The ABCs of New York State Medicaid Redesign. A Primer for Community- Based Organizations

Transcription

1 The ABCs of New York State Medicaid Redesign A Primer for Community- Based Organizations UNH Issue Brief November, 2016

2 Foreward If you have followed New York State policy in recent years, you have likely heard about the State s efforts to transform its Medicaid program. A complex and fast-changing initiative, further intensified by changes and opportunities under the federal Affordable Care Act, the redesign of New York State s Medicaid program has already had significant implications for community-based organizations, and will continue to do so in the coming years. Whether your organization has years of experience providing Medicaidfunded services, or does not view itself as a healthcare provider at all, it is important to understand what Medicaid Redesign means for community-based organizations. Not only has Medicaid Redesign changed current program operations in behavioral health and long-term care services, it provides an opportunity to fund new projects and efforts for CBOs. CBOs must weigh their participation carefully and think strategically about the ways to align their work with the goals of Medicaid Redesign. This document is intended to explore some of the nuances of Medicaid Redesign and explain what it means for CBOs in New York State. Medicaid Redesign poses one of the largest changes for CBOs in New York, and critical and creative thinking and strategies are needed in order to maximize participation and take full advantage of the opportunities. United Neighborhood Houses will continue to monitor developments and disseminate important changes and opportunities to its membership, and also to advocate for policies that protect CBOs and enhance their ability to participate in Medicaid Redesign initiatives. For more information, contact UNH Policy Analyst Nora Moran at nmoran@unhny.org or x316. Thanks to the Lawyers Alliance for New York and the United Hospital Fund for their contributions to this issue brief. 2

3 Table of Contents Introduction... 4 Background: The Medicaid Redesign Team (MRT) and Community-Based Organizations... 6 Transition to Managed Care: Medicaid Managed Long Term Care (MLTC) Plans and Fully Integrated Duals Advantage (FIDA) Plans... 8 Transition to Managed Care: The Behavioral Health Carve-In and Health And Recovery Plans (HARPs) Medicaid Health Homes Behavioral Health Home and Community Based Services (HCBS) Delivery System Reform Incentive Payment (DSRIP) Program Value Based Payments Children s Services Transition to Managed Care References

4 Introduction Medicaid, New York State s health insurance program for low-income individuals, serves as a safety net for individuals to access health and behavioral health services. For years, care within New York State s Medicaid program was fragmented, extremely costly, and often focused on inpatient hospital care. After years of conversations and planning, New York State began an ambitious overhaul of its Medicaid program in The ultimate goal is to achieve the Triple Aim: better care, better health, and lower costs. 1 The State plans to achieve this through a series of waivers to previous program requirements and new services and initiatives. At the same time, the Federal Patient Protection and Affordable Care Act opened up new opportunities for states to extend Medicaid coverage to more people, and to test new models of care delivery. This perfect storm of healthcare change is being felt across all levels of the healthcare system in New York State. These changes have profound implications for community-based organizations delivering health and human services, even though community-based organizations (CBOs) may not see themselves as deliverers of health care. New York State has expanded its definition of health care provider to include CBOs. All CBOs are being encouraged by the NYS Department of Health to participate in Medicaid redesign initiatives in order to reach more Medicaid recipients and promote overall population health, stemming from recognition that CBOs possess expertise in addressing the social determinants of health. 2 The barrier between the social model and the medical model of care is being broken down as healthcare payers (such as insurance companies) are demanding integrated person-centered care that is delivered in the community, rather than in traditional hospital facilities. The healthcare world is beginning to see the potential of community-based organizations to help keep communities healthy, and policy makers are trying to encourage partnership and collaboration through Medicaid Redesign. However, there are concerns about the allocation of resources for CBOs to be able to comply with new ways of doing business and to collaborate with larger hospital-driven counterparts. The Triple Aim framework, developed by the Institute for Healthcare Improvement (a national health policy organization), believes that health care systems must be simultaneously working to: improve a patient s health care experience, improve the health of a whole group or population, and reduce the per capita cost of health care. Federal policy has embraced this framework, and many of the initiatives under the Affordable Care Act utilize this approach. Medicaid Redesign presents new opportunities for CBOs to expand their work and access new revenue streams. Opportunities through the Delivery System Reform Incentive Payment (DSRIP) program and Health Homes can enhance the types of social services offered by CBOs, particularly those who serve low-income individuals and families, individuals with significant behavioral health needs, older adults, and The World Health Organization defines social determinants of health as the conditions in which people are born, grow, live, work and age, including the health system. These circumstances are shaped by the distribution of money, power and resources at global, national and local levels, which are themselves influenced by policy choices. The social determinants of health are mostly responsible for health inequities - the unfair and avoidable differences in health status seen within and between countries. 4

