Purchasing Strategies to Improve Care Management for Complex ...

Purchasing Strategies toImprove Care Managementfor Complex Populations: A National Scan of State Purchasers

Funded through the Robert Wood Johnson Foundation.

www.chcs.org

Center for Health Care Strategies, Inc.CHCS

By Melanie Bella, Chad Shearer, Karen LLanos,and Stephen A. Somers

March 2008

11833:11833Biddle_1 3/19/08 10:15 AM Page 2

© 2008 Center for Health Care Strategies

M. Bella, C. Shearer, K. LLanos and S.A. Somers, “Purchasing Strategies to Improve Care Management for Complex Populations: A National Scan of StatePurchasers.” Center for Health Care Strategies, Inc., March 2008.

This report is part of CHCS’ Medicaid Best Buys series developed to help states,health plans, and policymakers identify programs that have the greatest potentialto improve health care quality and control health care costs for high-risk beneficiar-ies. The series, made possible through support from the Robert Wood JohnsonFoundation, provides policy recommendations and technical resources to guideprogram development and implementation.

About the Center for Health Care Strategies The Center for Health Care Strategies (CHCS) is a nonprofit policy resource centerdedicated to improving health care quality for low-income children and adults, people with chronic illnesses and disabilities, frail elders, and racially and ethnicallydiverse populations experiencing disparities in care. CHCS works with state and federal agencies and health plans to develop innovative programs that better servepeople with complex and high-cost health care needs. For more information, visitwww.chcs.org

MEDICAID BEST BUYS

11833:11833Biddle_1 3/18/08 4:57 PM Page 3

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

Characteristics of States and Stakeholders Interviewed . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

Study Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

New Delivery System Models . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Financing and Risk Adjustment Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14

Performance Measurement Approaches . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

Conclusion: Considerations for States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

Appendices

Appendix 1: Systems of Care for ABD/SSI Beneficiaries in Scan States . . . . . . . . . . . . . .23

Appendix 2: Selected Financing Mechanisms for Systems of Care for ABD/SSI Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26

1

Table of Contents

Purchasing Strategies to Improve Care Management for Complex Populations: A National Scan of State Purchasers

11833:11833Biddle_1 3/19/08 4:45 PM Page 4


2

AcknowledgementsWe are grateful for ongoing support from the Robert Wood Johnson Foundation for fosteringand disseminating innovation in Medicaid. Jim Hardy, Sellers Feinberg, deserves credit forplanting the seeds for this inquiry while he was Pennsylvania’s Medicaid Director and for hismore recent guidance in helping us frame this study at the outset. The authors would also like tothank the Medicaid officials in the 12 scan states, as well as the managed care and disease man-agement vendors whom we interviewed, for sharing their experiences in creating programs foradults with chronic illnesses and disabilities. We applaud the ingenuity of these states and con-tractors for exploring new avenues and leverage points to enhance care management for peoplewith complex needs.

11833:11833Biddle_1 3/18/08 4:57 PM Page 5


Executive Summarys an experienced observer of Medicaidmight say, “States don’t sit still. They

can’t.” Constantly being driven byGovernors, legislatures, and advocates toprovide the best health care value for thetaxpayer dollar, Medicaid leaders are alwaysseeking better ways to care for their benefici-aries. In particular, many Medicaid leadersare currently looking for ways to improve themanagement of services for those beneficiar-ies whose care accounts for most ofMedicaid’s expenditures. Some recognizethis strategy as a variant of the Willie Suttonprinciple: when asked why he robbed banks,Sutton would reply: “because that’s wherethe money is.” In a number of early innova-tor states, the aged, blind and disabledand/or Supplemental Security Income(ABD/SSI) populations have long beenenrolled in full-risk managed care — withsome documented successes, according toindependent assessments (e.g., Maryland,Pennsylvania, Texas).1 But not every statehas the capacity, the managed care infrastruc-ture, or the political wherewithal to jumpdirectly from unmanaged fee-for-service(FFS) to full-risk managed care for the entirestate or even in select regions. Some statesmay never be able to implement fully capi-tated models for ABD/SSI beneficiaries, butrealize that leaving these beneficiaries inpure FFS represents a missed opportunity: toimprove care, bend cost trends, and poten-tially free up resources to expand coverage.

