CMS Opens Testing Out Integrated Care Models for Dual Eligibility up to States

May 2, 2019

On April 24, the federal government issued a letter to Medicaid directors announcing new opportunities to test integrated care models for dual-eligible individuals (Medicare and Medicaid). Twelve million Americans use services from both Medicare and Medicaid, and many of these have complex healthcare issues, including multiple chronic conditions, and experience socioeconomic risk factors that can lead to poor outcomes.

Many dual-eligible individuals find it challenging to access care because Medicare and Medicaid operate in silos, not providing integrated, easily navigable services. In the words of Centers for Medicare & Medicaid Services Administrator Seema Verma, “Less than 10% of dually eligible individuals are enrolled in any form of care that integrates Medicare and Medicaid services, and instead have to navigate disconnected delivery and payment systems. This lack of coordination can lead to fragmented care for individuals, misaligned incentives for payers and providers, and administrative inefficiencies and programmatic burdens for all. We must do better, and CMS is taking action.”

To this end, CMS invited states to come up with new ways to integrate care for all dual-eligibles or specific subsets, like people living in rural areas. The agency expressed its interest in concepts that reduce spending in the Medicaid and Medicare programs while increasing access to coordinated care, improving quality, and preserving patients’ access to all covered Medicare benefits.

The invitation to state Medicaid agencies is part of the CMS’ broader commitment to improve care for dual-eligible individuals. CMS aims to bring shared accountability for creating a more seamless experience for beneficiaries and providers across Medicare and Medicaid while ensuring that the program is pointed toward lower cost and better outcomes.

The letter to the State Medicaid Directors included three models:

The Capitated Financial Alignment Model: Through a joint contract with CMS, states, and health plans, this model creates a way to provide the full array of Medicare and Medicaid services for enrollees for a set capitated dollar amount.
Managed Fee-for-Service Model: This model is a partnership between CMS and the participating state and allows states to share in Medicare savings from innovations where services are covered on a fee-for-service (FFS) basis.
State-Specific Models: CMS is open to partnering with states on testing new state-developed models to better serve dual-eligible individuals and invite states to propose ideas for new innovative models.

Two examples highlighting state-specific models in action are Washington and Rhode Island:

Washington

Washington participates in a CMS Medicare-Medicaid Financial Alignment “Demonstration” for dual-eligible individuals who receive both Medicaid and Medicare benefits. By participating in the Demonstration, the state has been able to receive performance payments from CMS based on achieving statistically significant savings and meeting or exceeding quality requirements.

Under the Demonstration, Washington may ultimately share up to half of the gross Medicare Parts A & B savings after the completed final analysis of Medicare and Medicaid data for both years. In the first year, the state received a preliminary payment from CMS of $11.6 million, while in the second year, they received $10.7 million.

Rhode Island

The Centers for Medicare & Medicaid Services is partnering with the state of Rhode Island to try out a new model for providing person-centered care to Medicare/Medicaid dual enrollees. Instead of having benefits managed separately, dual-eligible individuals in the pilot will have their Medicare and Medicaid benefits managed together under the same health management plan, including long-term services and supports. The project will explore whether bringing the Medicare and Medicaid services under one management system for these individuals will better align services, care coordination, the management of chronic illnesses, and simplify navigating services.

We applaud CMS’s new models and look forward to seeing how these state initiatives improve care coordination for dual-eligible individuals. We also invite states and communities to take the next step and make addressing the social determinants of health part of their integrated care strategies. With access to Medicaid, Medicare, and social determinant data, state Medicaid agencies will have a complete picture of what it will take to improve outcomes and reduce the costs of care for those dual-eligible individuals living in their states and communities.