Skip to main content
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Current News
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Digital Health
    • Transformation
    • ESG
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Opinion
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Excellence in Governance
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top Innovators
    • Diversity in Healthcare
      • - Luminaries
      • - Top 25 Diversity Leaders
      • - Leaders to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Digital Health Transformation Summit
    • ESG: The Implementation Imperative Summit
    • Leadership Symposium
    • Social Determinants of Health Symposium
    • Women Leaders in Healthcare Conference
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Diversity Leaders Gala
    • Top 25 Women Leaders Gala
    • - Hospital of the Future
    • - Value Based Care
    • - Hospital at Home
    • - Workplace of the Future
    • - Digital Health
    • - Future of Staffing
    • - Hospital of the Future (Fall)
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
  • Data Center
    • Data Center Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • Newsletters
  • MORE+
    • Contact Us
    • Advertise
    • Media Kit
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Government
April 20, 2013 01:00 AM

Dual-eligible dilemma

States test managed care, but critics question if approach is cost-effective

Jonathan Block
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Policymakers are hoping moving Medicare- and Medicaid-eligible seniors and the disabled into managed-care plans will save taxpayers a lot of money through better coordination of care. But as a few state demonstration programs get off the ground, critics are beginning to question just how cost-effective the strategy will be.

    “I think they will struggle in the beginning, (but) they will definitely save money, but not the giant projections” some are making, said Charlene Frizzera, a senior adviser with consultancy Leavitt Partners and a former acting administrator for the CMS.

    The dual-eligibles, all of whom are poor and many of whom have multiple chronic conditions, are among the highest cost people in the healthcare system. To better manage their costs, five states have launched demonstration programs to register this population in managed-care plans.

    Proponents say these programs are a win-win for enrollees and states. Seniors get better coordinated care and states can cut costs.

    Last month, California became the fifth state to win approval (Illinois, Massachusetts, Ohio and Washington are the other four) from the CMS to launch the demonstration projects known as the Medicare-Medicaid financial alignment initiative. California will give payers a single, capped monthly payment for more than 450,000 dual-eligibles beginning in October. Another 19 states are hoping to participate in the program.

    Frizzera said the demonstration projects will be a major improvement over the way duals are now handled because they will get more coordinated care. That should cut expenses for long-term care, one of the largest cost-drivers for duals. She noted that nearly half of California's annual spending on duals—$2.5 billion—is just on long-term care facilities.

    Under the initiative, states can follow one of two models: either a single, capped payment or managed fee-for-service. The managed fee-for-service model uses a gain-sharing agreement between the state and the CMS where the state shares in the savings when initiatives that improve quality also reduces costs.

    No data yet exists on whether the programs have delivered what they have promised since they are still in the beginning stages. In November, one month after it became the first state to get CMS approval, Massachusetts named six health plans to take part in the program as integrated-care organizations: Blue Cross and Blue Shield of Massachusetts HMO, Boston Medical Center HealthNet Plan, Commonwealth Care Alliance, Fallon Total Care, Neighborhood Health Plan and Network Health.

    Enrollment will start July 1.

    The Massachusetts demonstration is using the capped payment model. It is based on two existing state programs: Programs of All-Inclusive Care for the Elderly and Senior Care Options. The state pays a team of providers in both plans a flat fee up front for the care of beneficiaries. If the care ends up being less than that fee, the providers share in the savings. If not, they must contribute to the extra costs.

    “I think that there's promise here,” said Bonnie Washington, a senior vice president at Washington, D.C.-based consulting firm Avalere Health and the former head of the CMS' legislation office. Because the dual-eligible population is often characterized by frequent hospital readmissions and lingering clinical issues, “they can benefit from more active care coordination.”

    Despite that promise, some people are concerned that the demonstration programs are moving too quickly and enrolling too many people before any results are known. “There are some real opportunities to improve the system,” said Kevin Prindiville, deputy director of the National Senior Citizens Law Center. “We're not moving in a way to test elements that are working, but just making wholesale changes. I'd like to see it on a smaller scale first, to prove that it works.”

    The advocacy group is calling for increased regulation of the programs and an ombudsman to provide oversight. Prindiville also wants more transparency so it's apparent where savings come from and where they go.

    While treating dual-eligibles under a single contract is a new concept for carriers, Washington said insurers' background in Medicaid and Medicare Advantage makes them well prepared. But whether they will be successful in doing so and save money in the process remains to be seen, she said.

    Although a state financial alignment initiative has yet to begin enrollment, Frizzera said she believes the program will succeed and become a model for treating dual-eligibles.

    “I don't know any other way to manage this population in a coordinated fashion,” she said. “Once (enrollees) get educated and see the benefits of these programs, then you will see advocates being more supportive.”

    Follow Jonathan Block on Twitter: @MHjblock

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    abortion-pill-misoprostol-legal
    Abortion pill case advances to appeals court, on course to Supreme Court
    young doctor medical resident
    Federal physician recruitment program at risk
    Most Popular
    1
    More healthcare organizations at risk of credit default, Moody's says
    2
    Centene fills out senior executive team with new president, COO
    3
    SCAN, CareOregon plan to merge into the HealthRight Group
    4
    Blue Cross Blue Shield of Michigan unveils big push that lets physicians take on risk, reap rewards
    5
    Bright Health weighs reverse stock split as delisting looms
    Sponsored Content
    Modern Healthcare Alert: Sign up for this breaking news email to be kept in the loop as urgent healthcare business news unfolds.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Digital Health
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Opinion
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Excellence in Governance
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top Innovators
        • Diversity in Healthcare
          • - Luminaries
          • - Top 25 Diversity Leaders
          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • ESG: The Implementation Imperative Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
        • - Workplace of the Future
        • - Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • Data Center
      • Data Center Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • Newsletters
    • MORE+
      • Contact Us
      • Advertise
      • Media Kit
      • Jobs
      • People on the Move
      • Reprints & Licensing