5 communities with high rates of chronic disease. Medicaid Redesign also raises operational and programmatic questions, such as: What could my organization be doing to prepare and participate effectively? What must my organization do to comply with new regulations and practices? Should my organization even participate in new Medicaid Redesign programs at all? Can we handle the financial risk? Should we begin to partner with other organizations? This document is intended to serve as a guide for community-based organizations to begin to make sense of Medicaid Redesign initiatives and prepare for and implement their organization s participation. It provides an overview of recent initiatives and changes that are most relevant to CBOs and describes how they impact service provisions and operations at CBOs. It also provides recommendations for how to respond in this new environment. New York State s Medicaid Redesign efforts have affected consumer rights and access under the Medicaid program, and will continue to do so in the coming years. Medicaid Redesign has also led to significant State investments in supportive housing programs, both in terms of capital investments to build units and support for social services. This brief does not offer details about consumer rights and protections or supportive housing development, as these are complex topics in their own right with bodies of literature. 3 5

6 Background: The Medicaid Redesign Team (MRT) and Community-Based Organizations New York State s Medicaid program has typically been the costliest state Medicaid program, costing nearly $60 billion to serve about 6.7 million people. 4 In 2011, Governor Andrew Cuomo issued an Executive Order to convene the Medicaid Redesign Team (MRT) to find new options for lowering Medicaid spending in New York State during the fiscal year. The MRT submitted a report to the Legislature of 79 recommendations in February 2011, 78 of which were included in the SFY enacted budget, including a global spending cap, that saved the State $2.2 billion. Once Phase 1 was completed, the MRT continued to work together to find long-term savings and efficiencies, and developed work groups to explore more complex issues and create a multi-year plan for state health care reform to achieve the Triple Aim: better care, better The Agency for Healthcare Research and Quality, part of the U.S. Department of Health and Human Services, defines care coordination as: deliberately organizing patient care activities and sharing information among all participants concerned with a patient's care to achieve safer and more effective care. This means that the patient's needs and preferences are known ahead of time and communicated at the right time to the right people, and that this information is used to provide safe, appropriate, and effective care to the patient. health, and lower costs. 5 The MRT developed a multi-year action plan called A Plan to Transform the Empire State s Medicaid Program. 6 A key general outcome of the MRT plan was that New York State would apply to the federal Centers for Medicare and Medicaid Services (CMS) to amend its existing Section 1115 Medicaid Demonstration Waiver 7 ( 1115 Waiver ). An 1115 Waiver derives from Section 1115 of the Social Security Act, and gives the federal Secretary of Health and Human Services authority to waive provisions of major health and welfare programs authorized under the Act, including certain Medicaid requirements, and to allow a state to use federal Medicaid funds in ways that are not otherwise allowed under federal rules. The authority is provided at the Secretary s discretion for demonstration projects that the Secretary determines promote Medicaid program objectives Waivers also must be budget-neutral for the federal government, meaning that it will not require the federal government to invest additional money in a state s Medicaid program. Thus, New York State has looked for cost-saving measures so that savings can then be invested in funding the 1115 Waiver to transform NYS s health care delivery system. New York State s current 1115 Waiver was finalized between NYS and federal CMS in April 2014, and will be in place for five years. Many of the initiatives discussed in this document are part of this 1115 Waiver. Another key outcome of the MRT plan was eliminating the fee-for-service health care delivery payment model, and transitioning all Medicaid consumers to a managed care model and ultimately moving toward a value based payment methodology. Eliminating fee-for-service care and implementing care coordination 9 for all Medicaid consumers is a key strategy of New York State to achieve Aim 1 of the Triple Aim: Improving Care. The MRT felt that managed care was the best way to ensure that all Medicaid consumers have access to fully integrated care management meaning that health services, behavioral health, long term care, and social needs would be managed together by one entity. This transition is nearly complete, as behavioral health services were recently transitioned to managed care (health services were transferred to managed care in 2012), and children s services 6

7 will be transferred in the coming years. The recommendations of the Medicaid Redesign Team have significant implications for community-based organizations, as the State views CBOs as an untapped resource that can help with the goals of the MRT. CBOs are trusted by their local communities, can address the social determinants of health, and already provide services to vulnerable populations in New York. However, these changes are taking place during a time of financial challenge for CBOs in New York City, both for those that bill Medicaid and those that do not. The Human Services Council estimated that nearly one out of five human services nonprofits in New York City was insolvent in 2013, and 30 percent had only two months or less of operating reserves. Underfunded government rates are a significant driver of this financial distress, as government contracts typically fund 80 cents or less of each dollar of program delivery costs. 10 Medicaidfunded programs operated by CBOs have similar financial challenges, and may be riskier given that their reimbursement model is driven by number of clients served (as opposed to fixed contract costs associated with other human services contracts). Few of the initiatives and programs described in this brief have resulted in significant increases in funding for CBOs. There are few guarantees that any meaningful share of the State s investment in Medicaid Redesign will flow to community based-organizations, despite repeated and frequent encouragement that CBOs get involved. It is important for CBOs to understand the level of risk involved with participating in Medicaid Redesign initiatives, and to weigh options carefully before doing do. This issue is discussed in detail in relation to the various initiatives highlighted in this brief. 7

