1. Office of MaineCare Services: Maine Accountable Communities Initiative Data Book Walk-Through May 14, 2014

2. - 1 - Agenda TopicPage Welcome and Introductions State Update2 Recap of the MaineCare Accountable Communities Program4 Overview of the Data Book9 Develop of Detailed Adjustments: Policy Adjustment11 Develop of Detailed Adjustments: Completion Factor14 Develop of Detailed Adjustments: Prospective Trend16 Develop of Detailed Adjustments: Claim Cap Adjustment19 Sample Data Book21 Outlines of Rule and MOU23

3. 2 State Update Claims cap correction Additional 3 mo. (6 mo. total) for claims run out Decision to have interim and final payments State Plan Amendment Rulemaking MaineCare: AC Lead Entity Discussions Provider agreement/ Rule/ MOU

4. 3 State Authority for AC 1.MaineCare Provider Agreement 2.MaineCare Rule (MaineCare Benefits Manual) 3.Memorandum of Understanding

5. - 4 - Recap of the MaineCare Accountable Communities Program

6. - 5 - Recap of Key Elements of the MaineCare AC Program The initial benchmark, adjusted final benchmark, and the performance PMPM TCOC are key elements in the MaineCare Accountable Communities Program. Below shows the relationship amongst these items. Initial Benchmark PMPM TCOC VS. Performance PMPM TCOC Before Performance Period After Performance Period Relationship of TCOC Elements Initial Benchmark PMPM TCOC  Serves as an estimate of the adjusted final benchmark PMPM TCOC  Uses State Fiscal Year 2013 data with 2- months run-out with adjustments for policy change, completion, trend and claims cap  Shared before the performance period begins Adjusted Final Benchmark PMPM TCOC  Uses State Fiscal Year 2013 data with 30- months run-out for interim calculation and 41- months run-out for final calculation  Adjusted for policy change, completion (if needed), trend, risk and claims cap Performance PMPM TCOC  Uses State Fiscal Year 2015 data with 6- month run-out for interim calculation and 17- month run-out for final calculation  Adjusted for completion (if needed) and claims cap  Interim savings will be determined by May 2016 and final savings by April 2017. Allows 1 month for DHHS to receive data and 3 months for calculations. Payments will be made within 30 days of reports. Adjusted Final Benchmark PMPM TCOC

7. - 6 - Recap of Timeline for MaineCare Accountable Communities Program Performance Period Benchmark Period July 2012 July 2014 June 2015June 2013May 2014 Initial Benchmark PMPM TCOC Finalized The timeline for the shared savings calculation in performance year 1 is discussed below. April 2017 Performance and Adjusted Final Benchmark PMPM TCOC Final Payment Performance Year 1 Timeline: Rebasing Benchmark PMPM TCOCs will only be rebased after the initial 3 year test period The Benchmark PMPM TCOC for Performance Years 2 and 3 will be based on the Base Year TCOC adjusted for policy, risk, trend, and claims cap between the Base Year and the end of each Performance Year. May 2016 Performance and Adjusted Final Benchmark PMPM TCOC Interim Payment SFY13 Data with 2-months paid run-out is used for calculation of Initial Benchmark PMPM TCOC SFY15 Data with 6-months paid run-out is used for calculation of Performance PMPM TCOC SFY15 Data with 17-months paid run-out is used for calculation of Performance PMPM TCOC

8. - 7 - Recap of Steps in Shared Savings Calculation Adjusted Final Benchmark PMPM TCOC Development 2 2 Initial Benchmark PMPM TCOC Development 1 1 Performance PMPM TCOC Development 3 3 Shared Savings Calculation 4 4 Identify and verify reliability of base period data Adjust base period data by performing Incurred But not Reported (IBNR) adjustments Apply known policy change adjustments Summarize adjusted claim costs for each attributed member Develop and apply prospective trend to the data Apply high cost claim cap adjustments Summarize initial benchmark PMPM TCOC for each AC Document aggregate concurrent risk score Adjust base period data by performing Incurred But not Reported (IBNR) adjustments, if needed Apply policy change adjustments to be reflective of performance period Summarize adjusted claim costs for each attributed member Develop and apply actual trend by sub-population to the data using the comparison population Adjust data to be on the same risk basis as the performance PMPM TCOC Apply high cost claim cap adjustments Summarize adjusted final benchmark PMPM TCOC for each AC Compare adjusted final benchmark PMPM TCOC to performance PMPM TCOC to determine if Min Savings Rate (MSR) is met Calculate care management fee PMPM in performance period Calculate quality metrics Calculate shared savings/losses for eligible ACs (care management fees in the performance period will be subtracted from the shared savings). Apply shared savings / loss caps (10% TCOC for Model I) Verify the reliability of the performance period data Perform IBNR adjustments to complete the performance period data, if needed Summarize adjusted claim costs for each attributed member Apply high cost claim cap adjustments Summarize performance PMPM TCOC for each AC Document aggregate concurrent risk score Shared Savings Calculation Steps The main steps to calculate shared savings are listed below.

