Geographic Managed Care Dental Program Evaluation: Executive Summary

April 2001

Prepared for the Medi-Cal Policy Institute by

William M. Mercer, Inc.

Acknowledgments This Executive Summary synthesizes findings from the complete report, Geographic Managed Care Dental Program Evaluation, prepared by William M. Mercer, Inc. for the Medi-Cal Policy Institute. To order the full report, contact the Medi-Cal Policy Institute (see below). William M. Mercer, Incorporated Ten Almaden Avenue, Suite 1450 San Jose, CA 95113 (408) 291-6300 The Medi-Cal Policy Institute, established in 1997 by the California HealthCare Foundation, is an independent source of information on the Medi-Cal and Healthy Families programs. The Institute seeks to facilitate and enhance the development of effective policy solutions guided by the interests of the programs’ consumers. The Institute conducts and commissions research, distributes information about the programs and the people they serve, highlights the programs’ successes, and identifies the challenges ahead. It collaborates with a broad spectrum of policymakers, researchers, providers, consumer representatives, and other stakeholders who are working to create higher quality, more efficient Medi-Cal and Healthy Families programs.

Copyright © 2001 Medi-Cal Policy Institute ISBN 1-929008-57-0 Medi-Cal Policy Institute 476 Ninth Street Oakland, CA 94607 tel: (510) 286-8976 fax: (510) 238-1382 www.medi-cal.org A project of the

Additional copies of this and other reports can be obtained by calling the Medi-Cal Policy Institute at (510) 286-8976 or by visiting the Web site (www.medi-cal.org).

Contents I. Introduction

1

II. Background

3

III. Methodology

5

IV. Summary of Findings

7

V. Detailed Findings

13

VI. Recommendations

31

I. Introduction The Medi-Cal Policy Institute (“the Institute”) engaged William M. Mercer, Incorporated (“Mercer”) to conduct an evaluation of the Department of Health Services (DHS) Geographic Managed Care (GMC) dental program in Sacramento County, California. In place since 1994, this pilot program provides dental care services to approximately 152,000 Medi-Cal eligibles monthly through four contracted dental managed care plans. A larger program known as Denti-Cal is responsible for serving approximately 4.75 million eligibles monthly throughout the rest of the state. Southern California also has a small number of pre-paid health plans (PHPs) that are responsible for serving a small number of eligibles. Performance of the Denti-Cal program served as the primary benchmark for this evaluation of Sacramento’s GMC program. Therefore, information regarding the Denti-Cal program is discussed throughout this report. Cathye Smithwick, RDH, MA led the Mercer team in conducting the evaluation between November 1999 and December 2000. Purpose The purpose of the evaluation was to provide answers to several key questions about the GMC dental program raised by policymakers, providers, health plans, patients, and advocates: 1. How does access to dental care compare to the Denti-Cal fee-for-service program? 2. How does quality of dental care compare to the Denti-Cal program? 3. How does the relative value (as defined by services received for dollars spent) compare between the two programs?

Geographic Managed Care Dental Program Evaluation: Executive Summary 1

4. How does the data collected by this independent study regarding access to care and quality of care compare to the data DHS receives from the four GMC plans? 5. How does DHS monitor the GMC program? Are the monitoring activities appropriate and accurate, or do changes need to be made?

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II. Background Since the GMC’s inception in 1994 there has never been a comprehensive and independent analysis of the program’s performance. Limited studies have been completed by DHS and other agencies however these were viewed by some policymakers as having the potential for conflict of interest. As a result, DHS began promoting the need for an independent evaluation of this program. It was hoped that the results would serve as the basis for making positive change that would ultimately improve access to care, quality of care, and cost performance of this program. The Medi-Cal Policy Institute seeks to facilitate and enhance the development of effective policy solutions with the interest of Medi-Cal recipients guiding this work. DHS involved the Institute in discussions about funding an evaluation of the GMC program and ultimately the Institute did provide a grant and engaged Mercer to conduct the study. A panel of experts (“the panel”) was established to provide insight to the evaluation team with respect to the study approach, evaluation tools, and preliminary findings. Members were drawn from the dental profession, state-sponsored dental benefit programs, academic institutions, and interested stakeholders. While all the decision-making authority rested with the Institute and the evaluation team, input and feedback from the panel was critical to the project’s success. Details regarding the panel of experts can be found in Exhibit 8 in the Appendix of the full report. It was determined that for ease of data analysis, the performance of the Denti-Cal program would be reviewed in one county only rather than for the entire state. Based on detailed research, Fresno was selected as the “comparator” county. While there were no perfect matches, in terms of various demographic variables reviewed, Fresno County was found to provide the closest match. For details regarding the process of selecting the comparator county, see Exhibit 6 in the Appendix of the full report.

Geographic Managed Care Dental Program Evaluation: Executive Summary 3

Dental benefits are provided to GMC eligibles by four different plans: Access Dental, Delta Dental, DentiCare of California, and Western Dental. Details regarding the enrollment by plan can be found in Exhibit 7 in the Appendix of the full report. A description of benefits available can be found in Exhibits 4 and 5 in the Appendix of the full report.

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III. Methodology The methodology of the evaluation involved: ▪

Analysis of responses by each of the four GMC plans and Denti-Cal to detailed questionnaires.

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Reviews of various DHS and vendor reports (see Finding 54 in Section VI of the full report).

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Interviews with managers and staff from DHS, the four GMC plans, and Denti-Cal. (Note: Interviewees have not been identified in the report due to the confidential nature of the information provided.)

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Analysis of utilization data provided by each of the four GMC plans and Denti-Cal.

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Audit of 102 charts per program for a total of 204 charts (for methodology see section IV, Quality Review, F, Chart Review of the full report). This audit was conducted by Ben Schechter, DDS.

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Review of relevant industry data, where available.

Geographic Managed Care Dental Program Evaluation: Executive Summary 5

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IV. Summary of Findings Access

Beneficiaries utilized services more under GMC dental and Denti-Cal than similar programs. ▪

Approximately 42% of GMC dental program members utilized services during the study period.

