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MaineCare Long Term Strategy

MaineCare Long Term Strategy. MaineCare Redesign Taskforce October 23, 2012 Seema Verma, SVC Robert Damler, Milliman. Expense by Cost Distribution FY2011. Source: MaineCare Redesign Taskforce, Maine by the Numbers, 2012. Annual Cost Per Member.

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MaineCare Long Term Strategy

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  1. MaineCare Long Term Strategy MaineCare Redesign Taskforce October 23, 2012 Seema Verma, SVC Robert Damler, Milliman DRAFT

  2. DRAFT Expense by Cost Distribution FY2011 Source: MaineCare Redesign Taskforce, Maine by the Numbers, 2012.

  3. DRAFT Annual Cost Per Member Source: MaineCare Redesign Taskforce, Maine by the Numbers, 2012.

  4. DRAFT Who is the typical consumer? Source: MaineCare Redesign Taskforce, Maine by the Numbers, 2012.

  5. DRAFT Previous Options • Option 1: State based (FFS) • Further development of State utilization management program • Active risk assessment & case management by State • Development of disease-specific management programs • Could develop different benefit packages according to risk • Option 2: Value based purchasing design • Medical homes, ACOs, incentive payments • Option 3: Capitation • Population & region, services • Providers, MCO, ACOs, PACE • Models: shared savings, risk adjustment, reinsurance, etc.

  6. DRAFT Proposed: Multi-Tiered StrategyBased on Population • Investment in primary care (80% of MaineCare) • Pregnant women • Children • Parents • Coordinated, quality services for Maine’s most vulnerable citizens (top 20% of MaineCare) • Waiver populations • Institutionalized • Disabled with chronic diseases • Other high risk • Effective & efficient use of services (100% of Maine Care) • All populations

  7. DRAFT Investment In Primary Care:Value Based Purchasing • 80% of MaineCare • Target groups: • Non-disabled • Non-elderly populations • Non-institutionalized populations • Health homes/Primary care case management • Primary care incentive program • Accountable care organizations • Targeted initiatives: • ED • Maternal & child health • Care coordination aimed to assist transitions • Increased promotion/incentive of PMP program to address narcotic abuse, incentives for using HIE, PA all MRIs and CTs

  8. DRAFT Goals of Value Based Program • Pay for outcomes • Pay for quality • Incent consumers to become active participants in their healthcare consumption • Design benefits that provide appropriate intensity and levels of care • Providers coordinate total care resulting in better outcomes at lower costs

  9. DRAFT Accountable Communities • MaineCare is planning an Accountable Communities Program • Goal is for groups of provider organizations called accountable care organizations (ACOs) to provide better care to members for lower costs • ACOs usually formed by different providers working together • Primary care doctors • Specialists • Hospitals • Others • How does this work? • Type of ACO is unknown • “We want to work with health care providers to plan the kind of ACOs we will have so that they join us in this project.” • ACOs have to meet quality goals • ACOs will have goals to save money Source: Value Based Purchasing, Member Services Committee, October 7, 2011

  10. DRAFT Patient Centered Medical Homes • PCMHs are primary care practices that: • Care for members using a team approach with communication among physicians & supports • Encourage the member & provider to have a good relationship • Use information technology to track member data • Make it easier for members to schedule necessary appointments • Focus on providing better care for members with serious physical & mental health issues • Currently • 26++ PCMHs • 8 Community Care Teams Source: Value Based Purchasing, Member Services Committee, October 7, 2011

  11. DRAFT Primary Care Provider Incentive Program The Primary Care Provider Incentive Payment (PCPIP) program pays bonuses to doctors that achieve certain goals: • Seeing MaineCare members at their doctor’s office • Primary care over emergency room care • Quality “MaineCare has not changed how it does the PCPIP since 2007. Doctors receiving the PCPIP do a much better job seeing MaineCare members at their office now than they used to. But in other areas, the doctors have not improved very much or at all.” “MaineCare is going to see how it can change the program to make sure that doctors are improving in all areas.” Source: Value Based Purchasing, Member Services Committee, October 7, 2011