9. - 8 - Recap of Initial Benchmark PMPM TCOC Development The initial benchmark PMPM TCOC is developed using Medicaid claims data with various adjustments applied to provide the AC Lead Entities with the best estimate available at the start of the Performance Year. Benchmark period July 2012 – June 2013 Performance period July 2014 – June 2015 Benchmark Period Base Data : Data with incurred dates between 7/1/2012 and 6/30/2013 and paid through 8/31/2013 will be used Data checks will be completed Only Medicaid specific claim costs for fully Medicaid eligible members will be used (including the dual population) Only core and optional services, if applicable, will be included in the base data Only claim costs for members attributed to each AC will be used Goal: Develop Benchmark PMPM TCOC to be Reflective of Performance Period Adjustments In order to calculate the initial benchmark PMPM TCOC, the following formula is applied: Initial Benchmark PMPM TCOC = (X) with an adjustment ofXX 1 1 Items Description Step 1: Policy Change Adjustments Policy change adjustments are made to account for rate, and benefit or eligibility changes that occur after the base period in order to bring base data to the effective period Step 2: Completion Factor Adjustments Completion factor adjustments account for claims that may still be outstanding in the base data Step 3: Prospective Trend Adjustments Prospective trend will be applied to project the base data in the benchmark period to the performance period based on projected PMPM TCOC trend. Step 4: Claim Cap Adjustments Claim cap adjustments smooth any potential volatility as a result of an abnormal distribution of catastrophic claims 2 2 3 3 4 4 5 5 1 1 2 2 3 3 4 4 5 5 Note: Aggregate risk score is documented for each AC in the benchmark period

10. - 9 - Overview of the Data Book

11. - 10 - Overview of the Data Book The data book shows the adjustments performed to the base data in the development of the initial benchmark PMPM TCOC. Below is an overview of the data book structure. ExhibitNameDescription 1Base Data Directly summarized from the claims system with no adjustments Data elements include attributed membership, gross payment amount, units, utilization, and PMPM. Shown by high-level service category as well as population. 2Policy Change Adjustment One adjustment factor is developed for each policy change and applied to the claims with the corresponding policy sections Shown by high-level service category as well as population 3Completion Factor Developed based on available historical claims data One completion factor is developed for each high-level service category and each month Shown by high-level service category as well as population 4Prospective Trend Developed based on 30-months of historical claims data with completion factor, policy and risk adjustments applied Developed and shown by population group 5Claim Cap Adjustment Factor Medicaid paid amount is summarized for each attributed member and the dollar amount above the corresponding claim cap threshold for the AC is removed 6 Initial Benchmark PMPM Summary Documents each adjustment applied to base data Data elements include the PMPM before and after the adjustment as well as the adjustment factor Detailed adjustment steps are shown by service category and by population group Appendix 1Service Category Mapping Documents which Accountable Communities program services are included in each service category

12. - 11 - Development of Detailed Adjustments: Policy Adjustment

13. - 12 - Accountable Community A Total Dollar Amount Policy Change Adjustment Factor $100,000 1.000 =$100,000/$100,000 $55,000 1.100 =$55,000/$50,000 Development of Detailed Adjustments: Policy Adjustment Methodology All policy changes that occurred in SFY13 and SFY14 with a fiscal impact will be summarized by the impacted policy sections. An adjustment factor will be calculated for each policy change with fiscal impact based on the estimated dollar impact by the State and the total claims dollars for the affected policy section after the change was implemented. The adjustment factor for each policy change will only be applied to the claims for the associated policy section prior to the corresponding policy change effective date to put that data on the current policy basis. Policy adjustments are made to the claims data to make sure data in prior periods are on the current policy basis. Example Calculation Accountable Community A Service Category Total Dollar Amount Inpatient$100,000 Physician$50,000 Policy Change: 10% Rate Increase on Physician Claims Before Change Implemented After Change Implemented

14. - 13 - Development of Detailed Adjustments: Policy Adjustment - Continued The actual policy adjustment factors for the total attributed population by each service category for the development of the initial benchmark PMPM TCOC are shown below. The adjusted final benchmark PMPM TCOC will be further adjusted by policy changes in SFY2015 to be reflective of the performance period policy basis Illustrative Policy Adjustments by Service Category Note: Policy change factors vary by community at the service category level, the population level, and in total based on the varying dollar distribution of claims by service category and population. The factors in the table above are illustrative only.

