More than 9 million people are dually eligible for both Medicare and Medicaid. They are called duals or dual-eligibles.
The duals are a diverse group with respect to age, health and disability status, and service utilization. Some duals have substantial needs for both health care and LTSS and incur major expenses for the public programs on which they rely, while others require few services.
Most duals get their Medicaid services through a fee-for-service (FFS) system that allows them to choose their providers. Some states permit duals to receive their Medicaid services from managed care organizations (MCOs). Other states require them to obtain Medicaid services through MCOs. The mandated approach is becoming more common. (See Chapter 8, Long-Term Services and Supports, for a full discussion of Medicaid-managed LTSS.)
However, most states that mandate Medicaid managed care for dual eligibles allow beneficiaries to continue to receive their Medicare services through FFS arrangements unless they opt to receive them from MCOs.
Most duals in FFS arrangements have at least two insurance cards—one for Medicaid and one for Medicare, with no clinical, service, or financial coordination between the two programs. In some cases they may have a third card for their Medicare Part D prescription drug coverage. Duals with complex health and LTSS needs can experience fragmented, uncoordinated care that can drive up cost without adding value. This is problematic at the individual, the provider, and the system level. Beneficiaries must navigate among programs with varying sets of requirements.
Potential issues with managed care—enrolling dual-eligibles in managed care plans can help eliminate fragmentation in care, improve quality, and may lead to some cost savings. Some experts believe that managed care plans have an incentive to keep people as healthy as possible because they bear financial risk. Others argue that capitated payments may create incentives to deny needed care. There are also concerns that managed care plans may not be able to meet the unique need of duals who need LTSS. Addressing these concerns will require robust oversight of managed care; inclusion of beneficiary and family member perspectives; meaningful beneficiary protections, including opt-out provisions; and sound quality measures.
Dual-eligible demonstrations—problems associated with lack of care coordination and high costs among duals have prompted states and the federal government to design programs that improve the quality of care that duals receive while also reining in costs. The Centers for Medicare & Medicaid Services (CMS) is considering two basic approaches through the Financial Alignment Initiative (also referred to here as the duals demonstrations).
The predominant approach, the capitated model, aims at improved service and financial coordination through risk-based managed care arrangements. Under this approach, a state, CMS, and a health plan enter into a three-way contract, and the plan receives a prospective, blended payment to provide comprehensive, coordinated care. Duals are then enrolled in a managed care plan that is expected to coordinate all their care (including LTSS if needed) within the blended capitated rate. If a state demonstration automatically enrolls duals in a risk-based managed care demonstration, it must offer an alternative coverage option so they can opt out of the demonstration.
A few states are pursuing a second option—the managed FFS model. This model gives duals all of their Medicare and Medicaid services (including LTSS) within an FFS environment. This model provides “high-risk” duals with care coordination services. Under the managed FFS model, a state and CMS enter into an agreement in which the state would be eligible to benefit from savings that result from initiatives designed to improve quality and reduce costs for both Medicare and Medicaid. Some states are developing demonstrations that test both models. (Policies related to the managed FFS model are included in this section under Managed Care for Dually Eligible Medicaid Beneficiaries because many of the policies that apply to the managed care demonstration also apply to the FFS demonstration.)
CMS has contracted with a national evaluation team to conduct an external evaluation of the demonstrations. Ensuring access to high-quality coordinated care for duals and controlling their costs without compromising consumer protections in the design, implementation, and administration of these new demonstrations are critical objectives for AARP.
AARP’s general policies related to duals in Medicaid managed care for health care and/or LTSS are reflected below. They also apply to people enrolled in state demonstrations to integrate care for duals—both the risk-based managed care approach and the managed FFS/shared-savings approach, where applicable.
Managed Care for Dually Eligible Medicaid Beneficiaries: Policy
States and the federal government should be transparent and inclusive in decisions related to dual-eligibles in managed care.
States and the federal government should establish user-friendly processes to ensure public involvement (including participation by people from diverse communities) in the development, implementation, and oversight of new approaches to providing care—including LTSS—to dual-eligibles.
States should make information on plan performance and other key measures available to the public in a user-friendly manner. For example, materials should be culturally and linguistically appropriate.
Data collection and reporting across plans should ensure accurate comparisons.
States and the federal government must ensure that risk-based managed care plans demonstrate they are able to provide the full range of services—primary, acute, and LTSS—required by the enrolled population before they are permitted to enroll dual-eligibles.
States should also ensure that plans demonstrate the ability to provide high-quality care and care coordination services.