  12. DRAFT Contracting Strategy • Continue FFS • Continue PMPM management fee to primary care medical homes • Quality Incentive Program • Community coordinators • PMPM fee • Care Management Organization (CMO) • Manages, utilization, PA etc. • Oversees PCCM • LA model • Shared savings & risk • Future capitation to ACOs

  13. DRAFT Louisiana Model • Operates under 1932(a)(1) SPA authority • Mandatory enrollment for disabled & non-disabled • Excluded populations • Duals • Voluntary Enrollment (must opt-out) • SSI Children • Foster Children • Children Receiving Special Health Services • Native Americans • Enrollees have choice between Enhanced PCCM Model & MCO Model Sources: Louisiana Department of Health and Hospitals, Healthcare Delivery Changes/Birth Outcomes Initiative, 2011; Louisiana State Plan Amendment, 2011; Louisiana Department of Health and Hospitals, 2012.

  14. DRAFT Louisiana Model • Enhanced PCCM model • Two entities operate PCCM model • Saving targets • Savings shared with providers • If no savings return up to 50% monthly care management payment made for each member • Example: • Total payments made for care management = $60M • Net loss of $3M • $3M owed to State • Network of primary care providers only Sources: Louisiana Department of Health and Hospitals, Healthcare Delivery Changes/Birth Outcomes Initiative, 2011; Louisiana State Plan Amendment, 2011; Louisiana Department of Health and Hospitals, 2012.

  15. DRAFT Timeline & Implementation 1/12 Source: Value Based Purchasing, Member Services Committee, October 7, 2011

  16. DRAFT Cost Distribution for Low 80%* * Reflects State & Federal Expenditures Source: DHSS, SFY 2010 Experience Summary, Cost by Specialty and Grouping 2010.xlsx.

  17. DRAFT Value Based Purchasing -Projected Cost Savings for Low 80% of Maine Care* Range from 0.0-4.0% , Depending on type of service * Reflects State & Federal Expenditures With cost-savings measures, MaineCare could save more than $7.0 in its “Low 80%” population. Source: DHSS, SFY 2010 Experience Summary, Cost by Specialty and Grouping 2010.xlsx.

  18. DRAFT Potential Savings (State and Federal expenditures) for Reducing Number of Neonates * Redistributed = If able to prevent 20% of each type of neonate ** For comparison, Indiana rates are 17% and Michigan rates are 27% Source: Maine, SFY 2010, DHHS, admits.xlsx, 2012.

  19. DRAFT Current Initiative: Emergency Department Project • MaineCare is working with hospital emergency departments across the State to: • Identify high utilizers • Identify drivers of high utilization • Collaborate with identified member’s healthcare providers to encourage utilization in more appropriate treatment settings

  20. DRAFT Emergency Room Utilization Maine – SFY2012 Less than 6% of the total population on MaineCare is using over 55% of the ER visits Source: DHHS, 2012.

  21. DRAFT Coordinated Quality Services for Vulnerable Populations • Service cost for top 5% represents 54% of spending • Focus on preventing next 15% from becoming the top 5% • Populations include: • Disabled non dual including low 80% • Waiver populations (DD & physically disabled) • Non dual residential facilities • State funded populations-? • Exempt disabled children?

  22. DRAFT Intellectual Disability & Developmental Disability HCBS Waiver Sources: Medicaid_1915(c)_Home _and_Community-Based_Service_Waiver_Participtants,_by_Type_of_Waiver.xls; statehealthfacts.org

  23. DRAFT Opportunities • Provide members with ONE number to call • Provide aggressive case & disease management • Prevent disease progression, avoid hospitalization and institutionalization • Integrate behavioral health care • Promote home & community based care over institutionalized care • Continually and periodically re-evaluate clients to assure service level is appropriate • Identify quality metrics, both process & outcome • Reduce waitlist

  24. DRAFT • 8 States currently enroll adults with intellectual/developmental disabilities in a managed long term services & supports (MLTSS) capitated program • 4 of these States also enroll children with developmental disabilities • 7 of these States enroll individuals in any setting type (i.e., ICF/MR & HCBS waiver) • 2 of these States deliver ICF/MR & waiver services outside the MLTSS program & DD enrollees receive all other services through MLTSS • Persons with serious mental illness (SMI) are included in some programs but generally need to fall into one of the other population groups to be enrolled in MLTSS (i.e., person must have physical, intellectual/developmental or age-related disability in order to enroll) MLTSS for Individuals with Developmental Disabilities & Serious Mental Illness Source: Truven Health Analytics, The Growth of Managed Long-Term Services & Supports (MLTSS) Programs: A 2012 Update. July 2012.