A Over the past 12 months, the Center forHealth Care Strategies (CHCS) has gath-ered information on innovative approachesto caring for adults with chronic illnessesand disabilities that could represent signifi-cant advances from FFS without putting allof Medicaid’s eggs in the full-risk basket.We undertook this environmental scanboth to guide our own work and, moreimportantly, to get these alternative pur-chasing strategies into the public domain sothat as many Medicaid stakeholders as pos-sible could benefit. We spoke withMedicaid officials and their current andpotential care management partners in 12states: California, Indiana, Minnesota,Mississippi, New York, North Carolina,Oklahoma, Pennsylvania, Rhode Island,South Carolina, Texas, and Washington.Many of the ideas we have captured andchronicled herein sound very promising and— just as important — very doable in statesacross the country.

This environmental scan demonstratesonce again that states are laboratories ofinnovation and that sometimes the best lab“scientists” can get better results by workingclosely with industry partners specializing inserving ABD/SSI populations — fromadministrative service organizations to dis-ease management entities and others thatare moving away from a single-disease focus

3

1 HealthChoice Evaluation: Final Report and Recommendations, Maryland Department of Health and Mental Hygiene, January 15, 2002. Available at: http://www.chpdm.org/publications/HealthChoice%20Evaluation%20-%20January%202002.pdf; Comparative Evaluations of Pennsylvania’s Health Choices Program and Fee-for-Service Program, The Lewin Group, May 2005. Available at: http://www.lewin.com/NR/rdonlyres/8B133C09-83F9-438B-B752-086AD9B04684/0/3178.pdf; STAR+PLUS Medicaid Managed Care Waiver Study: An Independent Assessment of Access, Quality, and Cost-Effectiveness, Texas A&M Public Policy Research Institute, October 1999. See also: Medicaid Managed Care Cost Savings – A Synthesis of Fourteen Studies, The Lewin Group, July 2004. Available at: http://www.ahipresearch.org/pdfs/MedicaidCostSavings.pdf.

11833:11833Biddle_1 3/19/08 4:45 PM Page 6


to high-touch care management programs foradults with multiple needs. A number of keythemes emerged from our conversations.Most important, we found these states andpartners to be universally dedicated to mov-ing beyond purely FFS or full-risk models.The new models being developed by statesembody a core set of care management ele-ments that are not unlike those of traditionalmanaged care but give states different“levers” to achieve accountability for bothquality and cost. Some of these levers, par-ticularly in the financing and performancemeasurement arenas, are still evolving.

In sum, what we uncovered by opening thelaboratory doors was a series of increasinglysophisticated approaches by Medicaid pur-chasers and their contractors alike to usealternatives to FFS and full-risk managedcare. This is, by definition, a mid-coursescan because these alternative purchasingstrategies will continue to evolve as statespursue further improvements in care andcost effectiveness for the complex popula-tions consuming a majority of their healthcare resources.

4

11833:11833Biddle_1 3/19/08 2:30 PM Page 7


riven by a desire to provide better caremore cost-effectively, Medicaid stake-

holders are increasingly focusing attentionon beneficiaries in the aged, blind and dis-abled (ABD) and/or Supplemental SecurityIncome (SSI) eligibility categories. Lessthan 15 percent of Medicaid beneficiariesaccount for over 75 percent of programexpenditures, and fewer than four percent ofbeneficiaries account for nearly 50 percent ofcosts (see Figure 1). The majority of thesebeneficiaries are in the ABD/SSI population,often with multiple physical, behavioral, andsocial needs, yet they often lack access to sys-tems of care that offer better coordinationand integration.

Across the country, the majority of ABD/SSIbeneficiaries receive care in the fragmented,uncoordinated, and often difficult to navi-gate fee-for-service (FFS) health care system.States have begun to recognize that FFS pro-vides limited opportunities to improve quali-

5

Introductionty for adults with a complex array of healthcare needs. As a result, states are exploringand implementing new systems of care thataddress the gamut of medical, behavioral andsocial needs and provide a greater level ofoperational, clinical, and financial accounta-bility.