States and the federal government should develop a robust plan-readiness review process to determine whether health plans in the capitation model or providers in the managed FFS model are prepared to provide all contracted services in a safe, efficient, and effective manner. Plan readiness includes, at a minimum, network adequacy (including the ability to pay contracted providers within a reasonable amount of time); a proven track record of high performance and/or the ability to provide high-quality care coordination services; the ability to offer participant-directed LTSS including, but not limited to, counseling and financial management services; the ability to monitor and improve services; demonstrated financial stability in the plan and adequate protections against insolvency; the ability to generate required data and reports for governmental entities and public reporting; and adequate capacity to respond to enrollee grievances and appeals.
States and the federal government must ensure that health plan provider networks include a sufficient number of health and LTSS providers in both rural and urban areas that are willing and qualified to serve the unique needs of plan participants.
Plans and providers must demonstrate that they offer person- and family-focused care by honoring individuals’ preferences and values through supporting the individual’s (or their representative’s) desire to self-direct their LTSS, and by recognizing family caregivers’ willingness and capacity to provide care. They also need to ensure that services are offered in a culturally and linguistically competent manner.
Medicare managed care organization (MCO) qualifications and standards
The federal and state governments should:
- consider the performance of potential managed care contractors on standardized quality measures before entering into contracts with them;
- require MCOs to consider the performance of providers prior to including them in their networks; and
- ensure that the plans they select to serve Medicaid and/or Medicare beneficiaries meet the same comprehensive standards that apply to health plans offered by all other payers. These standards should include a full range of consumer protections.
The federal and state governments should ensure that beneficiaries who are enrolled in managed care for Medicare, Medicaid, or both are permitted to change plans or return to FFS arrangements at any time, whether for cause or because they are not able to obtain needed services from participating MCOs. In addition, states should allow dual-eligibles to opt out of managed care altogether if they are not able to obtain needed services from participating plans. States should also provide participating beneficiaries with a regular opportunity, during open enrollment periods, to review their plan choices and make enrollment changes.
States should either conduct enrollment themselves or use independent third-party enrollment brokers to ensure that beneficiaries are not coerced or pressured to make a particular selection. States should use local Aging and Disability Resource Centers ( ADRCsAll states now operate Aging and Disability Resource Centers (ADRCs) as a single source of information and assistance about services for older adults and people with disabilities, regardless of their income or type of disability. A critical function of ADRCs is conflict-free care management… ) to provide this function when an individual needs LTSS.
States and the federal government should ensure that dual-eligibles are able to make reasonable choices about the type of coverage they prefer—either FFS or managed care. States and the federal government must not mandatorily enroll beneficiaries in managed care. In the event that managed care is mandated in the Medicaid program or in the duals demonstrations, federal and state governments must ensure that a choice of health plan and providers is offered. If beneficiaries are passively enrolled (i.e., they are automatically assigned a plan), there should be sufficient beneficiary protections to ensure enrollees receive the care they need. Specifically, when dual-eligibles are auto-enrolled into managed care plans for the purpose of the demonstration project, states and the federal government must ensure that they are counseled and informed of their right to opt out of the demonstration.
The federal and state governments must ensure that dual-eligibles enrolled in a managed care plan have a reasonable choice of providers.
When dual-eligibles are enrolled in managed care for Medicaid and/or Medicare benefits, states and the federal government must ensure that all statutorily required benefits are covered by the plan. In addition, benefits and services should ensure that dual-eligibles have access to a robust array of LTSS.
States and the federal government should ensure that benefits and services address individual medical, LTSS, language, cultural, and social needs and that they are accessible to people with disabilities. States and the federal government should ensure that efforts to harmonize Medicare and Medicaid preserve beneficiary access to the most protective benefit and due process policies of each program.
To ensure informed choices, states should guarantee that dual-eligibles and, as appropriate, their family caregivers or representatives receive information about all health and LTSS options for which the beneficiary is eligible (i.e., Medicare and Medicaid services). Federal and state governments must ensure that education, one-on-one counseling on health care options, conflict-free one-on-one counseling for all in need of LTSS, and relevant materials on participating plans, providers, and community supports are offered to beneficiaries before enrollment in managed care.
States must ensure that this information is easy-to-understand and culturally and linguistically appropriate. States should ensure that beneficiary materials include objective performance information for all participating plans and for the providers within their networks, to enable fair comparisons of plans and providers. This information should be made available for FFS providers as well, so beneficiaries can make fair comparisons by coverage type. States should also ensure that consumers receive full information about all providers who participate in each plan’s network.
Continuity of care
To the extent possible, states and the federal government should ensure that MCOs honor a beneficiary’s desire to maintain a continuous relationship with a high-quality provider or health plan. States and the federal government should support this goal by providing necessary data to states and/or health plans to inform auto-assignments. States and the federal government should ensure that beneficiaries who are undergoing short- or long-term treatment regimens are assured continuity of care with their current providers, if they wish.
If provider changes must occur, states and the federal government should ensure that any transition to new providers is smooth, coordinated, and includes appropriate transfer of records and medication reconciliation. States and the federal government should ensure that beneficiaries are held harmless for the cost of any care as they transition to new providers/networks.