  25. DRAFT LTSS Carve-Outs Source: Truven Health Analytics, The Growth of Managed Long-Term Services & Supports (MLTSS) Programs: A 2012 Update. July 2012.

  26. DRAFT Requirements for Vendor • Fiscal prudence • Predictable costs • Contain growth rate • Provide high quality, coordinated & efficient care for recipients • Person-centered • Community integration • More choices • Assure quality • Work with stakeholders to identify quality metrics and hold vendors accountable for achievement • Align incentives for providers across services • Essential providers • Minimum payment to providers

  27. DRAFT Capitation Features • Full risk (all services ?) • Risk adjusted to account for institutional vs. HCBS vs. diagnosis • Performance bonus for meeting quality incentives • Withhold to assure that certain process measures are achieved

  28. DRAFT Cost Distribution – High 5% (Non-Dual)State and Federal Expenditures – SFY 2010 Source: DHSS, SFY 2010 Experience Summary, Cost by Specialty and Grouping 2010.xlsx.

  29. DRAFT Cost Distribution – Next 15% (Non-Dual)State and Federal Expenditures – SFY 2010 Source: DHSS, SFY 2010 Experience Summary, Cost by Specialty and Grouping 2010.xlsx.

  30. DRAFT Capitation for MaineCare’s Top 20% • Cost savings estimates for High 5% range from 2.0-7.5% • Cost savings estimates for Next 15% range from 1.0-5.0% * Estimates are State & Federal With cost-savings measures, MaineCare could save more than $45.9 in its “Top 20%” population. Source: DHSS, SFY 2010 Experience Summary, Cost by Specialty and Grouping 2010.xlsx.

  31. DRAFT Implementation Timeline & Issues • Planning & development of waiver • Waiver approval process • Development of RFP & contracting process • Claims system • DHHS must be able to obtain claims data from MCOs/ACOs/PACE or other vendor • 18-24 months

  32. DRAFT Effective Use of Services • Assure that services are used appropriately • Reduce waste and inefficiency • Promote quality • Create financial incentives for providers to achieve quality benchmarks

  33. DRAFT Effective Use of Services: Strategy • Reimbursement Strategy • Bed hold days • Readmissions within 7 days: • ME does not reimburse for readmits within 72 hours • Hospital acquired conditions • New policy aligns with Medicare • Elective C-Section before 39 weeks • Radiology Benefits Manager • Transportation broker (in process) • Behavioral health ????

  34. DRAFT Medicare HAC Policy • Medicare does not pay for: • The additional costs associated with hospital acquired conditions (HAC) • “Never Events” • Under the Affordable Care Act, the Medicare policies were applied to Medicaid with some minor deviations • Medicaid agencies can identify additional HAC which will not be reimbursed by the State • MaineCare currently applies the Medicare policies

  35. DRAFT Maryland’s Hospital Acquired Condition Program Source: The Maryland Health Services Cost Review Commission - http://www.hscrc.state.md.us/init_qi_MHAC.cfm

  36. DRAFT Potentially Preventable Readmissions • Potentially preventable readmissions are hospital readmissions occurring within a short time period that could have reasonably been expected to be prevented through: • Effective use of discharge planning • Coordinated follow-up care • Nationally 20% of patients are readmitted within 30 days of discharge • Estimated to cost $25B annually Source: Community Catalyst, Overview: Model Legislation to Reduce Potentially Preventable Readmissions & Complications; October 2011.

