Thank You, Arnold, for Saving California AIDS Patients!

State Health Officials Reach Compromise on Contract for Renewal of ‘Positive Healthcare’ Program; Agreement Ensures Lifesaving Primary Care Case Management Plan for Low-income Californians with AIDS Will Continue

AHF’s Respected 15 Year-old AIDS Care Plan Saved State Nearly $7.5M in Past Five Years

By: AIDS Healthcare Foundation

Sacramento, CA - April 6, 2009

Late last week, officials from California’s Department of Health Care Services (DHCS) reached a compromise on a contract for the renewal of AIDS Healthcare Foundation’s (AHF) Positive Healthcare,  a lifesaving  primary care case management plan for low-income Californians living with AIDS. The agreement ensures AHF’s respected 15 year-old care plan—which has saved the state nearly $7.5 million dollars in the past five years alone—will be able to continue providing crucial services to one of California’s most vulnerable populations in a medically beneficial and money-saving manner.

In mid-December, in its initial contract renewal proposal for Positive Healthcare, DHCS officials proposed a per patient monthly ‘capitation rate’ for Positive Healthcare of just $1367.91—an 18% decline from the 2007 rate of $1,666.97—and a rate that AHF believed was not actuarially sound nor even legal under federal statute. As a result, AHF was unable to sign the proposed December contract by the March 31st 2009 state deadline, as AHF’s monthly costs for caring for these patients would easily exceed the state’s proposed capitation rate.  AHF was then forced to cease operating Positive Healthcare last Wednesday, April 1st. Most of the patients in the plan—all Medi-Cal recipients with an AIDS defining illness—then became general fee-for-service Medi-Cal patients without the benefit of assistance from Positive Healthcare’s specially trained nurse case managers coordinating the full spectrum of their AIDS care and services. 

“Despite the fact that the clock officially ran out last Wednesday, we are grateful that Governor Schwarzenegger and state health officials have had a heart, reconsidered, and offered this new compromise contract for Positive Healthcare,” said Michael Weinstein, President of AIDS Healthcare Foundation. “We have operated ‘Positive Healthcare on behalf of the state since 1995, dramatically increasing the health outcomes of patients in the plan. In the process, we also have saved California millions and millions of dollars in the costs of medical care—care that the state is legally obligated to provide and pay for one way or another. In the end, this is a victory for patients seeking proper and cost-effective care for their disease—a chronic, but potentially far more expensive disease to manage without the continuity of care that Positive Healthcare has provided over the years.”
  
“We look forward to working with state health officials to finalize this contract and get Positive Healthcare up and running again quickly,” said Donna Stidham, Chief of Managed Care for AIDS Healthcare Foundation. “Unfortunately, there will be a slight additional amount of bureaucracy involved, as the state came back to us with its compromise contract after Positive Healthcare ceased operating last Wednesday. As a result, all Positive Healthcare members must be re-enrolled in the program. In the larger scheme of things, however, the state is clearly doing the right thing morally and fiscally by continuing this primary care case management program for some of the state's poorest and most vulnerable citizens, and we thank them for this.” 

After first learning of the threat to Positive Healthcare’s existence from state health bureaucrats in mid-December, AHF spearheaded a multi-pronged campaign to save the plan by the March 31st state contracting deadline. The public awareness effort included lobbying visits to state legislators’ offices by Positive Healthcare patients and nurse case managers; the filing of a lawsuit in mid-February in the Superior Court of the State of California, County of Los Angeles (case #BS 119149) to legally halt the forced closure of the plan; and an innovative grassroots media and web-based awareness campaign intended to alert the public-at-large to the short-sighted bureaucratic move by state health officials. Visitors to the webpage could send an e-letter to the Governor asking him to save Positive Healthcare as well as view news stories and general information on the issue. AHF also posted a video parody of Governor Schwarzenegger that played off an image from his film star days as “The Terminator.” The 60 second parody also aired as a paid TV commercial on select television stations in Sacramento and Los Angeles.
During the awareness campaign, more than three million people visited the multi-media webpage urging California Governor Arnold Schwarzenegger to ‘Have a Heart’ and save ‘Positive Healthcare.’ The webpage (http://ga1.org/campaign/ahf_gov_haveaheart ) was a part of an ambitious operation spearheaded by AHF, the creator and operator of the Positive Healthcare, intended to persuade the Governor and state health officials to halt the forced closure of the respected money-saving AIDS care plan.

The primary issue keeping AHF and the state from reaching agreement on the state’s initial proposed capitation rate back in December was AHF’s belief that the rate was neither actuarially sound nor even legal. AHF repeatedly sought data from the state as to how it arrived at the rate, but was rebuffed. As a result AHF’s filed its lawsuit against DHCS in February. AHF’s lawsuit asserted that because the state has been unwilling or unable to set a contract capitation price that is consistent with state and federal law, its actions constitute a breach of law which is would force AHF to cease operating the Positive Healthcare managed care plan. AHF’s lawsuit—which is still pending in the court—states that, “In a time of rising health care costs, and for a disease that is one of the most costly to treat, DHCS has proposed paying 18% less than the previous contract price, for the same services.”  The lawsuit also states that, “…DHCS has breached its duties under both federal and state law, and that DHCS must contract at a per patient rate that is actuarially sound.”
“When Governor Schwarzenegger was first elected, he made a vow to increase transparency and ‘sunshine’ in his governance of the state,” added AHF’s Weinstein. “The inaction and obfuscation by some state officials on this issue was anything but transparent. I am heartened that that we are now forging an agreement that allows us to move forward, and look forward at some point to learning how the state arrived at the original rate it proposed.”

History of Positive Healthcare
AHF first established its Positive Healthcare program in California on April 1, 1995, when it introduced a groundbreaking Medicare Managed Care Plan—a ‘Special Needs Plan’ health care program—specifically designed for people living with an AIDS-defining illness who also lived in the Medi-Cal-designated service area of Los Angeles County, the only region AHF offered medical care and services at that time. The initial Positive Healthcare program, which operates under contract with California’s Department of Health Services (DHCS), was created with a prestigious federal ‘Special Projects of National Significance’ (SPNS) Grant. Since its inception, Positive Healthcare has both increased favorable patient health outcomes while significantly reducing the costs for such patients’ care to the state of California.

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About AHF: AIDS Healthcare Foundation (AHF) is the nation’s largest non-profit HIV/AIDS organization. AHF currently provides medical care and/or services to more than 98,500 individuals in 21 countries worldwide in the US, Africa, Latin America/Caribbean and Asia. Additional information is available at www.aidshealth.org