Quality and value
States and the federal government should ensure that:
- managed care plans, including those participating in the duals demonstrations, use approaches that improve the quality and value of care for duals by organizing and delivering care in ways that coordinate and improve service delivery, that eliminate unnecessary utilization and cost, and that promote quality;
- the integration of health care and LTSS does not lead to diminished consumer satisfaction;
- data on race, ethnicity, and language preference is collected and reported by plans;
- new approaches, such as those tested in the duals demonstrations, require robust data collection that can be used to inform regulators and others about whether duals are receiving the care they need (including LTSS) in the most efficient, cost-effective manner;
- payment structures promote the delivery of high-quality care and avoid incentives to deny access to appropriate and effective health and LTSS services—states and the federal government should reward (including financially) plans and providers that attain or improve health care quality and efficiency. High-performing plans should be financially rewarded and those with poor performance (i.e., those who fail to achieve specified benchmarks or demonstrate inadequate improvement) should be penalized; and
- there is public access to plan-performance information so that consumers can make informed choices.
States, in partnership with the federal government, must have sufficient capacity to monitor program compliance effectively and take corrective action where necessary.
States and the federal government should ensure a meaningful role in oversight for patients, consumers, and family caregivers, including but not limited to opportunities to participate on plan- and state-sponsored oversight committees.
State and federal regulators must have the resources (personnel and funding) to conduct robust oversight and enforcement of participating health plans and providers, to ensure compliance with all requirements of the demonstration program.
States and the federal government should require plans and providers to collect and report information that will enable the state and CMS to assess performance and determine if plans and providers meet all contract requirements. This information should be timely and publicly available to patients, consumers, and family caregivers.
Oversight and enforcement
State and federal oversight of managed care arrangements must be effective, timely, comprehensive, and coordinated among federal and state agencies, independent quality-assurance entities, and other relevant partners, to ensure that participating contractors are performing contracted duties and delivering high-quality services.
States and the federal government must enforce all requirements of managed care contracts with sanctions that are swiftly imposed, consistent with contract requirements, and proportional to contract violations. Enforcement actions, such as sanctions and performance improvement plans, should be timely and fully disclosed to the public.
States and the federal government must have rules to prevent health plan practices that could encourage disenrollment by consumers who have complex medical conditions or who are expensive to care for. States and the federal government should view excessive disenrollment as an early warning system.
States and the federal government should survey beneficiaries at the time they leave a plan to determine their reasons for disenrollment, and should monitor plans to ensure that there are no racial and ethnic disparities in quality and outcome.
States and the federal government should ensure that health plan performance is assessed using standardized measures that are valid and reliable. Measures should assess clinical effectiveness, safety, consumer and family experience, resource use, and efficiency across the continuum of care. Outcome measures are highly desirable (e.g., functional status, quality of life), but structure and process measures (when there is a known relationship to the outcome) may also be used. Establishing meaningful quality measurement uniformly across models and states is important for evaluation, benchmarking, and defining success.
States should ensure that a broad and diverse representation of stakeholders are actively and meaningfully engaged in the design, implementation, and operation of managed care programs for dual-eligibles, including of the duals demonstrations.
Evaluation of models
governments must ensure that all models of care designed to improve quality and reduce costs for dual-eligibles, including financial solvency, are rigorously evaluated by the national evaluator. States must ensure that plans provide sufficient baseline data on service utilization, cost, access to services, choice of providers and plans (as applicable), grievance and appeals procedures, quality, and consumer and family experience. States must also ensure that these data are captured after implementation to determine the effect of the demonstration on improving care and lowering cost.
States should have a clearly identified strategy to avoid including the impacts and outcomes of other payment and delivery system reforms and/or demonstrations and initiatives when they perform their duals demonstration evaluations. This will ensure that the results of duals demonstration evaluations are not affected by other demonstrations or initiatives, or alternatively that other relevant demonstrations and/or initiatives are accounted for in the results.
The federal and state governments should ensure that the care dual-eligibles receive through MCOs and other delivery models is coordinated and delivered in a person- and family-centered manner.
The federal and state governments should ensure that Medicare Part D and Medicaid prescription drug policies are reviewed to identify any inconsistencies that could be problematic in integrated demonstrations. For example the prescription drug benefit design should account for non–Part D drugs covered by Medicaid. CMS also should consider modifying or waiving current Part D coverage determinations and appeals policies, in order to encourage the development of a set of requirements applicable to all benefits.
States should ensure that MCOs are providing care coordination services (as appropriate) among all providers and across all care settings, in order to prevent undesirable and costly outcomes in quality of care. Examples include discharge planning, care coordination throughout care transitions, medication management to deter polypharmacy and dangerous drug interactions, and home- and community-based supports to prevent unnecessary institutionalization.
