Centennial Care Restructuring the State s Medicaid Program Summary and DRNM Comments on New Mexico s Revised 1115 Waiver Application September 6, 2012

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1 Centennial Care Restructuring the State s Medicaid Program Summary and DRNM Comments on New Mexico s Revised 1115 Waiver Application September 6, 2012 Overview New Mexico is once again asking for federal approval of a plan that would significantly change the state s Medicaid service delivery system. The proposal is in the form of an application for a waiver under Section 1115 of the Social Security Act. These "1115" waivers are intended to demonstrate new and more effective ways to provide health care services to Medicaid participants. The first application by the Human Services Department (HSD), submitted in April, was withdrawn in May since the state had not adequately consulted with Native American tribal officials and service providers. With new federal regulations in place requiring public input, HSD also held public hearings on the original proposal. The revised version reflects some of the comments and suggestions submitted to HSD. The new application was sent in on August 17. CMS, the federal agency in charge of such waivers, will be taking public comments on the state's application for the next 30 days. Comments can be submitted through the following CMS web site: Information/By-Topics/Waivers/1115/public-comments.html. Scroll down the list of states to find New Mexico. The deadline for submitting comments appears to be October 4, The state's plan, Centennial Care, is scheduled to go into effect in January The Human Services Department (HSD), which is the state's Medicaid agency, plans to select up to five MCOs (Managed Care Organizations), each of which would be responsible for providing the full range of Medicaid benefits: physical health, behavioral health, and long term services. The state has just issued a "Request for Proposals" from interested MCOs and those proposals are due on November 20, HSD plans to pick the MCOs it wants by the end of 2012 and use 2013 getting everyone - MCOs, providers and participants - ready for program implementation in Services currently provided through the Developmental Disabilities waiver will not be included in the new program. However, individuals on that waiver will receive their physical health services through the new MCOs selected for Centennial Care. Medicaid-covered therapies and other services offered as part of a special education student's IEP, and Family-Infant-Toddler services, will also be excluded from Centennial Care. The new approach emphasizes care management and care coordination, intended to assure that Medicaid participants promptly get the care they need in order to reduce or avoid hospitalization or other expensive services. This approach includes a pilot project ("behavioral health homes") that would take on responsibility for coordinating all aspects of a person's behavioral health care needs. Another initiative would base provider payments on health outcomes ("pay for performance") rather than simply on the specific services or treatments provided. All Medicaid participants will be

2 expected to take more responsibility for their health care needs, getting small rewards for "doing the right thing" such as having children immunized, and facing penalties in the form of co-pays for unnecessary use of hospital emergency rooms or insisting on brand name drugs when generic versions are available (though this would not apply to psychotropic medications). Centennial Care features a new approach to long term services that promises to provide help to a large number of people who need these services but are on waiting lists, but it limits the cost of community-based services to no more than the cost of nursing home placement. Major Changes to Medicaid Under Centennial Care Τhe new approach combines almost all physical health, behavioral health and long term services for all Medicaid recipients into one integrated program. Instead of having separate managed care programs for physical health ( Salud ), behavioral health (currently provided by Optum Health), and long term services ( CoLTS ), each MCO with a Medicaid contract will be required to cover all these Medicaid services statewide. HSD will probably pick 3 5 MCOs to provide these services. Since there are currently 7 Medicaid MCOs, and since HSD may select new MCOs that don't currently participate in the program, many Medicaid recipients will likely end up in a different MCO than they have now. DRNM is concerned that some MCOs may not have the expertise and capacity needed to provide the full range of Medicaid services state-wide. Consumers will have to try to compare various provider networks to see which ones include their current medical providers, and such information has not been readily available during past Medicaid transitions. Many participants may end up having to change doctors or other providers if one (or more) of their current providers is not in the network of the new MCO they choose or get assigned to, which may cause problems in continuity of care. The Centennial Care proposal does not address the question of whether the state will increase Medicaid eligibility to 138% of the Federal Poverty Level (FPL), as called for under federal health care reform. However, it does makes a few important changes to Medicaid eligibility: It appears that adults will be covered by the Centennial Care Medicaid program at least up to 100% FPL. In the current Medicaid program, parents of minor children are covered only up to around 30% FPL, and childless adults are not covered at all unless they qualify based on disability or some other separate qualifying condition, so Centennial Care would involve a significant expansion of the program. Those whose income is higher than typical Medicaid eligibility levels but currently qualify for Medicaid based on breast or cervical cancer, or who qualify to receive Medicaid-funded family planning services, will qualify in Centennial Care only up to 100% FPL rather than the higher income-eligibility levels that apply now. Fortunately, in response to concerns raised by DRNM and others, there will be no change to eligibility for the Working Disabled Individuals program, which offers Medicaid eligibility for certain individuals with disabilities with income up to 250% FPL. And pregnancy-related services will still be provided for women up to 185% FPL. HSD had earlier proposed capping eligibility for both of these programs at 138% FPL. There will be up to 12 months continuous eligibility for adults. This means that once found eligible based on income, an adult would remain eligible for 12 consecutive months even if there is some fluctuation in the person s income. All Medicaid participants will be screened to determine the extent of their current health care needs, and special emphasis will be placed on care coordination and case management services for those with more intensive needs. This was supposed to be a key element of the CoLTS program, but