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Some 47% of Denti-Cal patients utilized services during the same timeframe.

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Similar programs in the dental industry report utilization rates in the range of 25 to 35%.

The number of dentists available to members is a weakness for both programs. ▪

Denti-Cal and GMC have high member-to-provider ratios, at 577 and 564 respectively.

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Most commercial dental programs report having one dentist per 360 to 400 members.

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In the GMC program, the number of dentists available in each dental plan to accept new patients ranges from one dentist available per 246 members to only one dentist available per 1,012 members.

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The number of dentists available to new patients in the Denti-Cal program is not monitored.

Geographic Managed Care Dental Program Evaluation: Executive Summary 7

Access to dental specialists may be better under the GMC dental program. ▪

The ratio of members to specialty providers is significantly lower under the GMC program, suggesting that access to specialists may be better.

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While more specialty services were provided under the Denti-Cal program, only 22% of these complex services were actually performed by specialists compared to 50% in the GMC program.

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Industry benchmarks suggest that it is typical for 70 to 80% of all complex services to be performed by specialists.

Beneficiaries received treatment more expeditiously in the Denti-Cal fee-for-service program. ▪

Necessary treatment was provided expeditiously 89% of the time in the DentiCal program.

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Necessary treatment was provided expeditiously only 50% of the time in the GMC program.

Children under age 3 and over age 14 received fewer services in the GMC program. ▪

Patients under the age of 3 received 30% fewer services under GMC than Denti-Cal.

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Patients over the age of 14 received 19% fewer services under GMC than Denti-Cal.

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Data under-reporting is an identified issue in the GMC program and this may account for some of the discrepancy.

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GMC treatment provided in a hospital setting is often reported through the GMC medical plans rather than the dental plans and this may account for some of the discrepancy in the under age 3 category.

Quality

There is greater accountability for quality in the GMC dental program. ▪

Greater accountability is required under the GMC contract because it is a managed care program.

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The GMC program requires annual site visits to 100% of provider offices.

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The Denti-Cal program requires annual site visits to only 2% of provider offices.

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The GMC program provides full credentialing of dentists while the Denti-Cal program does not.

Both GMC and Denti-Cal performed poorly in the level of preventive services provided. ▪

The chart audit used quality of care indicators to assess whether documentation in the charts reviewed supported treatment done. Based on this documentation the appropriateness of care was also evaluated.

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The overall level and quality of preventive services was scored as unacceptable in 40% of the charts audited under the GMC program.

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The overall level and quality of preventive services was scored as unacceptable in 50% of the Denti-Cal charts audited.

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Some 31% of the GMC charts failed to indicate fluoride treatments for children with age profiles that were positive for fluoride.

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Some 56% of the Denti-Cal charts failed to indicate fluoride treatments for children with age profiles that were positive for fluoride.

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Denti-Cal dentists failed to document the application of sealants in 50% of patients with age profiles that were positive for sealants.

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GMC dentists failed to apply sealants in 56% of patients with age profiles that were positive for sealants.

The GMC program scored much better than the Denti-Cal program in documenting periodontal screening, but both programs need improvement. ▪

GMC dentists failed to document periodontal screening in 38% of the charts audited.

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Denti-Cal dentists failed to document periodontal screening in a full 80% of the charts audited.

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Industry benchmarks suggest that fewer than 33% of charts reviewed should fail to document periodontal screening when indicated.

The Denti-Cal program appears to “over-treat” patients. ▪

Treatment was provided without documentation of need in 35% of the charts audited under the Denti-Cal program.

Geographic Managed Care Dental Program Evaluation: Executive Summary 9

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Only 6% of the GMC charts audited indicated treatment where there was no documentation of need.

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Excessive numbers of x-rays were noted in 17% of the Denti-Cal charts audited compared to 2% of the GMC charts.

There are indications of potential quality issues in the Denti-Cal program. ▪

While current dental practice guidelines do not recommend sealants for children over the age of 14, Denti-Cal dentists reported applying them to these patients 90% more frequently than GMC dentists did.

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While current clinical research shows that there is little evidence to support extracting asymptomatic “wisdom teeth,” Denti-Cal dentists reported performing these extractions on patients over the age of 14 104% more often than GMC dentists did.

Medi-Cal dental benefits and plan design need improvements. ▪

Subgingival curettage, a procedure that is of questionable value, is currently a covered benefit.

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Age limits for sealants and space maintainers are currently covered through age 21 while they are generally considered to be effective only through the age of 14.

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Intra-oral photographs, rarely useful for diagnostic purposes, are currently a covered benefit.

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Non-standard billing codes used for Medi-Cal dental services hampers oversight by DHS and creates administrative burdens on dental providers.

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Updating and revising the dental benefit plan is administratively cumbersome as it requires legislative action to do so.

Cost

Costs per eligible member is similar in the GMC and Denti-Cal programs. ▪

The costs range from $120 to $125 per eligible per year.

▪

These costs are higher than similar public programs, which report costs in the range of $95 to $105.

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The cost per patient utilizing services. ▪

Costs were evaluated in absolute terms based on actual dollar payments to the Denti-Cal and GMC programs. Details can be found in in the Relative Value section of the full report.

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Cost profiles were calculated by taking the number of services and multiplying by the dollar value of the services based on the Denti-Cal fee schedule. Cost profiles illustrate how actual cost would compare if both programs paid dentists from the same fee schedule.

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Based on DHS data, Denti-Cal cost per unduplicated utilizer was 22% lower than GMC. This is likely due to the higher level of unduplicated utilization (47% versus 42%) in Denti-Cal versus GMC.

▪

Mercer’s utilization analysis found consistently lower cost profiles per unduplicated utilizer for specific services in GMC. This is likely due to both difference in unduplicated utilization rates and the mix of services (e.g., distribution between low cost and high cost services).

