Dual eligible beneficiaries and care coordination Mark E. Miller, Ph. D.
Medicare Payment Advisory Commission Independent, nonpartisan Advise the Congress on Medicare issues Principles Ensure beneficiary access to high quality care in an appropriate setting Give providers an incentive to supply effective, appropriate care and pay equitably Assure best use of taxpayer dollars 2
Why is MedPAC looking at duals? Complex care populations Dual eligible beneficiaries consume disproportionate share of both programs spending 16% of Medicare beneficiaries but one quarter of Medicare spending 18% of Medicaid enrollees but almost half of Medicaid spending Programs work at cross purposes that impede care coordination 3
Services covered by Medicare and Medicaid for dual eligible beneficiaries Medicare Hospital care Physician and ancillary services Skilled nursing facility care Home health care Hospice Prescription drugs Durable medical equipment Medicaid Medicare cost sharing Nursing home care Coverage for hospital and SNF care once Medicare benefits exhausted Optional services (vary by state): dental, vision, home and community based services, personal care, and home health care not otherwise covered. Some drugs not covered by Medicare Durable medical equipment not covered by Medicare 4
Examples of conflicting incentives of Medicare and Medicare programs Patient transfers from nursing home to hospital Ambiguous coverage for home health care 5
Characteristics of dual eligible beneficiaries Compared to other beneficiaries, dual eligible beneficiaries are more likely to: Be minorities Have poorer health status Have more ADL limitations Live in an institution or alone Have lower education level 6
Prevalence of chronic conditions varies widely across dual eligible beneficiaries 11% 8% 11% 38% 0-1 CC 2 CCs 3-4 CCs 5 CCs 18% 14% With dementia 0-4 CCs With dementia 5+ CCs Percents are shares of all full year dual eligible beneficiaries who qualify for full Medicaid benefits. Source: Mathematica Policy Research prepared for MedPAC using CMS merged MAX and Medicare summary spending files, 2005. 7
Per capita spending in 2005 by dual eligible group Spending in thousands $30 $25 $20 $15 $10 $5 $- $26,185 $26,841 $24,924 37% 40% 30% All Aged Disabled Medicare Medicaid Source: Mathematica Policy Research tables prepared for MedPAC using CMS merged Medicaid MAX and Medicare summary BASF files. 8
Nursing home spending is key driver of total per capita spending $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $- All Aged Under 65 and disabled Total No nursing home spending Top nursing home spending 9
Total per capita spending increases with dementia and number of chronic conditions Total per capita spending $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $- 1 2 3 4 5+ Number of chronic conditions With dementia Note: Analysis includes all full year dual eligible beneficiaries who qualify for full Medicaid benefits. Source: Mathematica Policy Research prepared for MedPAC using CMS merged MAX and Medicare summary spending files, 2005. 10
Four-fold difference in per capita spending across duals with physical or cognitive impairments Impairment group Spending relative to average No or one physical impairment 0.5 Developmentally disabled 1.2 Mentally ill 1.7 2+ physical impairments 1.9 Dementia 2.1 MedPAC analysis of MCBS cost and use files 2004-2006. 11
Service mix varies by chronic condition Percent of total per capita spending 80 70 60 50 40 30 20 10 0 14 26 10 17 8 45 6 14 12 20 11 27 All Alzheimer s Heart failure Rx drugs Nursing home Physician and other part B Hospital Note: Analysis includes all full year dual eligible beneficiaries who qualify for full Medicaid benefits. Source: Mathematica Policy Research prepared for MedPAC using CMS merged MAX and Medicare summary spending files, 2005. 12
State-SNP integrated managed care programs Some Medicare Advantage Special Needs Plans (SNPs) integrate Medicare and Medicaid payments and benefits Eight states initiated state-snp integrated programs (AZ, MA, MN, NM, NY, TX, WA, WI): Some started as Medicare demonstrations (MN, MA, and WI) Some built on top of statewide mandatory Medicaid managed care programs (AZ, NM, and MN) Enrollment is voluntary for Medicare services and program enrollment is generally low Approximately 120,000 duals (under 2% of all duals) are in fully integrated SNPs Outcomes research is limited, with generally lower rehospitalization and ER use. 13
Program of All-Inclusive Care for the Elderly (PACE) Provider-based program for the nursing home-certifiable elderly Services provided at an adult day care center All services, including care transitions, coordinated by an interdisciplinary team PACE employs most of its providers and contracts for services such as hospital and nursing home care Outcomes: lower rates of hospitalization and nursing home utilization Limited enrollment: 72 PACE organizations in 30 states enroll almost 18,000 enrollees 14
Challenges to expanding enrollment in integrated care Lack of state and managed care plan experience with managing long-term care Stakeholder resistance Voluntary enrollment Requires initial financial investments; Medicaid savings accrue later from avoided nursing home use Separate Medicare and Medicaid administrative rules and procedures 15
Additional expansion challenges State-SNP managed care model: All states are not likely to adopt this model The requirement that dual-eligible SNPs contract with their states is not likely to result in more fully integrated programs PACE: Day care based model is not a match for all dual-eligible subgroups Having to change primary care providers can discourage enrollment 16
Next steps Interview and visit programs that fully integrate Medicare and Medicaid for duals Also analyzing North Carolina s model - a medical home and shared Medicare savings model that offers care management to duals through not-forprofit primary care networks Understand features of best practices Consider approaches targeting subgroups of duals 17