Medicaid agencies across the country are engaging in innovative initiatives to address both the health and social needs of older adults and people with disabilities. Many of these initiatives involve either expanding existing provider networks or developing new provider networks in sectors such as social services, care management, institutional care, and Medicare. In California, Medi-Cal, the state’s Medicaid agency, is undertaking an ambitious statewide initiative known as California Advancing and Innovating in Medi-Cal (CalAIM) to transform services for people with the greatest needs and costs. As part of this initiative, Medi-Cal managed care plans (MCPs) in California are expanding health and social service provider networks to better respond to the needs of older adults and people with disabilities.

Under CalAIM, MCPs are contracting with community-based social service providers and care management organizations to offer non-medical Community Supports and Enhanced Care Management (ECM) services for people with the most complex care needs. MCPs in California are also strengthening their networks of institutional long-term care (LTC) providers — including skilled nursing, subacute, and intermediate care providers — as they carve in LTC. Additionally, many MCPs that serve people who are dually eligible for Medicaid and Medicare will be building networks of Medicare providers as they create aligned Dual Eligible Special Needs Plans, called Medicare Medi-Cal Plans.

This blog post, made possible by the California Health Care Foundation, reviews considerations for California and MCPs as they fortify provider networks to ensure that older adults and people with disabilities have their health and social needs met. It focuses on strategies for partnering with three key provider types: (1) community-based organizations (CBOs); (2) institutional LTC facilities; and (3) Medicare providers. Lessons from MCPs in California are highlighted throughout and can inform managed care organizations in other states.

1. Integrate CBOs into Provider Networks

Contracting with CBOs to provide social supports and care management can help MCPs better meet the health and social needs of older adults and people with disabilities on Medicaid. Collaborating with CBOs versus building capacity internally can be a cost-effective strategy for MCPs that may have little experience with care management and services for people with the most complex needs. In California, MCPs are adopting new approaches for developing CBO provider networks to deliver social supports.

• Partner with CBOs with experience delivering social care for older adults and people with disabilities. To meet the needs of older adults and people with disabilities, MCPs should partner with CBOs that have experience with these populations. In California, MCPs can provide up to 14 non-medical Community Supports. Six of these — respite nursing facilities, transitional care, community transition services, personal care and homemaker services, and meal services — are particularly relevant to supporting older Californians and people with disabilities. For services that help beneficiaries transition out of institutional care and into community-based settings, MCPs should seek social service providers with experience successfully working in transitional care services, including CBOs that have participated in programs such as Money Follows the Person.
• Center health equity when selecting CBOs for contracts. Taking time to understand the community and ensuring diversity in the CBOs in the network to best address the needs of populations served is a key step for addressing health equity. MCPs should contract with providers with connections to diverse communities, language capabilities, and the ability to work with people with limited English proficiency. Partnerships with CBOs can give MCPs a connection to the local community since CBOs are often trusted entities that understand the experiences and needs of health plan members beyond medical care. Smaller, less resourced CBOs often serve communities of color and should be sought out and included in provider networks. Offer supports to help providers, particularly community-based providers, build capacity to deliver services effectively for older adults and people with disabilities. For example, there are business acumen programs, such as those provided by the Administration for Community Living and the Aging and Disability Business Institute, to help CBOs that may not have the expertise to navigate MCP partnerships.
• Simplify and streamline readiness and contracting processes for CBOs. When contracting with CBOs, individual MCPs often establish their own credentialing or require vetting processes, such as pursuing a third-party accreditation or certification. CBOs may need to make significant upfront investments to meet plans’ readiness assessment and credentialing requirements. This can be challenging for CBOs that contract with multiple plans. Some CBOs in California have considered forming CBO networks to help streamline contracting and operational processes with MCPs. Although establishing a CBO network requires an initial time investment to form the partnership and build trust, in the long run a CBO network can save money and effort for CBOs seeking to provide Medicaid services. For CBOs in the network, MCPs can consider simplifying information systems and administrative requirements, such as reporting on service and program delivery standards, to ease the burden for CBOs in the network and encourage new CBOs to join. In California, MCPs that serve the same region can coordinate to standardize these processes for CBOs. For example, some California plans created a centralized questionnaire for potential ECM and Community Supports providers that are interested in contracting with plans, then shared a request for applications for Incentive Payment Program funds afterward. 
• Provide financial support to help CBOs develop their capacity. It is important to provide financial support to CBOs as they develop their capacity and programs for Medicaid enrollees, especially smaller organizations that serve specific language or ethnic groups and might have access to fewer resources. In California, some CBOs that decided against contracting with MCPs cited that payment rates were too low and were not financially sustainable for their organizations to effectively deliver services. One CBO shared that entering into a three-way contract with the county and an MCP, where the county reimbursed the provider at cost, was a beneficial strategy to support the delivery of services. In response, the state is providing funding streams that can be used to support CBOs including Incentive Payment Program and the Providing Access and Transforming Health (PATH) Program. One MCP’s payment model provides upfront funds to support capacity building prior to these funds becoming available.