Geographic Managed Care Dental Program Evaluation: Executive Summary 11

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V. Detailed Findings Access to Care Assessment Question 1: How does access to care compare among the GMC program

in Sacramento and the State of California Denti-Cal program and industry benchmarks? Access to care is defined in this report as a patient’s ability to obtain dental care. The ease of access is determined by such components as the number and location of dentists participating in the program, the availability of appointments and hours of operation, access to transportation, and to language translation services. Access problems can have harsh consequences for beneficiaries seeking dental care. These problems are often manifested in the form of postponed treatment leading to advanced dental disease and pain, tooth loss, and reduced quality of life. Public programs serving Medi-Cal beneficiaries have an obligation to take all measures possible to ensure adequate access to care. Access can be measured in a variety of ways, including: ▪

Member-to-provider ratios — A measure of potential access. Higher ratios may indicate access problems. However, member-to-provider ratios should not be viewed in isolation, because the productivity of dental practices can vary widely.

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Number and percent of offices closed to new patients — A measure of potential access. High numbers of offices closed to new patients reduces access to care.

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Access monitoring — A measure of the programs in place to monitor and facilitate access. Stricter monitoring programs help to ensure greater levels of access and quick response to problems that are identified.

Geographic Managed Care Dental Program Evaluation: Executive Summary 13

▪

Unduplicated utilization for general and specialty services — A measure of the percent of eligibles that actually received care and the types of services received.

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Provider reimbursement — A measure of potential access, because this affects the number of dentists willing to participate.

The results of the access evaluation are summarized below.

Member-to-provider ratios Member-to-provider ratios are similar between Denti-Cal and GMC, at 577 and 564 respectively. These ratios are high when compared to commercial programs where ratios are typically in the 360 to 400 range. Holding productivity constant, this could indicate access weakness under both programs. However, given the many challenges of participating in these programs (needy population, high administrative burden, etc.), unqualified comparison to commercial programs may not be appropriate. One weakness noted in the GMC program was the broad variability of member to open provider ratios (ranging from 246 to 1,012) among the four GMC plans. Also, the GMC plan with the poorest member to provider ratio (1,012) is responsible for 40% of total GMC membership. Alternatively, member-to-specialty-provider (orthodontists, endodontists, periodontists, oral surgeons, and pediatric dentists) ratios vary dramatically, not only between Denti-Cal and GMC, but also among the four GMC plans. For example: ▪

While the member-to-specialty-provider ratio for Denti-Cal (Fresno County) was 6,334, the corresponding GMC ratio was 3,554. This represents a ratio for Denti-Cal that is 78% higher than it is for GMC and it indicates that potential access to specialists is greater under GMC when compared to Fresno County.

▪

The member-to-specialty-provider ratios also vary widely among the four GMC plans, ranging from 1,939 to 4,697. The GMC plan with the poorest ratio (4,697) has no oral surgeons, endodontists, orthodontists, or periodontists under contract. This plan is responsible for about 6% of total GMC membership. We conducted interviews with plan managers, who indicated that non-network specialists are made available to GMC members through special arrangements. Mercer asked to see copies of reports demonstrating the level of specialty referral activity, but such reports were never provided. The lack of network specialists may represent a weakness in this plan, because it unfairly penalizes members for making choices that they may not fully understand.

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Closed offices One GMC plan, representing 40% of total enrollment, reports that 20.3% of its dentists are closed to new patients. This is high relative to industry averages, which range from 8 to 10% for managed care programs that treat similar populations. This would have an impact on newly enrolled beneficiaries who select this plan by making it difficult for them to find a dentist and schedule an appointment. This problem would also be more strongly felt by GMC beneficiaries than other types of dental patients, because they tend to be mobile (move often), may lack telephones and transportation, and often English is their second language. While there is a toll-free number available for anyone experiencing access problems and needing help with changing providers or plans, this does not address the potentially more serious problem of having so many closed offices. Also, while individuals enrolled in commercial programs would find this situation frustrating, the typical GMC member may eventually give up trying to seek care until need is so great that they must go to an emergency room. This could result in loss of teeth, because postponing dental treatment leads to continuing progression of dental disease. We recommend that DHS determine a maximum acceptable threshold for the number and percent of closed offices for each of the four GMC plans. Denti-Cal is a fee-for-service program and practices are not monitored to determine the number of offices that may be available to new patients who call for appointments.

Monitoring geographic access Relative to Denti-Cal, the GMC program shows strengths in monitoring geographic access to care. Geographic access measures the number and location of beneficiaries relative to providers and is a measure of potential access to care. The GMC program defines “acceptable” access as the number and percent of beneficiaries with access to one general dentist and one specialist in 15 miles. Currently, between 97.2% and 100% of beneficiaries meet these criteria. The criteria for general dentists (one dentist in 15 miles) is uncommon compared to that used by commercial managed care programs, which typically use a benchmark of two general dentists in 10 miles. While the current access statistics are high relative to industry averages, which typically range from 80 to 85%, using industry standard benchmarks we would still expect access in excess of 95%. Also, the GMC plans are contractually required to provide DHS with regular GeoAccess reports that measure the percent of members meeting the access criteria. These reports are used to identify areas with access problems so that DHS and the plans may collaborate to address these issues. Geographic access is not monitored under the Denti-Cal program, because it is not a contractual requirement. The mere act of measuring geographic access does not by itself ensure access. However the failure to measure it does reduce accountability for results and prevents managers and policymakers from identifying access problems and addressing them quickly and effectively.

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Monitoring of access to appointments The GMC program shows strengths relative to Denti-Cal in monitoring of access to appointments. All GMC plans have programs in place to monitor access to appointments and they include comparison to benchmarks and the delivery of routine reports to DHS. While the contract benchmarks—emergency care twenty-four hours a day, seven days a week (24/7) and other care within three weeks—are slightly better than those commonly used in the managed dental programs, some GMC plans used internal benchmarks that were inconsistent with the contract benchmarks. For example, some ranged from three to six weeks for hygiene appointments. This is more consistent with industry ranges, indicating that the GMC contract benchmarks may be overly strict. The GMC plans also perform member satisfaction surveys to evaluate member perceptions of access. Two recent surveys found that 67 to 90% of respondents were able to get an appointment in four weeks or less. We find that 67% is on the low side of the range for managed care programs treating similar populations, which report that 75 to 85% of respondents are able to get an appointment within this timeframe. On the other hand, Denti-Cal does not monitor access to appointments, because it is not required under the terms of its contract. This is a weakness under Denti-Cal, especially in light of the other challenges, such as lack of telephones and transportation, facing these beneficiaries.