This report presents findings from interviewswith 12 Medicaid programs and related con-tractors on emerging systems of care forABD/SSI beneficiaries.3 The models in thestates interviewed vary in scope and eligiblepopulations and fall somewhere between FFSand a fully capitated managed care environ-ment. While there may be some financialrisk involved, these new models are not fullycapitated programs. As such, understandingthe “levers” that states and their contractors(e.g., health plans, disease management enti-ties, and administrative service organiza-tions) can exercise to improve care andensure accountability is critically important.

Combinations of different purchasing strate-gies to support various systems of care withinstates are not uncommon. Some statesinclude ABD/SSI beneficiaries in programsthat are available to all Medicaid eligibilitygroups, while others have developed pro-grams solely for ABD/SSI beneficiaries.Some states may have a single option, e.g.,disease management for adults with complexneeds within an existing FFS or primary carecase management (PCCM) structure. Otherstates, depending on regional characteristicsand constraints, may offer a mix of fully capi-tated managed care, PCCM, and FFS.

$10,000+

$8,000

$6,000

$4,000

$2,000

$0

Tota

l Per

Cap

ita

Co

sts

Percent Medicaid Population

0 10 20 30 40 50 60 70 80 90 100

Figure 1: Per Capita Medicaid Spending

D

2 Sommers A. and Cohen M. Medicaid’s High Cost Enrollees: How Much Do They Drive Program Spending? Kaiser Family Foundation, March 2006. Available at: http://www.kff.org/medicaid/upload/7490.pdf.

3 Although dual eligibles are part of the ABD population, because they get most of their medical care from Medicare, this scan does not focus on care models for dual-eligible beneficiaries. We should note, however, that Medicare is also experimenting with comparable models of chronic care/disease management for some ofits FFS beneficiaries, e.g., the Care Management for High-Cost Beneficiaries Demonstration.

Source: Sommers A. and Cohen M. Medicaid’s High Cost Enrollees: How Much Do TheyDrive Program Spending? Kaiser Commission on Medicaid and the Uninsured, March 2006.

11833:11833Biddle_1 3/18/08 4:57 PM Page 8


6

The states examined in this scan areemploying a broad range of optionsbetween FFS and fully capitated man-aged care to improve care for ABD/SSIbeneficiaries (Figure 2). The findings inthis report provide states with a frame-work of the key components, as well asconsiderations, for designing and imple-menting care models for adults withcomplex needs. Intervention design,financing mechanisms, performancemeasurement techniques, risk distribu-tion, and provider and vendor contractterms vary substantially within andacross states, but the following keythemes emerged from the interviews:

1. There is considerable momentumamong the states to move beyondfee-for-service to provide more coor-dinated care approaches for subsets ofthe population that offer substantialopportunities for improving qualityand controlling costs.

2. States are developing alternativefinancing mechanisms for providersand contractors that include sharedrisk, shared savings, and pay for per-formance.

3. Measuring clinical and non-clinicalaspects of care management programscan be difficult, but states havebegun to develop and test moreappropriate performance measure-ment and monitoring strategies.

Characteristics of States andStakeholders InterviewedThe 12 states highlighted in this report(California, Indiana, Minnesota,Mississippi, New York, North Carolina,Oklahoma, Pennsylvania, Rhode Island,South Carolina, Texas, and Washington)are all implementing an array of approachesbetween FFS and fully capitated managedcare. All states interviewed have at leastone program that targets ABD/SSI benefi-ciaries for some type of care managementintervention. Some states have multiplesystems of care for this population, offeringfull-risk managed care in geographic areaswhere it is available and variations onPCCM or FFS in other regions. A numberof states interviewed have developed or areexploring new approaches tailored to thehighest-need, highest-cost subsets of bene-ficiaries.