2. Incorporate Institutional LTC Facilities into Provider Networks

While states are seeking to help people remain in home- and community-based settings, there is still a need to provide access to high-quality institutional LTC for Medicaid enrollees. MCPs can consider different strategies such as payment incentives to drive health quality and equity in their contracted LTC facilities.

• Pay attention to quality of care when building LTC networks. MCPs are responsible for the quality of care provided by their provider networks and ensuring that members have access to the highest quality providers. MCPs should review available quality data for LTC providers to avoid contracting with low quality providers. For example, some LTC providers are tagged by the Centers for Medicare & Medicaid Services (CMS) as Special Focus Facilities because of a pattern of low quality care, abuse and/or neglect of residents. MCPs should consider excluding these low-performing facilities from any new provider networks. As MCPs contract with institutional LTC providers in particular, publicly available data on quality, complaints, and deficits should be reviewed before including a facility in the network.
• Address equity when contracting with LTC facilities. There is ample evidence of racial disparities in institutional care including lower quality of care in facilities that have a higher percentage of residents of color as well as higher hospital readmissions for LTC residents of color. These disparities were exacerbated during the COVID-19 pandemic that caused higher number of deaths among LTC residents of color. Advocates in Pennsylvania made recommendations to safeguard against racial and ethnic disparities in institutional settings, including opportunities for MCPs to create contract requirements for measuring and addressing disparities in nursing home care.
• Use payment flexibilities to incentivize higher quality of care. MCPs can also use payment incentives to attract higher quality LTC providers into their networks. By carving in institutional care, MCPs have an opportunity to improve quality as well as provide more seamless transitions out of institutions. Some institutional LTC providers in California, however, were hesitant to contract with MCPs or admit Medi-Cal members, citing concerns about receiving timely payments from MCPs. In response, one plan encouraged higher quality facilities to join their network by offering an incentive payment for every admission. Other MCPs used value-based payment approaches that rewarded facilities for reduced hospital readmissions and other measures of higher quality. As more MCPs use payment flexibilities, it is important for MCPs serving specific regions to try to coordinate their efforts to reduce complications for LTC providers who are contracting with multiple MCPs.

3. Include Medicare Providers to Integrate Care for Dually Eligible Enrollees

As many states are continuing or developing approaches to use MCPs to integrate Medicare and Medicaid for dually eligible enrollees, ensuring provider continuity and avoiding disruptions in care will be essential. In California, MCPs are pursuing strategies to encourage Medicare providers to join their networks.

• Use data to recruit Medicare providers that have relationships with dually eligible enrollees. Since the federal Financial Alignment Initiative (FAI) that supported 13 states in creating integrated care models is sunsetting, CMS is encouraging states to develop Dual Eligible Special Needs Plans (D-SNPs) with “exclusively aligned enrollment” to ensure that people continue to have the option of integrated care. As California’s FAI ends, the state is requiring all Medi-Cal plans to develop aligned D-SNPs called Medicare Medi-Cal Plans (MMP). As a result, many MCPs in California will be contracting with Medicare providers for the first time. It will be essential for these plans to have robust Medicare provider networks so that dually eligible enrollees can enroll in these plans without losing access to their current trusted providers. Some MCPs have sought data to identify Medicare providers who currently serve their dually eligible enrollees so that they can conduct targeted outreach to include these providers in the new MMP networks.
• Use payment flexibilities to attract Medicare providers. While many states including California, New York, and Illinois, require Medicaid health plans to pay institutional providers the same rate as what they received through Medicare fee-for-service, that may not be enough to attract Medicare providers. A feasibility study in California suggests that increasing payment to Medicare providers at 110 percent above standard Medicare rates is one approach to incentivize Medicare providers who might otherwise be reluctant to join the managed care network.

Looking Ahead

As Medicaid MCPs develop new networks with CBOs, LTC facilities, and Medicare providers, there are a variety of approaches they can consider to ensure that their networks meet the health and social needs of older adults and people with disabilities. This includes payment and reimbursement strategies tied to quality and equity, evaluating their networks to ensure that they are contracting with providers that can address the populations within a community, and establishing relationships to address potential gaps in available provider types. Emerging lessons from California’s current efforts can help inform other states and Medicaid health plans across the nation.