Data reporting At the provider level, data reporting under GMC is similar to other capitation-based managed care programs we have reviewed. Data under-reporting is an industry-wide problem for dental managed care programs and industry estimates hold that as many as 50% of all services may go unreported. For the two GMC plans that track data submission levels, it was estimated that 25 to 33% of dentists fail to routinely submit data for services provided to GMC members. DHS should ensure that the GMC plans give the highest priority to addressing the data under-reporting issue.

Unduplicated utilization Unduplicated utilization is an access measure based on the number and percent of eligibles that receive care within a given timeframe. It is a very important measure of access because unlike measures of potential access, such as member-to-provider ratios, it is based on the actual number of eligibles that receive care during a given period of time. GMC unduplicated utilization was 11% lower than for Denti-Cal (42% versus 47% respectively). These differences are probably not statistically significant, especially in light of the data under-reporting problem noted in GMC. Also, these rates are high relative to industry estimates, which range from 25% to 35% for similar managed care programs. One explanation for the high level of unduplicated utilization might be the degree of dental need in this population and in fact, one recent study found that California’s children have about twice as much untreated decay as their national counterparts. 16 Medi-Cal Policy Institute

More dramatic differences were noted between Denti-Cal and GMC for unduplicated utilization for the under 3 and over 14 age groups. Specifically we found: ▪

Unduplicated utilization in GMC for children under age three was 30% less than for Denti-Cal (4.45% versus 6.33% respectively). However, data underreporting is a significant problem under GMC, especially for young children receiving care in a hospital setting. Our analysis found that it is common for GMC providers to submit data for treatment provided in the hospital (common for very young children with severe dental disease) to the GMC medical plans, rather than the dental plans.

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Unduplicated utilization for GMC beneficiaries over the age of 14 was 19% less than for Denti-Cal (37.53% and 46.29% respectively). Again, data underreporting plays a role in these differences, because not all patient treatment is being reported by GMC providers.

While these findings are important, they should not be fully weighted until further research is done to determine the accuracy of the data and the level of statistical significance.

Access to specialty care and to specialists More specialty services per unduplicated utilizer were reported under Denti-Cal than under GMC. For this study, specialty services were defined as those with a difficulty level high enough as to warrant being done by a specialist, rather than a general dentist. On a composite basis (using all specialty services) our analysis found 0.9655 and 0.4153 services per unduplicated utilizer for Denti-Cal and GMC respectively. This equates to an unduplicated utilization rate that is 57% lower for GMC than for Denti-Cal. However, only 22.1% of the specialty services done under Denti-Cal were actually performed by specialists, the rest were done by general dentists. On the other hand, almost half (49.6%) of the specialty services provided under GMC were actually done by specialists. While industry data on unduplicated utilization rates for specialty services is sketchy, there is more evidence about the level of care actually performed by specialists. Estimates indicate that it is common for 70 to 80% of all complex services to be done by specialists, rather than general dentists. Access to specialists is a problem throughout the managed dental care industry and is not unique to Denti-Cal and GMC. Low reimbursement to specialists is cited by many industry experts and stakeholders as the most common reason for this problem.

Differences in specific unduplicated utilization Dramatic differences between the two programs were found for unduplicated utilization of specific services. For example: ▪

GMC dentists reported 30% fewer diagnostic services (e.g., exams and x-rays) per unduplicated utilizer (2.99 versus 4.26) than did Denti-Cal dentists. A big Geographic Managed Care Dental Program Evaluation: Executive Summary 17

contributing factor to this discrepancy may be the difference in the way the two programs handle initial oral exams (procedure 010). Under the GMC program an initial exam can only be recorded once per patient per lifetime. On the other hand, each time a Denti-Cal patient sees a new dentist, a new initial oral exam fee may be charged and paid. This discrepancy results in the recording of fewer diagnostic services in GMC than in Denti-Cal. ▪

GMC dentists reported 9.4% fewer preventive services (e.g., cleanings, fluoride, sealants, etc.) per unduplicated utilizer (0.55 versus 0.71) than did DentiCal dentists. Also, GMC dentists reported 39% fewer sealants (0.244 versus 0.403) than did Denti-Cal dentists.

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GMC dentists reported 47% fewer basic services (e.g., fillings) per unduplicated utilizer (1.01 versus 1.90) than did Denti-Cal dentists.

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GMC dentists reported 117% more complex services (e.g., extractions of impacted teeth, molar endodontics, etc.) per unduplicated utilizer (0.39 versus 0.18) than did Denti-Cal dentists.

These differences, while significant, may be due to under-reporting or under-treatment by GMC dentists, or over-reporting or over-treatment by Denti-Cal dentists, or other factors yet to be determined. Our data review found evidence of under-reporting and/or miscoding by GMC dentists and the chart review found evidence of over-treatment in the Denti-Cal charts and slow or delayed treatment in the GMC charts. We recommend that DHS immediately address the data reporting issue by working with the GMC plans to find ways to capture data on all services provided under this program. In addition, we recommend that DHS conduct random chart reviews to reconcile actual treatment done and reported for both GMC and Denti-Cal.

Cost profiles Significantly different cost profiles were found between Denti-Cal and GMC for most services. Cost profiles calculate the value of service provided per unduplicated utilizer, based on the Denti-Cal fee schedule, for specific services or service sectors and are driven by both the level and distribution of services between high and low cost procedures. Cost profiles are important measures of access and quality, because they can help evaluators identify possible overor under-treatment or data submission/coding problems. Some examples are: ▪

Cost of diagnostic services per unduplicated utilizer was 15% lower under GMC than Denti-Cal ($29.43 versus $34.76).

