Draft for Public Comment

NORTH CAROLINA STATE DEMONSTRATION TO INTEGRATE CARE FOR DUAL

ELIGIBLE INDIVIDUALS

Submitted to CENTER FOR MEDICAID AND MEDICARE INNOVATION

Contract Number: HHSM-500-2011-00037C

North Carolina Department of Health and Human Services Division of Medical Assistance

March 15, 2012

Table of Contents

A. Executive Summary 1B. Background 3

i. Overall Vision and Strategyii. Description of population

C. Care Model Overview 12i. Proposed Delivery System and Programmatic Elementsii. Benefit Designiii. Supplemental Benefits/Supportive Services iv. Evidence- based practicesv. Description of other Initiatives

D. Stakeholder Engagement and Beneficiary Protections 19i. Internal and External Stakeholder Engagement ii. Beneficiary Protectionsiii. Ongoing Stakeholder Input and Beneficiary Engagement

E. Financing and Payment 24i. State level Payment Reforms ii. Payment types

F. Expected Outcomes 24i. State’s ability to Monitor, Collect and Track Data on Key Metrics ii. Potential Targets for Improvement iii. Impact of Proposed Demonstration

G. Infrastructure and Implementation 27i. North Carolina’s Current Capacity ii. Medicaid/or Medicare Rules that need to be Waived iii. Plans to Expand to other Populations and /or Service Areas iv. Overall Implementation Strategy/Timeline

H. Feasibility and Sustainability 32i. Potential Barriers and Challenges to Implementation ii. Statutory and Regulatory Changes Needed iii. New State Funding Commitments or Contracting Processes iv. Scalability and Replicability

I. Budget Request 32J. Additional Documentation 32K. Interaction with other HHS/CMS Initiatives 33

Appendices A. Bibliography B. GlossaryC. Meeting Dates and Agenda D. Work group RecommendationsE. Beneficiary Conversations F. Quality Measures G. Budget H. Work Plan

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A. Executive SummaryNorth Carolina’s Dual Eligible Beneficiary - Integrated Delivery Model has the triple

aims of improving responsiveness to beneficiary goals, improving care quality and achieving shared savings. This new way of doing business is a model designed to meet needs rather than simply provide services; a model where the investment of public funds acknowledges

individual differences in the conceptualization of quality of life, the wisdom of preventive services and high quality care, needed supports must vary according to changing goals of individual beneficiaries and

their caregivers, and the variation of resources available in communities.

North Carolina’s vision is for a cohesive, equitable and sustainable approach to meeting the needs of dual eligible beneficiaries. It is premised on the knowledge that providing the right care, to the right person, at the right time results in better access and care for us all.

North Carolina has invested in the development and implementation of a statewide medical home and population management strategy through the Community Care of North Carolina (CCNC) Program. The impact of this work on health effectiveness performance measures (HEDIS) places CCNC in the top 10 percent nationally for diabetes, asthma, and heart disease when compared with commercial managed care plan performance in the U.S. Building on the success and infrastructure of CCNC, North Carolina’s integrated delivery model approaches integration through working with beneficiaries as they define and refine their goals and offering medical home supports to assist in the achievement of those goals.

Through the hard work of more than 180 volunteer beneficiaries and stakeholders, North Carolina has fashioned a strategic framework to build on what works well, and to define systemic improvements needed to integrate Medicare and Medicaid services and supports designed to assist dual eligible beneficiaries.

In Phase 1, Medicaid financing will extend medical home offerings to dual eligible beneficiaries in nursing homes and adult care homes. Development will begin on a new process and methodology for the independent assessment of need and functional need-based allocation of resources, toward the Phase 2 goal of replacing the current FL-2 medical need eligibility determination and level of care determination/placement authorization process. During Phase 1 beneficiaries, providers and other stakeholders will continue to help define the integrated delivery model and refinements, and will develop and implement opportunities for cross-stakeholder education and community-level dialog regarding medical home team dynamics, beneficiary goal setting, and the importance of advance directives specifying personal preferences for physical and mental health care.

As shared savings are made available to North Carolina, Phase 2 activity will move the integrated delivery model implementation forward through realignment of financial and regulatory incentives designed to establish new working relationships and information sharing, the broader use of actionable data and capacity building to expand the array of service and support options available to dual eligible beneficiaries with need for assistance from others. Phase 2 efforts will achieve even greater shared savings and further reallocation of resources to rectify current inefficiencies created in the health care delivery system.

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Table 1: North Carolina Dual Eligible Beneficiary –Integrated Delivery Model

Target Population Full benefit Dual Eligible beneficiaries (duals) age 21 and olderTotal Number of Full Benefit Medicaid-Medicare Enrollees Statewide

222,753 (Dec 2010, Medicaid)

Total Number of Beneficiaries Eligible for Demonstration

222,151 (Dec 2010, Medicaid)Includes: all duals age 21 and older Excludes: Full benefit duals under 21 years of age (n=455) & full benefit duals incarcerated with suspended Medicaid benefits (n=141)

Geographic Service Area Statewide, includes all 100 counties of North Carolina Summary of Covered Benefits

Medicaid covered servicesMedicare Part A, B and D covered services

Financing Model Managed Fee for Service Summary of Stakeholder Engagement/Input

a. Core Leadership Team, representatives from the Divisions of Medical Assistance, Aging and Adult Services, Vocational Rehabilitation, Mental Health/Developmental Disability, and Substance Abuse Services, Public Health and Health Services Regulation, along with Community Care of North Carolina began weekly meetings in July 2011 and currently meet bi-weekly.

b. Statewide Partners Group, representatives from over 50 partner organizations have met to date on August 18, October 17, and December 16, 2011, February 21 and March 20, 2012.

c. Work Groups, Phase 1 planning and development groups co-lead by Core Leadership Team members, with broad beneficiary and stakeholder membership, convened in September 2011 and began submitting recommendations in December 2011.

o Medical/Health Homes and Population Managemento Long Term Services and Supportso Transitions Across Settings and Providerso Behavioral Health Integration

Phase 2 Work Groups - Payment and Delivery System Integration and Community Stakeholder and Beneficiaries Work Group began in late 2011, early 2012 and will continue throughout implementation along with other workgroups.

d. Beneficiary Conversations, between October 2011 and February 2012, 9 beneficiary conversations were convened in 8 different communities across the state.

e. Public Information and Input,: Dual Eligible Planning Website http://www.communitycarenc.org/emerging-initiatives/dual-eligible-initiative/;Dualfutures@n3cn.org

f. Public Hearings Dates, March 20 and March 27, 2012.

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Proposed Implementation Date

January 2013

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A. Backgroundi. Overall vision/rationale for the proposed design Buoyed by the hope of a federal and state partnership, stakeholders in North Carolina

are embracing the opportunity to rethink how best to meet the needs of dual eligible beneficiaries. The integrated delivery model outlined here is the product of more than 180 stakeholders thinking and working together to formulate overarching guidance for North Carolina Medicaid policy.

The vision is for a cohesive, equitable and sustainable approach to meeting the needs of dual eligible beneficiaries. It is premised on the knowledge that providing the right care, to the right person, at the right time results in better access and care for us all. This delivery model approaches integration through working with beneficiaries as they define and refine their goals, and offers medical home supports to assist in the achievement of those goals. When fully implemented all dual eligible beneficiaries, working with their primary care physicians, will have access to quality health care services, support networks, and access to information and resources that build on beneficiaries’ strengths, regardless of their functional capacity, clinical needs, or living arrangement.

Health care and supportive services for dual eligible beneficiaries in North Carolina are often delivered through a complex and fragmented delivery system. Absent an explicit, proactive shared vision, the evolution of policy and program priorities have produced a dizzying array of service systems that fail to meet the needs of those they intend to serve. Furthermore, these systems result in perverse expectations and incentives, making it difficult for well-intentioned providers to deliver the best care. Regulatory and financial interests of providers are in direct conflict with the preferences and clinical best interests of beneficiaries at multiple junctions of these fragmented systems. As a consequence there is a lack of trust and little dialogue between and among beneficiaries, providers and policy makers. The untoward outcomes are beneficiary dissatisfaction, sub-optimal care and inefficient use of public funds. Examples of the misery sustained by beneficiaries and their families, frustrations faced by providers and advocates and examples of wasteful use of public funds are well known to stakeholders from all perspectives.

Over the past 20 years, North Carolina has tackled similar systems realignment through the piloting, development, and implementation of cohesive statewide capacity to:

assure children’s access to quality care through development of pediatric medical homes,

improve outcomes for Medicaid recipients through extension of medical homes to adults, and

improve the quality of care provided for individuals with chronic conditions, targeting chronic diseases such as asthma (in 1998), diabetes (in 2000), and congestive heart failure and chronic care (in 2004/5).

North Carolina has invested in the development and implementation of a statewide medical home and population management strategy through the Community Care of North Carolina (CCNC) Program. The impact of these initiatives on health effectiveness performance measures (HEDIS) place CCNC in the top 10 percent nationally for diabetes, asthma, and heart disease when compared with commercial managed care plan performance in the U.S.

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Building on the success and infrastructure of CCNC, in January 2010 eight of the 14 CCNC Networks began focusing on the complex needs of dual eligible beneficiaries through rapid-learning pilots under a Medicare 646 Quality Demonstration Project funded by the Centers for Medicare and Medicaid Services, with approximately 206 practices participating.

The Medicare 646 Quality Demonstration pilots have fueled exploration of new ways to better meet the needs of dual eligible beneficiaries and the integrated delivery model design process. Examples of promising pilot practices being tested include:

Clear expectations have been established through collaborative development of acute care transition supports with home health providers using tele-health technology to monitor beneficiaries’ chronic disease self-management activities. Implemented protocols are being refined for structured hand-offs to assure continuity of care when home health services are concluded, home health-owned tele-health technology is removed and primary care medical home teams assume primary responsibility for installation and ongoing monitoring and support for beneficiaries’ chronic disease self-management activities;

A primary care practice has extended their Project REACH guided care work to residents of adult care homes (non-medical residential care settings). Through the creation of new relationships, communication materials and educational supports for residents and staff of adult care homes, primary care practices are encouraging residents and staff to use practices’ 24/7 call capacity to reduce the use of emergency department and county ambulance resources for non-urgent conditions;

Dialysis nurses and Networks are testing initiatives to encourage patients with kidney insufficiency to pursue outpatient shunt placements. Non-emergent placement is expected to help avert serious health crises and concomitant intensive care hospital stays, and emergency-driven initiation of dialysis.