8 Transition to Managed Care: Medicaid Managed Long Term Care (MLTC) Plans and Fully Integrated Duals Advantage (FIDA) Plans Part of the Medicaid managed care transition focused on individuals who require long term care, meaning older adults or individuals with disabilities who require non-medical assistance with activities of daily living (ADLs), such as bathing, dressing, eating, etc. These individuals are often dually eligible meaning that they have both Medicare (government insurance for individuals age 65+ and/or disabled) and Medicaid (government insurance for low-income individuals of all ages). New York State developed two insurance options for dually eligible individuals who need long term care: Medicaid Managed Long Term Care (MLTC) plans and Fully Integrated Duals Advantage (FIDA) plans. Care for dually eligible individuals is often costly and uncoordinated, making this area a prime target for reform. In 2012, dually eligible individuals represented roughly 15% of the total NYS Medicaid population, but accounted for 45% of total Medicaid expenditures. 11 Additionally, care for this population has often been fragmented due to complex health care needs and coordination of benefits issues between Medicare and Medicaid. MLTC and FIDA plans seek to improve care coordination and streamline benefits administration while also controlling the high costs associated with long term care. Which health care consumers are affected? Dually eligible New Yorkers are affected by the mandatory transition to MLTC plans. Dually eligible individuals tend to be low-income older adults with complex health care needs. As of mid-2016, there are approximately 135,000 individuals enrolled in MLTC plans across the state, with about 114,100 enrolled in New York City. There are approximately 5,400 individuals enrolled in FIDA plans in NYC and Nassau County as of May FIDA plans are not yet available in the rest of New York State, and plans to expand the demonstration are on hold. Which providers are affected? All providers who work with dually eligible individuals are affected by this change. In particular, CBOs that provide home care and social adult day care (SADC) are affected, as they now have to contract with multiple managed care plans in order to receive reimbursement for these services. There are 33 MLTC plans in New York State, 24 of which are in NYC. There are 17 FIDA plans in New York. Both MLTC and FIDA plans also may reimburse for services that were not traditionally considered to be a Medicaid benefit, such as home-delivered meals and health and wellness classes. What is the timeline? Enrollment in a MLTC plan is mandatory in all counties in New York State for those who need long-term care services. The FIDA demonstration began in January 2015 in New York City and Nassau County, and enrollment is still optional. Plans have struggled to attract and retain individuals in the FIDA program, likely due to limited choice within provider networks. FIDA enrollment is scheduled to extend to Suffolk and Westchester Counties in FIDA is a demonstration program set to end on December 31, How does this affect CBOs? CBOs who provide home care services and social adult day services experienced a significant business and programmatic change when they had to start billing MLTC plans for reimbursement. CBOs now must contract with and bill several managed care plans, rather than a single predictable payer (in this case, New York State) under the fee-for-service model. The switch to multiple payers has resulted in cash flow problems for some CBOs, and they have experienced late and unpredictable payments. This change also necessitated a significant 8

9 increase in back office operations in order to bill properly and ensure quality services. With mandatory MLTC enrollment in place in NYC for several years now, the number of home care providers has shrunk due to the transition and minimal start-up costs allocated to providers. CBOs already contracted with MLTC/FIDA plans should become familiar with the State s Value Based Payment Roadmap (discussed later in this document), as this will shape managed care contracts in the coming years. Additionally, there may be further consolidation among MLTC/FIDA plans in the near future, especially if overall enrollment in MLTC/FIDA plans is static. MLTC/FIDA plans also look beyond home care and social adult day services to keep their enrollees healthy and out of the hospital. If contracted with a MLTC or FIDA plan, CBOs may be able to contract for other supportive services. For example, an MLTC plan might pay for an evidence-based falls prevention course or for home-delivered meals for the plan s enrollees. Though contracts with MLTC/FIDA plans and other healthcare providers have the potential to diversify the revenue of CBOs serving older adults, there have yet to be significant relationships forged between providers in the aging services network and the healthcare field. The NYC Department for the Aging is exploring the creation of a management services organization (MSO) 12 to leverage the possible connections between CBOs and health care plans and providers. Managed Long Term Care Plans Cover specific Medicaidcovered long term care benefits such as home care services and social adult day care services Must be enrolled in a MLTC plan to access these long term care services Someone with a MLTC plan still has separate Medicare benefits FIDA Plans Cover all Medicare and Medicaid benefits under one insurance plan Offer additional benefits that regular MLTC plans do not offer, such as care coordination Require communication between an individual s providers Enrollment is optional 9