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Cost of preventive services per unduplicated utilizer was 17% lower under GMC than Denti-Cal ($18.07 versus $21.84).

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Cost of basic services per unduplicated utilizer was 49% lower under GMC than Denti-Cal ($44.33 versus $86.41).

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Cost of complex services per unduplicated utilizer was 27% lower under GMC than Denti-Cal ($18.37 versus $25.25).

The above could be an indication that Denti-Cal dentists have a preference for providing more high-cost services relative to low-cost services than do their GMC counterparts. However, due to the data under-reporting problem in GMC, we are unable to determine the exact significance of the differences described above. We recommend that DHS work with the GMC plans to address data under-reporting as previously discussed.

Barriers to change Benefit design and provider reimbursement for Denti-Cal and GMC are defined by legislation and thus are not easily changed. This creates significant barriers to change and these barriers may have negative consequences to beneficiaries. For example, the Denti-Cal fee schedule is very low when compared to similar programs. The plan design for both programs is out-ofdate. This has resulted in fewer dentists participating than would have otherwise.

Stakeholder perspectives around access Stakeholders for both GMC and the fee-for-service Denti-Cal programs were surveyed about access issues and all expressed a belief that access was a problem under both the GMC and Denti-Cal programs. Explanations given included an unwillingness of providers to participate, due to: ▪

High administrative burden.

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Difficulty in treating this population (high level of dental need, transportation problems making it difficult to keep appointments).

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Low level of reimbursement relative to the cost of treating these patients.

Stakeholder comments were consistent with findings discussed throughout this report and only act to reinforce the need for change in these two programs. Quality Review Question 2: How does quality of care compare among the GMC program

and the Denti-Cal program and industry benchmarks? Quality of care is defined in this report as the degree to which dental services for individuals and populations increase the likelihood of desired dental outcomes that are consistent with current professional knowledge. Administrative functions that help to drive quality outcomes include provider credentialing, utilization analysis and reporting, grievance resolution

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programs, chart audits, and site visits. Defining and measuring quality is hampered by the fact that, unlike the medical industry, the dental industry does not have diagnostic codes. This makes definitive measurement of dental health outcomes very difficult. In the absence of diagnostic codes, dental industry analysts use more primitive methods for evaluating the quality of care. This study used various “quality indicators” such as administrative reviews to assess activities in place to support quality, utilization analysis to identify possible treatment problems, and chart audits to estimate the quality of actual treatment provided. Quality problems can impact beneficiaries by leading to inferior health outcomes, for example lost teeth rather than saved teeth, pain rather than freedom from pain, etc. Public programs have an obligation to take all measures possible to ensure the best quality outcomes for beneficiaries. During the study period, the water supplies in Fresno and Sacramento Counties were not fluoridated (with the exception of one small area in Fresno, representing less than 5% of the total county population). Also, a recent study found that California’s children have twice as much decay as their national counterparts and millions of school days are lost each year due to dental-related illness. Adding fluoride to the water supplies in California counties that currently do not have it is the single most important public policy measure that can be taken to improve the dental health of California’s children and adults, especially those in low-income brackets. While water fluoridation does not directly relate to specifically evaluating performance of the GMC and Denti-Cal programs, it is nevertheless a very important public policy issue that we believe deserves special attention. The results of the quality review are discussed below.

Quality monitoring Quality monitoring varies dramatically between the Denti-Cal and GMC programs, with the most fundamental difference being driven by contractual requirements around site visits and provider credentialing. For example, the GMC contract requires annual site visits to all provider offices. This equates to an annual review rate of 100%, and is higher than industry averages for similar programs, which typically review offices every 24 months, equating to an annual review rate of 50%. On the other hand, the Denti-Cal contract requires quarterly reviews of one half of one percent (0.5%) of offices, with half of these reviews being comprehensive. This equates to an annual review rate of 2%, and is low relative to industry practices for similar programs, which require 100% review in the first year and random reviews of between 4% and 5% of offices thereafter. Also, the GMC contract requires full credentialing of dentists, including site visits, while the Denti-Cal contract does not. These differences can have significant impact on quality of care and managers’ ability to identify problems and implement solutions. We recommend that DHS consider implementing a formal provider credentialing program for Denti-Cal and requiring greater levels of site visits than currently required.

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Plan design The Denti-Cal and GMC programs share the same plan design, determined by legislative action. Please see Exhibits 4 and 5 in the Appendix of the full report for detailed plan information. We find that the plan design is out of date and should be revised. While important revisions have been implemented (most recently, the allowance of two oral exams and cleanings per year), other revisions are needed. Examples of needed revisions include: ▪

The migration to standardized dental coding protocols (i.e., CDT-3). The current situation of using non-standard billing codes makes filing claim forms and encounter data cumbersome for dentists, reduces their willingness to participate, and hampers oversight by DHS by making it difficult to compare performance of GMC and Denti-Cal to commercial programs. This migration is planned for a future date.

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Elimination of coverage for subgingival curettage (a procedure that is generally considered to be ineffective and is excluded from most dental plans).

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Elimination of coverage for intra-oral photographs (rarely useful for diagnostic purposes and excluded from virtually all dental programs).

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Revisions to age limitations for sealants and space maintainers. For example, sealants are generally considered to be effective through age 14, yet the GMC and Denti-Cal programs cover them to age 21. As a result, the utilization analysis found an unusually high number of sealants being provided to DentiCal patients over the age of 14, and yet the overall rate of sealants for both programs was lower than expected. This would indicate that sealants are being over utilized for patients who do not need them (those over age 14) and underutilized for patients that should have them (those under age 14). The policy implication of this finding is that for the same dollars spent, greater levels of dental health could be achieved through the appropriate use of sealants.

