The Challenges of the Medicaid Modernization Mandate – Part 1 Joel L. Olah, Ph.D., LNHA Executive Director Aging Resources of Central Iowa Iowa Assisted Living Association August 26, 2015

The Challenges of the Medicaid Modernization Mandate Definitions, Goals, and Expectations of Managed Medicaid Care Medicaid Modernization – Iowa Iowa’s Managed Care Organizations Impact of Managed Medicaid on the provider network Client education, care management, and service delivery 2

Managed Care Managed care is a health care delivery system organized to manage cost, utilization, and equality. Medicaid health benefits and additional services through contract arrangements between state Medicaid agencies and Managed Care Organizations(MCOs) that accept a set per month (capitation) payment for services. 3

4 Medicaid Managed Care Managed care is the predominant delivery system for Medicaid beneficiaries  66% of all Medicaid beneficiaries in 2011 in a health plan (for some or all services)  39 States deliver some or all Medicaid benefits through health plans (comprehensive or limited)  Capitated health plans payments represent ~33% of all Medicaid expenditures  Virtually all of the 11 million adults receiving coverage under the ACA are in managed care plans

5 State Processes States can decide how to structure their managed care program by deciding: ‒Who will enroll (eligibility groups) ‒What services will be provided (scope of benefits) ‒Where it will operate (geographic reach) ‒Who will provide the services (type of provider) CMS provides technical assistance and directs States to the Federal authority that will accommodate their program design

6 Managed Care Fundamentals States select managed care plans (typically through competitive procurement CMS has ~85 pages of Federal requirements that states and health plans must follow States execute a contract (approved by CMS) with each managed care plan that makes the plan responsible for providing Medicaid services Managed care plans are paid an amount per member per month (PMPM) in exchange for providing all services included in the contract

7 Managed Care Fundamentals Managed care plans are required to: ‒Have sufficient providers to ensure access to services ‒Monitor and report on the quality of services, which the state establishes ‒Provide access to member services and case management for members ‒Have an appeal process for disagreements on service access

8 Iowa’s Managed Care Programs

9 Why are states pursuing MLTSS? Managed care payments provide budget predictability for states Potentially can provide more HCBS services to beneficiaries on waiting lists (HI, WI, DE) Plans have incentives to provide care in least restrictive/most cost-effective settings Plans may speed rebalancing by contracting and reimbursement practices with providers (TN, AZ)

10 CMS “Requirements” for MLTSS

11 1. Adequate Planning & Transition Strategies

12 2. Stakeholder Engagement

Preference for HCBS Over Institutional Services

14 6. Support for Consumers

15 7. Person-Centeredness

16 8. Qualified Providers

17 9. Participant Protections

Quality

What is Medicaid Modernization? 19 Medicaid Modernization is: ‒The movement to a comprehensive risk-based approach for the majority of current populations and services in the Medicaid program. The goals include: ‒Improved quality and access ‒Greater accountability for outcomes ‒Create a more predictable and sustainable Medicaid budget

What are the initiative’s goals? 20 Improve the quality of care and health outcomes for enrollees Integrate care across the healthcare delivery system Emphasize member choice & increase access to care Increase program efficiencies and provide budget accountability Hold contractor responsible for outcomes Create a single system of care which delivers efficient, coordinated and high quality health care that promotes member choice and accountability in health care coordination

How could Medicaid managed care work? 21 Medicaid agencies contract with managed care organizations (MCO) to provide and pay for health care services. MCOs establish an organized network of providers. MCOs establish utilization guidelines to assure appropriate services are provided the right way, at the right time, and in the right setting. Shifts focus from volume to per member, per month capitated payments and patient outcomes.

What do other states do to manage Medicaid? 22 Nationally, over half of Medicaid beneficiaries are enrolled in comprehensive risk-based MCOs. Under comprehensive risk-based managed care, an MCO receives a fixed monthly fee per enrollee and assumes full financial risk for delivery of covered services. 39 states, and the District of Columbia, contract with MCOs to provide services to various populations.

2014 State of the States in Aging & Disability 23