10 Transition to Managed Care: The Behavioral Health Carve-In and Health And Recovery Plans (HARPs) Medicaid is the primary funding source of behavioral health services for individuals with severe mental illness and substance abuse conditions in New York State. Since behavioral health care (referring to mental health and substance abuse services collectively) is specialized and complex, New York State conducted a separate process when transitioning these services to a managed care model. Providing these services through an integrated managed care plan is considered to be an important step in addressing the high costs and fragmented nature of service delivery for this population. By including behavioral health services in managed care plans, the State seeks to integrate and coordinate care while driving down costs. Though implementation was delayed several times by New York State due to concerns that managed care plans did not have adequate networks of behavioral health service providers, behavioral health services became covered under managed care as of October 1, 2015, in New York City. These services are now offered under managed care plans in New York City via two insurance options: Mainstream Managed Care plans for all individuals with Medicaid, and Health and Recovery Plans (HARPs) for individuals with significant behavioral health needs. Which consumers are affected? All Medicaid consumers seeking to access behavioral health services now must do so through their managed care plan. Those with significant behavioral health needs can enroll in a new HARP plan these plans are only available to those with Serious Mental Illness (SMI) and Substance Use Disorders (SUD). Though enrollment in a HARP is not mandatory, certain enhanced benefits like Home and Community Based Services (HCBS, discussed later in this document) are only available to those enrolled in a HARP. HARPs were designed to coordinate and integrate the physical health, mental health, and substance use services for individuals with significant behavioral health needs. Individuals must be at least 21 years old to enroll in a HARP. New York State has identified those eligible to enroll in a HARP and notified them of their eligibility. Those who are HARPeligible must be offered care management through a Health Home (discussed later in this document). The Health Home care manager will work to coordinate the individual s care. Note that HARP enrollment excludes dually eligible individuals (those who have both Medicare and Medicaid) and anyone participating in programs with the NYS Office for People with Developmental Disabilities (OPWDD). There are proposals to make certain behavioral health services available to dual-eligible individuals via MLTC plans, but this is not definite Which providers are affected? All providers who bill Medicaid for behavioral health services will now have to contract with managed care plans in order to be reimbursed for such services. Currently, there are guaranteed reimbursement rates for all providers contracting with managed care plans for behavioral health services. These State-guaranteed Ambulatory Patient Group (APG) rates are only set There are now two ways individuals can access behavioral health treatment under Medicaid: Through a Mainstream Managed Care plan for any individual with Medicaid who needs behavioral health services, or through a Health and Recovery Plan (HARP), a specialized insurance plan for individuals with serious behavioral health needs. This means community-based organizations must contract with managed care plans to be reimbursed for behavioral health services. 10

11 through April 1, 2018; beyond this, it is up to providers to negotiate rates with managed care plans. What is the timeline? Effective October 1, 2015, Medicaid Mainstream Managed Care plans began covering expanded behavioral health services for adults in New York City. Also effective October 1, 2015, HARP plan enrollment began for eligible individuals. Many of these individuals were passively (automatically) enrolled into a HARP plan. For the rest of New York State, behavioral health coverage under mainstream managed care plans and HARP enrollment began on April 1, How does this affect CBOs?: This transition has significant implications for CBOs, particularly around billing and reimbursements for behavioral health services. CBO providers now must contract with several managed care plans rather than a single payer, and the creation of HARPs increases the number of potential payers. Contract management and billing has become more complex and timeconsuming, which has increased the administrative elements of running a behavioral health program (often referred to as back office functions ). This shift in administrative tasks is similar to the shift that occurred among homecare providers with MLTC/FIDA plans. Reimbursement rates have also posed challenges for CBOs providing behavioral health services. The Comprehensive Outpatient Reimbursement Services (COPS) payment program, phased out by 2013, had provided supplemental rates to Medicaid behavioral health providers. The elimination of COPS payments destabilized many Article 31 mental health clinics, as COPS covered the additional costs of operating these clinics. The replacement APG rates often do not adequately cover the cost of providing services, especially given the increased back office costs associated with the transition to managed care. To assist struggling Article 31 clinics, New York State made two rounds of Vital Access Provider (VAP) funding available to preserve the stability and geographic distribution of mental health clinic services, which was targeted toward agencies willing to merge or consolidate. It is not clear whether more VAP funding will be made available in the future. If they have not done so, CBOs operating behavioral health programs should examine their short- and long-term financial situation and consider different business options to streamline operations and deal with financial challenges, including collaborations or mergers with other organizations and outsourcing of billing and compliance. Once APG rates end (targeted for April 2018), CBOs will have to demonstrate their value to managed care organizations in order to secure contracts. Without a high patient volume, or well-documented outcomes, CBOs may struggle to contract with managed care organizations at sustainable rates. CBOs that provide billable behavioral health services should begin considering how to document their outcomes before the transition to a value based payment methodology (discussed later in this document), so that they can proactively demonstrate their value to managed care organizations. 11

