AARP Eye Center
Background
More than 12 million people are simultaneously eligible for both Medicare and Medicaid. They are often known as “dual-eligibles” or “duals.” Dual-eligibles are a diverse group with respect to age, health and disability status, and service utilization. Some have substantial needs for health care, including behavioral health services and long-term services and supports (LTSS). Duals often incur major expenses for both types of services.
Many dual-eligibles receive their Medicaid services through a fee-for-service (FFS) system that allows them to choose their providers. Still, the lack of coordination between Medicare and Medicaid can be problematic for dual-eligibles in FFS arrangements. In some cases, duals may have a third member identification card (in addition to cards for Medicare and Medicaid) for their Medicare Part D prescription drug coverage. Historically, there has been poor clinical, service, or financial coordination between the Medicare and Medicare programs for these beneficiaries. Those with complex health and LTSS needs can experience fragmented, uncoordinated care. That can drive up costs without adding value. This is problematic at the individual, provider, and system levels. Additionally, beneficiaries must navigate among delivery systems with varying sets of requirements.
Many dual eligibles now receive services (through Medicare, Medicaid, or both) from managed care organizations (MCOs). Enrolling dual-eligibles in MCOs may help eliminate care fragmentation, improve quality, and lead to cost savings.
Depending on the state of residence, dual-eligibles may choose or may be required to receive their Medicaid-funded services through MCOs. The mandated approach is becoming more common (see also Long-Term Services and Supports for a full discussion of Medicaid-managed LTSS). In contrast, Medicare beneficiaries from any state can choose to receive Medicare-funded benefits either through FFS or an MCO (called Medicare Advantage in Medicare).
Some experts believe that MCOs are incentivized to keep people as healthy as possible because they bear the financial risk of paying for their care. Others argue that capitated payments may create incentives to deny needed care. Ensuring that MCOs are able to meet the unique need of dual-eligibles, many of whom need LTSS and other supportive services, requires:
- robust state oversight of MCOs;
- inclusion of beneficiary and family member perspectives in MCO oversight;
- meaningful beneficiary protections, including opt-out provisions; and
- sound quality measures.
Duals demonstrations: Problems associated with lack of care coordination and high costs among dual-eligibles prompted states and the federal government to design programs to improve the quality of care delivered while reigning in costs. This resulted in the Financial Alignment Initiative, sometimes known as the duals demonstrations.
Begun in 2013 as a demonstration, the capitated model has become the predominant approach. It aims to improve service and financial coordination through risk-based managed care arrangements by engaging the state, CMS, and the health plan into a three-way contract. The plan receives a prospective, blended payment to provide comprehensive, coordinated care and is expected to coordinate all members’ managed care benefits (including LTSS if needed). If a state demonstration automatically enrolls dual-eligibles, it must offer an alternative coverage option so beneficiaries can opt out. While demonstrations in Virginia and New York have ended, California’s sunset at the end of 2022.
Two states (Colorado and Washington) implemented a second option—the managed FFS model. This provides dual-eligibles with Medicare and Medicaid services (including LTSS) within an FFS environment, through which high-risk dual-eligibles receive care coordination services. Under the managed FFS model, the state can benefit from savings resulting from quality improvement and cost reduction initiatives through both Medicare and Medicaid. (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.) Colorado ended its demonstration in 2017. Washington’s is currently in place through 2023.
CMS has contracted with a national evaluation team to conduct an external evaluation of the demonstrations. Critical objectives of these evaluations include:
- Continued access to high-quality coordinated care for dual-eligibles, and
- Cost controls without compromising consumer protections in the design, implementation, and administration of these new demonstrations.
CMS has released at least two annual evaluation reports for each of the active demonstrations. Results have been mixed. Although enrollee satisfaction has been high, findings related to cost savings have been inconclusive.