We also interviewed selected contractors inthe scan states: CA-Inland Empire HealthPlan and Partnership HealthPlan; IN-SchallerAnderson, Inc; MN-AXIS Healthcare; NY-Affinity Health Plan; PA-McKesson HealthSolutions; RI-Neighborhood Health Plan ofRhode Island; SC-South Carolina Solutions;TX-Amerigroup Texas, Inc.; and WA-MolinaHealthcare of Washington. These organiza-tions were interviewed because of their expe-rience and perspectives on serving adults withspecial needs, including a number with partic-ular experience in offering partial risk and/ornon-capitated products.

Financing Options

Primary Care Case Management, Administrative Service Organizations, etc.

Alternative Models

Care Management ApproachesDisease Management; Chronic Care Management;

Medical Home

Fee for

Service

Full-RiskManaged

Care

Figure 2: Systems of Care

11833:11833Biddle_1 3/19/08 3:01 PM Page 9


7

New Delivery System Models

States are increasingly recognizing opportuni-ties to test alternative purchasing strategiesthat offer more accountability than tradition-al FFS. While the scan states are piloting adiverse mix of options that fall betweenunmanaged FFS and fully-capitated managedcare, all share a common goal: to improvecare management for populations withchronic and complex health care needs. Thisnew generation of care management pro-grams seeks to improve coordination of carewhile providing cost-effective, non-duplica-tive services. Aligning incentives and build-ing accountability are important considera-tions in these models since they do not havethe same clinical and financial “levers” asfully capitated models.

The alternative strategies being employed bystates go by many different names — diseasemanagement, primary care case management,enhanced primary care case management,medical home, chronic care management,etc. — but all share common components.The following section describes how statesare defining populations and designing tai-lored care management approaches. The sec-tion also discusses factors that influence stateprogram design decisions regarding these keycomponents. Financing and measurement arediscussed in later sections.

Identifying and Stratifying thePopulationScan states are using a variety of approach-es to identify and stratify beneficiaries tobetter understand their needs, prioritize risk

levels, and design systems of care to bestmeet those needs. Identification approachesmay include or exclude beneficiaries basedon aid category, illness, disability, severity,risk, cost, or some combination of these fac-tors. States generally rely on prior claimsdata to help identify target populationsbecause claims are readily available and rela-tively easy to use. Claims can provide infor-mation on beneficiaries’ conditions, comor-bidities, service utilization, specific patientencounters (e.g., emergency room visits), andexpenditures. While claims provide a wealthof data, they may not contain the depth ofdiagnosis and comorbidity information opti-mal for identifying beneficiaries who aremost likely to benefit from more intensivecase management. States are also applyingpredictive modeling techniques to analyzeprior claims to identify beneficiaries at riskfor high future utilization/expenditures. Thefollowing examples highlight variousapproaches used by states to identify targetpopulations.

• Rhode Island: In the Connect CareChoice program, the state identifies allSSI, severely and persistently mentally ill(SPMI), and developmentally disabled(DD) beneficiaries and excludes institu-tionalized and dual-eligible beneficiaries.The state then uses claims data to generatemoderate- or high-risk scores to identifythe target population.

Study Findings

Theme 1: There is considerable momentum among the states to move beyondfee-for-service to provide more coordinated care approaches for subsets of thepopulation that offer substantial opportunities for improving quality and con-trolling costs.

11833:11833Biddle_1 3/18/08 4:57 PM Page 10

duct initial non-clinical health screens atthe point of enrollment and many requirephysicians or contractors to conduct morein-depth clinical health assessments within90-120 days after enrollment into a pro-gram. The information gathered throughthese types of tools is essential for creatingcare plans for ABD/SSI beneficiaries.


• Oklahoma: The state uses commerciallyavailable predictive modeling software toidentify high-cost beneficiaries for itsHealth Management Program. The statefirst excludes dual-eligible, institutional-ized, and home- and community-basedwaiver beneficiaries and then uses thesoftware to identify the top 5,000 benefi-ciaries with chronic conditions with thehighest predicted future costs.

