Managed Care for Duals

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Chloe Hood
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1 Managed Care for Duals Jim Schultz, MD, MBA Chief Medical Officer, CCC Gary Rotto Director of Health Policy March 6, 2013

2 Patients with both Medicare and Medicaid 10 million in US, 1.2 million in California Poor, mentally ill, disabled 60% > 65, poor 40% < 65, disabled Very sick 20% of Medicare population but 31% of expense 15% of MediCal population but 40% of expense 2

poor 40% < 65, disabled Very sick 20% of Medicare population

3 38% with permanent disability 40% with severe cognitive impairment (Alzheimer s, severe mental illness, etc) Many in long term care facilities Poor: 50% with annual income < $10,000 $350 BILLION market nationally

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5 Medicare: Part A: hospital, acute care Part B: MD visits, tests- ANY MD/facility Part D: meds Deductible, share of cost, donut hole for meds fee-for-service reimbursement MediCal: Medicare copay/deductible/soc Long term care/custodial care Dental Transport fee-for-service reimbursement

fee-for-service reimbursement MediCal: Medicare copay/deductible/soc

6 Created by SB 1008 and SB 1036 Two Major Parts of the Initiative Duals Demonstration Managed Medi-Cal Long-Term Supports and Services (LTSS): 6

7 Have other private or public health insurance. Individuals with developmental disabilities receiving services through a Department of Developmental Services (DDS) 1915(c) waiver; regional center; state developmental center; or intermediate care facilities for the developmentally disabled (ICF/DD). Enrolled in Nursing facility/acute hospital waiver service HIV/AIDS waiver services Assisted living waiver services In-Home Operations waiver services. 7

(DDS) 1915(c) waiver; regional center; state developmental center; or intermediate care facilities for the

8 76,860 in San Diego 2nd largest county 18,000 IHSS recipients are dual eligibles (72% of total IHSS population) 71% over 65 Less than 20% in managed care 8

9 What are the key components? Implement Fixed payment for total care Mandatory assignment of patients to a managed care plan, +/-choice of plan Managed Care plans allowed To limit provider network Drug formularies Contract with limited vendors and facilities

patients to a managed care plan, +/-choice of plan Managed Care

10 Health plans to contract with the County for services including: In-Home Supportive Services (IHSS): Client continues to hire, fire & supervise care provider County social worker performs assessments Public Authority provides registry, training, provider enrollment, payroll Multipurpose Senior Services Program: Case Management services provided by County. January 2015, MSSP becomes managed care benefit Plans can request additional IHSS and will pay for it 10

provides registry, training, provider enrollment, payroll Multipurpose Senior Services Program: Case Management

11 Government perspective: Fixed predictable costs Control over future cost growth Elimination of cost risk -all risk passed on to managed care plan Potential for improved coordination of care improved quality reduced cost 11

risk passed on to managed care plan Potential for

12 Before: Pt any MD office or hospital; service rendered MD or hospital claim to CMS CMS $ to MD/hosp (fixed payment, usually about 25% of charges) MD/Hosp balance bills MediCal for residual (?)

13 After: CMS/state $$$ to HMO HMO 20-30% retention Capitation to provider group for: Primary care only All MD cost MD plus partial hospital cost Total care Net effect: 20-30% retention (profit target) for HMO, risk passed on to provider groups to manage (very simplified)

hospital cost Total care Net effect: 20-30% retention (profit

14 Coordinate and responsible for all Medical Services All Medicare and Medi-Cal services currently covered Long-term care services and supports (LTSS) Institutional Long-Term Care (SNF) Personal care services/ihss Community Based Adult Services (CBAS)(formerly ADHC) Multi-purpose Senior Services Program (MSSP) 14

Institutional Long-Term Care (SNF) Personal care services/ihss Community

15 MD/Hospitals: Provide a lot of services Provide new technology Provide expensive services No reward for quality No reward for efficiency Prescribe the best med Order the latest test/newest tech

16 MD/Hospitals: Reduce service volume Reduce service intensity Reduce referrals to specialists Order least expensive med Don t order tests Avoid latest tech

17 If a Medicare Plan Retain as much of the premium as possible Pass on as much of the risk as possible Marketing push Gather data demanded by CMS/state Find healthier subsets of patients to market to Profit imperative ($$ currently going to pt care diverted) If a MediCal Plan Will they really make $$?

CMS/state Find healthier subsets of patients to market to Profit

18 Based on current experience with SnPS population, already converted to managed care Disruption of primary care relationships Forced change of patient s medical home Disruption of longstanding specialty relationships, including those with unique super-specialists Loss of medication due to new formulary requirements

medical home Disruption of longstanding specialty relationships, including

19 Change of facilities Hospital not contracted Long term care facilities not contracted Delayed access Limitation of specialty network Limitation of specialty network Limitation of primary care network Need for prior authorization for services Need for formulary trials of meds/denial etc.

Limitation of specialty network Limitation of primary care network Need

20 Different insurers for Medicare and MediCal potential for different PCPs, auth processes, provider networks, formularies, etc. Better care coordination Overall cost savings?? More appropriate provision of care based on evidence Data- quality and outcomes scores now possible

Better care coordination Overall cost savings?

21 Revised to start in September Pushed back from January 21

22 Poor outreach and insufficient communication to beneficiaries and providers Problems with default assignments Systemic problems processing Medical Exemption Beneficiaries mental health needs not adequately addressed 22

23 Not the patients-most unaware until they seek services Insurers- feeding frenzy Approaching Community Health Centers for 1 st time Willing to take MediCal-only patients in order to gain access to Duals Medical Providers: mixed Coordination of care a plus Jumping through hoops factor-exponential and very worrisome

24 Traditional Medicare-only providers unprepared for: Severity of illness/complex co-morbidities Mental illness factor Impact of lower education level Impact of lower socioeconomic scale/ language and culture issues Dealing with long term care patients in volume

25 Good for taxpayers and government budgets Good for some health plans if allowed to pass on risk and take off the top Could be good for patients if care coordinated through a medical home and quality metrics implemented Could be good for sophisticated integrated health care systems used to managed care Many patients will dislike limited choice Many patients likely to suffer due to lack of ability to navigate a complex system without some safeguards

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State of California HEALTH AND HUMAN SERVICES AGENCY

EDMUND G. BROWN JR. GOVERNOR State of California HEALTH AND HUMAN SERVICES AGENCY Governor's Coordinated Care Initiative Long-Term Services and Supports Aging DIANA S. DOOLEY SECRETARY Alcohol and Drug