Premised on the availability and use of actionable data for targeting, the Medicare 646 Quality Demonstration recently completed its second year of operation. Remarkably, this initiative was successful in meeting the quality improvement benchmarks on 14 of the 18 Performance Measures and showed some improvement in 17 of the 18 measures. Hobbled by the absence of Medicare claims data for risk stratification and targeting until month 20, it is not surprising that these pilot efforts have yet to show evidence of anticipated cost-savings. In addition, the program uses an “attributed enrollment” logic which makes it difficult to ensure the benefits inherent in the medical home and population management model.

INTEGRATED DELIVERY MODEL STRATEGIC FRAMEWORKBENEFICIARY GOAL CENTERED

North Carolina’s delivery model centers on the dynamic goals for quality of life defined by individual beneficiaries, and is designed to build on beneficiaries’ strengths, natural supports, and available community resources. The model’s goal has the triple aims of improving responsiveness to beneficiary goals, improving care quality, and achieving shared savings for reallocation in support of full implementation and refinement of the model and sustainable supports for dual eligible beneficiaries.

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This new way of doing business is a model designed to meet needs rather than simply provide services, a model where the default setting of care is private homes; a model where the investment of public funds acknowledge

individual differences in the conceptualization of quality of life, the wisdom of preventive services and high quality care, and needed supports must vary according to changing goals of individual beneficiaries and

their caregivers, and the variation of resources available in communities.

BUILDING ON NORTH CAROLINA’S MEDICAL HOME INFRASTRUCTUREBuilding on North Carolina's primary care medical home, managed fee for service

structure, and population management infrastructure, this Integrated Delivery Model, when fully implemented, offers all dual eligible beneficiaries the opportunity to enjoy the benefits of primary care led medical homes. Through this team-based approach, beneficiaries will serve as members of a broader group, with professionals and para-professionals whose purpose is to provide services and supports to help the beneficiary articulate and achieve their evolving personal health goals.

The dual eligible delivery model builds on North Carolina’s CCNC program with enhanced quality monitoring. This reporting and shared information capacity was developed in collaboration with primary care providers, hospitals, public health departments and other community organizations. An infrastructure with demonstrated success resulting in improved access, care outcomes and cost efficiencies in meeting the needs of Medicaid recipients. Additional information on the CCNC Networks is included in Section C: Care Model Overview and Section G: Infrastructure and Implementation.

The strategic framework for the new Integrated Delivery Model comprises a series of systemic/structural improvements to better target the use of public funds to meet beneficiaries’ needs and to create incentives for improvements in capacity and accountability on the part of all medical home team members. With full implementation, the model realigns incentives to rectify current inefficiencies created when provider financial goals are in conflict with the achievement of beneficiary goals and evidence-based clinical best-practices. These improvements will be implemented over time with Phase 1 focusing on medical home/population management with emphasis on working with beneficiaries residing in nursing homes and adult care homes. As shared savings are realized, the portion of savings available for reallocation to better meet the needs of dual eligible beneficiaries will be used to incent improved delivery capacity and full implementation.

Implementation Phase 1: At the outset, we will target dual eligible beneficiaries at highest-risk for potentially avoidable use of medical services through development of medical homes for residents of adult care homes and nursing homes. This will bring medication reconciliation and transitional supports to beneficiaries that in turn will reduce adverse drug events, non-urgent use of emergency department and ambulance services and potentially preventable and discretionary hospitalizations. During Implementation Phase 1 a functional need-based independent medical eligibility determination and resource allocation methodology will be developed, along with a statewide cross-stakeholder education and community dialog regarding the integrated delivery model, beneficiary goal setting, and the importance of advance directives specifying personal preferences for physical and mental

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health care. Based on testing currently underway, other Medicare 646 pilot initiatives will be added to the statewide repertoire of Implementation Phase 1 integration responses.

Implementation Phase 2: As shared savings accrue, a yet to be negotiated share will be available to North Carolina to create incentives for improvements in capacity and accountability on the part of all medical home team members for all dual eligible beneficiaries. Incentives for improvements will be driven by tiered per member per month payments, potential regulatory relief, and other shared savings incentive structures activated when providers achieve specified quality and cost targets. At the same time, independent assessment and the need-based resource allocation methodology will be implemented to support greater flexibility in the use of public funds and to enable more innovative and responsive treatment-in-place options for beneficiaries in all living arrangements. These arrangements are expected to further reduce non-urgent emergency department and avoidable hospital use, while improving access to a broader set of home and community-based options. New care-giving solutions will be cultivated by creative team-based medical home support to beneficiaries made possible through access to public funds that can be used more flexibly.

Following full implementation we anticipate the eradication of waiting lists for services as shared savings are reinvested. In addition, when fully operational, culture changes and realigned financial and regulatory incentives will rectify current inefficiencies created when provider financial goals are in conflict with achievement of beneficiary goals and evidence-based clinical best-practices. Additional detail on implementation phases is presented in Section E: Financing and Payment.

The remainder of this section provides a brief overview of the strategic framework and systemic changes underlying this integrated delivery model and discussion of the underpinnings of

o independent assessment of needo functional need-based resource allocationo flexible use of public fundso capacity incentiveso broader use of actionable data

INDEPENDENT ASSESSMENT OF NEED

Improved targeting of public funds will be advanced through the introduction of an independent process for the assessment and determination of dual eligible beneficiaries' medical and support needs. Such independence in medical eligibility determination assures that those assessing need are free of conflicts of interest that have contributed to overutilization when assessors are employed by providers of direct services.

Trained assessors will use standardized, tested tools and definitions, during meetings with beneficiaries identified as at-risk. Targeting will include primary care physician visit screening, automated risk-stratification flagging, targeting via transitions initiatives, and inter-agency and self-referral. In addition to assessing needs, care managers will begin discussions of enrolled beneficiaries’ strengths and goals, review available natural and community resources, and use tested protocols to keep medical home team members informed of the beneficiaries’ current status. This information will provide key

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communication to assure integration of services and supports, and will be incorporated, along with other beneficiary data in the CCNC Informatics Center that supports medical home team electronic communication. Additional information on these Informatics Center resources can be found in Section G: Infrastructure and Implementation.

FUNCTIONAL NEED-BASED RESOURCE ALLOCATIONThe determination of need and the attendant allocation of public funds for supports

and services will rely on a functional need-based definition of need that encompasses all dual eligible beneficiaries, regardless of their diagnosis, living arrangement or combination of co-morbidities. This functional need-based assessment will provide an objective basis for the allocation of resources in a manner that is both equitable and transparent. At its root, this process incorporates various dimensions known to impact daily functioning:

mental health and emotional impairments and limitations in cognitive capacity, physical health capacity/impairment, conditions requiring professional or specialized resource, and availability and adequacy of natural supports.

In discussing this type of functional need-based approach, North Carolina's stakeholder design volunteers recommended incorporating the following existing processes:

activities of daily living and instrumental activities of daily living; 4 quadrant classification of co-occurring mental and physical health conditions; minimum data set (MDS)/resource utilization groups (RUGS) that define the level of

resources required to meet the needs of skilled nursing facility residents, and Program for All-inclusive Care for the Elderly (PACE) assessment domains.

This approach represents an important shift away from the allocation of public funds for supports and services that is based on the constellation of services assembled in response to beneficiaries’ living arrangements. FLEXIBLE USE OF PUBLIC FUNDS

Flexibility in the use of public funds pertains to two dimensions of this integrated model, individual and systemic. 1. Greater flexibility in the individual use of funds allocated to meet beneficiaries’ needs is

designed to be instituted following development and full implementation of the independent assessment and needs-based resource allocation components of the model.

This first dimension of flexibility is incorporated at the suggestion of our beneficiary and stakeholder input. They expressed concern about barriers to acquiring devices to assist with communication, in-home care technology and cost-effective purchasing of appliances that reduce dependence on others. In addition to beneficiary preferences, this approach has demonstrated cost savings as evidenced by evaluation findings supplied by the CMS Cash & Counseling demonstration program (Mathematica 2007). Of note too, is the viability of this approach with the recent attainment of statewide access to approved fiscal intermediary capacity to work with enrollees in North Carolina's Home and Community Based Services Waiver, Community Alternative Program (CAP) Choice option.

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2. Flexibility in the systemic use of public resources designed to assure the consistent quality of key integrated delivery model functions and support capacity available to beneficiaries statewide.

North Carolina has a growing urban population, however, a greater proportionate share of dual eligible beneficiaries reside in rural communities when compared with the distribution of the state’s total population. This geographic distribution, along with stark differences in access to services and supports in resource rich and resource poor communities, and the diversity of the dual eligible beneficiaries’ needs, require Networks and community providers to find innovative solutions to assure statewide consistency. By focusing on defined functions, with explicit expectations and measurable standards, North Carolina's current infrastructure has successfully built a robust Network infrastructure that adapts to the needs of patients, and the strengths and weaknesses in the community resources and healthcare delivery system. Continuation of this function, expectation and standards based approach is incorporated in the integrated delivery model design.

One example of local variations in delivery that assure consistency is how Networks deploy care management resources. Nurses and social workers employed by Networks to manage care in urban areas may be embedded in and work exclusively with a single primary care practice or as transition support in a single hospital system. In contrast, in rural communities, care managers routinely work with multiple hospitals or practices that serve fewer enrollees.

As medical homes are extended to beneficiaries in different living arrangements and new capacity is being encouraged to improve quality and capacity, flexibility will both ensure consistency of offerings, and encourage/permit creative responses in the development of more dynamic system responses.

