Just a few years ago, nearly all of the 11 million people in the U.S. who are dually eligible for Medicare and Medicaid had to navigate two separate, almost entirely disconnected systems of care. In 2012, the nation spent more than $300 billion on care for the members of this high-need group who often have multiple chronic conditions, physical or behavioral health disabilities, and functional limitations. This results in:

• Limited provider communication and uncoordinated services;
• Poor health outcomes;
• Unaligned policies for reimbursement, beneficiary protections, and enrollment — and related beneficiary confusion;
• Cost-shifting; and
• Avoidable spending.

Now — spurred by significant state innovation and investment and the creation of the Medicare-Medicaid Coordination Office in the Centers for Medicare & Medicaid Services (CMS) — nearly 750,000 dually eligible individuals are enrolled in integrated health plans. These include two types of plans: (a) Medicare-Medicaid Plans (MMPs) in the Financial Alignment Initiative demonstrations; and (b) Medicare Advantage Dual Eligible Special Needs Plans (D-SNPs) that are aligned with a Medicaid managed long-term services and supports plan (LTSS) to coordinate both Medicare and Medicaid services.

Integrated Care Innovation:  The Role of Health Plans

States and the federal government have made considerable progress with implementing integrated models of care for individuals dually eligible for Medicare and Medicaid but, with the exception of Washington State’s managed fee-for-service approach, they would not have done it without innovative health plan partners at the fulcrum of most integrated care models. For nearly four years, CHCS has facilitated a learning collaborative of high-performing health plans through PRIDE (PRomoting Integrated Care for Dual Eligibles), a national initiative supported by The Commonwealth Fund to develop best practices for integrating care. PRIDE plans believe that combining Medicare and Medicaid financing and services into one integrated benefit allows them to address the full range of their dually eligible members’ needs. Managing both acute care and LTSS can, for example, avoid further medical or functional decline that would require an individual’s admission to a hospital or nursing facility.

The PRIDE plans — BlueCare Tennessee (Tennessee), CareSource (Ohio), Commonwealth Care Alliance (Massachusetts), Health Plan of San Mateo (California), Independent Care Health Plan (Wisconsin), Inland Empire Health Plan (California), UCare (Minnesota), and VNSNY CHOICE Health Plans (New York) — each offer an MMP and/or a D-SNP that provides all Medicaid services including LTSS. Examples of innovations being pursued by PRIDE plans include:

• In-home care to reduce inpatient care. One plan recently partnered with a provider of in-home medical care for its members with five or more chronic conditions to divert emergency department (ED) visits, prevent hospital readmissions, and extend individuals’ ability to remain in their homes. This has led to an initial, considerable improvement in the plan’s member “reach rate” for this subset of high-need individuals to engage them in a plan of care. Another plan launched a community paramedicine program to accomplish similar goals which, according to a recent program evaluation, found that individuals diverted from EDs through this effort had lower average costs than those not diverted. Per person savings were $791 for a seven-day period, and $3,677 for a 15-day period. A third plan has partnered with community-based organizations (e.g., housing and other social service providers) to support member transitions out of institutions, resulting in a 50 percent cost savings for participants, as well as very high member satisfaction, positive reported impact on quality of life.
• Delivery system innovations. One plan, in which nearly 70 percent of members under age 65 have a behavioral health condition, created Crisis Stabilization Units (CSUs) for members who need short-term intensive behavioral health and medical services. Early findings show that nearly 90 percent of CSU stays were diversions from more costly inpatient admissions, and on average CSU stays were shorter than hospitalizations.
• Value-based purchasing. Several plans established initiatives to improve quality in nursing facilities, through: (a) a value-based payment model linking payment incentives to quality metrics; and (b) nursing facility “report cards” to motivate quality improvement efforts related to hospital readmission rates, outcomes for individuals with behavioral health conditions, and others. Although these programs have had mixed results, several plans are actively applying lessons learned related to nursing facility and hospital engagement strategies and pharmacy benefit management to new pilots and models.

Build on the Momentum: Policy Potential

Sustaining and expanding integrated care programs is a high priority for PRIDE plans. Last March, plans submitted a letter to the Secretary of Health and Human Services to underscore the importance of these programs and suggest policy options to sustain them. The recommendations included:

1. Establish permanent integration platform(s). Neither MMPs nor D-SNPs operate under permanent authority. Some states elected to extend their Financial Alignment Initiative demonstrations, but states and plans face an uncertain future thereafter. Current SNP authorization expires after December 31, 2018, which may limit both states and health plans’ willingness to invest in these programs.
2. Explore policies to better address specific characteristics of the dually eligible population. PRIDE plans appreciate CMS’ recognition that health plans serving a high proportion of dually eligible beneficiaries are more likely to have enrollees with behavioral health conditions, functional limitations, and other challenges related to low-income status. For example, a recent federal study found that dual eligible status was the most significant predictor of poor health outcomes among Medicare beneficiaries. PRIDE plans support continued efforts to re-evaluate risk adjustment and Medicare Star Ratings methodologies based on enrolled populations.
3. Promote collaboration and communication between the states and CMS. PRIDE plans feel the positive impact of a strong state-federal partnership at the delivery system level. They commended recent progress that CMS and states have made to: (a) establish regular communication mechanisms for shared program oversight and to discuss ways to address existing misalignments across programs; and (b) create opportunities for stakeholders to comment on Medicare Advantage policies that impact Medicare-Medicaid enrollees. It is critical for states and CMS to continue their collaboration as the nation’s population ages and the number of dually eligible beneficiaries with Medicaid-covered LTSS needs grows significantly in coming decades.

Opportunities are emerging to further the growth of integrated care programs.  On September 26, the U.S. Senate unanimously passed the CHRONIC Care Act of 2017 (S. 870), which gives Medicare Advantage better tools to improve care for beneficiaries with chronic conditions, including permanently authorizing Special Needs Plans and requiring that D-SNPs plans meet new administrative requirements that advance alignment and assume greater responsibility for covering Medicaid LTSS and/or behavioral health services.  The House is considering similar legislation.  While there is still much work ahead, PRIDE plans are encouraged by the unprecedented progress that integrated care platforms achieved in recent years and by the bipartisan support for expanding integrated care options for millions of additional dually eligible individuals.