  37. DRAFT Potentially Preventable Readmissions: State Examples New York Massachusetts • Effective 7/1/10 • Projected $47M in savings 7/10-3/11 • Reduce hospital’s payment based upon the excess number of potentially preventable readmissions (PPRs) • Applies to PPRs within 14 days • Excess readmission rate is difference between observed rate & expected rate • For excess readmissions, the hospital’s payment for all non-behavioral health related Medicaid discharges is reduced by applying the computed adjustment factor to the applicable case payment or per-diem rate • Effective 10/1/11 • Hospitals above the threshold for readmissions received 2.2% reduction in their standard payment amount per discharge • Penalty amount determined using 3M Potentially Preventable Readmission System • 24 of 65 contracted hospitals were identified to have higher-than-average readmissions • Statewide average is adjusted for severity of illness & hospital case mix Sources: http://www.health.ny.gov/regulations/recently_adopted/docs/2011-02-23_potentially_preventable_readmissions.pdf & http://commonhealth.wbur.org/2011/09/hospitals-face-financial-penalties-for-preventable-readmissions.

  38. DRAFT Potentially Preventable Readmissions: Medicare Policy • The ACA created the Medicare Hospital Readmissions Reduction Program • Targets readmissions: • Acute Myocardial Infarction (AMI), Heart Failure (HF), and Pneumonia (PN) • Readmission within 30 days of discharge • Calculate excess readmission ratio for AMI, HF, and PN • Includes adjustment factors that are clinically relevant (i.e. patient demographics, comorbidities, patient frailty, etc.) • Measure of a hospital’s readmission performance compared to the national average • Utilizes risk adjustment methodology endorsed by National Quality Forum (NQF) • Effective 10/1/12: Maximum penalty is 1% of base Medicare reimbursements • October 2013: Increases to 2% • October 2014: Increases to 3% • 71% of hospitals reviewed to be penalized • 2,217 hospitals nationwide to receive penalties • 1,910 hospitals to receive penalties <1% • $280M in total penalties • Comprise approximately 0.3% of total amount hospitals are reimbursed by Medicare Sources: http://www.kaiserhealthnews.org/Stories/2012/August/13/medicare-hospitals-readmissions-penalties.aspx; CMS, Readmissions Reduction Program, 2012.

  39. DRAFT MaineHospital Admissions & Readmissions * This rate is for children under 1 year of age If Maine could cut medical/surgical readmission rates in half, the program would save $15.0 million (State and Federal expenditures). Sources: Maine DHHS, October 2010 – September 2011 Hospital Claim Experience, 2012; AHRQ, All-Cause Hospital Readmissions among Non-Elderly Medicaid Patients, 2007, 2010.

  40. DRAFT • Put a “hard stop” to elective inductions prior to 39 weeks gestation • Savings gained from: • Shorter labors • Reduced c-section rate • Better birth outcomes • Potential savings: $850K State & Federal1 • Challenges • How to implement? • OH & UT required hospital to enter week’s gestation in order to schedule induction • PA as potential alternative Elective Inductions Prior to 39 Weeks State Example: Ohio 1MaineCare has ~5,400 births/yr. Estimated 25% elective induction rate. Reduction to 2.5% assumed. Source: DHHS, 2012.

  41. DRAFT Radiology Cost Control • State strategies for containing radiology costs & ensuring the appropriate delivery of services have included: • Radiology Benefit Managers • Clinical decision support models • Real-time online interactive PA

  42. DRAFT Radiology Cost Control Radiology Benefits Management (RBM) • Role: • To ensure imaging needed for potential diagnosis • Pros: • Potential utilization & cost reductions of 8-20% • Successful RBM programs could save $13-24 billion by 2020 • Cons: • Costs shifted to providers • Getting prior authorization for all imaging services places administrative burden on providers Sources: CaretoCare, Achieving Cost Savings and Patient Safety through Radiology Benefit Management, 2010; Magellan Health Services, Independent study estimates significant savings to Medicare through RBM programs, 2011; Lee, Rawson, & Wade, Radiology benefit managers: cost saving or cost shifting?, 2011.

