Contraceptive choice, access, and affordability are core determinants of an individuals’ economic and personal health. Access to contraceptives has improved women’s rates of enrollment and graduation from higher education, contributed to significant increases in women’s participation in the workforce, and is connected to increased wages.[i] Federally Qualified Health Centers (FQHCs) are community-based providers that exist to meet patients where they live and provide the primary care services they need. However, these health centers face unique reimbursement challenges to offering long-acting reversible contraceptives (LARCs) that may impede FQHC patients from accessing the full range of FDA-approved contraceptive methods.
Instead of being reimbursed for the cost of the service provided, FQHCs receive “bundled” payments for each qualifying visit or “encounter” under the Medicaid Prospective Payment System (PPS).[ii] While each FQHC’s PPS reimbursement rate is ostensibly derived from the cost of services for a generalized population, these payment rates often fall short of covering the costs associated with purchasing and stocking LARCs and providing related services. If FQHCs do not receive adequate reimbursement, these clinics may not be able to provide LARC services. One option to addressing this type of access barrier to LARCs is to unbundle, or “carve out”, the cost of the LARC device from the Medicaid PPS rate. In some states, LARC insertion and removal is also reimbursed separately from the PPS, depending on provider type.[1]
Medicines360 collaborated with Health Management Associates (HMA) and Waxman Strategies to conduct research focused on using an unbundling reimbursement strategy to expand access to LARCs in FQHCs. Several states have already used this strategy to increase LARC uptake. The research — which included interviews with providers, administrators, and stakeholders over the course of 2020 and early 2021 — concluded with the issuance of a policy brief for use by states interested in exploring a similar Medicaid reimbursement policy change. To illustrate an example of how one state unbundled LARCs, we gathered information resulting in a case study that details Georgia Medicaid program’s experience implementing a LARC unbundling policy.
Policy Brief: The Policy Brief describes the different Medicaid reimbursement policy options for expanding access to LARC at FQHCs. The Policy Brief recommends that interested policymakers pursue one of the following options:
- Pursue a Medicaid state plan amendment (SPA) that allows FQHCs to unbundle reimbursement of the LARC device from the PPS rate as a medical benefit; or
- Use an FQHC alternative payment methodology (APM) as defined in statute, either in place of or alongside the PPS rate, that incorporates family planning incentives and/or performance metrics as part of a broader payment methodology.
The Policy Brief also recommends that policymakers include both insertion and removal service fees as part of this policy to make sure provider incentives are aligned with a patient’s autonomy and choice in use of LARC methods.
Georgia Case Study: In 2010, 60 percent of all pregnancies in Georgia (119,000) were unintended.[iii] Unintended or closely spaced pregnancies can have negative health and economic consequences for women and their families.[iv] The LARC unbundling policy for FQHCs and Rural Health Clinics (RHCs) was one component of Georgia Medicaid’s strategy to address these outcomes. In 2015, the Georgia Medicaid program, with involvement of the Georgia Primary Care Association (PCA), submitted and received approval for a SPA that expanded the unbundling of reimbursement for LARC devices from the PPS at FQHCs and RHCs within fee-for-service (FFS) Medicaid. The Georgia Medicaid FFS data for the period following the unbundling policy change shows that the percentage of FQHC/RHC services that were LARC encounters gradually increased through 2018 and does correlate with the timing of the LARC FQHC unbundling policy. The claims data show the rate of increase was most prominent in 2015 and 2016: 36.8 percent in 2015 and 23.5 percent in 2016. In Georgia, the unbundling policy change may be contributing to improvement in the outcomes that Georgia Medicaid sought to address, as well as on contraceptive access and availability. Data from the Georgia Pregnancy Risk Assessment Monitoring System (PRAMS) shows that unintended pregnancies were down from 60 percent in 2010 to 43.3 percent in 2017.[v]
To learn more about the research methodology, findings, policy recommendations, the full documents are accessible on the Waxman Strategies and Health Management Associates (HMA) websites.
Medicines360 conducted this research in collaboration with HMA and Waxman Strategies with support from Arnold Ventures. Medicines360 is a nonprofit global pharmaceutical company focused on expanding healthcare access for women and is the developer of the LARC product, LILETTA®.
[1] For example, Georgia Medicaid provides separate FFS reimbursement to hospital-based Rural Health Center providers for LARC insertion and removal.
[i] Anna Bernstein, et al., The Effects of Contraceptive Access: A Review of the Evidence, Institute for Women’s Policy Research (Jul. 2020), available at https://iwpr.org/wp-content/uploads/2020/07/B381_Contraception-Access_Final.pdf.
[ii] Note that the PPS system only applies to fee-for-services Medicaid patients.
[iii] Kathryn Kost, Unintended Pregnancy Rates at the State Level: Estimates for 2010 and Trends Since 2002, Guttmacher Institute
(Jan. 2015), available at http://www.guttmacher.org/pubs/StateUP10.pdf.
[iv] Amy Tsui, et al., Family Planning and the Burden of Unintended Pregnancies, National Institutes of Health (Jun. 2010), available at
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3115338/.
[v] See, Georgia PRAMS, available at https://dph.georgia.gov/PRAMS.