• Texas: The Integrated CareManagement program is using predictivemodeling to identify a target populationof beneficiaries who are likely to incurfuture high costs. The state is also iden-tifying beneficiaries who are at high riskof developing a chronic illness or itscomplications, and/or who are at risk ofincurring high costs in the future.4

After identifying the target population,states or their contractors may further strat-ify the population into subgroups to tailorintensive interventions to an even smallersubset of the population. In the Oklahomaexample, the 5,000 beneficiaries identifiedfor the Health Management Program aredivided into two tiers. The state uses thesame predictive modeling software to iden-tify the top 1,000 highest predicted costbeneficiaries for Tier 1, leaving the remain-ing 4,000 beneficiaries in Tier 2.Beneficiaries in Tier 1 receive in-personnurse care management services and self-management education, while Tier 2 bene-ficiaries receive less intensive services fromnurse care managers based in a call center.

Stratification can also take place after thetarget population is enrolled in a caremanagement program. Most of the statesinterviewed are using health screens toassess beneficiary needs. Some states con-

8

4 The Texas Integrated Care Management Program began enrollment in December 2007; services began in February 2008. For more information, see Request for Information Health Management Program Texas Medicaid RFI 529-07-0178, Texas Health and Human Services Commission, August 1, 2007. Available at: http://www.hhsc.state.tx.us/contract/529070178/HealthMgmt_RFI_080107.pdf.

5 RFS-7-62 Indiana Care Select Program, Attachment D: Scope of Work, State of Indiana Department of Administration on behalf of Indiana Family and Social Services Administration. Available at: http://www.indianamedicaid.com/ihcp/CareSelect/content/documents/62attd.pdf.

Initial Health Screening/Assessment inIndiana

Indiana requires that its Care Select program con-tractors (care management organizations [CMOs])use an initial health screen to ensure that newlyenrolled beneficiaries who need care managementare connected to the appropriate services. Thescreening tool, which is completed by the benefici-ary, is designed to identify:

• Participation in waiver programs;• Behavioral health history/mental health status;• Recent emergency department use;• Ability to perform activities of daily living;• Durable medical equipment needs; and• Current medications.

Care Select vendors send new enrollees the healthscreening tool within 30 days of enrollment into theprogram. Incentives are used to motivate CMOs tofollow-up with enrollees who have not completedinitial health screens. CMOs can receive a perform-ance payment equal to two percent of their caremanagement fee if they submit completed healthscreens for at least 70 percent of their assignedmembership by the end of the first quarter; 80 per-cent by the second quarter; 90 percent by the endof the third quarter; 95 percent by the end of thefourth quarter; and 95 percent for every quarterthereafter.5 These incentives are part of Indiana’sbroader two-prong incentive program in which 20percent of the care management fee is withheld toencourage CMOs to meet specified performancetargets.

11833:11833Biddle_1 3/18/08 4:57 PM Page 11

Care Management ApproachesOnce identified, beneficiaries are enrolledin an array of different care managementprograms that vary by state depending ontarget population, state capacity, provideravailability, and other factors. Some states(e.g., Mississippi, California, and NewYork) are using disease managementapproaches that go beyond a single diseasefocus to provide more comprehensive caremanagement for beneficiaries with targetedchronic conditions. Other states (e.g.,North Carolina, Oklahoma, and Indiana)are using their PCCM or “enhanced” pri-

mary care case management (EPCCM) pro-grams as the base to develop medical homesthat target more comprehensive care man-agement services for complex populations.6

Still others (e.g., Pennsylvania, Texas,Rhode Island, South Carolina, andWashington) use multiple programs includ-ing some fully-capitated managed careoptions to provide services to high-risk bene-ficiaries. These systems of care may differ instructure, but they all share the common ele-ment of connecting beneficiaries with a ven-dor or provider that tailors care managementto meet the needs of the population.


9

6 Note: The remainder of the document does not distinguish between PCCM and EPCCM programs unless describing a program that is defined by its state specifically as EPCCM.