12 Medicaid Health Homes Following from a concept put forth by the federal government, New York State has identified medical Health Homes as a key intervention for driving change and coordinating care for Medicaid beneficiaries. Health Homes are not a physical place, but rather are a way of providing care to individuals. Health Homes continue to play an integral role in New York State as MRT recommendations are implemented, and the success of several MRT recommendations is closely tied to the success of Health Homes. The Affordable Care Act created an optional Medicaid benefit for states to establish Health Homes to coordinate care for Medicaid beneficiaries with chronic health conditions. A Health Home is a care management service model where all of an individual's caregivers communicate with one another so that all of a patient's needs are addressed in a comprehensive way. The federal Centers for Medicare and Medicaid Services (CMS) expects state Health Home providers to operate under a "whole-person" philosophy an understanding that caring for someone s physical health is just as important as meeting their social, economic, and family needs. This is done primarily through a care manager who oversees and provides access to all of the services an individual needs to stay healthy, out of the emergency room, and out of the hospital. For Health Home members, health records are shared among providers so that services are not duplicated. Health Home services are provided through a network of organizations that includes providers, managed care plans, and community-based organizations. The MRT recommended Health Homes as a main vehicle for coordinating care for Medicaid consumers with complex healthcare needs. Health Homes are required to provide six core services: 1. Comprehensive care management 2. Care coordination and health promotion 3. Comprehensive transitional care 4. Enrollee and family support 5. Referral to community and social supports 6. Use of Health Information Technology (HIT) to link services. Health Homes are made up of partnering organizations who work together to coordinate care for consumers. These partnering organizations are comprised of a health home administrative lead, responsible for maintaining data, securing payment, and ensuring quality; network partners who are designated as care managers; and a network of affiliated providers who deliver a broad range of services to Health Home members. 13 Which consumers are affected? Medicaid consumers qualify to join a Health Home if they have one or more of the following: Two or more chronic conditions (e.g., mental health condition, substance use disorder, asthma, diabetes, heart disease, BMI over 25, or other chronic conditions); One qualifying chronic condition and the risk of developing another; One serious mental illness. Health Homes are not mandatory for Medicaid consumers at this time. Current health homes focus on serving Medicaid consumers with behavioral health and/or chronic medical conditions, and have not been tailored to meet the needs of the developmentally disabled or long term care populations. Which providers are affected? Health care providers and community-based organizations can join Health Homes to provide any of the six core services. Additionally, providers who serve a Health Home enrollee will likely interact with that individual s Health Home Care Manager. What is the timeline? New York State began its Health Home program in January The State continues to market Health Homes in order to increase 12

13 enrollment and provide care coordination to more individuals. How does this affect CBOs? Health Homes impact CBOs primarily in two ways: CBOs can be part of a Health Home to help provide care coordination services, and can work with Health Homes to provide services for a Health Home member. If a CBO is part of a Health Home, they may be eligible for reimbursement of certain services to coordinate an individual s care. For those CBOs providing Home and Community Based Services (HCBS, described in the next section), relationships with Health Homes will be crucial to receive referrals and ensure that a client is progressing toward their recovery goals. Health Homes are the gateway to HCBS, as they will assess HARP enrollees for HCBS eligibility and ultimately refer to HCBS providers. Additionally, CBOs can help facilitate greater enrollment in Health Homes for Medicaid beneficiaries, in order to ensure that those beneficiaries who require a higher rate of care coordination can access it. 13

14 Behavioral Health Home and Community Based Services (HCBS) In order to better coordinate care and keep individuals in recovery and out of inpatient settings, New York State is offering an expanded suite of services under Medicaid, called Behavioral Health Home and Community Based Services (HCBS). HCBS is only available to Medicaid consumers enrolled in a Health and Recovery Plan (HARP). HARPs will cover HCBS in order to provide these Medicaid beneficiaries with a specialized set of supportive, recovery-oriented services not currently covered under mainstream Medicaid managed care plans. New York State included HCBS as part of its broader 1115 Waiver, as the Affordable Care Act gave states more authority in designing and implementing HCBS, including targeting these services to specific populations. HCBS tend to be similar in program design to Personalized Recovery Oriented Services (PROS) 14 and other vocational and supportive services. The following services are included in HCBS, and are now reimbursable under Medicaid: Community Psychiatric Support and Treatment (CPST) Pre-vocational Services Psychosocial Rehabilitation (PSR) Transitional Employment Habilitation/Residential Support Services Intensive Supported Employment (ISE) Family Support and Training Ongoing Supported Employment Mobile Crisis Intervention Education Support Services Short-term Crisis Respite Empowerment Services - Peer Supports Intensive Crisis Respite Non-Medical Transportation Individuals identified as HARP eligible must be offered care management through a Health Home designated by New York State. Individuals working with their care manager will determine which HCBS services they are eligible for, and Health Homes will refer individuals to HCBS providers (including CBOs). Which consumers are affected? Medicaid consumers who are eligible to join a HARP (meaning they must be 21 or older, be insured only by Medicaid, and be eligible for Medicaid managed care) are able to access these services after assessment and approval by their Health Home Care Manager. They also must have a severe mental illness or substance abuse disorder, and must be enrolled in a Health Home. Which providers are affected? Community-based organizations are affected by these new HCBS services, as they are able to bill Medicaid for these services for the first time. Providers had to apply to the NYS Office of Mental Health (OMH) to be designated as HCBS providers. While some organizations already bill Medicaid for behavioral health services and are adding HCBS to their current programming, other organizations are billing Medicaid for the first time. Most HCBS providers received small start-up grants from OMH to prepare for HCBS implementation. What is the timeline? HCBS services were offered to HARP members as of January 1, 2016, in New York City. HCBS will be offered in the rest of state as of October 1, CBOs can still be designated as HCBS providers after October How does this affect CBOs? Many CBOs were designated as HCBS providers by NYS OMH. As of mid-2016, HCBS start-up has been slow in New York City. Few HARP members have been fully assessed and referred to HCBS providers by their Health Home, so HCBS providers have received few referrals since the program began. Additionally, start-up has proved more complicated for some provid- 14