Looking forward: CMS has announced plans, in partnership with demonstration states, to transition the duals demonstrations to integrated Dual-Eligible Special Needs Plans (D-SNPs), which are Medicare Advantage plans designed specifically for dually eligible enrollees. Medicare Advantage plans must have a contract with the state to operate D-SNPs in that state. Medicare Advantage plans that are not D-SNPs do not need a contract or formal approval from the state. This means that states have some control and oversight over how the D-SNP operates that it does not have for other Medicare plans. However, coordination and integration between the Medicare and Medicaid in D-SNP programs vary greatly across the states.
States increasingly require MCOs to integrate care for their dually eligible members by mandating that enrollees join Medicaid MCOs and D-SNPs run by the same health plan. Under this arrangement, the dually eligible member’s Medicare and Medicaid benefits can be better coordinated. CMS has been adding requirements for D-SNPs that give the states more control and oversight. Many of these mandates proved successful in the demonstrations and are now being expanded for states to use in managing D-SNPs.
MANAGED CARE FOR DUALLY ELIGIBLE MEDICAID BENEFICIARIES: Policy
MANAGED CARE FOR DUALLY ELIGIBLE MEDICAID BENEFICIARIES: Policy
Transparency
Federal and state governments should be transparent and inclusive in decisions related to dual-eligibles in managed care.
Federal and state governments should establish user-friendly processes to ensure diversity in public involvement. This involves the development, implementation, and oversight of new approaches to providing care—including long-term services and supports—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 managed care organizations should ensure accurate comparisons.
Plan readiness
State and federal governments must ensure that risk-based managed care organizations (MCOs) demonstrate they can provide the full range of Medicaid-covered services—primary, acute, and long-term services and supports (LTSS)—before they are permitted to enroll dual-eligibles.
Plans must further demonstrate the ability to provide high-quality care and care coordination services.
Maintaining strong provider networks is important to beneficiaries. Virtual providers and virtual networks should not completely replace local, in-person providers. Telehealth should be an additional tool for delivering care, not a replacement for in-person care.
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 fee-for-service 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, the ability to provide high-quality care coordination services, or both; 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.
State and federal governments must ensure that health plan provider networks include a sufficient number of health and LTSS providers in both rural and urban areas willing and qualified to serve the unique needs of plan participants.
States must ensure that plans and providers demonstrate the ability to offer person- and family-centered care. They should honor individuals’ preferences and values, support their or their representatives’ desire to self-direct LTSS, and recognize the willingness and capacity of family caregivers to provide care. States must also ensure that services are offered in a culturally competent and linguistically appropriate manner.
Managed Care Organization (MCO) qualifications and standards
Federal and state governments should consider the performance of managed care contractors and providers before entering into contracts. They should:
- consider the performance of potential managed care contractors on standardized quality measures,
- require MCOs to consider the performance of potential subcontracting providers before including them in their networks, and
- ensure that the plans they select to serve Medicaid or Medicare beneficiaries meet the same comprehensive standards, including a full range of consumer protections, which apply to health plans offered by all other payers.
The Centers for Medicare & Medicaid Services (CMS), states, and MCOs should implement strategies with target populations designed to achieve health equity among all enrollees and measure and publish outcomes.
States should ensure that MCOs contract with a racially/ethnically diverse group of providers as well as providers who speak the primary language of enrollees.
Guarantee Choice
Federal and state governments should ensure that beneficiaries enrolled in MCOs for Medicare, Medicaid, or both are allowed to change plans or return to fee-for-service (FFS) arrangements at any time. Beneficiaries should retain this right for cause or because they cannot obtain needed services from the MCOs. In addition, states should allow dual-eligibles to opt out of managed care altogether if they are not able to get 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 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 (ADRCs) to provide this function when an individual needs LTSS.
States and the federal government should ensure that dual-eligibles have reasonable choices about the type of coverage they prefer—either FFS or managed care.
States must not mandatorily enroll beneficiaries in managed care. If managed care is mandated in the Medicaid program or in 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), sufficient beneficiary protections should ensure enrollees receive the care they need.
If dual-eligibles are auto-enrolled into managed care plans as part of a demonstration project, state and federal governments must ensure that they are counseled and informed of their right to opt out of the demonstration.
Federal and state governments must ensure that dual-eligibles enrolled in an MCO have a reasonable choice of providers.
