Comprehensive Waiver Application Overview

1. Comprehensive Waiver Application Overview The NJ Department of Human Services September 2011

2. What is a Comprehensive Waiver? The Comprehensive Waiver is a collection of reform initiatives designed to: • sustain the program long-term as a safety-net for eligible populations • rebalance resources to reflect the changing healthcare landscape • prepare the state to implement provisions of the federal Affordable Care Act in 2014 NJ-DHS 9-2011

3. Why Do We Need a Waiver? • Medicaid programs are matched – in part – with federal funding; all changes to the program must be approved before implemented • NJ has 8 Medicaid waivers (including CCW) for various programs/services; need to consolidate to reduce administrative burden • Medicaid grew in cost by 18% over 3 years; state must spend resources efficiently NJ-DHS 9-2011

4. Comprehensive Waiver Development • February 2011 - Governor Chris Christie calls for a Medicaid reform plan during FY’12 budget address • February 2011 to May 2011 – DHS, DHSS, DCF review every facet of the program, examine other states’ plans, look at every possible opportunity to improve and to reform • May 2011 - Waiver concept paper is released • May 2011 to August 2011 - Extensive public input process • August 2011 to September 2011 – Input is reviewed/concept paper revised/waiver application drafted and finalized • September 2011 - Waiver is submitted to CMS/posted on DHS website NJ-DHS 9-2011

5. Stakeholder/Public Input Support for: • Structural reform • Enhanced services for underserved populations • Preserving eligibility criteria • Reinvestment of savings into community-based services Opposition to: • Freezing AFDC/TANF+ parent population • ER co-pay for non-emergency visits NJ-DHS 9-2011

6. Waiver Highlights • Model for reform and innovation • Streamlines program administration and operation • Preserves eligibility and enrollment • Does not include ER co-pay • Enhances and coordinates services to specialty populations • Rewards efficiency in care NJ-DHS 9-2011

7. The details by category WHAT DOES IT ALL MEAN? NJ-DHS 9-2011

8. What does Medicaid Waiver mean for Behavioral Health services? • Integrates behavioral health and primary care • Develops innovative delivery systems – MBHO, ASO • Supports community alternatives to institutional placement • Braids funding • Provides opportunities for rate rebalancing • No-risk model transitions to risk-based model • Increased focus on children, SAI and consumers with developmental disabilities NJ-DHS 9-2011

9. Why the focus on BH/SA? • The merger of DMHS and DAS into DMHAS lays the foundation to build a combined system that provides best practice treatments for individuals with co-occurring mental illness and substance use disorders. • To improve access to appropriate physical and BH care services for individuals with MI/SA • To better manage holistic care for individuals with co-occurring BH/PH conditions • To improve health outcomes and consumer satisfaction NJ-DHS 9-2011

10. Eligibility Criteria • Medicaid enrollees with MI/SA who meet the state’s definition of medical necessity for one or more covered BH service • Two exceptions: • Dual eligibles enrolled in a Special Needs Plan (SNP)/MCO • Medicare BH benefits will be carved into the SNP/MCO • Medicaid BH benefits will be carved out to the ASO/MBHO • Coinsurance and deductibles associated with BH benefits are carved into the SNP • Medicaid eligible members in a NF LOC or in a home and community-based waiver under managed LTC, administration of BH services will be carved into the LTC plan NJ-DHS 9-2011

11. Need for Care Integration • Currently, BH care under Medicaid FFS is fragmented with an over-reliance on institutional, rather than community-based care • Consumers receive care through managed care organizations (MCOs) with limited or no formal protocols for coordination between medical and behavioral health delivery systems • Approximately two-thirds of Medicaid’s highest cost adult beneficiaries have MI and one-fifth have both MI and a substance use disorder. NJ-DHS 9-2011

12. Delivery System Innovations Clinical Service Model: • Uniform screening and assessment • The SAMHSA 4-quadrant model • ASO/MBHO clinical role • Behavioral health homes, Accountable Care Organizations • Special initiatives NJ-DHS 9-2011

13. Managed Behavioral Health • Administrative services organizations (ASO) or managed behavioral health organizations (MBHO) provide improved access, quality outcomes, better distribution of services across the care continuum. • These organizations have extensive experience with the BH population, including individuals dually diagnosed with intellectual and developmental disabilities (I/DD) and BH • Coordinate services to the seriously mentally ill (SMI) and severely emotionally disturbed (SED) populations • Integration of MH/SA services NJ-DHS 9-2011

