Affordable Care Act:Overview of Impacts on Medicaid

Marni Bussell

SIM Project Director, DHS

Lindsay Buechel

Communications Manager, IME

Introduction

• The Patient Protection and Affordable Care Act (ACA), also known as “Health Care Reform”, was signed into law on March 23, 2010.

o The law is complex and requires a significant amount of time and effort to plan and implement during the last 2 and coming year(s).

• There continues to be strong public policy debate on the lawo Supreme Court Decision o Strong efforts to repeal or change the law in Congress.

2

Affordable Care Act (ACA)• Key provisions take effect January 1, 2014

o Creation of Health Benefits Exchange/Health Insurance Marketplace Exchange is a “marketplace” to allow consumers to compare plan benefits

and price, provide consumer assistance, facilitate plan enrollment. Mandate for individuals to have insurance coverage; penalties for large

employers who don’t offer insuranceo Option for Medicaid expansion to 133% of the Federal Poverty Level (FPL)

2013 133% FPL: Household of 1: $15,282 Household of 4: $31,322

• Other provisions with various implementation dateso Mandatory Iowa Medicaid Enterprise (IME) operational changes to ensure ACA

complianceo Optional opportunities to improve or re-balance health care programs

3

State Innovation Model Grant

4

The problemChronic disease drives costs

5

Members Costs0%

20%

40%

60%

80%

100%

5%

48%15%

29%80%

23%

Chronic Care Within Medicaid

Top 5% Next 15% Bottom 80%

Top 5% High Cost/High Risk Members* Accounted for:

• 90% of hospital readmissions within 30 days• 75% of total inpatient cost • Have an average of 4.2 conditions, 5 physicians, and 5.6

prescribers• 50% of prescription drug cost• 42% of the members in the top 5% in 2010, were also in

the top 5% in 2009

*Excludes Long Term Care, IowaCare, Dual Eligibles, and maternity

6

Why change?• Health care delivery system is fragmented• Reimbursement methods reward volume not

value• Cost of health care is unaffordable and

unsustainable for citizens and taxpayers• We need to increase quality/outcomes & lower

cost

7

What is Medicaid’s role in Delivery Reform?

• Medicaid relies on the same health care system as all others to deliver care to our covered members

• Medicaid uses very similar payment and contracting methods

• Whatever is driving the rest of the health care system is also driving Medicaid

• Medicaid is a significant payor - 2nd largest payor, covers 23% of Iowans

8

9

Iowa Health and Wellness Plan Background

• Begins January 1, 2014

• Iowans age 19 - 64

• Income up to and including 133% of the Federal Poverty Level (FPL)

• New, comprehensive program will replace the IowaCare program, ending December 31, 2013

The Iowa Health and Wellness Plan was enacted to provide comprehensive health coverage for low-income adults

10

Iowa Health and Wellness Plan

• The Iowa Health and Wellness Plan must receive approval from the federal government

• DHS is working to obtain approval

• Some program details may still change as we work with federal officials

11

One Plan, Two Options

Iowa Wellness Plan• For adults age 19 - 64• Income up to and including 100% of the Federal Poverty Level

Marketplace Choice Plan• For adults age 19 - 64• Income 101% to no more than 133% of the Federal Poverty Level

12

Iowa Wellness Plan: 0-100% FPL

Family of one

$11,490

Family of two

$15,510

Individuals up to

100% FPL

Patient Manager (PM) BenefitsPayment Performance

Fee for Service or Encounter Based Fee

Claim submission

Administrative Fee $4.00 Per Member-Per Month

Wellness Exam Incentive $10.00 Per Member Annually if Threshold Achieved

Up to $4.00 Wellness Plan Medical Home Value Index Score (VIS) Bonus

Per Member Quarterly if Quality Target Achieved

14

Iowa Wellness Plan: 0-100% FPLProgram innovations include:

• Ensure coordination of care for members through‘medical homes’

• Ensure health care providers are accountable forachieving high quality and cost effective

care thatis focused on the patient

Program innovations will continue to be developed through a statewide planning process related to the State Innovation Model* grant

*Go to http://www.ime.state.ia.us/state-innovation-models.html for more information

ACO Option• Medicaid may contract with Accountable

Care Organizations • ACO can earn the wellness exam and

medical home bonus for attributed population

• By Year 3: the Wellness ACO option will likely be replaced with the SIM initiative to develop a state-wide, full Medicaid ACO program.

State Innovation Model (SIM)• Grants available to Governors

from the Centers for Medicare and Medicaid Innovation

• 2 tracks: Design (Iowa) or testing

• Provides funding for developing State Health Care Innovation Plan

• Iowa’s Plan will be complete by January

• Will apply for Testing funds

2013 Design: State Health Care Innovation Plan

2014 Testing: Application for funds / authority to test

2016? Implementation

16

State Health Care Innovation Plan“Vision”

Vision: Transform Iowa’s health care economy so that it is affordable and accessible for families, employers, and the state, and achieves higher quality and better outcomes for patients.