CAPACITY INCENTIVESThrough the flexible use of resources the integrated delivery model assures that dual

eligible beneficiaries in all settings will have access to a standardized medical home team-based care capacity and that providers participating on these teams will have support to improve their quality and capacity. Phase 1 of this model will be supported by Medicaid per member per month (PMPM) payments at the aged, blind and disabled recipient rate. When fully implemented, shared savings from Medicare will be applied to tiered PMPM to encourage primary care practices to take responsibility for and work with dual eligible beneficiaries’ with the most complicated circumstances and complex health conditions. Similarly, Networks supporting beneficiaries’ medical home teams will be receive Medicaid Aged, Blind and Disabled (ABD) PMPM during phase 1. Tiered incentive PMPM will be instituted when the model is able to achieve cost savings to allow for flexible financing being funded by both the federal and state government.

In Phase 2, Network payments will include a fixed rate payment to cover independent needs assessment, contributions to support the statewide electronic and human information infrastructure, as well as routine care management and medical home support functions. Network PMPM will also include flexible resources to incent broader collaboration among medical home team members to assure all beneficiaries have access to a defined set of system capacities to support their needs. This flexible share of the PMPM will also be used to incentivize provider participation and practice improvements to meet both beneficiary and integrated delivery model capacity enhancements and cost saving goals.

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Allocation of this portion of the Network PMPM will vary based on responsibilities assumed by various team members, and their demonstrated capacity as evidenced by achievement of defined standards and quality metrics. This tiered approach for provider development, once fully implemented will support raising the level of care provided by all medical home team providers and will incent development of new provider capacity.

With growing experience, providers who meet or exceed defined quality standards will be eligible to participate in the most sophisticated enhanced capacity options with the potential for regulatory relief, shared savings and other benefits that accrue as a result of being identified as a leading edge provider. Increasing Beneficiary Capacity

Increasing beneficiary capacity is also key to this integrated delivery model. New modes of communication like motivational interviewing, building trusted relationships and engaging beneficiaries as members of their medical home teams requires training and education. Shifting away from a history of imbalance among providers as well as between providers and beneficiaries will require diligence and patience. Throughout the beneficiary and stakeholder processes we repeatedly heard about distrust of providers by beneficiaries and their family caregivers, and reluctance to share honest opinions for fear of reprisals. And, while clinicians and providers are well-intentioned in their efforts, all too often beneficiaries are intimidated and unable to make their needs, goals and preferences heard. Avoidance of difficult conversations by providers and beneficiaries serve to exacerbate these communication gaps and undermine the shared goals of a more responsive, high quality, cost-efficient delivery system.

Therefore this integrated delivery model will continue to build opportunities for beneficiaries, their caregivers and providers to think together about improvements and mechanisms to develop and refine the model as discussed in Section D: Stakeholder Engagement and Beneficiary Protections.

BROADER USE OF ACTIONABLE DATAThe final structural element of this model is the expanded use of actionable data by all

parties. Beneficiaries will have the opportunity to learn more about their healthcare and to become more active partners in managing their health. They will participate in defining the metrics used to measure progress toward the achievement of their goals and will have access to information to understand the short and long term implications of biometric and other clinical indicators of their health status.

At the same time, beneficiaries and members of their medical home care team will have access to actionable data to inform choices and shared decision-making, and to assess the quality of care provided. On a more global level, actionable data will be used to inform implementation, evaluation, and resource allocation during the development and operationalization of this integrated delivery model as described in Section F: Expected Outcomes.

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ii. Description of the Medicaid-Medicare Enrollee Population North Carolina, through the Dual Eligible Beneficiary—Integrated Delivery Model

proposes to focus solely on full-benefit dual eligible adults. This accounts for 222,151 adult beneficiaries. Excluded from the target population are approximately full-benefit dual eligible beneficiaries who are under the age of 21 (n=455), and those with suspended Medicaid due to incarceration (n=141).

In December 2010, full-benefit dual eligible beneficiaries in the target population represented 15% of all Medicaid recipients. Analysis of Medicaid data gives a glimpse into the demographic characteristics of the population. Dual eligible beneficiaries are by definition low income, with 60% living below the federal poverty level and almost 94% living below 200% of poverty. The majority of dual eligible beneficiaries are age 65 or older (54.2%) and female (65.5%). Compared with the overall population in North Carolina dual eligible beneficiaries are less likely to be White, Non-Hispanic (52.1% of duals, 65.3% of NC population), Hispanic (2.0% of duals, 8.4% of NC population) or Asian (1.4% of duals, 2.2% of population), and dual eligible beneficiaries more likely to be Black, Non-Hispanic (38.2% of duals, 21.5% of NC population) or Native American (1.4% duals compared with 1.3% in the total population).

Dual eligible beneficiaries are widely recognized as having complex medical needs, as well as functional and cognitive limitations. In December 2010, approximately 39,800 or 17.9% of the dually eligible population in North Carolina had a severe and persistent mental illness. Approximately 14% (31,588) were receiving long-term services and supports within an institutional setting and another 5.4% (12,083) were receiving long-term services through Waivers and PACE (Table 2). The majority of the target population, 71.9% (159,799) lives in the community. 34.5% of the target population had two or more chronic conditions. As a result of being in poor health and having multiple chronic conditions, they also tend to use high-cost health services such as emergency room visits and inpatient hospitalizations at a higher rate than the general population. In 2010, 29.5% the dual eligible beneficiaries visited the Emergency Department (ED) at least once and 22% had at least one hospital inpatient stay.

Table 2: Dual Eligible Enrollee Population

Overall **Individuals receiving LTSS in institutional settings

***Individuals receiving LTSS in HCBS settings

Overall 222, 151(100%) 31,588(14.2%) 12,083 (5.4%)Individuals >65 120,530(54.2%) 26,028(82.3%) 7,272(60.2%)Individuals <65years 101,648(45.8%) 5,530 (17.5%) 4,811(39.8%)SPMI* 39,863(17.9%) 4,893(15.5%) 1,371(11.3%)

*Serious and Persistent Mental Illness (SPMI). SPMI includes Schizophrenia(icd9-295*), Bipolar or major depression (icd9 296), Schizoaffective disorder (icd9-3012) or inpatient stay in a mental hospital

** Individuals receiving LTSS in institutional settings include living arrangements of skilled nursing, ICF, ICF-MR/DD and mental institution

*** Individuals receiving LTSS in Home and Community Based Services (HCBS) include beneficiaries of waiver services and PACE

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C. Care Model Overviewi. Proposed Delivery System & Programmatic Elements North Carolina’s Integrated Delivery Model is statewide and with full implementation

is designed to provide beneficiary-centered medical homes to dual eligible residents in all 100 counties of the state.

Dual eligible beneficiaries will be assigned to their beneficiary-centered medical homes through an opt-out process piggy-backing the current Medicaid medical home enrollment structure.

North Carolina has a statewide, fully operational program of 14 regional Networks of medical and community resources collectively known as Community Care of North Carolina or CCNC. This program currently serves more than 1.24 million Medicaid enrollees including 230,000 aged, blind and disabled recipients and 100,000 dual-eligible beneficiaries.

Community Care of North Carolina Networks include 1,500 medical homes and over 4,300 primary care providers. Each Network has a clinical director to lead and engage all the participating practices and providers. In addition, each Network has an executive director, psychiatrist, pharmacist, systems administrators, privacy officers, behavioral health coordinators and palliative care coordinators. Networks hire the care managers that work in the practices, in the community and in hospitals. There are over 600 care managers statewide. Other support staff is hired by the Networks to support routine population health management activities and targeted initiatives.

This system serves the state’s most vulnerable and high cost populations through access to primary care medical homes, vigilant care management and provider collaboration. Currently Medicaid recipients and low-income uninsured residents have access to the comprehensive and high-quality CCNC medical home model.

Each Network contracts with primary care practices to support medical home functions including:

primary care physician leadership, routine medical screening, preventive health care informed by automated alerts based on patients health history

and current conditions, in-depth assessment of potential problems identified through screening, team-based care, education, support, and referral for self-management of newly diagnosed conditions,

and based on patients’ needs, pharmacy management, behavioral health, and palliative care

consultation and referral. Augmenting this infrastructure are Networks’ partnerships with local health care

delivery systems, including hospitals, county health departments, local safety net providers, community-based organizations, and specialty practices, including behavioral health providers.

Care management tools employed to achieve quality, utilization, and cost savings goals include:

evidence-based best practice programs, risk-stratification to target care and disease management interventions, coordinated care delivery with an emphasis on improving transitions, motivational interviewing, patient education and self-management skill building,

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improved management of chronic illness care through use of actionable data and automated patient-specific alerts,

pharmacy management strategies and interventions, and a structured environment from which community providers can work collaboratively

to improve care and health outcomes of enrollees.

The 14 regional Networks work together to advance rapid-learning and pilot testing of new practices, and to refine the shared, statewide information management systems that provide analytic support and advanced informatics capacity, as described in Sections F: Expected Outcomes and G:Infrastructure and Implementation. This infrastructure supports the triple aims of the integrated delivery model via several tools, including three primary components.

1. A Provider Portal that supplies patient-level data from administrative claims for care provided, clinical information (lab, x-ray, pharmacy) to guide utilization of evidence-based practices, and in over half-the state, live feeds that identify when patients are admitted to the hospital or seen in an emergency department ,

2. The Case Management Information System (CMIS) contains current patient goals, plans of care and support, progress notes regarding challenges encountered, remedies, and progress toward achievement of patient goals. In addition, the CMIS provides the care managers with electronic population management tools and resources.

3. A broad compendium of practice, county, network and state-level reports to monitor and manage quality, performance and population health targets.

Community Care of North Carolina is a private-public collaborative effort through which the State has partnered with community physicians, hospitals, health departments and other community organizations to build regional networks to improve the quality, efficiency and cost-effectiveness of care for Medicaid recipients.

Overall, North Carolina has 9,017 primary care physicians, with an additional 17,853 specialty physicians. There are 5 academic medical centers, 13 trauma centers, 104 acute care hospitals (excluding Veterans hospitals), 20 Critical Access Hospitals, 103 hospital-based emergency departments, 60 federally qualified health centers and 102 rural health centers.