3 HSD appears to recognize that CoLTS has fallen short of expectations. DRNM has heard from many CoLTS participants that it is hard to reach their care coordinators and that they seem to receive little benefit from this service. DRNM appreciates the further emphasis on assuring that participants get what they need, but it is not clear how Centennial Care will improve on the CoLTS model and assure the desired outcome. Participants who use a hospital emergency room for a condition that turns out not to be an emergency will have to pay a co-pay if alternative services are available but the person insists on receiving treatment in the ER. The proposed co-pay amounts exceed what's currently allowed by federal law. DRNM notes that there are few if any alternatives to ERs on evenings or weekends and shares the concerns of many advocates and providers that this will be difficult to administer. The state proposes to waive the current requirement that Medicaid cover the cost of medical services provided in the three months before a person applies for Medicaid (if they are found eligible for Medicaid at the time of application and for the preceding months). However, in response to widespread concerns over this request, HSD has agreed to delay implementation of this aspect of Centennial Care for six months, until July DRNM appreciates the brief delay, but this new policy remains problematic. Since many people don't apply (or re-apply) until after they have started to receive necessary medical services, such a waiver would mean that the bill for such earlier services would not be covered by Medicaid and the cost would have to be paid by the low income individual or the health care provider(s) simply wouldn t get paid. The state proposes to require Native American Medicaid recipients to enroll in Centennial Care. Currently, only Native Americans who are in one of the CoLTS population groups (people who are eligible for both Medicaid and Medicare, and those who receive Medicaid long term services) are required to be in this managed care program. Those who are eligible for the general Medicaid Salud program may choose whether to enroll in managed care or remain in the traditional fee for service program, and only about 15-20% of those eligible have chosen to enroll in Salud. Native American tribal governments in New Mexico have been unanimous in opposing the state s plan for mandatory enrollment. Long Term Services The Centennial Care plan would make several major changes to the current system for providing long term services under Medicaid: Α variety of services, including attendant care services (Personal Care Option or PCO) and most of the services that are currently provided only through waiver programs (Disabled and Elderly, Medically Fragile, Mi Via), such as assisted living, skilled maintenance therapy, private duty nursing, respite, etc., will be packaged together as a Community Services Benefit. Everyone who is income-eligible for Medicaid and meets the nursing home level of care will be eligible to access the full range of long term services in the Community Services Benefit without having to be in a waiver slot. This will quickly and substantially expand the number of people who can get these needed services in two ways. People who are currently on the hopelessly long waiting list for waiver services and qualify for Medicaid based on income will get access to community-based services without a slot. And many people already on the waiver can give up their slot without losing eligibility or services, which will free up slots for individuals at slightly higher income levels. This approach to services is consistent with recommendations provided to HSD by DRNM and The Disability Coalition.

