NYAPRS Note: The newly released report on dual eligibles (those who receive Medicaid and Medicare) commissioned by the NYS Health Foundation underscores the following:
- There are 700,000 dual eligibles in NY, 2/3 of which are over 65 and 40% of which have ‘significant behavioral health or cognitive’ issues especially for those in the 1/3 that’s under 65.
- They represent 15% of NYS Medicaid beneficiaries but use 45% of those dollars; New York’s per-person Medicaid expenditures for dual eligibles are twice the national average and the highest in the nation.
- Prominent in the report’s recommendations include:
- constructing the state’s health homes and capitated managed care initiatives to serve dual eligibles and
- emphasizing that beneficiary education and enrollment processes that incorporate the input of beneficiaries and their representatives will be crucial to the success of such an effort, a prominent NYAPRS member advocacy priority
Integrating Care for Dual Eligibles in New York: Issues and Options
James M. Verdier, Jenna Libersky, Jessica Gillooly
Mathematica Policy Research for NYS Health Foundation February 2012
Executive Summary
http://www.nyshealthfoundation.org/userfiles/file/DualEligibles_2012.pdf
More than 700,000 people in New York are simultaneously enrolled in both Medicare and Medicaid. These “dual eligibles” and their families, health care providers, and those who operate the two programs are continually challenged by an intricate maze of overlapping and conflicting programs and services, and by the inefficiency, fragmentation, and duplication of services that drives up overall costs for both programs.
Dual eligibles get almost all of their physician, hospital, prescription drug, and other short-term acute care services from Medicare, while most of their long-term care services in nursing facilities and in the community are provided through Medicaid.
Some services, like home health, nursing facility, hospice, and durable medical equipment, such as wheelchairs, are covered by both programs, but the coverage rules in each program are different.
These divisions of payment responsibility between Medicare and Medicaid thwart efforts to reduce preventable hospital, emergency room, and nursing facility use because the costs of prevention are often borne by one program while the financial savings accrue to the other. Divided payment responsibility also fosters wasteful efforts by providers and payers to shift costs from one program to the other.
Better coordination and integration of care for dual eligibles could save State and Federal dollars and substantially improve the quality of care for this diverse and vulnerable population.
Dual eligible characteristics, care needs, and costs. Almost two-thirds of dual eligibles are over age 65, and more than one-third are under age 65 and have serious disabilities and chronic illnesses. All have low or no incomes, more than half do not have a high school degree, and more than 40% have significant behavioral health or cognitive problems, with behavioral health problems more prevalent among those under age 65, and Alzheimer’s and dementia more common among those over age 65. Twenty percent are living in an institution, and another 27% are living alone.
Not surprisingly, health care costs for dual eligibles are very high. Nationally, while dual eligibles represent only 15% of Medicaid enrollees and 18% of Medicare beneficiaries, they account for 39% of total Medicaid expenditures and 31% of Medicare expenditures. In New York, these cost patterns are magnified-dual eligibles represent 15% of Medicaid enrollees, but account for 45% of total Medicaid expenditures. Significantly, New York’s per-person Medicaid expenditures for dual eligibles are twice the national average and the highest in the nation.
New York and national initiatives. Major initiatives are underway both in New York and nationally to improve the coordination and integration of care dual eligibles receive through Medicare and Medicaid. In January 2011, New York Governor Andrew Cuomo appointed the Medicaid Redesign Team (MRT). The MRT recommended-and the Legislature subsequently passed-a number of initiatives aimed at improving the management and coordination of care for dual eligibles and other high-need, high-cost beneficiaries. The major State initiative related to dual eligibles is mandatory enrollment of Medicaid beneficiaries in need of long-term care services in managed long-term care (MLTC) health plans.
At the national level, the Medicare-Medicaid Coordination Office (MMCO) and the Center for Medicare and Medicaid Innovation within the Federal Centers for Medicare & Medicaid Services (CMS) joined together in April 2011 to award $1 million contracts to New York and 14 other states to design demonstration programs to better integrate care for dual eligibles. Approved demonstration proposals will receive additional CMS funding for implementation.1
Recommendations
Use the Federal dual eligible demonstration to support and enhance State initiatives for dual eligibles. The Federal demonstration can test ways to provide more fully integrated Medicare and Medicaid services on a smaller or more geographically limited scale than is planned in the State MRT process. MLTC plans that currently cover Medicaid long-term supports and services (LTSS) in the community and in nursing facilities could, for example, add linkages to primary, acute, behavioral health, and Medicare services for dual eligibles in the New York City area, where the building blocks needed to add these capacities already exist among a variety of health plans. Those aspects of the Federal demonstration that prove successful could be incorporated into the broader State initiatives as they are implemented over time.