•Patient-focused

•Accountability

• Aligned Quality Strategies

•Economically Sustainable

•Workforce

17

Iowa State Innovation Model Plans

Improve value and align payment models Valued based payment reform Organized, coordinated delivery systems Build on developing health homes / medical homes Align payors to provide ‘critical mass’ to support needed investments in change

18

* ‘Accountable Care Organizations’ are a reimbursement method that incents accountability for outcomes and lowers costs

•Strategy 1: Implement a multi-payer ACO* methodology across Iowa’s primary health care payers

•Strategy 2: Expand on the multi-payer ACO methodology to address integration of long term care services and supports and behavioral health services

•Strategy 3: Population health, health promotion, member incentives

Goals of Iowa Wellness Plan• Begins to implement SIM Strategy 1 and 3

in the Wellness Plan– Implements medical homes and ACOs– Health Incentives for members to engage in

Healthy Behaviors• Based on local access to care• Focus on health and improved outcomes• Emphasis on care coordination

2/13/2012 19

Iowa Wellness Plan Reforms• Iowa will pay incentives to physicians and ACOs

for achieving quality metrics consistent with Wellmark metrics

• No claims history so starting with incentives and will move to shared savings for ACOs

• Provides starting point to begin and learn, and will eventually be merged under larger Medicaid SIM designs

2/13/2012 20

21

Iowa Wellness Plan: 0-100% FPL

Out of Pocket Costs:

• No copayments except for using the emergency room when it is not an emergency

• No monthly contributions during the first year (2014)*

• No contributions for those with income below 50% FPL*

• Costs cannot exceed 5% of income *Monthly contributions subject to CMS

approval

22

Iowa Wellness Plan: 0-100% FPL

Monthly contributions* waived beginning in 2015 if the member completes wellness activities

First year (2014) members need to complete health risk assessment and wellness exam (annual physical)• 2015 and beyond will also

other wellness activities

*Monthly contributions subject to CMS approval

23

Marketplace Choice Plan: 101-133% FPL

Family of one

$11,491-$15,282

Family of two

$15,511-$20,628

Individuals 101% FPL

up to133% FPL

24

Marketplace Choice Plan: 101-133% FPL

Members select a certain commercial health plan available on the Health Insurance Marketplace

Medicaid pays the premiums to the commercial health plan on behalf of the member –often referred to as “premium assistance”

25

Marketplace Choice Plan: 101-133% FPL

Innovation: Purchasing private coverage

Allows individuals to stay enrolled in their current plan if their income changes

26

Application Process

APPLICATION

PROCESS

DHS websitewww.dhs.state.ia.

us

Federal Health Insurance

Marketplacewww.HealthCare.go

v

DHS Contact Center

1-855-889-7985

Stronger Primary Care

(PCP/MH)

Stronger Care Management (Health Home

(Chronic Condition & SPMI & BIPP)

Stronger Home and Community Based Services (through BIPP)

Stronger Mental Health System

(Through Redesign Efforts)

SIM Development

Phase I: H&W Population

Phase II: Full Medicaid , Statewide

ACO Regions

Phase III: Fully Defined

LTC and Behavioral

health Accountability

Iowa Health & Wellness Builds PCP Capacity &

Entry Point for New Population

Incentivizes Medical Home

Concepts, Prepares for ACO models

Sustainability through SIM Development

, and Multiplayer Alignment

Current St

ate:

Mostly FFSUnmanaged CareSilos of Care DeliveryLimited AccessVolume Based Purchasing

Future State:

Value Based PurchasingClear Accountability Integrated Care DeliveryAlignment in Measures and AnalyticsData are timely and Secure

27

Stakeholder Process• Workgroups met June – September, 2013

• Metrics and Contracting• Member Engagement• Long Term Care Integration• Behavioral Health Integration

• Two Consumer Focused Workgroups (October)• Recommendations to Steering Committee,

October 30, 2013• Review and seek guidance from Legislative

Subcommittee in November 201328

SIM Organizing Principles for Transformation

Areas of Recommendation Across all Workgroups:

• Care Coordination/Community focus• Communication/Technology• Regulatory• Financing• Measures/data Transparency• Provider Supports• Patient Supports• Access/Benefits

• Dedicated and consistent leadership

• Collaboration and open communication

• Clarity in accountability

• Transparency in Data• Alignment in measure

and analytics

29

IowaCare Transition

IowaCare Transition

• IowaCare will end on December 31, 2013• Current members will continue to have

same access to services until the program endsoContinue to seek care at medical home

IowaCare Transition

• Current members will not be cancelled unless:o Premiums are not paidoGet other health insuranceo Turn 65oMove out of the state

IowaCare Transition• DHS re-evaluated the decision that all

IowaCare members will have to go through the full application process and will: o Centrally verify the income of all IowaCare

memberso `Administratively transfer` qualifying

members into the Iowa Health and Wellness Plan

IowaCare Transition• DHS must verify income in order to

`administratively transfer`• Members who cannot be verified or

whose income exceeds the Iowa Health and Wellness Plan limits will be instructed to proceed to the full application process

IowaCare Transition• The verification/transfer process will take place by the

end of October• Members whose verified income indicates eligibility for

Iowa Health and Wellness will receive confirmation of eligibility and will proceed to enrollment for physician selection, or qualified health plan selection

• Members whose income cannot be verified or cannot be transferred, or have income too high for the program will receive an additional letter instructing them to proceed to HealthCare.gov

IowaCare Transition

• Iowa Medicaid will:o Send letters to each IowaCare member before

October 1 notifying them of this change in the verification/transfer process

oCoordinate with medical homes on outreachoReach out to members multiple times to make

sure they are aware of transition

Questions?

Marni Bussell

SIM Project Director

Iowa Medicaid Enterprise

mbussel@dhs.state.ia.us

515-256-4659

Lindsay Buechel

Communications Manager

Iowa Medicaid Enterprise

lbueche@dhs.state.ia.us

515-974-3009

37