Ensuring benefit coverage
When dual-eligibles are enrolled in managed care for Medicaid benefits, Medicare benefits, or both, state and federal governments must ensure that all statutorily required benefits are covered by the plan. In addition, both levels of government should ensure that dual-eligibles have access to comprehensive LTSS.
State and federal governments should ensure that benefits and services address individual medical, mental health, prescription, LTSS, language, cultural, and social needs. They also must be accessible to people with disabilities. Both levels of 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.
State and federal governments should work collaboratively to align coverage standards for overlapping Medicare and Medicaid benefits, including durable medical equipment and home health services. Beneficiaries should receive the more generous benefit or more protective provisions when there are competing provisions on the same issue.
Informed choice
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). States must ensure that this information is easy to understand, culturally competent, and linguistically appropriate. 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 should ensure that beneficiary materials include objective performance information for all participating plans and 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 participating in each plan’s network. All communication should be culturally and linguistically appropriate.
Continuity of care
To the extent possible, states and the federal government should ensure that all MCOs honor beneficiaries’ 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 health plans to inform auto-assignments. States and the federal government should ensure that beneficiaries 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 transfers of records and medication information. Changes should not interfere with an ongoing course of treatment if they would jeopardize the beneficiary’s health or safety. 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.
Self-directed care
When enrolling dually eligible individuals into managed care, states and the federal government must ensure that these consumers can self-direct their care if they so choose.
Quality and value
States and the federal government should ensure that MCOs (including those participating in duals demonstrations) seek to improve the quality and value of care for dual-eligibles. Care must be organized and delivered in ways that coordinate and improve service delivery, eliminate unnecessary utilization and cost, and promote quality.
States and the federal government should also ensure that:
- integrating health and LTSS does not diminish consumer satisfaction;
- MCOs collect and report data on race, ethnicity, and language preference; and
- new approaches to serving dual-eligibles, like those tested in the duals demonstrations, require robust data collection that can be used to inform regulators about whether they are receiving needed high-quality care (including LTSS) in the most efficient, cost-effective manner.
MCO payment structures at the state and federal level should 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:
- financially reward MCOs that attain or improve health care quality and efficiency and penalize poorly performing plans, and
- ensure public access to plan performance information to enable informed consumer choice.
Consumer participation
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 duals demonstrations.
Oversight and enforcement
States, in partnership with the federal government, must have sufficient capacity to monitor MCO compliance effectively and take corrective action where necessary.
State and federal policymakers should ensure a meaningful MCO oversight role for patients and family caregivers, including, but not limited to, opportunities to participate on oversight committees.
State and federal regulators must have the resources necessary to conduct robust oversight and enforcement of MCOs to ensure compliance with program requirements.
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.
State and federal oversight of MCOs must be effective, timely, comprehensive, and coordinated among federal and state agencies, independent quality assurance entities, and other relevant partners. They must ensure that participating contractors perform contracted duties and deliver 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.
Disenrollment protections
States and the federal government must have rules to prevent MCOs from encouraging disenrollment by consumers who have complex medical conditions or require costly care. States and the federal government should view excessive disenrollment as an early warning sign of a potential problem.
States and the federal government should survey beneficiaries when they leave an MCO to determine reasons for disenrollment. MCOs should be monitored for racial and ethnic disparities in disenrollment.
Performance assessment of health plans
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.
Evaluation of models
Federal and state governments must ensure that all models of care designed to enhance beneficiary experience, improve quality, reduce unnecessary service use, and lower costs for duals (including financial solvency) be rigorously evaluated on an ongoing basis by a national, independent 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 costs.
States should have an identified strategy to avoid including the impacts and outcomes of other payment and delivery system reforms, demonstrations and initiatives, or both 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. It will also ensure that other relevant demonstrations or initiatives are accounted for in the results.
Care coordination
Federal and state governments should ensure the care that dual-eligibles receive through MCOs and other delivery models is coordinated and delivered in a person- and family-centered manner.
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 to encourage the development of requirements applicable to all benefits.