4 There will continue to be a waiting list for individuals who are not income-eligible for Medicaid but who have incomes not exceeding 225% FPL and who need long term services. There are around 17,000 people now on the waiting list for Disabled and Elderly waiver services, since virtually no one has come off it in the last few years. HSD's plan promises that a limited number of slots in Centennial Care they haven t said how many will be provided for some of those on the waiting list in the first year, with additional slots allocated on an annual basis in future years. HSD may change the way it prioritizes allocations for slots, giving priority for allocations based on the extent and the urgency of need rather than just first-come first-served based on the length of time someone has been on the list. Under Centennial Care, the cost of community-based services for an individual (the Community Services Benefit) cannot exceed the cost of nursing home services. DRNM believes that this provision discriminates against those with more severe disabilities and eliminates their opportunity for integration into the community, and thus violates the Americans with Disabilities Act. The Mi Via self-directed waiver program comes to an end with Centennial Care, but selfdirection will be available with respect to many (but not all) long term services. It will be available to everyone who receives those services and is capable of self-direction without having to be in a waiver slot as is the case today. The Centennial Care MCOs will be required to provide assistance to those who want to self-direct their long term services, either through their own staff or through contract with agencies providing consultant services. HSD s Community Reintegration program, which allows people to transition from nursing homes to community services by giving them waiver slots when they become available, will apparently continue in Centennial Care. However, unlike current practice, some slots in Centennial Care will also be allocated to persons on the waiting list, as indicated above. Assistance in transitioning from facilities such as nursing homes into the community is one of the services provided as part of the Community Benefit, but this will only be available to those who have been in such a facility for at least 90 days. DRNM finds it ironic that a 90-day nursing home stay is required to receive this benefit, since the primary reason given by HSD for withdrawing from the federally supported Money Follows the Person program was that it was limited to those with at least a 90-day stay. The Community Integration program is controversial in the disability community because it places facility residents ahead of everyone already on the waiting list. This creates a perverse incentive to place a person in a nursing home in order to go through the program to transition back into the community with waiver supports and services services that one would otherwise have to wait years to receive. Behavioral Health Services In the current Medicaid program, behavioral health services for children and adults with significant needs are provided through one state-wide MCO (currently Optum Health) through contract with the state s multi-agency Behavioral Health Purchasing Collaborative. Centennial Care features a carve in approach intended to integrate physical health and behavioral health by making MCOs responsible for providing the full range of Medicaid services that a participant needs, including behavioral health. The goal is a holistic approach that coordinates treatment for medical and behavioral health. However, the new model allows the MCOs to subcontract with partner organizations to coordinate and deliver behavioral health services, and requires the MCOs to delegate much of their behavioral health service delivery to Core Service Agencies. DRNM supports the integrated model for physical and behavioral health, but it is not clear how subcontracting the

5 management of behavioral health and delegating delivery to the CSAs will assure that this integration occurs. In the state s new plan, all Medicaid participants will be screened to assess the scope and intensity of the health care services they need, including behavioral health. Those with moderate or intensive needs will receive services pursuant to an annual plan of care, although the assessment process appears to rely heavily upon self-reporting. This may be a problem because some individuals may be hesitant to report a need for services in an attempt to avoid stigma or unwanted interventions. Most individuals with intensive needs will be referred to a Core Service Agency, which will provide traditional behavioral health services as well as Comprehensive Community Support Services (CCSS) and some care coordination. Some but not all Core Service Agencies will be designated as a "behavioral health home" and will provide a broader and more extensive level of care coordination and case management. Three new behavioral health services will be added to the current Medicaid benefit package: peer to peer recovery services, family support, and respite care for families of youth with mental illness. DRNM welcomes the addition of these services as part of the Centennial Care benefit package. The plan provides an assurance that funding currently earmarked for behavioral health will continue to be dedicated to this purpose, but it is not clear how this will be accomplished. The fact that the plan seems to allow all of the costs of integrating physical and behavioral health to come out of existing behavioral health funding creates some doubt about this assurance.