Some states iffy on extending 'duals' demo

This summer the Obama administration conceded it needs more time to evaluate a large-scale test coordinating benefits and care for low-income and disabled Americans. The participating states appear willing to stick with it, although the two biggest ones expressed significant reservations.

Twelve states have rolled out three-year demonstrations under the Affordable Care Act to better align the health benefits of Americans who are eligible for both Medicare and Medicaid, and as a result, receive splintered care at extremely high costs to both programs.

In spite of widespread challenges, all of those states signaled they're interested in the administration's invitation to extend their programs for two years beyond the time they were scheduled to end. States enrolled at different times; Massachusetts was the first, and its demo is set to expire Dec. 31, 2016, unless extended.

The CMS said in a recent letter to Medicaid directors that the extra time would minimize disruptions for beneficiaries and allow RTI International, the research firm hired to evaluate the demos, 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 states took the letter as a vote of confidence from Washington, said Matt Salo, executive director of the National Association of Medicaid Directors.

Policy experts and patient advocates say patients enrolled in the program are pleased with the care they're getting. “I have not heard anyone in any form criticize this care model,” said Stephanie Anthony of consulting firm Manatt Health Solutions. Anthony advised Massachusetts when it was forming its demo.

But not all of the states are enthusiastic about the program'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 if that doesn't improve soon, California will pull out at the start of 2017 when its demo ends. Texas replied to the administration with a list of issues to be addressed before the state extends its participation.

California and Texas aren't the only ones running into hurdles. All 12 participating states are reporting high rates of beneficiaries opting 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 Community Catalyst, a consumer advocacy group.

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.

Still, many participating health plans remain committed to the effort.

“This is a very important program which drastically changes how the most vulnerable people in our healthcare system are cared for,” said Lois Simon, president of the Commonwealth Care Alliance, a plan in Massachusetts recognized as a pioneer in coordinating care for dual-eligible patients. “We feel five years is a more appropriate timeline to see its full potential.”