Medicaid/Medicare certified providers serving the various sub-populations of dual eligible beneficiaries, include 1,044 psychiatrists, 22 geriatricians, and 298 cardiologists; 3 state mental health hospitals, 46 acute care hospital psychiatric units; 28 centers for individuals with complex intellectual and developmental disabilities, 331 intermediate care facilities for the mentally retarded and 1,254 group homes specializing in care for persons with developmental disabilities. There are 194 Medicare/Medicaid certified home health agencies, 87 Hospice agencies, 434 nursing facilities, and 613 Adult Care Homes with 7 or greater and 618 family care homes with 2-6 beds.

The North Carolina Department of Health and Human Services comprises of statewide agencies with responsibility for healthcare and long term services and supports, information and beneficiary supports. Prominent among these are the Division of Aging and Adult Services which is responsible for several related initiatives including Healthy Living evidence-based programs including the Stanford Chronic Disease Self-Management program, the falls prevention program, A Matter of Balance and Healthy IDEAS depression training. The

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Division of Aging and Adult Services is also responsible for development of Aging and Disability Resources Centers, known as Community Resource Connections, in NC and oversees Administration on Aging and state funded home and community-based supports, including family caregiver programs. The North Carolina Medicaid Agency and the Division of Aging and Adult Services both serve under the NC State Department of Health and Human Services. The organizational structure allows our agencies to work together closely and to align initiatives.

An important related resource is the Area Agencies on Aging, housed within regional Councils of Government across the State. They serve five basic functions: (1) advocacy; (2) planning; (3) program and resource development; (4) information brokerage; and (5) funds administration and quality assurance. These agencies are important in the development and implementation process and bring particular expertise based on their experience with home and community-based services and stakeholder engagement processes.

Another vital component of the Department of Health and Human Services serving younger adults with a disability is the Division of Vocational Rehabilitation, with expertise spanning Community Living Services, Assistive Technology and Employment and Training. The 33 Vocational Rehabilitation Regional Offices and 16 Independent Living Centers have established collaborative relationships at the state and local level with the aging network, and are currently developing a shared resource information base for adults with disabilities of all ages. Similarly, the Division of Mental Health Substance, Developmental Disabilities and Abuse Services operates under the auspices of Department of Health and Human Services and works with a network of Local Management Entities to provide services and supports to dual eligible beneficiaries. A full description of the federal and state funded services and supports available through these and other divisions, and even a simple mention of the myriad local agencies and organizations who work with dual eligible beneficiaries on a daily basis exceed the page limits of this proposal.

As evidenced by the turnout of stakeholders helping with the development of this integrated delivery model, North Carolina has a demonstrated history of collaboration with private-public partnerships and agencies that are well able to develop, implement and refine this new way of working with and meeting the needs of dual eligible beneficiaries.

ii. Benefit design Benefit EnhancementsAlignment of Medicare and Medicaid services will rest with dual eligible beneficiaries

and their medical home teams. Core medical home team functions (described previously) will be enhanced to include new communication protocols and information sharing resources to support development of medical homes for dual eligible beneficiaries in all settings.

While full implementation will await achievement of shared savings, development and testing of an independent functional need-based assessment and resource allocation methodology will begin in Phase 1. This process will begin by collecting and evaluating assessment and claims data to develop preliminary ‘virtual budgets’ to meet the needs of beneficiaries

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Education and training programs will assist beneficiaries, their families and medical home team members as they learn the processes necessary for shared decision-making regarding services and creation of support plans.

This Integrated Delivery Model differs from current benefit design through offering medical home supports to residents of nursing homes, adult care homes and other supported residential settings. At present nursing home residents are excluded from enrollment in medical homes.

As shared savings accrue, other enhancements discussed include greater use of technology by beneficiaries, greater access to information on available community resources and development of peer support capacity. In addition the behavioral health system will include supports that are recovery oriented, trauma-informed and keeping pace with emerging state-of-the art treatment options.

Accountability for managing services and supports included in a beneficiary-centered medical home team support plan will rest with the beneficiary and their healthcare team. Explicit goals, services/supports and measures of quality and satisfaction will be included in the plan, with designated responsible parties identified for each task or action step identified.

Clinical oversight is the responsibility of the primary care physician, and oversight of the assurance of delivery and compliance of other provider plan elements is the responsibility of the Network. As appropriate, beneficiaries, medical home team members and Networks may share responsibility for managing care with qualified medical home team members through contracts or other written agreements. Shared responsibility will require advanced certification of provider capacity.

Explicit care quality, performance standards, and goal-related outcome targets will be well documented, understood and agreed upon by the primary care provider, care manager and other providers integral to the healthcare team.

iii. Supplemental benefits and/or other ancillary/supportive services With full implementation, the integrated delivery model will have greater flexibility in

the use of public funds will represent a modification to the current approach to service delivery as described in the overall strategic framework in Section B: Background

iv. Utilization of evidence-based practices will be employed as part of the overall care model.

The CCNC Provider Portal provides access to a compendium of low-literacy patient education materials, and evidence-based practice tools for screening and assessment, health coaching and disease management. In addition, the CCNC Informatics Center tools provide a comprehensive patient-level view of clinical and claims information in a searchable Chronic Care patient snapshot database which facilitates triage when referrals are made for care management by providers or at the time of hospital discharge.

Specific reports are generated for special initiatives and targeting (e.g., identification of patients with newly diagnosed asthma, heart failure, and diabetes; identification of patients receiving controlled substance prescriptions from multiple sources; identification of patients with poor adherence to their blood pressure medications for a telephonic health coaching intervention). In addition, quality measurement and performance feedback monitoring reports of quality at the individual practice level help to engage providers in the quality

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improvement process and to monitor progress at the practice, county, network, and statewide level. These reports are an integral component of CCNC’s quality improvement initiatives related to the complex co-morbidities of dual eligible beneficiaries. Quality measures based on evidence-based care guidelines currently encompass diabetes, asthma, hypertension, cardiovascular disease, and heart failure.

v. Description of how the proposed model fits with:(a) Current Medicaid waivers and/or State plan services available to this population

The North Carolina Medicaid Program also operates several 1915(C) Home and Community-Based Waiver Programs that include adults:

The NC Supports Waiver and NC Comprehensive Waiver provides adult day health, day supports, home and community supports and in home services and training for individuals w/autism, Developmental Disability, Mental Retardation.

CAP/DA (Community Alternatives Program/Disabled Adults) provides adult day health, case management, institutional respite, care advisor (CHOICE option only), assistive technology, home modifications and mobility aids, meal preparation and delivery, non-institutional respite, participant goods and services, personal assistant (CHOICE option only), personal care aide, PERS, training and education, transition, waiver supplies for individuals 65 years of age or older.

CAP Choice provides adult day health, respite institutional, in-home aide, personal assistant, care advisor, FMS, consumer-directed goods and services, home modifications and mobility aids, preparation and deliver of meals, respite (in-home), telephone alert, waiver supplies for aged individuals 65 years or older and for the disabled adults between 18 and 64 years of age.

Personal care services (PCS) provides eligible recipients with supervision or hands-on assistance with activities of daily living. The service does not include skilled medical or skilled nursing care. Individuals must be referred for PCS by a primary care or attending physician or by the physician who is providing treatment for the medical condition causing the person's need for PCS.

Home health care encompasses a wide array of health care services that are provided in the residence of recipients. The goal of home health care is to treat an illness or injury. Home health care supports are designed to help recipients improve or regain health and independence, and become as self-sufficient as possible.

(b) Existing managed long-term care programs

PACE is the only managed long-term care program operating in North Carolina, see below.

(c) Existing specialty behavioral health plansThe Division of Mental Health, Developmental Disabilities and Substance Abuse

Services established a pilot Medicaid-managed care vendor through the use of 1915(b) and 1915(c) Medicaid Waivers to serve individuals with mental health, developmental disabilities and substance abuse needs who are eligible for Medicaid. While remaining responsible for state allocated funds including federal block grants and for all applicable rules and policies, the pilot site, Piedmont Behavioral Health (PBH) in April 1, 2005, began managing Medicaid

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State Plan funded mental health and substance abuse services through the Piedmont Cardinal Health Plan. This Plan operates under a capitated pre-paid inpatient health plan (PIHP) which includes coverage for inpatient services for recipients with need in Cabarrus, Davidson, Rowan, Stanly, and Union counties.

In 2009, at the direction of the North Carolina General Assembly (S.L. 2008-107), the NC Department of Health and Human Services initiated a collaborative effort with the NC Division of Medical Assistance and Division of Mental Health, Developmental Disabilities and Substance Abuse Services, in partnership with the local management entities (LMEs), to restructure the management system for Medicaid funded mental health, substance abuse and developmental disabilities services, building on the PBH Waiver experience, with the intention to phase in PHIP capitated services statewide.

Since February 2010, the DHHS twice solicited applications for LMEs to participate as Medicaid PHIP vendors under the State’s 1915 (b)/(c) Medicaid Waiver, in addition to their state-funded responsibilities. The Department selected 11 LMEs to manage Medicaid funded services as DMA contracted vendors through this capitated plan. DMA and DMH/DD/SAS will each contract with the selected LMEs. Through Division of Mental Health, Developmental Disabilities and Substance Abuse Services contract, LMEs will continue current obligations and commitment to the management of state and federally funded mental health, substance abuse and developmental disabilities services. Through the DMA contract, the LMEs will expand their roles and responsibilities as an LME PHIP contractor (referred to in NC as LME/MCO). All selected LMEs must be fully operational by January 1, 2013. Thereafter the DHHS will assign counties that remain uncommitted at that time to fully operational LME/MCOs, with full expansion and DHHS assignment expected to be completed by July 1, 2013.

(d) Integrated programs via Medicare Advantage Special Need Plans (SNP’s) or PACE programsSpecial Needs Plans – There is, as of the March 2012 report, 10 Special Needs Plans (SNP’s) in North Carolina. One PPO SNP Chronic and Disabling Condition plan targeting beneficiaries with End Stage Renal Disease with no enrollees reported on the CMS March, 2012 report. There are 2,276 enrollees in 4 Medicare Advantage (MA) “Institutional” SNP’s and 8,694 enrollees in 5 MA “Dual Eligible” SNP’s.