15 ers, especially those that are first-time Medicaid billers. Many have put their services on hiatus while preparing for HCBS implementation. Reimbursement rates set by New York State are low, and there are concerns that it will be difficult for CBO providers of any size to offer HCBS in a financially sustainable way. Finally, some CBOs who were designated as HCBS providers do not primarily serve a HARP-eligible population and may not have the staff expertise to provide HCBS; these CBOs are putting their services on hiatus until there is a bigger HCBS client base. Though providers are experienced in clinical programs, HCBS is more similar to recovery and workforce programs. Both the slow pace of assessments and slow start-up among providers have made it difficult to assess HCBS in a significant way as of mid

16 Delivery System Reform Incentive Payment (DSRIP) Program The Delivery System Reform Incentive Payment (DSRIP) Program is the main way that New York State will implement its new 1115 Medicaid Demonstration Waiver. DSRIP s purpose is to restructure Medicaid s healthcare delivery system through investing $7 billion toward program redesign, with the primary goal of reducing avoidable hospital use by 25% over five years. DSRIP is a performance-based incentive program, with payments based upon achieving predefined results in system transformation, clinical management, and population health. Other states have DSRIP programs, and each state structured the program based on the needs and provider networks within their state. NYS DOH has prioritized collaboration in DSRIP, and structured the program so that organizations must collaborate to achieve the ultimate DSRIP goal of reducing avoidable hospital use through hospital-led Performing Provider Systems (PPS). These PPS are composed of a broad array of providers, including Health Homes, skilled nursing facilities, behavioral health providers, and community-based organizations. There are 25 PPS across the State that are designated by geographic regions; 13 PPS are in the New York City area. New York is one of the first states with a DSRIP program that involves this broad array of providers. DSRIP has a strict five-year timeline, ending March 31, 2020, under which certain transformation goals must be achieved, as prescribed by New York State and federal CMS. At the start of DSRIP, PPS selected between five and 10 projects across three domains: system transformation, clinical improvement, and population-wide health. This gives each PPS authority to choose projects that they believe will best manage chronic conditions and prevent avoidable hospital readmissions for the consumers in a PPS catchment area. Examples of projects under DSRIP include efforts to control and treat chronic conditions like asthma and diabetes, integrating physical and behavioral health care, and offering palliative care in the community. To a large extent, PPS have already selected the network of providers they will be working with on DSRIP projects. Payment to PPS, and the individual providers within those PPS, depend on their ability to successfully complete the goals of each project. By the end of DSRIP Year 5, the State s goal is to have percent of managed care payments to providers use value based payment methodologies (discussed later in this document). Which consumers are affected? All Medicaid consumers are affected by DSRIP. Though consumers will not have to change their health care providers under DSRIP or only access services through specific PPS, their medical information can be shared among providers in a PPS, with the intention of improving health care outcomes. By using Health Information Technology (HIT), PPS plan to share up-to-date information about patients to better coordinate care and support individuals with chronic health conditions (like asthma or diabetes). Medicaid consumers are given the option to opt out through State-administered letters and forms so that their medical information is not used in DSRIP. Which providers are affected? All current Medicaid providers are affected by the goals of DSRIP, as well as organizations that do not currently bill Medicaid. A significant shift under DSRIP is that community-based organizations are considered providers, even if they have never billed Medicaid before. This stems from New York State s recognition that community-based organizations have regular contact with Medicaid consumers and can work with hospitals to promote preventive care within communities. DSRIP places a significant emphasis on primary care within communities, though this is something that hospitals typically have not provided. What is the timeline? DSRIP Year 1 began in New York State on April 16

17 1, DSRIP is a five-year program, set to conclude by March 31, How does this affect CBOs? In general, DSRIP has broad implications for CBOs since New York State included a broader set of providers in its waiver design. CBOs are able to join PPSs, and PPSs have tapped their CBO partners to work on projects and/or engage with non-utilizing or low-utilizing Medicaid consumers. CBOs are attractive partners to PPSs, as CBOs often have broad reach in the communities they serve and are trusted institutions. CBOs can offer valuable skills and perspectives, as well as connections to Medicaid consumers in the community. Each PPS varies in how and when it funds its contractors, includig CBOs. Few planning funds have been made available to CBOs, either from the State or from PPSs. In summer 2016, the State Department of Health released some planning funds for CBOs, but they were only available for non-medicaid billing CBOs with operating budgets of less than $5 million. Organizations that bill Medicaid and/or have larger budgets do not necessarily have resources to plan and prepare for PPS participation. Furthermore, time spent attending PPS meetings and following DSRIP developments is important for CBOs, but there are limited resources to help CBOs do this. Such time has not been reimbursed by PPSs to date, and it does not appear that it will in the future. CBOs should have a working knowledge of the DSRIP program before participating, and should know whether they serve a significant number of Medicaid consumers. Additionally, CBOs should consider their skills and expertise when it comes to addressing the social determinants of health. They should be able to articulate that expertise to PPSs in relation to participation in a specific DSRIP project or future value based payment arrangements and should look to the performance metrics set forth by the State s Clinical Advisory Groups. If a CBO does not work with Medicaid consumers or have experience in health management or other healthrelated supportive services, it may not make sense for them to participate in a PPS. Finally, providers should review any contracts with PPSs carefully, and understand the payment timeline for these contracts, as some PPS projects may require significant up-front investments. DSRIP Timeline Information source: New York State Department of Health April March 2015 April March 2016 April March 2017 April March 2018 April March 2019 April March 2020 YEAR 0 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 April 2014 CMS approves Medicaid Redesign Team waiver amendment; DSRIP Year 0 begins December 2014 PPS applications due April 2015 DSRIP implementation period begins Payments begin to shift from pay-forreporting to pay-forperformance By year end 80%-90% of managed care payments to providers will be paid through value Lorem ipsum dolor sit based amet, arrangements consectetur adipiscing elit. Cum March 31, 2020 autem in quo sapienter dicimus, id a primo DSRIP rectissime program dicitur. ends 17