Require greater integration of all Medicaid and Medicare services in capitated managed care programs. As part of the demonstration, the State could require managed care organizations or other care coordination entities participating in the demonstration to cover all Medicare and Medicaid primary, acute, behavioral health, and long-term supports and services for dual eligibles, or to have close contractual relationships with entities that do.
Use the CMS Financial Alignment Models to Help Finance More Integrated Benefits for Dual Eligibles. The financial alignment models that CMS is making available in the demonstration provide a way for states and health plans to share in the savings that can result from better coordination and integration of Medicare and Medicaid benefits for dual eligibles, including Medicare inpatient hospital, emergency room, prescription drug, and skilled nursing facility benefits, and Medicaid LTSS and behavioral health benefits.
Use three-way capitated contracts to broaden and integrate the benefit package for dual eligibles. The CMS capitated financial alignment model permits states, CMS, and health plans to enter into three-way contracts that cover all Medicare and Medicaid services for dual eligibles, including benefits that are now provided separately through Medicare and Medicaid health plans, or through fee-for-service (FFS) arrangements.
While few managed care programs in New York fully integrate both acute and long-term care and Medicaid and Medicare benefits, there are health plans that operate plans in several of the Medicaid and Medicare managed care programs in the State that partially integrate these benefits. They include the different types of MLTC plans, Medicare Advantage Special Needs Plans (SNPs), and Mainstream Medicaid Managed Care plans, in addition to the small but fully integrated PACE plans. These plans could serve as building blocks for more fully integrated managed care options for duals. The kinds of partnerships and collaborations among health plans and other entities needed to accomplish this greater degree of integration have already begun in the New York City area, and the dual eligible demonstration could provide further support and encouragement. The biggest challenge in upstate New York will be bringing LTSS into a managed care framework, because few health plans and providers operating in those
areas have that experience.
Use State’s health home initiative to increase integration of behavioral health services for dual eligibles. Another important State initiative related to dual eligibles is establishing “health homes” for Medicaid beneficiaries with complex and costly physical and behavioral health care needs. Nearly 1 million Medicaid beneficiaries in the state have complex physical and behavioral health conditions and could benefit from the greater coordination health homes could provide, and nearly one-third are dual eligibles. Health homes can be used in either managed care or FFS settings, so they could be used as a way of more fully integrating behavioral health into capitated plans, both in the dual eligible demonstration and as part of the MRT process.
Use health homes funding to cover initial Medicaid care coordination costs. The Federal Affordable Care Act of 2010 authorizes 90% Federal funding for specified care coordination activities for the first two years of health homes initiatives. Health homes can be a source of upfront funding for the care coordination support systems needed by dual eligibles, with particular focus on the behavioral health care needs that are widely prevalent among dual eligibles under age 65.
Use passive enrollment to increase enrollment in the dual eligible demonstration. In order to support the enhanced care coordination activities needed to make the Federal demonstration successful, and to increase the likelihood of Federal Medicare savings that would benefit the State, the demonstration must achieve a significant volume of dual eligible enrollment. CMS has authority to permit states to “passively enroll” dual eligibles in capitated managed care plans for their Medicare services for purposes of the demonstration, as long as those who are passively enrolled have the ability to opt out easily. Beneficiaries must be fully informed about their care options, including their ability to return to the Medicare FFS program at any time.
Continue and expand stakeholder engagement and consultation. Extensive stakeholder engagement is one of the major CMS requirements for dual eligible demonstrations. New York has considerable experience with this approach, since it has been a hallmark of the MRT process. Stakeholder engagement will be especially important for generating support for expanding enrollment in the Federal demonstrations through passive enrollment. Beneficiary education and enrollment processes that incorporate the input of beneficiaries and their representatives will be crucial to the success of such an effort.
Next steps. The NYSDOH proposal for the design of the dual eligible Federal demonstration proposal is due to CMS in April 2012. The time between now and April can be used to design a demonstration proposal that builds on the strengths of the MRT initiatives by testing approaches that can move New York as quickly and effectively as possible toward programs for dual eligibles that fully integrate and coordinate all of their care.
1 Both the State MRT initiatives related to dual eligibles and the CMS dual eligible demonstrations share the goal of developing person-centered approaches to coordinating care for dual eligibles across primary, acute, behavioral health, and long-term supports and services, but the time line for implementation of the State MRT initiatives is somewhat longer and the State initiatives are focused more broadly on all Medicaid beneficiaries and the services they receive, not just dual eligibles.
http://www.nyshealthfoundation.org/userfiles/file/DualEligibles_2012.pdf