Identification and referral/structured hand-offs for beneficiaries who wish to enroll/disenroll in MA-SNP’s and other programs and projects with responsibility and assigned risk for dual eligible beneficiaries’ care and support services will require development and refinement. Of particular importance will be creation of electronic communication and timely sharing of information regarding enrollee assignment managed at the federal level. In addition, every effort will be made to develop agreements for cooperation and continuity of beneficiary care at the local level to address individual needs as the need arises and are made known to regional CCNC Networks, the Division of Medical Assistance and participating providers.

Program of All-Inclusive Care for the Elderly (PACE) is a unique model of managed care service delivery for the frail older adults living in the community. Most PACE participants are dual eligible beneficiaries, and all are certified eligible for nursing facility level of care. North Carolina’s PACE programs are centered in certified adult day health programs, with services

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provided on site and supplemented by in-home and referral services in accordance with each participant’s needs. There are currently five PACE sites serving portions of 13 counties. Three new programs are slated to open in 2012, and 3 additional sites are expected to open the following year, bringing the total number of PACE programs to eleven by end of 2013. Five more program sites are in the preliminary stages of development. The integrated development model will work closely to align all efforts with these PACE sites to learn best practices and maximize available resources.  

Identification of beneficiaries wishing to enroll or dis-enroll from PACE will be managed at the local level. Based on collaborative relationships already in place, we expect locally defined protocols for structured hand-offs will assure continuity of care for beneficiaries and clear assignment of responsibilities.

(e) Other State payment/delivery efforts underway (e.g., bundled payments, multi-payer initiatives, etc.)

North Carolina’s participation in CMS Multi-payer Demonstration is noted below.

(f) Other CMS payment/delivery initiatives or demonstrations The CCNC Networks and infrastructure serves as the platform for both the CMS Multi-

Payer Advanced Primary Care Demonstration and the CMS Medicare Health Care Quality 646 Demonstration discussed in section B: Background. Multi-Payer Advanced Primary Care Demonstration - The North Carolina Department of Health and Human Services was awarded the project by CMS. Community Care of North Carolina (CCNC) is operating the demonstration collaboratively with Medicare, the Division of Medical Assistance, Blue Cross Blue Shield of North Carolina, and the North Carolina State Health Plan for Teachers and State Employees. The demonstration will be implemented in seven rural counties: Ashe, Avery, Bladen, Columbus, Granville, Transylvania, and Watauga. All participating payers will contribute resources to practices and Community Care networks to support practice transformation to “medical homes,” and to improve quality of care, care coordination, access, patient education, community based support, and other care support services. CMS Medicare Health Care Quality 646 Demonstration - Additional information on the Medicare 646 Quality Demonstration Project is included in Section B: Background. As negotiations between North Carolina and CMS regarding implementation support for North Carolina’s Dual Eligible Beneficiary - Integrated Delivery Model progress, explicit understandings will be specified for the processes and plan to suspend the Medicare 646 Quality Demonstration as we begin implementation of the Integrated Delivery Model. This will include mapping the timing and workflow for providing 60 day notice to CMS of intent to terminate, as appropriate, in the late fall of 2012.  We anticipate there will be little to no gap between the 646 Demonstration and implementation of the Integrated Delivery Model. We will work further with CMS to address any additional concerns to assure compliance with conditions of both programs. Other CMS Initiatives - We are aware of multiple pending applications and proposals pertaining to Health Homes, Community Care Transition Programs, Accountable Care

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Organizations and Innovation Challenge grants submitted from North Carolina and will solidify relationships as any of these initiatives become operational.

D. Stakeholder Engagement and Beneficiary Protectionsi. Internal and External Stakeholder Engagement North Carolina’s active engagement of stakeholders and beneficiaries is led by the Division

of Medical Assistance with support from the Core Leadership Team formed in June 2011 and multi-stakeholder perspectives provided by the Statewide Partners’ Group, initiated in August 2011. Four topic-specific Planning Grant Work Groups began meeting in September 2011 with final draft recommendations issued in December 2011 and January 2012. In addition, since October 2011, nine sub-state sessions with beneficiaries and beneficiary caregivers have been conducted. Two development Work Groups were mobilized later in the process, the full Beneficiary and Community Stakeholder Work Group was mobilized in December 2011 as other work group activity lessened and recommendations began to emerge. Finance and Payment Work Group conversations began February 2012

Core Leadership Team: The NC Division of Medical Assistance assembled the Leadership Team drawing on Department of Health and Human Services Division leaders and Community Care of North Carolina (CCNC). The overall charge of the Core Leadership Team is to guide development of the Statewide Partners’ Group, develop and co-lead Work Groups and advice on the development and implementation of North Carolina’s Integrated Delivery Model. Core Leadership meetings shifted from a weekly to bi-weekly schedule following the launch of Work Group meetings in September 2011. Dates and agenda for their 25 meetings held between June 2011 and March 2012 are summarized in Appendix C.

In addition to Work Group co-leads noted below, other members of the Core Leadership Team include the Division of Medical Assistance leaders who comprise the internal working group: Melanie Bush, Assistant Director for Administration; Sandra Terrell, Assistant Director for Clinical Policy and Programs; Tracy Linton, Chief, Clinical Policy; Roger Barnes, Assistant Director for Financial Management; Jeff Horton, Chief Operating Officer, Division of Health Services Regulation; and Ruth Petersen, Chronic Disease and Injury Section Chief, Division of Public Health and others, as needed.

Statewide Partners’ Group: Following a brief orientation to the initiative and review of Work Group needs in August, this group assisted with recruitment of work group volunteers and dissemination of information to stakeholders throughout the state. Meeting bi-monthly, this group serves as the forum for cross-interest discussion and advice on overarching matters. Meeting agenda have ranged from vetting and further developing suggestions for effectively engaging and gathering input from beneficiaries and other stakeholders, to small group vetting of the strategic framework and recommendations and implementation plan considerations advanced by the Work Groups noted above. Most recently, this group convened to conduct two Public Hearings on this implementation proposal in March 2011.

With support from this group, approximately 180 individuals and more than 50 North Carolina based beneficiary organizations, state and community agencies, and statewide stakeholder associations, have worked together in Work Groups and other discussion venues to inform the development of this integrated delivery model. For more on participants see the

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Partner Links section, follow along links to agenda and related documents for the Statewide Partners’ meetings online at: http://www.communitycarenc.org/emerging-initiatives/dual-eligible-initiative/dates-and-directions/ .

Beneficiary Perspective: Beneficiary and Family Caregiver Groups: National Alliance on Mental Illness (NAMI – NC), Friends of Residents in Long Term Care, NC Consumer Advocacy, Networking, and Support Organization (CANSO); State and County Advisory Councils: NC Governor's Advisory Council on Aging, Wake County Consumer and Family Advisory Council; and Advocacy Groups: Senior Tarheel Legislature, AARP North Carolina

Service and Support Networks: Home and Community-Based Care Resources: NC Association of Area Agencies on Aging, North Carolina Adult Day Services Association, NC Program for All-Inclusive Care (PACE) Directors, NC Statewide Independent Living Council, Easter Seals UCP North Carolina & Virginia, Inc; Association for Home & Hospice Care of North Carolina, Carolinas Center for Hospice and End of Life Care, North Carolina Association on Aging, NC Association of Directors of Social Services, NC Long Term Care Ombudsman Program; Residential Care Providers: North Carolina Health Care Facilities Association, NC Association, Long Term Care Facilities, North Carolina Assisted Living Association, NC Providers Council Association; Acute Care Providers: North Carolina Hospital Association, Primary Care Providers: NC Academy of Family Physicians, NC Community Health Center Association, and representatives of the 14 regional CCNC Networks and statewide NC Community Care Network staff and consultants, including Clinical Directors, Network Directors, aging continuum coordinators, transitional support, pharmacy, behavioral health and palliative care leaders; and Aging & Disability Information Resources: (ADRC) Chatham-Orange Community Resource Connection & Forsyth Community Resource Connection, Department of Insurance Senior Health Insurance Information Program (SHIIP).

Planning Grant Work Groups: The planning grant work groups noted below began meeting in September 2011, operating under a common set of core values, to address both overarching and topic-specific foci, as described by their working titles. These 4 Core Leadership led Work Groups met as a full-group and in sub-groups, in person or by conference call, 10-15 times during the fall and early winter, their mission being to:

gather information on the needs of dual eligible beneficiaries, including issues specific to this cohort and possible innovations to be considered,

establish priorities and review the evidence regarding key model elements, and recommend elements for inclusion in the Strategic Framework and implementation

considerations for an integrated model of care for dual eligible beneficiaries.

Work group volunteers brought with them experience with numerous existing initiatives underway in North Carolina, including CCNC’s Medicare 646 Demonstration program, falls prevention and chronic disease self-management initiatives, hospital, nursing facility and community-based transitional care demonstration projects, and emerging models and evidence-based practices spanning the behavioral health, aging and disability communities.