18 Value Based Payments (VBP) As part of the DSRIP program, New York State plans to transition percent of managed care payments to providers to value based payment arrangements, meaning that payment for services under the Medicaid program will only Value based payments will incentivize providers to offer high-quality care rather than high volume care. Instead of being reimbursed to provide many services, providers will be reimbursed if the services help an individual to get healthy, stay healthy, and manage any chronic conditions. be delivered if certain outcomes are met. In 2015, the NYS DOH released A Path toward Value Based Payment: New York State Roadmap for Medicaid Payment Reform, its vision for achieving value based payments. The State has emphasized that this is a living document, meaning that it will be updated annually since many of the smaller details are still being shaped by the State. Notably, the transition from project-based agreements to VBP arrangements is not entirely clear and may not be standardized across PPSs. VBP is a significant change from the fee-forservice system, which pays providers for services rendered regardless of the outcome. A VBP agreement will be shaped in negotiations between providers (referred to in the Roadmap as VBP contractors) and managed care organizations. The agreement will depend on two factors: the VBP option and the level of risk. The VBP options are defined by the NYS DOH and are based on the population served or the payment model, and include: total care for general population; integrated primary care, including the chronic bundle; the maternity bundle; and/or total care for special needs subpopulations. There are several levels of risk associated with VBP, and each VBP option can have a different level of risk (detailed in the chart on page 20). Ultimately, changes will take shape as negotiations between providers and managed care organizations progress, as the State s Roadmap is only intended as a guide to VBP. The real change and innovation will happen during negotiations, so there are few examples to illustrate what a VBP arrangement will look like in practice. Which consumers are affected? Most Medicaid consumers are affected by the transition to VBP, though the change may not be apparent from a service delivery perspective. VBP should improve a consumer s health care experience, as it should incentivize providers to offer better and more coordinated care. Which providers are affected? In theory, all providers are affected by the transition to VBP, and the Roadmap offers some guidelines around who is considered a VBP contractor. A VBP contractor is an entity that contracts VBP arrangements with managed care organizations (MCOs). VBP contractors can be an: Accountable Care Organization (ACO) Independent Practice Association (IPA) Indidividual provider (either assuming all responsibility/risk, or subcontracting with other providers); or Individual providers brought together by a MCO through individual contracts with these providers. The Roadmap also states that the NYS DOH will exclude financially challenged providers from being a parent or risk-carrying party of a VBP arrangement. Financially challenged providers means that a provider has less than 15 days of cash and equivalents, no assets that can be monetized other than those vital to operation, and the provider has exhausted all efforts to obtain resources to sustain operations. Such providers 18

19 should be in discussions with NYS DOH to be absorbed by another system, transitioned to another licensure category or service line, or discontinue operations. 15 What is the timeline? By DSRIP Year 5 (April 2019-March 2020), New York State plans for 80 to 90 percent of Medicaid payments to providers to be delivered in value based arrangements. How does this affect CBOs? The Roadmap states that addressing the social determinants of health is key to achieving the overall goals of DSRIP and Medicaid Redesign, and it specifically mentions CBOs as part of VBP arrangements. Through the Roadmap and its VBP Bootcamp Series, NYS DOH has stated that it envisions CBO participation in VBP arrangements through ACOs and IPAs. Because it is not recommended to contract VBP arrangements for small population groups, CBOs should be careful to assess whether it is feasible to enter a VBP arrangement as an individual provider, or whether they need to collaborate with other providers via an IPA or ACO. While PPSs cannot be VBP contractors themselves, they may facilitate the formation of VBP contracting structures. The Roadmap also stipulates that VBP contractors in Level 2 or 3 agreements (see chart on page 20) will be required to implement at least one social determinant of health intervention. Thus, starting in January 2018, Level 2 and 3 VBP arrangements must include at least one Tier 1 CBO. As of late 2016, it is not yet clear what these VBP arrangements will look like in practice, or what exactly a CBO s role will be. Currently, New York State is providing resources for providers to learn about VBP contracting, particularly if they have never participated in a VBP arrangement before. Some providers are slated to participate in VBP pilots in late 2016 and 2017, in an effort to test out metrics from the Clinical Advisory Groups and refine them based on feasibility. The Roadmap describes tiers as: Tier 1: Non-profit, non-medicaid billing, community-based social and human service organizations (e.g. housing, social services, food banks) Tier 2: Non-profit, Medicaid billing, non-clinical service providers (e.g. transportation, care coordination) Tier 3: Non-profit, Medicaid billing, clinical and clinical support service providers (licensed by DOH, OMH, OPWDD, or OASAS) An Accountable Care Organization (ACO) 16 is a group of doctors, hospitals, and other healthcare providers, who come together voluntarily to give coordinated high quality care to their Medicare or Medicaid patients. An Independent Practice Association (IPA) 17 is a legally incorporated business entity that is organized and owned by a network of independent healthcare practices in order to reduce overhead or pursue business ventures. 19

