliness of payment, but we are holding them accountable. They've also received management letters from us and are on corrective action plans to address those problems."
Sharon said problems included provider education, incorrect mailing addresses for paper checks and onboarding providers for electronic funds transfer. She said the department monitors timeliness and payment denials through monthly contract reporting and that Magellan has returned to compliance on timeliness measures.
Why it matters: The IBHP consolidation moves behavioral health payments and oversight into a managed-care model. Disruption in provider payments affects small behavioral health and federally qualified health center providers’ cash flow and the continuity of care, so the department said it is monitoring and enforcing the contract.
What’s next: The department asked the committee for a one-time supplemental to cover additional configuration work and to support vendor onboarding; staff said they will continue monthly oversight and provider outreach and share follow-up details with legislators who raise ongoing payment concerns.