Contractual requirements around dental record-keeping Dental record-keeping is a crucial component in any quality dental care delivery system. It is a requirement of all dental licensing boards and dental schools. Failure to keep adequate patient records can compromise patient health and quality of care. Dental record-keeping requirements for both programs were found to be very weak and in need of revision. The chart review found significant weaknesses in dental record-keeping for both programs. These weaknesses could also place patient health at risk. For example, 39% and 21% of DentiCal and GMC charts respectively, found inadequate documentation of the type of local anesthetic used. Adverse reactions to local anesthetics can happen and some adverse reactions can be life threatening. If the type of local anesthetic is not documented, this could cause

Geographic Managed Care Dental Program Evaluation: Executive Summary 21

serious problems for treating physicians, should the patient need hospitalization due to an allergic or other reaction to the anesthetic.

Overall patient history This area of the chart review evaluates whether or not the dentist collected all information necessary to make sound clinical judgements and treatment decisions. This is an aggregate score and includes areas such as medical and dental history, charting, x-rays, diagnosis and treatment planning, etc. Both the Denti-Cal and GMC charts were very poor in this category, with 29% of the Denti-Cal charts and 24% of the GMC charts scored as unacceptable. This means that fully one-fourth of the charts reviewed did not include adequate information for making sound, scientifically-based treatment decisions. This impacts beneficiaries by increasing the likelihood that treatment done may be inappropriate or not the best treatment for treating the patient’s condition. We recommend that DHS strengthen contractual requirements around dental record-keeping and enforce compliance through regular chart audits.

Medical alerts Both the Denti-Cal and GMC dentists showed significant weaknesses in the posting of medical alert information in the patient record. Failure to clearly indicate medical alerts for patients with compromised health conditions can seriously complicate treatment, pose a health risk to the patient, and in some cases, be life threatening. While 29% of Denti-Cal charts that should have included medical alerts did not, a full 43% of GMC charts failed to include medical alert information. This represents a serious weakness in both programs. We recommend that DHS strengthen contractual requirements around dental record-keeping and enforce compliance through regular chart audits.

Preventive services The chart review found that both programs needed significant improvement in the area of preventive services. This category of the chart review evaluates whether or not adequate preventive services were provided and includes areas such as oral hygiene instructions, cleanings, sealants, and fluoride treatments. For example: ▪

Overall preventive services. Each chart was given an aggregate score for the overall level and quality of preventive services. Both the Denti-Cal and GMC charts scored poorly in this area with 52% of Denti-Cal charts and 40% of GMC charts scored as unacceptable.

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Oral hygiene instructions. 48% of Denti-Cal charts and 27% of GMC charts scored unacceptable for oral hygiene instruction. This means that for between one-fourth to one-half of the charts reviewed, oral hygiene instructions were not recorded as being done.

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Sealants for children under the age of 14. Sealants are plastic coatings applied to the chewing surfaces of permanent molars on children to prevent decay. Performance in this area was very poor, with 50% of Denti-Cal charts and 56% of GMC charts failing to indicate the use of sealants for patients with age profiles that were positive for sealants.

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Fluoride treatment for children under the age of 14. Fluoride treatments have been found to be highly effective at reducing decay in children. Both the Denti-Cal and GMC charts were weak in this important area with 56% of Denti-Cal charts and 31% of GMC charts failing to indicate fluoride treatments for children that needed them.

Periodontal screening While the GMC charts scored much better than the Denti-Cal charts in the area of periodontal screening, improvements are needed in both programs with respect to this very important diagnostic procedure. Periodontal screening evaluates the health status of the supporting structures of the teeth (gums and bone around the teeth) and failure to perform regular periodontal screening can lead to tooth loss that could have been prevented. Periodontal screening should be done on adults at the initial exam and at regular follow-up exams thereafter. Fully 80% of the Denti-Cal charts and 38% of the GMC charts were unacceptable in this important area. Scores of “unacceptable” mean that either periodontal screening was not done, or any extenuating circumstances that may have precluded it from being done were not indicated. Similar programs we have reviewed have unacceptability scores in fewer than 33% of the charts. We recommend that DHS work with organized dentistry, the Board of Dental Examiners, and the dental academic community to strengthen record-keeping standards for the profession as a whole. DHS should continue to emphasize the importance of dental record-keeping and monitor it through regular chart audits.

Potential over-treatment A higher incidence of potential over-treatment was found in the Denti-Cal charts than in the GMC charts. Potential over-treatment can be defined as treatment performed when the need for such treatment is not evident from the x-rays or supported by documentation and charting. It can also be defined as treatment that is more complex than that recommended by industry guidelines. For example, 17% of the Denti-Cal charts and 2% of the GMC charts contained an excessive amount of x-rays. Also, over one-third (35%) of Denti-Cal charts included treatment that was performed without evidence of need. Only 6% of the GMC charts contained such evidence. The data analysis also found high rates of extractions (especially for wisdom teeth), and sealants on children over the age of 14 (not recommended) in Denti-Cal relative to GMC.

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Potential under-treatment for GMC The chart review found evidence of potential under-treatment in GMC. Under-treatment can be defined as failure to provide all necessary care and/or failure to do so expeditiously. While 89% of Denti-Cal charts reviewed were acceptable in the area of expeditious treatment, only 55% of GMC charts scored acceptable for this category. Also, undiagnosed pathology was found in both Denti-Cal and GMC charts with a greater proportion of Denti-Cal charts demonstrating undiagnosed pathology, such as failure to document the presence of decay when it was shown on x-rays.

Utilization patterns Differences were found in utilization patterns for certain services between Denti-Cal and GMC. This was especially evident in sealants for patients over the age of 14 and third molar extractions. Both of these services are often used as indicators of possible quality problems. For example: ▪

Sealants for patients over the age of 14. Denti-Cal dentists reported 90% more sealants per unduplicated utilizer for the over age 14 group than did their GMC counterparts. Current dental practice guidelines indicate that sealants are most effective when placed on molars within two years of eruption, usually through age 14. However, current Denti-Cal and GMC plan design covers sealants to age 21. This is contrary to current practice guidelines and excessive application of sealants for patients over the age of 14 could indicate a quality problem.