  43. DRAFT Radiology Benefits Manager: North Carolina Source: North Carolina Department of Health & Human Services - http://www.ncdhhs.gov/dma/services/radiology.htm

  44. DRAFT Radiology Cost Control Clinical Decision Support • Clinical decision support (CDS) is an alternative to utilization reviewers & Radiology Benefit Managers • “Clinical decision support (CDS) is the use of health IT to provide clinicians and/or patients with clinical knowledge and patient-related information, intelligently filtered or presented at appropriate times, to enhance patient care. (HRSA)” • Providers guided to order the appropriate test through an interactive electronic question set vs. receiving a PA denial • Can be integrated into EHRs or accessed via the Web http://www.diagnosticimaging.com/practice-management/content/article/113619/1750408 http://www.diagnosticimaging.com/radblog/display/article/113619/1932985 http://www.hrsa.gov/healthit/toolbox/HealthITAdoptiontoolbox/EvaluatingOptimizingandSustaining/decisionsupport.html

  45. DRAFT • Minnesota implemented CDS pilot in 2007 & expanded as statewide option in 2010 • Implemented by Institute for Clinical Systems Improvement (ICSI) • Non-profit organization representing 64 medical groups & sponsored by 5 health plans • Implemented clinical criteria based on American College of Radiology standards • Review is given in real-time & “decision support number” is given & required to process the claim Clinical Decision Support for Radiology: Minnesota • Over ½ of all scans in • MN are ordered through • this process • Increase in scans ordered • 2003-2006: 8% • 2007-2012: 1% • Time expended by • medical group staff • Pre-pilot: 308 hrs • Post: 5 hrs • None of the 4,500 pilot • practices requested • return to traditional PA • when pilot concluded http://www.diagnosticimaging.com/practice-management/content/article/113619/1750408 http://www.diagnosticimaging.com/radblog/display/article/113619/1932985

  46. DRAFT • April 2011: New York Medicaid implemented a collaborative, non-denial Radiology Benefits Manager • Applies to outpatient non-emergency advanced imaging for FFS • Duals & MCO enrollees excluded • Utilize RadConsultTM • Provides peer consultation & evidence-based medical criteria Radiology Clinical Decision Support: State Example • 5% reduction in • advanced diagnostic • imaging • Consults per 1,000 • members: • June 2011: 89.58% • Feb 2012: 85.53% http://www.health.ny.gov/health_care/medicaid/program/update/2011/jan11mu.pdf http://www.healthhelp.com/dr-hiatt/detail/collaborative-utilization-management-of-advanced-diagnostic-imaging-for-med

  47. DRAFT • Iowa Medicaid implemented Clear Coverage (a McKesson product) • Online interactive PA system using InterQual criteria for certain elective outpatient radiology tests • PA not required for inpatient or ER procedures • Requests that meet criteria are automatically approved in real-time Real-Time Online Interactive Radiology PA: State Example Sources: http://www.ime.state.ia.us/Providers/PriorAuthorization.html & McKesson, Iowa Medicaid Enterprise & IFMC: Automatic Prospective Utilization Management of Diagnostic Imaging at the Point of Care, 2011.

  48. DRAFT • The program achieved cost savings within 10 months • Annual estimated savings of $2.4M attributed to: • $1.3M due to physicians canceling requests found non-medically appropriate • $0.6M due to denials • $0.5M vs. adding 7 full-time employees for manual PA reviews • The volume of manual reviews has been reduced Iowa’s Radiology Management: Outcomes • Of 50,ooo PA requests: • 40%: Instant • automated approval • 8%: Cancelled by • provider when notified • clinical evidence not • aligned with request • 4%: Denied as • medically • inappropriate Sources: http://www.ime.state.ia.us/Providers/PriorAuthorization.html & McKesson, Iowa Medicaid Enterprise & IFMC: Automatic Prospective Utilization Management of Diagnostic Imaging at the Point of Care, 2011.

  49. DRAFT Federal Waivers • Waiver authority • Dependent on strategy • What populations • What method is being used • Managed care • Other? • What flexibilities are needed? • Statewideness • Mandatory/Voluntary enrollment • Defined network, limited choice of contractors • Benefits • Timing (length of approval process) • Budget tests • Budget neutrality • Cost effectiveness

  50. DRAFT Stakeholder Submissions • 1) Integrated chronic care management for high cost cases, 1915 waiver populations • 2) Independent administration of HCBS, children ID/DD,& Adults in LTC • 3) Population Based Integrated Services Model for Medicaid Eligible Individuals with a Serious Mental Illness and Chronic Co-Morbid Medical Conditions

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