Abstract
The success of mandating memoranda of understanding (MOU) in promoting collaboration between Medicaid managed care (MCMC) plans and local health departments (LHDs) was examined in this research project. The mandate resulted in MOUs that contributed to increases in collaborative activities, increased perceived quality of health care, and successful management of reimbursement to LHDs. Factors associated with success included a local initiative type of health plan, longer length of time that the MOUs were in place, and higher interorganizational collaborativeness. Concerns related to the MOU approval process and lack of contribution of the MOUs to quality of public health services were identified. MOUs promote collaborative relationships between MCMC plans and LHDs on health care issues important to both sectors.
COLLABORATION between public health agencies and managed care plans has been promoted as a strategy for addressing public health concerns generated by the transition of state Medicaid programs from fee-for-service arrangements to managed care plans. 1 One method for promoting collaboration between public health and managed care is the "Memoranda of Understanding" (MOU). These documents are written, formal interorganizational agreements that describe how the organizations plan to interact and solve problems of mutual concern. 2 The purpose of this study was to examine the success of a strategy of mandated MOUs between managed care plans serving a Medicaid population and local health departments (LHDs) in the state of California.
Evaluation of the use of MOUs in promoting collaboration has been limited. Case studies of MOUs between public health and managed care organizations (MCOs) have reported them to be good tools for initiating relationships and collaboration between agencies. 2,3 However, the MOUs studied were found to be limited to addressing the role of public health agencies in delivering services to enrollees of health plans and did not address the role of MCOs in broader public health issues and activities. 3
Information on factors contributing to successful collaboration between MCOs and public health agencies is limited. Schauffler reported that certain types of MCOs (locally developed and county-organized systems) were more likely than others to collaborate with LHDs. 4 Nonprofit status, high MCO penetration in a geographic area, and large health department size also were identified as factors associated with more collaboration by Halverson. 5,6 Numerous organizational factors have been identified in the literature as promoting interorganizational collaboration. These factors include perception of interdependence and need to collaborate, 7-10 capacity to collaborate, 7,11 knowledge of the other organization, 12 experience and prior ties, 13,14 trust, 9,15 and leadership. 15,16 Mandates or regulations that require collaboration between organizations have been identified as powerful factors in promoting collaboration, although a mandate alone is not necessarily sufficient for successful collaboration to occur. 10,17,18
A 1998 survey of Medicaid programs found MOUs between LHDs and Medicaid managed care (MCMC) plans were mandated in nine states and existed in 31 states. 19 Compared with most other states, California has taken a more aggressive policy approach to encouraging collaboration by mandating MOUs, providing policy guidance on their content, and requiring formal state review and approval. Enrollment in managed care plans is mandated for California Medicaid participants eligible for the program due to their participation in the federal Temporary Assistance to Needy Families program in the state's most populous counties. 20 Three major models of managed care exist in California: (1) the Two Plan Model (12 counties), (2) Geographic Managed Care (two counties), and (3) County Organized Health Systems (five counties). 4 In the Two Plan Model, participants have a choice of two health plans: a commercial plan (CP) or a health plan developed locally by traditional providers of Medicaid services known as a "Local Initiative" (LI) plan. 20 At the time of this study, one county had only one health plan in place and in two counties, both health plans were CPs. Monthly enrollment in these 12 counties was 1.8 million in June 1999, with two thirds enrolled in the LI plans and one third in CPs. 21 The health plans serving the enrollees in these counties were required to develop MOUs with the LHDs serving the 12 counties in nine service areas related to communicable disease prevention [immunization, sexually transmitted disease (STD), human immunodeficiency virus (HIV), and tuberculosis (TB)] and family health promotion (family planning, children with special health care needs, Early and Periodic Screening, Diagnosis, and Treatment (EPSDT), maternal and child health, and Women's, Infants' and Children's (WIC) program. Eight LIs, three CPs operating in multiple counties, and 15 LHDs (12 county and three city agencies) were covered under the mandate. The state Medicaid program provided detailed guidance for the content of the MOU agreements and required that the MOUs be approved through a staff review process that involved both Medicaid and public health programs. The requirement to have an MOU was waived in situations where the LHD did not provide the relevant service (e.g., the county WIC program was not conducted by the LHD). The policy was implemented in 1996. This study examined only MOUs in the Two Plan Model counties.