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Extractions of third molars (“wisdom teeth”). Denti-Cal dentists reported 104% more third molar extractions per unduplicated utilizer for patients over the age of 14 than did their GMC counterparts. This is significant because current clinical research shows that there is little evidence to support extracting third molars unless the patient is experiencing pain, discomfort, or other troubling systems. A deviation that is this dramatic may indicate that Denti-Cal dentists are taking a more liberal approach to extracting third molars than GMC dentists.

Distribution of services

Distribution of Services

The distribution of services (the percent of Service Category Denti-Cal GMC Industry total services done broken out by each catePreventive/Diagnostic 61% 63% 60–63% gory) was found to be similar between Basic Restorative 23% 18% 17–20% Denti-Cal and GMC as well as to industry Periodontics 1% 1% 5–6% ranges. The one exception to this was the low level of periodontal services at 1%, Major/Complex 14% 17% 13–15% compared to industry ranges of 5 to 6%. One factor that might have contributed to this is plan design, which under Denti-Cal and GMC is limited with respect to periodontal services.

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Relative Value Assessment Question 3: How does relative value compare between the GMC program

and the Denti-Cal program? Value can best be described by the equation where: Value =

(Access + Quality + Service) Cost

The equation above implies that if two programs are found to have equal quality, the one with the lowest cost provides the greatest value. The relative value analysis looks at value on two levels: the value of the services in dollar terms (i.e., per dollar spent), and in terms of unduplicated utilization.

Barriers to value comparisons There are many barriers to comparing value between the two programs. These include: ▪

Differing financial incentives between the two programs. GMC dentists may have an incentive to under-treat because many of them are paid via capitation. Denti-Cal dentists, who are paid on a fee-for-service basis, may have an incentive to over-treat.

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Under-reporting in GMC. Not all patient encounters are being reported under the GMC program and there is evidence that as many as one-third of all utilization may go unreported.

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Over-reporting in Denti-Cal. Denti-Cal may have an incentive to over-report services due to the fee-for-service nature of the program and the lack of oversight for billing for some services (routine fillings).

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Appropriateness of care. When assessing relative value, it is important to realize that providing greater numbers of services does not automatically equate to greater value especially if unnecessary treatment is being performed.

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Administrative oversight. Administrative oversight requirements are greater under GMC than Denti-Cal. However, it is difficult to quantify the value of administrative oversight.

As a result of the above-described barriers, we were unable to quantify a relative value score for each program. However, the value equation described above was used as a theoretical tool for the overall discussion relating to value.

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Cost per eligible Average cost for Denti-Cal and GMC are similar, ranging from $120 to $125 per eligible per year. This cost appears higher than in other public programs, which report costs in the range of between $95 and $105. All else being equal, this would imply similar value between DentiCal and GMC.

Cost per unduplicated utilizer Denti-Cal reported lower cost per unduplicated utilizer than did GMC. Average Denti-Cal and GMC costs were $311 and $401 respectively. All else being equal, this would imply greater value under Denti-Cal than GMC.

Unduplicated utilization rates Reported utilization rates are higher under Denti-Cal than under GMC. Average utilization for the four-year period ending 2000 was 40% and 30% for Denti-Cal and GMC respectively. This is actually high relative to industry information, which indicates unduplicated utilization typically ranges from 25 to 30% for similar programs. In addition, weaknesses were noted in data collection and reporting for the two programs. For example, evidence indicates that GMC services are being under-reported, which would cause utilization rates to be understated. Additionally, it is our understanding that denied claims are included in Denti-Cal’s calculations of unduplicated utilization, which would overstate Denti-Cal utilization rates. We cannot comment on the actual quantitative impact on value of these reported utilization rates, because so many problems exist around data integrity for the GMC program.

Utilization by age group Denti-Cal also reported higher unduplicated utilization for all age brackets than did GMC. For example: ▪

Denti-Cal reported unduplicated utilization for patients over the age of 14 that was 34% higher than GMC.

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Denti-Cal reported unduplicated utilization for patients between the ages of 3 and 14 that was 56% higher than GMC.

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Denti-Cal reported unduplicated utilization for patients under the age of 3 that was 63% higher than GMC.

However, there are problems with data integrity, evidence of over-treatment in the Denti-Cal program, and evidence of under-reporting in the GMC program.

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Access monitoring Access to care is monitored under GMC, but not for Denti-Cal. While access monitoring in and of itself does not necessarily ensure adequate access, we find that programs that actively monitor and report access issues are far more likely to have better access than programs that do not. All else being equal, this would imply greater value under GMC than under Denti-Cal. Data Collection Review Question 4: How does the data collected by this independent study

regarding access to care and quality of care compare to the data the Department of Health Services receives from the four GMC plans and industry benchmarks for similar programs? Reports generated by DHS DHS receives a great deal of data from each of the GMC plans and uses this data to create internal monitoring reports. Data tracked includes utilization trends, number and percent of services by key procedures per 1,000 members and per 1,000 unduplicated users, dollar value of services, procedure ratios, members assigned to each plan, and membership to specialty ratios. DHS staff interviewed by Mercer indicated that trend analysis (i.e., comparing current performance to past performance of the same program) rather than comparison to benchmarks, is used to identify potential problems. Failure to use objective industry benchmark information as one basis for analysis can reduce the ability of DHS to detect problems and quickly identify solutions. Improvement can be made in the ability of DHS to monitor performance of the GMC program by adding industry benchmark information to its reporting program and by comparing each data element to industry benchmarks.

Differences in unduplicated utilization Mercer applied the formula used by DHS to calculate unduplicated utilization and derived slightly different estimates. For example, while DHS estimated unduplicated utilization for GMC of 39.27%, Mercer’s calculations resulted in unduplicated utilization of 42.14%, about 7% higher than DHS estimates. These differences may be due to rounding errors or to differences in the actual data received by Mercer, which was obtained directly from the GMC plans, and data received by DHS, which is received through the fiscal intermediary organization EDS. However, we believe that the differences are small enough as to not be significant.

