1. Medicaid Managed Care for Elderly and Persons with Disabilities Pam Coleman Texas Health and Human Services Commission October 11, 2006

2. STAR+PLUS Harris County Pilot implemented in Harris County (Houston) in 1998 Risk-based, capitated managed care Integrates Medicaid funding and service delivery of long term and acute care Integrates Medicaid funding and service delivery of long term and acute care Serves 60,000 aged and disabled not in a nursing facility

3. Why STAR+PLUS? Legislative direction (SCR 55, 74 th session) Legislative direction (SCR 55, 74 th session) Improve coordination of physical health care needs with personal care needs Improve coordination of physical health care needs with personal care needs Improved access to community based long-term care support services Improved access to community based long-term care support services Promote coordination of Medicaid and Medicare Promote coordination of Medicaid and Medicare Increase cost effectiveness Increase cost effectiveness

4. Texas Medicaid Expenditures Texas Medicaid in Perspective, HHSC, April 2004 Total $18 Billion Children, Adults and Other are 74% of the Medicaid population and 37% of costs. Aged and Disabled are 20% of the Medicaid population but 62% of costs (all funds). Total $18 Billion

5. HMOPCCMFFSTotal FY2006809,418(31%)970,931(35%)932,599(34%)2,770,268 FY20071,060,358(42%)760,071(27%)848,502(30%)2,791,482 FY20081,134,851(45%)732,521(25%)852,094(30%)2,877,952 Texas Medicaid Managed Care Growth Texas Medicaid Managed Care Growth

6. STAR+PLUS Members STAR+PLUS Members Supplemental Security Income (SSI) adults who are not in a nursing facility or other institution and who are not currently being served through a Home and Community Based Waiver program, other than Community Based Alternatives (CBA), must enroll in STAR+PLUS. Supplemental Security Income (SSI) adults who are not in a nursing facility or other institution and who are not currently being served through a Home and Community Based Waiver program, other than Community Based Alternatives (CBA), must enroll in STAR+PLUS. Non-SSI adults who qualify for 1915 (c) Nursing Facility Waiver services must enroll in STAR+PLUS to receive those services. Non-SSI adults who qualify for 1915 (c) Nursing Facility Waiver services must enroll in STAR+PLUS to receive those services. SSI children, under age 21, may voluntarily enroll in STAR+PLUS. SSI children, under age 21, may voluntarily enroll in STAR+PLUS.

7. HMO Member Benefits HMO Member Benefits Traditional Medicaid benefit package Traditional Medicaid benefit package Unlimited Prescription drugs (Medicaid only) Unlimited Prescription drugs (Medicaid only) Annual adult well checks Annual adult well checks Removal of limit for length of stay for hospitalization (STAR only) Removal of limit for length of stay for hospitalization (STAR only) PCP provider directories PCP provider directories PCP coordinates health care of patient PCP coordinates health care of patient 24-hour nurse helpline (through their health plan) 24-hour nurse helpline (through their health plan) Member services helpline (through their health plan) Member services helpline (through their health plan) Member handbooks and health education Member handbooks and health education Case management for members with special health care needs Case management for members with special health care needs

8. STAR+PLUS LTC Services Personal assistance Personal assistance Day activity and health Day activity and health 1915(c) waiver services 1915(c) waiver services Adaptive aids Adaptive aids Adult foster home Adult foster home Assisted living Assisted living Medical supplies Medical supplies Home modifications Home modifications Respite care Respite care Therapies Therapies Emergency response Emergency response

9. Contracting Method Contracting Method DADS DADS –Open Enrollment –Licensure –Contract –Program specific STAR+PLUS HMO STAR+PLUS HMO –Negotiated Individually –Additional providers dependent on network adequacy –Contract by service, not program –May add licensed providers that are not contracted with DADS

10. Rates Rates DADS DADS –Established on a statewide basis for each program. –Based on cost reports filed by providers –Same for all providers STAR+PLUS HMO STAR+PLUS HMO –Negotiated with each provider –May establish fixed rates for each service or can negotiate different rates –Provider can offer additional service for additional compensation

11. Access Access DADS DADS –Individuals needing assistance must contact DADS or be referred by family, provider or community for assessment and authorization STAR+PLUS STAR+PLUS –All members are contacted within 30 days of enrollment –Informed about services available –Telephonic risk questionnaire may lead to assessment and authorization for services

15. Care Coordination Results External quality review study completed July 2003 External quality review study completed July 2003 SSI clients in STAR+PLUS were compared to SSI PCCM clients SSI clients in STAR+PLUS were compared to SSI PCCM clients Significant cost difference – particularly for the highest acuity clients ($3,226 mo in STAR+PLUS vs. $13,160 mo in PCCM) Significant cost difference – particularly for the highest acuity clients ($3,226 mo in STAR+PLUS vs. $13,160 mo in PCCM) Lower inpatient and ER use in STAR+PLUS Lower inpatient and ER use in STAR+PLUS

16. STAR+PLUS vs. PCCM Overall Expenditures

17. Cost Savings Cost savings result from managing care by: Cost savings result from managing care by:  Early identification and treatment of health problems  Promoting wellness and healthy lifestyles  Avoiding higher cost services and products when lower-cost, clinically appropriate services can be rendered  Coordinating care effectively and reducing duplication of services

18. STAR+PLUS and Special Needs Plans Have 9 SNPs operating in Texas. Two have STAR+PLUS plans with over 20,000 enrolled for both programs Have 9 SNPs operating in Texas. Two have STAR+PLUS plans with over 20,000 enrolled for both programs SNP plans would like to see expansion of STAR+PLUS SNP plans would like to see expansion of STAR+PLUS We pay a premium to the SNP plans to cover Medicaid cost share obligation We pay a premium to the SNP plans to cover Medicaid cost share obligation

19. Expansion Issues Unable to expand the program due to potential loss of UPL to public hospitals. Unable to expand the program due to potential loss of UPL to public hospitals. Medicaid laws prohibit hospitals from receiving UPL if they are paid by a capitated HMO. Medicaid laws prohibit hospitals from receiving UPL if they are paid by a capitated HMO. Texas plans to implement alternative models including hospital carve-out and non-capitated managed care programs, but effectiveness and efficiency will be compromised. Texas plans to implement alternative models including hospital carve-out and non-capitated managed care programs, but effectiveness and efficiency will be compromised.

20. STAR+PLUS Expansion STAR+PLUS Expansion STAR+PLUS is expanding to 4 new areas January 2007 STAR+PLUS is expanding to 4 new areas January 2007 STAR+PLUS will carve out inpatient hospital services from the HMO capitation STAR+PLUS will carve out inpatient hospital services from the HMO capitation Capitates physician, ER, outpatient, and community-based long-term support services. Capitates physician, ER, outpatient, and community-based long-term support services.