15. - 14 - Development of Detailed Adjustments: Completion Factor

16. - 15 - Development of Detailed Adjustments: Completion Factor Methodology From June 2011 to August 2013, the Medicaid paid amount and members were summarized for each service category by incurred and paid month. Historical payment patterns were analyzed in the Deloitte reserve model using the summarized data and ultimate completion factors were estimated for each incurred month. Claims were adjusted by the completion factor with the corresponding service category and incurred month for the 12 month benchmark period. Illustrative Completion Factor by Service Category Completion factor adjustments account for any claims incurred but not yet paid. Different completion factors will be developed for the adjusted final benchmark PMPM TCOC based on the additional run-out available Note: Completion factors vary by community at the service category level, the population level, and in total based on the varying dollar distribution for incurred month by service category and population. The factors in the table on the left are illustrative only.

17. - 16 - Development of Detailed Adjustments: Prospective Trend

18. - 17 - Development of Detailed Adjustments: Prospective Trend Methodology 30-months of claims data was limited to only members who met the attribution criteria statewide and adjusted for completion, policy changes, and risk score. Utilization and unit cost trends were analyzed under various trending techniques Final prospective trend was based on an equal weighting of four trend techniques  Monthly linear regression  Quarterly linear regression with seasonality adjustment  Six month rolling trend  12 month rolling trend Total PMPM TCOC trends by population group were developed by multiplying the utilization and unit cost trends together  Developing trends by population group is consistent with the trend development for the Medicare Shared Savings Program Prospective trend is applied to project the base data from the base period to the performance period.

19. - 18 - Development of Detailed Adjustments: Prospective Trend - Continued Illustrative PMPM TCOC Trend by Population Group Prospective trend will be replaced by the actual retrospective trend from the comparison population in the development of the adjusted final benchmark PMPM TCOC Note: Trend factors will not vary at the sub-population level by community. The total trend factor will vary by community based on the varying distribution of dollars by population. The factors in the table above are illustrative only.

20. - 19 - Development of Detailed Adjustments: Claim Cap Adjustment

21. - 20 - Development of Detailed Adjustments: Claim Cap Adjustment Methodology The catastrophic claim cap threshold is:  $50,000 for accountable community group sizes of 1,000 to 1,999;  $150,000 for accountable community group sizes of 2,000 to 4,999;  $200,000 for accountable community group sizes of 5,000 + The Medicaid paid amount (after applying the previous adjustments) is summarized for each attributed member and the dollar amount above the threshold corresponding to the member’s community is removed. Example Calculation Catastrophic claim adjustments are made to smooth the data for outlier claims. The claim cap adjustment will be refreshed in development of adjusted final benchmark PMPM TCOC after updates are made for completion, policy changes, retrospective trend, and risk Accountable Community A With 5,500 Members and $200,000 Claim Cap Threshold Member Before AdjustmentAfter Adjustment Total Dollar Amount A$250,000$200,000 B$100,000 C$210,000$200,000 Total$560,000$500,000 Adjustment Factor0.8929= $500,000 / $560,000

22. - 21 - Sample Data Book

23. - 22 - Sample Data Book The final data book sent to each accountable community will only contain that community’s data.

24. - 23 - Outlines of Rule and MOU

25. 24 MaineCare AC Rule content: Chapter II Provider Requirements RFA, MaineCare Provider, quality measurement, learning activities PCCM Contractual relationships: Providers of care coordination for members with Chronic Conditions, Developmental or Intellectual Disabilities, and Behavioral Health Issues Invitations to CCT and BHHO partners of HHPs to contract Partnerships or policies with all hospitals in service area, public health entity Covered services: locating, coordinating and monitoring of core and any optional services selected Member eligibility: minimum MaineCare eligibility and attribution methodology Quarterly notification by DHHS to members assigned to AC Member freedom of choice Quality framework (actual measures in MOU) Governance: transparency, MaineCare member participation Performance bond required for Model II Termination: Pro-ration if state terminates the AC without cause, or if the Department or legislature eliminates the AC program. Other provisions under discussion with AAG.

26. 25 MaineCare AC Rule content: Chapter III Shared Savings Methodology

27. 26 Memorandum of Understanding (MOU) Purpose To formalize an agreement to engage in a partnership. On an individual AC basis, to allow for the selection of key elements of the program that the Lead Entity has chosen on behalf of the Accountable Community and for which the Lead Entity will be held accountable. To specify Quality measures that will not be a part of rulemaking due to the likelihood of modifications for each Performance Year. To outline deliverables and deadlines on the part of the Department and the Lead Entity.

28. 27 MOU Key Elements 1 year Term of Agreement with up to two (2) renewals = 3 years Risk Sharing Model Selection Service Area Optional Services Quality Measures Core Measures Elective Measures Authorization for Department to directly access quality data (HbA1c, CG-CAHPS, etc) Reports and Due Dates Department to Lead Entity Lead Entity to Department – 22

29. 28 MOU: Commitment to Provide Reports Provider to Department: AC Provider Organization AC Primary Care Physician (for non FQHC or RHCs) Member Assignment Reconciliation Department to Provider: Initial Benchmark Total Cost of Care Quarterly: – Member Assignment – Quality Performance – Total Cost of Care Tracking Monthly Utilization Dashboard Reports (PHI)

30. 29 Q&A Questions?