14. MBHO/ASO Assignment • The MBHO will be responsible for developing and managing the adult BH service delivery system • The ASO will share responsibility with the state for developing and managing the children’s BH service delivery system • Improved access • Improved quality • Greater value • Sustainability NJ-DHS 9-2011

15. MBHO/ASO Member Services • 24 hour toll free information and referral line • MBHO will coordinate with the PERS system for adult consumers, including providing education and technical assistance to the crisis centers about consumer needs, model programs and best practices • The children’s ASO will manage a 24-hour crisis response system, including dispatch of mobile crisis response teams consistent with the currently approved NJ State Plan • The MBHO will be responsible for adjudication of all BH claims delivered by the specialty BH network, including contracted MBHO providers and out-of-network BH providers needed to meet the special needs of enrollees • The MBHO may eventually be paid on an at-risk basis NJ-DHS 9-2011

16. MBHO/ASO Administrative Role • Network Credentialing and Contracting – • NJ will set reimbursement rates for BH network services until such time that the MBHO assumes full risk • The MBHO/ASO will provide technical assistance to the state on reimbursement rates and appropriate use of financial and non-financial incentives for improved outcomes • Network Development – the MBHO/ASP will assist the state with network development, including technical assistance to new providers regarding enrollment in Medicaid • Management Information Systems (MIS) and Electronic Exchange Data - MBHO/ASO will establish and maintain a MIS that allows the MBHO and its subcontractors to collect, analyze, integrate and report data on service utilization, service costs, claim disputes, appeals and clinical and financial outcomes • Financial Management and Reporting – establish a process for tracking service utilization and cost by funding source and provide regular reports in compliance with state and federal reporting requirements NJ-DHS 9-2011

17. Community vs. Hospital based Care • Behavioral health care will be delivered through an administrative services organization (ASO) • Begins January 2013 • Uniform screening and assessment • Behavioral health homes/case management/risk model • Reliance on community-based settings • Manage Medicaid funding, block grant and state-only dollars NJ-DHS 9-2011

18. Waiver Impact on Access, Quality, Outcomes • State sets client outcome benchmarks for MBHO and performance measures for network participation • Allows for consumer and family participation in the design and ongoing monitoring of access and quality outcomes • Per the ‘medical loss ratio’ provision, MBHO must spend majority of resources on care • Sets minimum amount on services • Limits maximum administrative spending • Limits maximum profit to be earned • Reinvestment in new capacity NJ-DHS 9-2011

19. Aspects of the Risk Model • Non-entitlement services remain non-risk • Increased opportunities for Medicaid reimbursement for the first 30-days of community-based residential treatment services - individuals age 22 to 64 • Increased ability to capture savings generated from improved, coordinated BH services • Greater assurance of meeting budget neutrality projections through capitation • MBHO has more flexibility to develop new services • Provides incentives for clients to be served in the least restrictive and least costly level of care NJ-DHS 9-2011

20. Bottom Line – Good News • Integrated care SA/MH and BH/PH • Opportunities for rate rebalancing • Increase FFP • Service expansion for SA services • Reinvestment of some savings • Reimbursement for community-based services instead of acute care • Better access, enhanced quality, improved outcomes NJ-DHS 9-2011

21. Expected Challenges • Timely communication • Consumer involvement to ensure ease of access • IT infrastructure • Moving from non-risk to risk • Managing eligibility and enrollment • Coordination between MBHO and MCO • Defining outcome measures to gauge performance NJ-DHS 9-2011

22. What are the next steps? • Federal review of the waiver application • Informal and formal communications with CMS on waiver elements • CMS submits waiver questions • NJ responds to CMS questions • CMS/NJ negotiations • Waiver approval/denial NJ-DHS 9-2011

23. What is the tentative timeline for implementation? • January 2012 – SNPs offered, expanded support to I/DD • July 2012 – managed LTC, streamlined eligibility for LTC support • July 2012 – BH services to children expand • January 2013 – managed BH organization implementation NJ-DHS 9-2011

24. More information • The full waiver application can be found online at: www.state.nj.us/humanservices/ • Comments can be emailed to CMWcomments@dhs.state.nj.us NJ-DHS 9-2011