Questions, ideas and strategies suggested by the Core Leadership Team and Statewide

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Partners’ Group, along with materials from the CMS Innovation Center, technical assistance contractors, and peer-reviewed literature were subject of discussion and debate among broadly representative members of the Work Groups. Sub-groups were created to delve more deeply into particularly complex aspects of integrated delivery model. Work Groups, their Co-leads and sub-groups with narrowed focus for conceptual development are: Medical/Health Home and Population Health Co-leads: Randall Best, MD, Chief Medical

Officer, DMA and Denise Levis, Director of Clinical Programs and Quality Improvement, Community Care of North Carolina (CCNC)Sub-group foci: Medical Homes for Adult Care Home Residents, Medical Homes for Nursing Home Residents, greater access to Palliative Care and Needs Determination

Behavioral Health Integration Co-leads: Nena Lekwauwa, Medical Director, Division of Mental Health/Developmental Disability & Substance Abuse Services; Amelia Mahan, Behavioral Health Section DMA/CCNC; Mike Lancaster, Director of Behavioral Health Integration, CCNCSub-group foci: Provider Participation & Access, Continuum of Care

Long Term Services and Supports Co-leads: Pamela Lloyd-Ogoke, Vocational Rehabilitation Community Services Chief; Heather Burkhardt, DAAS Information and Assistance Program SpecialistSub-group foci: Community Living, Nursing Homes & Residential Care

Transitions Across Settings and Providers Co-leads: Trish Farnham, Project Director, Money Follows the Person Demonstration Project DMA; Sabrena Lea, Human Services Supervisor DAAS; Jennifer Cockerham, Chronic Care Program Coordinator, CCNC Sub-group foci: Transitions from Acute Care to Community, Transitions from Nursing Home to Other Long Term Settings and Transitions among ProvidersSub-group recommendations were aggregated to the Work Group level for review,

discussion and further development by the Core Leadership Team and Statewide Partners’ Group. Consolidation and integration of Work Group and Beneficiary conversation input was subject of drafting by a smaller Core Leadership Team working group and project staff, resulting in the draft Integrated Delivery Model strategic framework and implementation plan presented here. As this work progressed, the Core Leadership Team, Statewide Partners’ Group work group volunteers, and beneficiaries and other interested stakeholders, engaged through the efforts of the Community Stakeholder and Beneficiaries Work Group, reviewed, commented, and tested the feasibility and practicality of proposed model elements, implementation strategies and related improvements. Membership, charge to the workgroup, and work group recommendations presented in Appendix D, are also available online at http://www.communitycarenc.org/elements/media/files/work-group-recommendations.pdf

Dual Eligible Beneficiary and Community Stakeholders Work Group In December 2011, the workgroup specifically designed to plan for and engage

beneficiaries and community stakeholders convened. This group is lead by Dennis Streets, Director of Division of Adult and Aging Services. Membership includes beneficiaries and their families, members representing NC Consumer Advocacy, Network and Support Organization (NC CANSO), National Alliance on Mental illness (NAMI), ARC of North Carolina, the Division

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of Vocational Rehabilitation, Division of Medical Assistance - Money Follows the Person Program, NC Department of Insurance Senior Health Insurance Information Program, NC Association of County Directors of Social Services, NC Governor’s Advisory Council on Aging, ARC of North Carolina, NC AARP, NC Association of Area Agencies on Aging, and NC Statewide Independent Living Council.

With the help of beneficiary and community stakeholder volunteers, a new approach to sub-state beneficiary and community stakeholder engagement was instituted, resulting in a series of 7 information gathering conversations taking place during the winter. With the input from stakeholders and beneficiaries conversation protocols, (guiding questions, consent forms, and background information forms) were prepared and reviewed during beneficiary and community stakeholder volunteer training conducted prior to individual sessions. Additional information and summary of beneficiary conversations is included in Appendix D. Key themes identified include:

o Most dual eligible beneficiaries were satisfied with the current level of care that they are receiving.

o Many have been receiving Medicaid and Medicare for several years.

o Most duals were aware that they have both Medicaid and Medicare. However, while they know they have both sets of coverage, they were not clear on the full extent of their benefits.

o Those duals that had family and social support were able to navigate the system, seek and access the needed care without any trouble. Those individuals who did not have natural social supports found the process difficult.

o A few have had trouble with coverage issues associated with Medicare and Medicaid. About half have experienced difficulties locating a doctor who accepts both Medicaid and Medicare, particularly dentists, counselors and ophthalmologists.

o Most beneficiaries who have a care coordinator were very happy with the support they received. They used the care coordinator as the first point of communication in resolving a health or related issue.

o Most felt that their doctors and specialists did not actively communicate with each other or with them. They felt that the doctors did not have the time to explain the problem and the solution to them.

o Considerable difficulty was identified in finding mental health services in private practice (psychologists and counselors) who take Medicaid /Medicare.

o Universal concerns expressed in every group of beneficiaries included- Inability to keep appointments due to lack of transportation- Unable to get dental care - Unable to get prescription medications on time due to copays- Unable to get eye glasses and other assistive devices that will enable them to

lead an independent life in the community.

ii. Beneficiary Protections: Through the Department of Health and Human Services, Division of Medical Assistance, there are processes already in place for beneficiary protection and appeals. G.S 108A-70.9A governs the process used by a Medicaid recipient to appeal an

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adverse determination made by the Department in North Carolina along with the Social Security Act, 42 C.F.R 431.200 et.seq. There are three phases to the appeal process , a mediation process which should be completed within 25 days of receipt of hearing, Office of Administrative Hearings (OAH) proceeding completed in 55 days and finally the final agency decision to be completed within 20 days of receipt of case from OAH Through coordination and collaboration with the Division of Medical Assistance, Division of Aging and Adult Services, agreement with CMS, provisions that are currently in place will be enhanced to further augment and ensure the protection of beneficiary health, safety, access to high quality care, robust appeals and grievances process and most of all a user friendly and responsive customer service system.

iii. Ongoing Stakeholder Input and Beneficiary Engagement: The beneficiary engagement and conversations that began during the planning and design phase of the project are the beginning of an ongoing development process. As the work moves from design and planning to implementation, this process and these networks will be central to the development and implementation of beneficiary and provider education and discussion activities. This engagement will encompass multiple functions including, though certainly not limited to development of :

a shared language and communication materials to assure open dialog between beneficiaries and their medical home team colleagues and between beneficiaries and the broader natural support and community resources and networks, mechanisms for multi-stakeholder dialog and monitoring of implementation and development activities at the local and regional level, quality indicators that are responsive to the priorities and concerns of each sub-population of dual eligible beneficiaries and various stakeholder interests

As this proposal is readied for submission, public comment is being sought through project staff and Core Leadership Team member presentations of the strategic framework, design elements and implementation plan at various statewide meetings including the Governor’s Council on Aging, and the Senior Tar Heels Legislature and posting on the Dual Eligible website.

Duals Website and Email Box: North Carolina created a website http://www.communitycarenc.org/emerging-initiatives/dual-eligible-initiative/ , dedicated to the Dual Planning Initiative. The website has been live since October 2011 and serves as a communication tool for Work Groups and Statewide Partners’ Group meeting notices, agendas and material dissemination. The website directs all viewers to a dedicated email address – Dualfuture@n3cn.org, an email address promoted via emails to Statewide Partners, and during statewide conferences and meetings.

Public Comment: Two public hearing and comment sessions are being held in Raleigh on March 20th and 27th. In addition, proposal and development materials are posted and e-mail input is being solicited through Statewide Partners’ dissemination of information to their constituencies.

E. Financing and Payment

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i. Description of proposed state-level payment reformsNorth Carolina’s Integrated Delivery Model is building upon the existing Medicaid

managed fee-for-service primary care medical home and population health management infrastructure.

ii. Proposed payment types; financial incentives; risk sharing arrangementsPhase 1 implementation activity will begin with extending the current Medicaid aged,

blind and disabled PMPM fees to CCNC Networks and primary care providers to create medical homes for residents of Adult Care Home and Nursing Homes.

Phase 2 Implementation will supplement Phase 1 PMPM and draw on Medicare and Medicaid shared savings to fund an enhanced PMPM care management payment structure that provides tiered payments to primary care providers and Networks. Tiered PMPM payments will be adjusted to reflect beneficiary need as defined through an independent assessment and functional need-based needs determination process developed in Phase 1. Tiered Network PMPM payments will comprise 2 components, a fixed rate retained by the Network to support independent assessment, information management and enhanced Network supports, and a flexible rate to be used to engage qualified providers in quality and capacity improvement activities, and sharing responsibility for enhanced beneficiary medical home functions. At the highest levels of enhanced capacity, the most qualified providers extending treatment-in-place supports will have access to financial incentives through participation in shared savings, developed with CMS. F. Expected Outcomes

i. State’s ability to monitor, collect and track data on key metrics North Carolina Community Care‘s “Informatics Center” is an electronic data exchange

infrastructure maintained in connection with health care quality initiatives for the State of North Carolina sponsored by the Department of Health and Human Services, Division of Medical Assistance, and the CMS. Currently, the Informatics Center contains health care claims data provided by Medicaid, as well as health information about program participants obtained directly from health care providers and care managers and/or the primary care medical record. Since 2010 additional data sources integrated into the Informatics Center include: Medicare claims and Surescripts pharmacy data for dual eligible beneficiaries, LabCorp (laboratory results), and real-time hospital admission/discharge/ transfer data from 49 large NC hospitals.

In March 2012 CCNC received 2007-2010 Medicare Part A and B claims data from CMS for care coordination and the work of this demonstration project. A second COBA has also been instituted pertaining to future access of full cross-over and Medicare claims data. A request for Medicare Part D is in final review at CMS at the time of this writing and we are awaiting information about when we can expect to receive 2011 Medicare claims data.

These data being uploaded and will be used for targeting and to estimate utilization and expenditure trends, quality and performance targets and are central to the development of the Integrated Delivery Model.

These data will also be analyzed for targeting beneficiaries during for Phase 1 implementation activities, and accessed by the CCNC Networks to identify patients in need of care coordination; to facilitate disease management, population management, and pharmacy

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management initiatives; to enable communication of key health information across settings of care; to monitor cost and utilization outcomes; and to monitor quality of care and provide performance feedback at the patient, practice, and network level. Informatics Center programs supporting medical home operations are also described in Section G: Infrastructure and Implementation. The following are Informatics Center programs central to collecting, monitoring and tracking key metrics:

Quality Measurement and Feedback Chart Review System - Chart audit, quality measurement and performance feedback are an integral component of CCNC’s clinical quality improvement initiatives. CCNC conducts over 26,000 medical record reviews in over 1,250 primary care practices statewide on an annual basis. To manage the expanding scope of the chart review process, this process moved from a paper chart abstraction tool to a fully electronic, streamlined system in 2009. Medicaid claims data are used to generate a random sample of eligible patients, and to pre-populate audit tool elements according to an individual’s identified chronic conditions.