20 Potential Combinations in VBP Information source: A Path Toward Value Based Payment: New York State Roadmap for Medicaid Payment Reform, New York State Care Options for VBP Arrangements Level 0 VBP Level 1 VBP Level 2 VBP Level 3 VBP (only feasible after experience with level 2, requires mature VBP contractor) Total Care for General Population Fee for service (FFS) with bonus and/or withhold based on quality scores FFS with upsideonly shared savings when quality scores are insufficient FFS with risk sharing (upside available when outcome scores are sufficient; downside is reduced or eliminated when quality scores are high) Global capitation (with quality-based component) Integrated Primary Care with Chronic Bundle FFS (plus Per Member Per Month (PMPM) subsidy) with bonus and/or withhold based on quality scores FFS (plus PMPM subsidy) with upside- only shared savings based on total cost of care (savings available when quality scores are sufficient) FFS (plus PMPM subsidy) with risk sharing based on total cost of care (upside available when outcome scores are sufficient; downside is reduced or eliminated when quality scores are high) PMPM capitated payment for primary care services (with quality-based component) Maternity Bundle FFS with bonus and/or withhold based on quality scores FFS with upside-only shared savings based on bundle of care (savings available when quality scores are sufficient) FFS with risk sharing based on bundle of care (upside available when outcome scores are sufficient; downside is reduced or eliminated when quality scores are high) Prospective bundled payment (with quality-based component) Total care for subpopulation FFS with bonus FFS with upside-only and/or withhold based on shared savings based on quality scores subpopulation capitation (savings available when quality scores are sufficient) FFS with risk sharing based on subpopulation capitation (upside available when outcome scores are sufficient; downside is reduced or eliminated when quality scores are high) PMPM capitated payment for Total Care for Subpopulation (with quality-based component) 20

21 Children s Services Transition to Managed Care Just as the State has transitioned adult services to managed care and offered an enhanced package of benefits, there are also plans to transition children s behavioral health services. Similar to the adult system, the children s system is siloed and difficult to navigate for families and providers. The children s system transition to managed care comes at a time when more focus and attention is placed on childhood behavioral health, as research about child development has advanced, particularly for children ages zero to three. Nationally, one in five children ages zero to 18 has a diagnosable mental health disorder, and one in 10 children has serious mental health issues severe enough to impact functioning. 18 The three main aspects of the children s managed care transition in New York State are: expanding available services to all children who are eligible, streamlining services by transitioning current waiver programs to managed care, and implementing Health Homes that will specifically coordinate care for highest-need children. 19 The expansion of services will include six new services (currently referred to as State Plan Amendment, or SPA, services), including: Crisis Intervention Community Psychiatric Supports and Treatment Family Peer Support Services Youth Peer Advocacy and Training Other Licensed Practitioners Psychosocial Rehabilitation Services Currently, children requiring behavioral health services are served through a variety of programs, including several children-specific waiver programs (apart from the 1115 Waiver discussed earlier). The six waiver programs that are transitioning to managed care are an Office of Mental Health waiver for children and adolescents with serious emotional disturbance, three waiver programs known as the Bridges to Health waivers overseen by the Office of Child and Family Services, and two Care at Home waivers overseen by the Department of Health. All waivers will be transitioned to managed care without slot limits. Finally, the State is working to tailor the Health Home model to serve children and their families, as Health Homes will be the main care coordinators under the new children s system. Which consumers are affected? Children under the age of 21 who qualify for Medicaid coverage and require behavioral health services will be affected by the transition. Which providers are affected? Providers serving children under the age of 21 with behavioral health needs will be affected; this includes physicians and child psychiatrists, as well as community-based organizations and foster care agencies. What is the timeline? The children s transition to managed care is scheduled to occur July 2017 in New York City, with the rest of the state transitioning in January However, these dates have shifted often due to the complex nature of the children s managed care transition and various implementation delays happening around the adult transition. How does this affect CBOs? The transition of children s behavioral health services to managed care is complex, with many disparate systems and programs being brought together under Medicaid. There are significant infrastructure needs among providers currently serving children, which will require financial investment and staff training in order to meet the State s goals. For example, community-based providers may not have adopted the Health Information Technology (HIT) that is central to care coordination and billing. There are resource questions for the State, as many of the Medicaid Redesign start-up funds have been directed toward the adult transition to managed care, but not yet to providers serving children. The children s transition will continue to take shape in 2017 and