States should ensure that MCOs coordinate needed care among all providers and across all care settings to prevent undesirable and costly patient outcomes.
Examples of coordination could 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.
Needs assessment
States should ensure that MCOs assess the needs of individuals and develop timely care plans in collaboration with consumers and family caregivers, as appropriate. If an individual needs LTSS, states should ensure that assessment and care planning includes the ADRC that serves the individual’s community.
Consumer-centered care
States should ensure that all care and services provided to dual-eligibles through MCOs address their individual health care and LTSS needs and preferences (including a self-directed care option for LTSS). States should ensure that service plans assess and address family needs and preferences, especially when the service plan depends on the involvement of a family caregiver.
Consumer protections
Both levels of government should ensure that efforts to harmonize Medicare and Medicaid preserve beneficiary access to each program’s most protective benefit and due process policies.
Policymakers must ensure that dual-eligibles enrolled in MCOs receive the same consumer protections provided to Medicaid beneficiaries in FFS. Where dual-eligibles are enrolled in MCOs for receipt of Medicare benefits, they must have access to all consumer protections available through Medicare. If dual-eligibles are enrolled in MCOs for both Medicare and Medicaid, Federal and state efforts to harmonize consumer protections must defer to the protections of the program that affords the strongest protections.
Federal and state governments should adequately fund and staff independent, unbiased State Health Insurance Assistance Programs, Aging and Disability Resource Center services, or similar programs. These services should counsel, support, and advocate for dual-eligibles and their family caregivers.
Ombudsman programs
All states that enroll dual-eligibles in any form of managed care should have an independent and sufficiently funded ombudsman program available to serve them. If states already have an existing, independent ombudsman program for Medicaid managed care, this function should be expanded to include duals demonstrations where applicable. States and the federal government should invest sufficient resources into ombudsman programs.
Cost-sharing
States and the federal government must ensure that dual-eligibles enrolled in MCOs—including the duals demonstration enrollees—have processes to protect consumers against the imposition of inappropriate cost-sharing charges, like provider balance billing (see also this chapter’s section on Medicaid Assistance for Medicare Beneficiaries with Low Incomes for information on Medicare Savings Programs).
Standards and quality measures
To avoid redundancy, states should take strong steps to ensure MCOs selected 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.
States should adequately monitor contracted MCOs to ensure that they comply with federal solvency, quality, and consumer protection standards. The standards are outlined in the Balanced Budget Act of 1997 and include, but are 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.
Grievance and appeals
Federal and state governments should collaborate to develop, execute, and continually evaluate a coordinated Medicare-Medicaid grievance and appeals process for dual-eligibles.
The coordinated grievance and appeals process must be culturally relevant, language accessible, and address the needs of special populations.
Legal service support to access the grievance and appeals process must be available for beneficiaries who need it. 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.
State and federal governments should ensure that dual-eligibles 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 preserve beneficiary access to the most protective consumer protections available in each program.
States must ensure that Medicaid enrollees in managed care have ongoing access to a meaningful grievance and appeals process. Enrollees must also have access to a system that allows them to file complaints about problems with a health plan or provider, including challenges to initial or ongoing assessments or service plans.
States must ensure that the grievance and appeals rights are clearly explained to beneficiaries and that beneficiaries have access to easy-to-understand materials that are culturally competent and linguistically appropriate.
Limited scope of duals demonstrations
State and federal policymakers should ensure that the duals demonstrations designed to test the integration of Medicare and Medicaid services (including the provision of LTSS) 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 as well as 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 not permit states to expand their duals demonstration projects to full scale unless there is evidence from a rigorous, independent evaluation that the demonstration is effective, and that quality and cost-containment goals have been met.
Reinvestment in LTSS
States should use a portion of any savings from the duals demonstrations to strengthen and improve access to and availability of community-based LTSS.
Managed FFS
States and the federal government should ensure that managed FFS delivery models provide care coordination services to vulnerable dual-eligibles. To the extent applicable, they should 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 directed to capitated managed care demonstrations apply to the managed FFS demonstrations.