1. Variations on the Theme of “The View from MedPAC on SNPs, Integration and Specialized Managed Care”
Robert A. Berenson, M.D.
Institute Fellow, The Urban Institute
SNP Leadership Forum
1 November Washington, DC

2. Disclaimer
The views expressed here are my own and not the views of MedPAC. I was on MedPAC when its position was formulated but off of MedPAC when its letter to CMS expressing concerns about the duals demo was released. My views are close to, but not identical, to MedPAC’s.

3. I Accept Premise of the “Promise of Integrated Care for Duals”
Yet -- “Less than 1% of duals are enrolled in integrated [capitated] medical and long-term care delivery models designed to meet their needs.” -- Bob Master 10/22/12 HA Blog “We estimate that there are fewer than 25 financially integrated D-SNPs, and collectively, they enroll about 65,000 dual eligibles.” -- MedPAC 10/12

4. Berenson Testimony before the U.S. Special Committee on Aging
Examining Medicare and Medicaid Coordination for Dual-Eligibles
Hearing, 7/18/12

5. Notable Successes Don’t Necessarily Scale
See PACE Medicare demonstrations have problems and are not appropriate for some innovations -- but have some useful attributes ∙ for “proof of concept” (see long list of “obvious” innovations that failed) ∙ for important operational lessons ∙ to then develop a strategy for broader scaling

6. For Duals There Is No Record of Success with State-based Managed Care
The reported successes have been more in SNPs than in Medicaid MCOs, yet many states are opting for the latter Particular approaches in demo approach that don’t comport with positive experience – CMS and State take their share up front, no restrictions on using low payment rates to achieve savings, some states without safeguards on network adequacy and provision of LTSS

7. Medicaid MCOs v. D-SNPs – The Former Lack Experience
120,000 v 1.25 million Medicaid plans have experience mostly with mothers and kids whereas high cost duals have severe mental illness, DDs, severe physical disabilities, ESRD, HIV/AIDs, dementia and other ADL limitations It is not enough to do better care coordination through managed care techniques

8. Lack of Capacity To Serve The Influx of New Duals
Demo would move 2-3 million within 2-3 years into the new capitated programs Two LA County Medicaid managed care plans serve 7,500 but under the state’s proposal might serve as many as 375,000 Current experience is in small-scale programs. The Commonwealth Care Alliance, a model approach, currently serves about Over ambition is how to kill a good idea

9. Particular Challenges Call For Operational Experience
Current quality measures mostly not relevant to various duals subpopulations How do you actually administer a passive enrollment with opt out for a population with high levels of cognitive impairment and mental illness? Risk selection and flaws in current risk adjustment continues to be a problem

10. Proof of Concept Requires Rigorous Evaluation
CMS Actuary by law must certify that the demo has reduced spending with no change in quality or better quality with no more spending Not the same as a Medicaid waiver which is meant to apply to all in state who meet the criteria and doesn’t require determination of success

11. Proof of Concept Requires Rigorous Evaluation (cont.)
Calls for a rigorous enough design with a control group – hard to do when all duals or subpopulation of the whole state is enrolled Opt out (although necessary) makes evaluation more challenging – easier with a matched control group

12. Too Big to Fail
As proposed would involve 30% of full duals from 26 states If wholesale movement of duals into managed care arrangements (whether Medicaid MCOs or SNPs), how do you turn the clock back if the demo “fails?” On what basis do you not allow all states to emulate those in the demo who will get a pass regardless of results?

13. States View This as a Waiver Not a Demonstration
And why not, as it seems CMS does also although that clearly in not allowed under the relevant statutory language In a Medicaid waiver, states and the CMS have a political negotiation over terms and conditions. A negotiation is what some states are positioning for, e.g., on sharing from any savings

14. This Demo Trumps the Basic Medicare Delivery Reform Strategy
Assignment to a state-approved duals demo plan takes precedence over core Medicare demos, especially various forms of accountable care organizations, as well as D-SNPs So ACOs will have to actively work with their assigned beneficiaries to dis-enroll them from their plan assignment

15. The Tail Wagging the Dog
Medicare should lead reform of care for duals Of $320 billion in M and M spending on duals in 2011, 80% represent federal $s There is in fact very little overlap between high cost Medicaid and Medicare duals -- only 1% are in highest cost tier in both The savings are on the Medicare side

16. Assumption of Upfront Savings
Capitated payments to plans assume savings for state and feds Which in turn puts pressure on plans to limit LTSS and to pay below Medicare rates to live within budget The spending performance of SNPs do not justify the assumption of easy cost savings ∙ SNP bids for 2012 are at 101% of traditional Medicare, with payments at 110%

17. Assumption of Upfront Savings (cont.)
The assumption of upfront savings is not how true demonstrations work and could lead to narrower networks without the requisite expertise in caring for duals with unique and demanding conditions and disabilities

18. Some Questions Re What to Do About Expiring SNP Authority
Whose fault is it when a D-SNP doesn’t have a contract with the State to arrange for coverage and coordination of Medicaid benefits? For C-SNPs, what exactly are these specific benefit designs that permit better targeting to beneficiaries with particular chronic conditions? It seems to me the logic of having C-SNPs depends on a robust answer to this question