States should ensure that MCOs assess the needs of each individual and develop care plans (in collaboration with consumers and family caregivers as appropriate), doing so in a timely manner. In the event that the individual needs LTSS, states should ensure that assessment and care planning is conducted by the ADRC that serves the individual’s community.
States should ensure that all care and services provided to dual-eligibles through MCOs account for the individual health care and LTSS needs and preferences of enrolled beneficiaries. States should also ensure that plans for care and services recognize and address family needs and preferences, especially when the plan of care depends on the involvement of a family caregiver.
States should ensure that MCOs make the self-directed care option available to all enrolled individuals for their LTSS needs.
Federal and state governments must ensure that dual-eligibles enrolled in MCOs have access to all consumer protections provided to Medicaid beneficiaries. Where duals are enrolled in MCOs for receipt of Medicare benefits, they must have access to all consumer protections available to them through Medicare. Where duals are enrolled in MCOs for both Medicare and Medicaid, federal and state efforts to harmonize consumer protections must preserve access to the most consumer-friendly choices.
Independent counseling services are necessary and help ensure that the information beneficiaries receive is objective and unbiased. Therefore states and the federal government should ensure the provision of adequately staffed and funded independent, unbiased State Health Insurance Assistance Programs, ADRC services, or similar programs to counsel, support, and/or advocate for duals and their family caregivers.
All states that enroll dual-eligibles in any form of managed care should have an independent ombudsman program available to provide services for them. Where states already have an existing, independent ombudsman program for Medicaid managed care, this function should be expanded to include the duals demonstration as applicable. States and the federal government should invest sufficient resources into ombudsman programs.
States and the federal government should ensure that dual-eligibles who are enrolled in duals demonstrations have meaningful access to the most favorable independent grievance and appeals process afforded to them in either Medicare or Medicaid. States and the federal government should ensure that efforts to harmonize Medicare and Medicaid result in preserving beneficiary access to the most protective consumer protections available in each of the programs.
States must ensure that all Medicaid beneficiaries enrolled in managed care have ongoing access to a meaningful grievance and appeals process and to a system that allows them to file complaints about problems with a health plan or provider, including challenges to initial or ongoing assessments and/or care plans. States must make sure that the grievance and appeals rights of beneficiaries are clearly explained to them and that they have access to easy-to-understand materials that are culturally and linguistically appropriate.
States and the federal government must ensure that dual-eligibles who are enrolled in managed care—including for the duals demonstrations—have processes in place to protect enrolled consumers against the imposition of inappropriate cost-sharing charges, such as balance billing from providers. (See also this chapter’s section Medicaid Assistance for Low-Income Medicare Beneficiaries below for information on MSPs.)
To the extent possible, to avoid redundancy, states should take strong steps to ensure that the plans they select to participate in their managed care programs meet the same comprehensive standards and quality measures that apply to health plans offered by all other payers. However, given the unique characteristics of dual-eligibles, additional or substitute requirements may be necessary. Standards should include a full range of consumer protections. Plans must include a fair and rapid appeals process in which decisions that incorrectly deny, reduce, or terminate care to beneficiaries may be overturned. Beneficiaries must retain access to all needed services during appeal.
States should adequately monitor contracted managed care entities to ensure that they comply with the solvency, quality, and consumer protection standards outlined in the Balanced Budget Act of 1997—including, but not limited to, rules on actuarially sound capitation rates, beneficiary education and materials, managed care quality assessment and performance improvement, beneficiary grievance and appeal rights, and other consumer protections.
Limited scope of duals demonstration
States and the federal government should ensure that the duals demonstrations designed to test the integration of Medicare and Medicaid services (including LTSS) for dual-eligibles are reasonably limited in scope.
States and the federal government should ensure that the duals demonstrations are piloted on a limited basis in most cases. When determining the scope of a demonstration, states and the federal government should consider the experience level of the state and its contractors, and the timeframe for implementation. However, states and the federal government should also make allowances for smaller states where the level of enrollment needs to be sufficient to support a meaningful demonstration.
The federal government should require states to demonstrate that their duals demonstrations are effective before they are allowed to extend their projects to a broader population. The federal government should not permit states to expand their projects to full scale unless there is evidence from a rigorous evaluation that quality and cost-containment goals have been met.
Reinvestment in LTSS
States should be encouraged to use some of the savings from the duals demonstrations to strengthen and improve access to and availability of community-based LTSS.
States and the federal government should ensure that managed FFS delivery models provide care coordination services to vulnerable dual-eligibles and that, to the extent applicable, they comply with the policies listed above.
States and the federal government should ensure that strategies used to identify dual-eligibles for care coordination services in the managed FFS demonstrations are periodically validated to adequately indicate those beneficiaries whose quality of care/quality of life would be improved through care coordination.
All of the relevant policies in this section apply to the managed FFS demonstrations.