Informatics Center (IC) Reports Site - The IC Reports Site was created to allow the efficient and secure distribution of reports through a secured web-based report access and management application, with report access permissions determined by the appropriate scope of access of individual users. Network-level administrators authorize their own employees and providers by customizing their scope of access by practice or region. A report built at the statewide level can be readily distributed according to the permission tree structure, such that only the appropriate patient information is visible to each end user. Various functions are served by our analytics and reporting capacity:

Population Needs Assessment: Identification of demographic, cost, utilization, and disease prevalence patterns by service area. The Community Care Chronic Care patient database contains over 80 data elements and is updated quarterly to reflect the current aged, blind, and disabled enrolled population. Network leaders can readily obtain information about the demographic characteristics, prevalence of chronic medical and mental health conditions, spending by category of service, and rates of hospital, emergency department, and other service use within their service areas. This aids in program planning and resource allocation; identification of outlier patterns (such as unusually high rates of service uses); and tracking of utilization over time.

Tracking of Care Quality Indicators. In addition to the quality measures tracked in the annual chart review process, Informatics Center tracks a number of quality measures using claims data alone, with quarterly updates. Results can be viewed in spreadsheet format for easy comparative view across practices, or as a comprehensive practice-level, county-level, network-level, or program-level report with trend information. Reports include a variety of indicators including measures related to diabetes, asthma, heart failure, cardiovascular disease, and colorectal cancer screening.

Program Evaluation and Tracking of Key Performance Indicators. Informatics Center reports also enable program performance tracking of key metrics providing stakeholders with assurance that efforts are aligned toward the overarching goals of cost savings and quality improvement, and that all Networks are held accountable for the overall performance of the

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program. Key indicators include both process measures such as percent of targeted hospitalized patients receiving medication reconciliation, and outcome measures such as hospitalization, ED, and readmission rates.

Consumer Assessment of Health Care Providers and Systems (CAPHS Survey) The Division of Medical Assistance in partnership with the University of North Carolina at Charlotte periodically conducts the CAHPS survey among Medicaid recipients. The Consumer Assessment of Healthcare Providers and Systems (CAHPS) program is a multi-year initiative of the Agency for Healthcare Research and Quality (AHRQ) to support and promote the assessment of consumers' experiences with health care. The survey is able to assess the patient centeredness of care, compares and reports on performance indicators from the beneficiary perspective and improves the quality of care. Conducted in English and Spanish, the survey respondents are drawn from a stratified random sample with sufficient representation to allow analysis at the Network level. The sampling structure for the next CAHPS survey, scheduled for administration in fall of 2012, (September – November), is being changed to include dual eligible beneficiaries. This instrument will contain a series of supplemental questions that are of specific interest to the dual demonstration, in addition to the core AHRQ questions. These data will help set some baseline benchmarks for the dual demonstration. Along with the CAHPS survey, focus groups and key informant interviews will be utilized to obtain input from beneficiaries and information on their engagement and satisfaction with the new integrated delivery model.

ii. Potential targets for improvement

In January of 2010, CCNC initiated the Medicare 646 Quality Demonstration program with 8 networks, 200 practices and 900 providers working in 26 counties, to address gaps in care, quality and efficiency. The project completes its third year of demonstration in December of 2012. When North Carolina is approved for an implementation of its Integrated Delivery Model, the 646 Demonstration will be converted into this statewide initiative. The dual eligible demonstration will build on the efforts and lessons learned from the 646 project. Quality measures used with the Medicare 646 Demonstration Project described Appendix E encompass diabetes care, heart health, ischemic heart disease, hypertension and transitional care. These quality measures are intended to reflect the level and success of care coordination for dual eligible beneficiaries enrolled in the medical homes. In addition to these measures, the demonstration will also monitor and evaluate:

a) beneficiary satisfaction with services and care received (CAHPS surveys and focus groups)

b) potentially avoidable hospitalizationsc) emergency department use/admissionsd) hospital readmissions rate, and e) changes in expenditures and utilization patterns over time.Targets and benchmarks for these quality and outcome measures will be claims –based

and set in consultation with CMS and stakeholders after the analysis and trending of historical Medicare data for a minimum of three years.

iii. Expected impact of the proposed demonstration on Medicare and Medicaid costs

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Drawing upon North Carolina’s experience providing medical homes for Medicaid recipients who are aged, blind or disabled, we anticipate that there will be short-term increases in costs associated with pharmacy costs and physician visits to address unmet beneficiary needs. Savings associated with reductions in potentially avoidable hospitalizations, readmissions and non-urgent use of emergency department services are expected to accrue 12 to 18 months following the introduction of medical home care management functions. Details of financial projections and estimates of costs savings will be developed with analyses of linked Medicare and Medicaid claims data and refinements during negotiation between North Carolina and the Centers of Medicaid and Medicare Services.

G. Infrastructure and Implementation

i. North Carolina’s Current Capacity The CCNC Informatics Center operates under contract with the NC Department of

Health and Human Services, Division of Medical Assistance. It houses multiple systems that support the implementation of medical homes for dual eligible beneficiaries and development of other key integrated delivery model information needs. This section described the systems that provide oversight of services and supports to dual eligible beneficiaries, and inform the work of primary care practices and other medical home team members through the state. The following programs offer a brief summary of this fully operational current capacity. Further information on the infrastructure for monitoring, collecting and tracking key metrics and capacity to receive and analyze Medicare data is described in Section F: Expected Outcomes. Additional information of project management, staffing and use of other contractors is included in Appendix F: Budget

Care Management Information System (CMIS) is a web-based portal accessible to all networks, allowing care managers to maintain a health record and single care plan that stays with the patient as he or she moves across provider settings. Thus CMIS enables a continuity of care record for patients as they migrate “in and out” of Medicaid and un-insurance. CMIS provides a standardized framework for care manager workflow management and documentation, incorporating tools for evidence-based patient screenings and assessment, goal setting, and health coaching. In addition, CMIS has report-designing capability for monitoring caseloads and activities of the care management workforce.

Pharmacy Home was created to support CCNC pharmacy management initiatives, and address the need for aggregating information on drug use and translating it to the network pharmacist, case manager and primary care provider in a manner best suiting their care delivery needs. The system provides a patient level profile and medication history for point-of-care activities, as well as a population-based reports system to identify patients that may benefit from pharmaceutical care delivery via pharmacists, case managers and PCP’s in the medical home. The Pharmacy Home drug use information database is used prospectively for multiple purposes: for identification of care gaps and problem alerts; targeting of at-risk patients; development of the pharmaceutical care plans; and proactive intervention to assist providers and patients with therapeutic substitution required by state Medicaid policy. Retrospective uses of the Pharmacy Home database are equally

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important, to enable efficient and timely analyses needed for continuous quality improvement and program evaluation.

Informatics Center (IC) Reports Risk Stratification, Identification of High-Opportunity Patients, and Patient-level Information. The size and complexity of the enrollee population, in terms of physical health, mental health, and socioeconomic needs, necessitates intelligent mechanisms for identifying patients most appropriate for care management interventions. The use of historical claims data to screen patients for care management intervention greatly improves the efficiency of the care team. Through a combination of mechanism we are able to flag patients who meet specified criteria for further screening by a care manager.

Monitoring of Emergency Department(ED) and Inpatient Visits. A number of detailed utilization reports are generated automatically from the data warehouse, updating with every claims payment cycle. These can be easily navigated by local managers and clinicians who may not be highly technically savvy. As an example, the user can readily access a listing of ED visits by their enrolled population. The report can be parameterized by hospital, PCP, or patient or visit characteristics; and can tally visit counts by patient or practice. A similar report is available for inpatient hospitalizations. In addition to claims data, all networks receive real time ED data from hospitals in the community.

Provider Portal - The Informatics Center Provider Portal was released in August of 2010. This portal was built with the treating provider in mind, offering elements of CMIS, Pharmacy Home, and the Reports Site, tailored to the target user. Through a secure web portal, treating providers in the primary care medical home, hospital, emergency room, or mental health system can access their patient’s health record which includes patient information, care team contact information, visit history, pharmacy claims history, and clinical care alerts. Importantly, the use of claims data provides key information typically unavailable within the provider chart or electronic health record. For example, providers are able to see encounter information (hospitalizations, ED visits, primary care and specialist visits, laboratory and imaging) that occurred outside of their local clinic or health system. Contact information for the patient’s care manager, pharmacy, mental health therapy provider, durable medical equipment supplier, home health or personal care service providers are readily available. Providers can discern whether prior prescriptions were ever filled, and what medications have been prescribed for the patient by others. Built-in clinical alerts appear if the claims history indicates patient may be overdue for recommended care (e.g. diabetes eye exam, mammography).

Non-claims data sources for dual eligible beneficiaries are used to help fill the gaps in needed information to maximize population management activities. These sources include: Surescripts –to acquire prescription fill history data for dual eligible beneficiaries. The feeds return a twelve month prescription history and come from multiple pharmacies or prescription benefit plans. This is particularly helpful for practices that do not yet have an e-prescribing tool that is certified with Surescripts for fill history transactions. Ensuring access to Medicare Part D data will be important to fully integrate and manage the pharmaceutical and healthcare of dual eligible beneficiaries.

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Lab Data – the Informatics Center receives historical and monthly lab results for Medicaid recipients, including dual eligible beneficiaries, whose lab claims were billed to LabCorp. This historical data represented labs for 230,000 Medicaid recipients. Results for 125 selected tests are displayed as part of the patient record in the Provider Portal.

Hospital Admission, Discharge and Transfer (ADT) Data – CCNC has contracted with Thompson-Reuters to supply twice daily feeds of inpatient, outpatient, and emergency room admissions. Transactions include the chief admission complaint and identify the attending physician. Transactions are immediately reported to CCNC care managers in the Case Management Information System (CMIS) and are consolidated into reports housed in the Community Care report site. Thus far, Community Care is receiving ADT data from 49 North Carolina hospitals, representing over 60% of ED and inpatient visits for the NC Medicaid and dual eligible population.

