This summer the Obama administration conceded it would need more time than expected to evaluate a large-scale test to better manage benefits and care for low-income and disabled Americans. The states participating in the initiative appear willing to stick with it, although two big ones expressed significant reservations.
Twelve states have rolled out three-year demonstrations under the Affordable Care Act to better coordinate health benefits provided to Americans who are eligible for both Medicare and Medicaid, and as a result, currently receive splintered care at extremely high costs to both programs.
In spite of widespread challenges encountered so far, all of those states signaled they're at least interested in the administration's invitation to extend their programs for two more years beyond the time they were originally scheduled to end.
The CMS said in aletter to Medicaid directors this summer that extending their programs would minimize disruptions for beneficiaries and allow RTI International, the research firm hired to evaluate the demonstrations, more time to collect and analyze data.
“The long-term viability of the models we are currently testing depends on whether we are able to measure improvements in quality and overall cost savings,” the CMS said in the letter. The first data will become available to states a year before the tests are scheduled to end, making it difficult for state budget planners already looking beyond those dates.
The states took the letter as a vote of confidence from Washington, said Matt Salo, executive director of the National Association of Medicaid Directors. “There is a commitment to this population and these efforts,” he said.
Policy experts and patient advocates say patients enrolled in the demonstration program are pleased with the care they're getting. “I have not heard anyone in any form criticize this care model,” said Stephanie Anthony, a director of Manatt Health Solutions who advised the state of Massachusetts when it was forming its demo.
But not all 12 states are enthusiastic about the initiative's financial and administrative structure. California officials said they would consider, but could not commit to an extension, noting “challenges that require ongoing refinements to our program.”
California Gov. Jerry Brown flagged the demonstration in his annual budget proposal as costing rather than saving the state money, and said he would pull the plug once it runs its course at the start of 2017, if there are no signs of improvement by January 2016.
Texas, meanwhile, replied to the Obama administration's overture with a bulleted list of issues to be addressed before the state extends its participation.
California and Texas aren't the only ones running into hurdles.
All of the participating states are reporting high beneficiary opt-out rates. Out of the 1.7 million people eligible in the 11 states with financial alignment demonstrations (Minnesota's is limited to administrative functions), just 24% had signed up as of Aug. 1, according to consumer advocacy group Community Catalyst.
Most of the programs are relying on private health plans to manage care, and those plans have dropped out in some states. Some insurers say they've had trouble getting accurate contact and demographic information from state agencies for beneficiaries who are passively enrolled in their plans. And the CMS has logged reports of providers telling patients they won't continue seeing them if they enroll in a managed-care plan under a dual-eligible demo.
Still, many of the participating health plans remain committed to the effort and submitted letters saying so to the CMS.
“This is a very important program which drastically changes how the most vulnerable people in our healthcare system are cared for, and we feel five years is a more appropriate timeline to see its full potential,” said Lois Simon, president of Commonwealth Care Alliance, a Massachusetts plan recognized as a pioneer in coordinating care for dual-eligible beneficiaries.
Mark Reagan, managing partner of the San Francisco office of the healthcare-focused law firm Hooper, Lundy & Bookman, said the Obama administration acknowledges the program is in trouble. “CMS is essentially testing the waters to see if states will stick with a program that has been generally difficult to implement with a partner (CMS) that has not been as flexible as many states have desired,” he said.
But Renee Markus Hodin, program director at Community Catalyst, said it's worth continuing the effort in spite of the challenges. “It's far too early to throw in the towel on this,” she said.