Data integrity In general, the data collected by Mercer during this evaluation was similar to that provided to DHS by the GMC plans. However, weaknesses were noted, such as:

Geographic Managed Care Dental Program Evaluation: Executive Summary 27

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Under-reporting in GMC. There is evidence that not all utilization information is being reported for the GMC program. This evidence is based on a combination of anecdotal information, such as interviews with managers and staff for all the GMC plans as well as the rather dramatic differences in unduplicated utilization rates for specific services reviewed during the evaluation. The fundamental cause of data under-reporting in GMC and similar plans, is the fact that the majority of dentists are paid by monthly capitation payments and therefore submission of utilization information is not directly tied to compensation.

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Duplicate services. GMC data also contained duplicate services, especially for treatment involving multiple visits. It appears that some GMC dentists require additional education about how to report care for multiple visit services, such as crowns, partials, and dentures.

This finding is consistent with other programs we have reviewed, where data under-reporting is always an issue for capitation-based dental programs. On the other hand, claims-based programs such as Denti-Cal, almost by definition, have far greater data collection abilities because provider reimbursement is perfectly correlated with claims submission. GMC Monitoring Review Question 5: How does DHS monitor the GMC? (i.e., are the monitoring

activities appropriate and accurate or do changes need to be made?) Monitoring can be defined as all those activities routinely carried out by DHS managers and staff to ensure that the GMC plans are complying with contractual provisions, including appropriate levels of access and quality of care. Typical monitoring activities include regular review of performance reports, and conducting site visits and chart audits.

Qualifications and training of contract managers Contract Managers (CMs) are responsible for day-to-day monitoring of the program. The CMs are experienced analysts, but DHS indicates that none have clinical experience or backgrounds.1 In addition, there are no training programs available for CMs. At a minimum, we would expect that DHS would provide all CMs with initial and ongoing training in dental administration basics, including basic clinical concepts and terminology.

1

We were anecdotally informed by one Department Dental Consultant that there is one CM with some clinical background.

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Policies and procedures for monitoring GMC performance DHS has an Administrative Guide used by CMs in monitoring the GMC program. However, this Guide is limited to the fundamentals of filling out paperwork and routine report review and related correspondence. DHS indicates that it does not have formal written policies and procedures in place for the actual process of monitoring performance of the GMC program. Failure to have detailed written policy guidelines for monitoring program performance can lead to inconsistent decisions and ineffective policies.

Protocol for integrating clinical feedback into GMC monitoring Each individual CM is responsible for independently determining when a particular issue needs the input of a dental clinician. The Dental Program Consultant then provides input when requested. This process is informal and there are no written guidelines regarding integration of dental clinical expertise into the monitoring process. It is inappropriate to leave such decisions to ad hoc opinions of staff with no clinical background or training and such an approach may result in lost opportunities to identify problems and implement solutions.

Clinical representation in management DHS does not have a Dental Director or dentist with management/decision making authority. This is a serious weakness because there is no set protocol for integrating the knowledge and resources that a dental clinician brings to a program of this magnitude. The importance of this point can not be over-emphasized because having a Dental Director ensures appropriate clinical input with respect to management decision making (i.e., strategic planning). In addition, while each of the GMC plans has a Dental Director, they do not have a counterpart within DHS.

Dental program consultant access to reports DHS generates standard reports on its mainframe system. These reports are used by the CMs and Dental Program Consultants to monitor the performance of the GMC program. When either a routine or an ad hoc report is needed, it must be requested and we were informed that it usually takes 24 hours to print and route a report. DHS can achieve greater monitoring effectiveness by developing a system that allows real time desktop access to the reporting database.

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VI. Recommendations 1. We recommend that DHS give high priority to assessing member-to-provider ratios statewide; developing benchmarks for optimal ratios; using these benchmarks for conducting targeted recruiting efforts; and monitoring progress on an ongoing basis. 2. We recommend that DHS revise the access benchmarks used for the GMC program to the industry standard of two general dentists in 10 miles and implement access criteria and monitoring for the Denti-Cal program. 3. We recommend that DHS review and consider revising its criteria for access to appointments under GMC (three weeks for routine care may be aggressive) and implementing a requirement to monitor access to appointments under Denti-Cal. 4. We recommend that DHS implement a program to monitor and track unduplicated utilization for both programs, by service area and by age bracket. Also, DHS should work with the GMC plans to improve data reporting to ensure that all treatment is reported under this program and to provide more accurate comparisons between the two programs. 5. We recommend that DHS review and revise the Denti-Cal fee schedule to be structurally consistent with similar commercial programs in California. We also recommend that DHS work with the GMC and Denti-Cal plans to find ways to increase reimbursement to specialists. On the Denti-Cal side this would involve creating a separate fee schedule for specialists, which is currently prohibited by regulation. On the GMC side, this would involve allowing DHS to review provider reimbursement used by the plans to pay specialists. Currently, the level of provider reimbursement under GMC is considered confidential. Geographic Managed Care Dental Program Evaluation: Executive Summary 31

6. We recommend that DHS develop ways to streamline administration of both programs in a way that allows for regular reviews and updates of both provider reimbursement and plan design. 7. We recommend that DHS develop protocols to regularly review and update the plan design for both programs to ensure that they are consistent with current professional research. 8. We recommend that DHS revise dental record-keeping requirements under both programs and monitor and enforce compliance through regular chart audits. 9. We recommend that DHS strengthen contractual requirements around dental record-keeping and enforce compliance through regular chart audits. 10. We recommend that DHS include screening for potential over-treatment in its chart audit protocol. 11. We recommend that DHS include screening for potential under-treatment in its chart audit protocol. 12. We recommend that DHS reconsider plan design for coverage with respect to periodontal care because such care is designed to save teeth that might otherwise be lost. 13. We recommend that DHS work with the GMC plans to reduce the level of under-reporting and accurately track all services provided. In addition, once the data reporting issue has been resolved, DHS should recalculate unduplicated utilization and if disparities still remain, determine the actual cause and take corrective action as needed.

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