This infrastructure brings engaged physician leaders throughout the state together to identify program priorities, adopt and implement quality and utilization performance metrics and spread best practices to community providers and agencies. Combined with the local CCNC Network leadership with the ability and history to develop and implement this integrated delivery model North Carolina is addressing the barriers and disincentives inherent in the current system. The development of this new delivery model for dual eligible beneficiaries further these collaborative efforts and establish new partnerships and relationships with dual eligible beneficiaries, their natural and community support systems and stakeholders throughout the state.

Discussion of North Carolina’s infrastructure and capability to receive, process and analyze Medicare data is addressed in Section F: Expected Outcomes.

i. Medicaid and/or Medicare rules that need to be waived The most important change to current policy will be the state plan amendment to allow

medical homes for nursing home residents. Other rule changes are subject of ongoing review and assistance from CMS.

ii. Plans to expand to other populations and/or service areas Phase 1 will focus on dual eligible beneficiaries residing in adult care homes and

nursing homes and beginning the culture change and education processes to move to Phase 2. With shared savings achieved in Phase 1, and implementation of Phase 2, all dual eligible beneficiaries will be included in the integrated delivery model’s independently assessed functional need-based need determination and resource allocation structure, access to medical homes. Those assessed need for support will have options for more flexible use of public funds to meet their needs and a growing array of options with regard to where and how they can acquire the supports needed to supplement their natural support systems’ capacity.

iii. Overall implementation strategy and anticipated timelinePhase 1 implementation activities target dual eligible beneficiaries at the very highest

risk for avoidable high cost care. Phase 1 implementation activities will be financed through (a) Medicaid medical home funding (b) support from CMS to cover one-time start-up and

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development expenses and (c) through continuation of current initiatives like the Chronic Pain and ESRD work underway and from which we can anticipate longer run Medicare shared savings.

Phase 2 implementation activities will implement integrated delivery model features that require the investment of resources in new ways. Phase 2 will be financed through a combination of Medicaid medical home funding and CMS Implementation support funding as noted for Phase 1, plus the application of a portion of Medicare shared savings resulting from Phase 1 to realign financial incentives and increase capacity to better meet beneficiaries’ goals. These Phase 2 activities will serve all dual eligible beneficiaries and further improve outcomes of this affordable, sustainable and replicable Integrated Delivery Model

Phase I ImplementationGoal: To establish an integrated beneficiary centered medical home and an integrated delivery model for dual eligible residents of North Carolina anchored in North Carolina’s successful Medicaid primary care medical home and population health management, managed fee-for-service infrastructure.

A. Foundational Elements of Integrated Delivery Model

1. Establishment of Tier 1 Medicaid financed medical homes for dual eligible residents of adult care (ACH) and nursing (NH) homes by April 2014:

a. By March 2013, apply hi-risk impactable use algorithms, medical home eligibility criteria and related targeting metrics to linked Medicare & Medicaid claims data to identify Tier 1 enrollee priority targets and communicate findings to regional CCNC Networks.

b. By April 2013, establish protocols for working with and communication materials designed for beneficiaries/legal representatives, facilities, attending physicians and other providers to identify potential Tier 1 medical home team members and establish expectations on topics specific to Tier 1 medical home supports including assessment, beneficiary goal-setting, medication review & reconciliation, transitional supports and advance directive/palliative care discussions.

c. By May 2013, test and refine protocols and work flows for assessment and enrollment of high-risk beneficiary residents with volunteer ACH and NH facilities in each Network.

d. By July 1, 2013, complete cross-training of regional Network care manager/assessors to activate Tier 1 medical home functions:

i. enroll beneficiaries and eligible Primary Care Providers in beneficiary-centered medical homes.

ii. meet with beneficiaries or their legal representative to conduct assessments, establish primary goals, activate Tier 1 medical home medication reconciliation and review and transitional supports, as appropriate.

iii. determine the existence of or interest in developing advance directives for use during physical and mental health events.

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2. Development of an independent functional need-based assessment and resource allocation process, to replace the Fl-when accrued savings become available for Phase 2 implementation in July 2014. Specific activities include:

a. cross-train care manager/assessors to activate Tier 1 medical home functions defined above in section 1.d.i. to iii., and to:

i. reliably administer a uniform assessment tool and communication processes,

ii. garner experience with independent assessment for needs determination and to gather functional assessment data for development of a functional needs-based allocation of resources methodology,

b. analyze functional assessment and linked claims data to develop and test needs determination algorithms and prepare preliminary virtual budget allocation estimates.

c. construct an electronic information system interface and execute data use agreements to enable integrated remote 24/7medical home team member access to ACH, NH and community dwelling beneficiaries’ status for needs determination and to acquire specific assessment, pharmacy and advance directive instructional data to be maintained in a data repository for use by appropriate care-givers and physicians.

3. Engagement of beneficiaries and other & stakeholders in no-cash-cost model development activities:

a. Establish statewide work groups to advise on continuing development of integrated model elements and measures of improvement, from the multiple stakeholders’ perspectives, to monitor and evaluate implementation and related training and learning opportunities for beneficiaries, caregivers and providers at all levels,

b. Develop and implement community-level educational/conversational programs to foster dialog between beneficiaries, caregivers and service and support providers regarding advance directives, including palliative care wishes, for use when mental or physical health crises preclude self-expression of care preferences,

c. Establish sub-state networks of beneficiaries and community stakeholders to help establish a common nomenclature and to encourage greater interaction and communication among beneficiaries, caregivers, providers and policy makers.

B. Documentation of Tier 1 medical home initiation impact, including quality/outcome improvements and concomitant Medicare and Medicaid savings:

1. By March 2013, test baseline and change-over-time data reports on quality indicators and claims-based factors for computing shared savings, using data definitions agreed upon with CMS in advance of implementation,

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2. By September 2013, test use of linked Medicare & Medicaid claims, and Provider Portal, CMIS related data to document:

a. physician actions based on medication reconciliation and review recommendations, rates of adverse drug reactions and medication missteps, and pharmacy charges at baseline and 6 month intervals post-enrollment in Tier 1 medical homes,

b. rates of potentially avoidable hospitalizations (for preventable, discretionary and futile admissions) among Tier 1 medical home enrollees receiving transitional supports in non-ACO/Community Care Transition Program Communities,

c. rates of non-emergent use of ambulance, emergency department and related professional services among Tier 1 medical home enrollees receiving medication reconciliation and transitional supports.

3. By January 2014, institute a monthly shared saving calculation with CMS and a reporting process to facilitate implementation of quarterly payments from them beginning July 2014, and develop a business case for the integrated Medicare/Medicaid funding of beneficiary centered medical home.

H. Feasibility and Sustainability i. Potential barriers/challenges and/or future State actions

Of particular concern are perceived and real limitations placed on providers wishing to participate in more than one CMS initiative simultaneously. These restrictions pose the threat that North Carolina’s dual eligible beneficiaries will have unequal access and choice in a two-tiered delivery system with provider dominant urban markets with restricted choices for dual eligible beneficiaries and less well-resourced collaborative, community-driven rural delivery systems. North Carolina will encourage continued development of multi-payer systems that can help bridge these concerns and advocate for urban/rural sensitive development of new approaches to the delivery of health care for all North Carolinians.

ii. Statutory and/or regulatory changes needed Offering medical homes to dual eligible beneficiaries who reside in nursing homes will

require a state plan amendment.

iii. New State funding commitments or contracting processes necessary Annual contracts are negotiated between the Division of Medical Assistance and CCNC

and priorities are defined based on identified opportunities to better manage the care of the enrolled population. Estimate of additional expenditures to offer medical homes to these beneficiaries have been developed and assurances provided that funding will be available for implementation activities to begin by January 2013, pending approval and support from CMS, formal agreements pertaining and shared savings. Additional contract modifications will be required for the implementation of Phase 2 ‘enhanced medical home PMPM’ and ‘enhanced capacity incentives’ based on achievement of savings in Phase I. Shared PMPM agreements between Networks and qualified providers will require development, review and approval during Phase 1, prior to implementation of Phase 2.

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iv. Scalability of the proposed model and its replicability North Carolina’s integrated delivery model is a statewide initiative that will begin with

pilot testing and rapid cycle learning in the implementation of each new protocol and workflow process. This approach has proven successful over the past 20 years of medical home development and can be expected to serve dual eligible beneficiaries and federal and state interests equally well. This development process will ensure that all the necessary processes and system changes are in place to support and sustain replication of the model.

In addition to sharing lessons learned with other States and jurisdictions, quarterly updates in the CCNC Toolbox and annual reports will be developed and disseminated. Recent Commonwealth Foundation support for development of the CCNC Toolbox and replication activity will serve as models for sharing North Carolina’s experience with other states.

I. CMS Implementation Support Budget: North Carolina’s budget request to support the implementation of this demonstration

is detailed in Appendix G. The areas of request include a. Program Staffb. IT infrastructure development and enhancementsc. Monitoring and Evaluation(Quantitative/ Qualitative Data Collection, Analysis

and Dissemination)d. Actuarial supporte. Marketing and outreachf. Communicationg. Staff travel

J. Additional Documentation:North Carolina Division of Medical Assistance will provide additional documentation,

as needed, upon CMS request.

K. Interaction with Other HHS/CMS InitiativesThe Partnerships for Patients, Action Plan to Reduce Racial and Ethnic Health

Disparities and Million Hearts Campaign embody the sorts of health promotion and educational programs that are fundamental to the collaborative approach underlying North Carolina’s Integrated Delivery Model. Relationships between these efforts and the Integrated Delivery Model have begun to emerge. In January 2012, the Integrated Delivery Model strategic framework was subject of a workshop discussion session at the NC Partnership for Patients’ Summit. This statewide gathering, co-sponsored by several partners to this work, including Community Care of North Carolina, the NC Division of Aging and Adult Services, brought together hospital and healthcare leaders, physicians, nurses, home and community-based long-term service and support providers and advocates and offered an early opportunity for strategic framework review and discussion of implementation with and among those who are working to meet the needs of dual beneficiaries in the midst of transitions. In addition, many Statewide Partners are already actively engaged in Partnership for Patients’ and Million Hearts Campaign educational activities across the state. We welcome CMS’ support in working with these and other initiatives as they evolve.

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