MaineCare Accountable Communities Initiative Data Book Walk-Through

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

2. Agenda

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

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

5. Recap of the MaineCare Accountable Communities Program

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

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

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

9. Recap of Initial Benchmark PMPM TCOC Development Goal: Develop Benchmark PMPM TCOC to be Reflective of Performance Period Benchmark period July 2012 – June 2013 Performance period July 2014 – June 2015 • Benchmark Period Base Data: • Data with incurred dates between 7/1/2012 and 6/30/2013 and paid through 8/31/2013 will be used • Data checks will be completed • Only Medicaid specific claim costs for fully Medicaid eligible members will be used (including the dual population) • Only core and optional services, if applicable, will be included in the base data • Only claim costs for members attributed to each AC will be used Adjustments 1 2 3 4 5 • The initial benchmark PMPM TCOC is developed using Medicaid claims data with various adjustments applied to provide the AC Lead Entities with the best estimate available at the start of the Performance Year. Note: Aggregate risk score is documented for each AC in the benchmark period • In order to calculate the initial benchmark PMPM TCOC, the following formula is applied: 1 2 3 4 5 Initial Benchmark PMPM TCOC = ( X X X ) with an adjustment of

10. Overview of the Data Book

11. Overview of the Data Book • The data book shows the adjustments performed to the base data in the development of the initial benchmark PMPM TCOC. Below is an overview of the data book structure.

12. Development of Detailed Adjustments: Policy Adjustment

13. Development of Detailed Adjustments: Policy Adjustment • Policy adjustments are made to the claims data to make sure data in prior periods are on the current policy basis. • All policy changes that occurred in SFY13 and SFY14 with a fiscal impact will be summarized by the impacted policy sections. • An adjustment factor will be calculated for each policy change with fiscal impact based on the estimated dollar impact by the State and the total claims dollars for the affected policy section after the change was implemented. • The adjustment factor for each policy change will only be applied to the claims for the associated policy section prior to the corresponding policy change effective date to put that data on the current policy basis. Methodology After Change Implemented Before Change Implemented Example Calculation Policy Change: 10% Rate Increase on Physician Claims

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

15. Development of Detailed Adjustments: Completion Factor

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

17. Development of Detailed Adjustments: Prospective Trend

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

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

20. Development of Detailed Adjustments: Claim Cap Adjustment

21. Development of Detailed Adjustments: Claim Cap Adjustment • Catastrophic claim adjustments are made to smooth the data for outlier claims. • The catastrophic claim cap threshold is: • $50,000 for accountable community group sizes of 1,000 to 1,999; • $150,000 for accountable community group sizes of 2,000 to 4,999; • $200,000 for accountable community group sizes of 5,000 + • The Medicaid paid amount (after applying the previous adjustments) is summarized for each attributed member and the dollar amount above the threshold corresponding to the member’s community is removed. Methodology Example Calculation The claim cap adjustment will be refreshed in development of adjusted final benchmark PMPM TCOC after updates are made for completion, policy changes, retrospective trend, and risk

22. Sample Data Book

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

24. Outlines of Rule and MOU

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

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

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

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

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

30. Q&A Questions?