Multiple Strategies in the Keystone State

Pennsylvania uses multiple purchasing strategies to tailor programs to the careneeds of ABD/SSI beneficiaries in different geographic areas. Enrollment in thestate’s HealthChoices managed care program is mandatory for the ABD/SSI popu-lation in 25 counties. In another 27 counties ABD/SSI beneficiaries can choosebetween full-risk managed care plans or the ACCESS Plus EPCCM program. In theremaining 15 counties, participation in the EPCCM program is mandatory in FFS.Dual-eligible adults and nursing home residents are exempt from mandatory enroll-ment throughout the state.

The state also offers both traditional disease management and more comprehen-sive care management interventions for qualified beneficiaries. Adults in both theEPCCM and FFS programs are eligible to enroll in a traditional disease manage-ment program, which is operated by a vendor. The vendor provides telephonic dis-ease management services for beneficiaries with five prevalent chronic conditions:asthma, coronary artery disease, chronic heart failure, chronic obstructive pul-monary disorder, and diabetes. High-need beneficiaries in the EPCCM programwith multiple chronic conditions or serious mental health comorbidities are target-ed for significantly higher levels of care management and care coordination provid-ed by a state-run Intensified Medical Case Management unit.

11833:11833Biddle_1 3/18/08 4:57 PM Page 12

State “Medical Home” ProgramsMany of the programs outlined in thisreport focus on strengthening the relation-ship between primary care physicians andtheir patients, often describing programs asmedical home models. Four national physi-cian organizations have developed a con-sensus definition of medical home as “ahealth care setting that facilitates partner-ships between individual patients, and theirpersonal physicians, and when appropriate,the patient’s family.”7 While this definitiongarners widespread support, states, healthplans, physicians, and vendors are seekingthe best ways to build on the medical homeconcept to improve beneficiary outcomesfor the ABD/SSI population and injectaccountability into the system. Many of thestates interviewed, including Indiana,Minnesota, North Carolina, Oklahoma,Rhode Island, and South Carolina, haveembraced the concept of “medical homes”that provide beneficiaries with all primarycare services and specialty and hospitalreferrals (see facing page sidebar for variousstate strategies). Their experiences will addsignificantly to the discussion on howstates can link external care managementresources with community based care man-agement and medical home initiatives.

Strategies to Enhance Care ManagementStates are using a number of alternativestrategies to enhance the care managementconnection among beneficiaries, providers,and contractors. For example, health infor-mation technology (HIT) can facilitatestronger stakeholder connections through

the sharing of clinical information toimprove care planning and management.In North Carolina, the state developed aweb-based Case Management InformationSystem that gives providers access to diag-nosis and utilization data. Stakeholdersincluding case managers, Community CareNetworks, and providers can use the data toidentify enrollees for targeted care manage-ment, track interventions, assess adherenceto evidence-based guidelines, and reviewclinical outcomes and changes in utilizationpatterns.

Washington’s Chronic Care Managementpilot program calls on one of its contractorsto support the provider’s role in the chroniccare process by entering enrollee-specificdata directly into the provider’s informationsystem or directly into the enrollee’s med-ical record. The contractor is also requiredto meet with providers on a weekly orbiweekly basis as necessary, and obtainprovider approval on patient care plans toensure they complement the provider’streatment plans.8

Select states are also using financial incen-tives to accelerate the adoption of healthinformation technologies that can facilitatemore effective care management acrossproviders and contractors. New York, forexample, is offering grants to Medicaidproviders to purchase electronic healthrecords if they agree to collect medicationhistory, patient visit history, demographics,procedure and diagnosis data, and clinicaldata for all Medicaid beneficiaries.9


10

7 Joint Principles of the Patient-Centered Medical Home, American Academy of Family Physicians (AAFP), American Academy of Pediatrics (AAP), American College of Physicians (ACP) and American Osteopathic Association AOA), March 2007. Available at http://www.medicalhomeinfo.org/Joint%20Statement.pdf.

8 Request for Proposals # HRSA/OCC-0106, Washington Chronic Care Management Project, Washington Department of Social and Health Services, Health and Recovery Services Administration, July 2006. Available at: http://www.chcs.org/usr_doc/Chronic_Care_Management_Project_RFP.pdf.

9 Request for Grant Applications HEAL NY Phase 5 Health Information Technology Grants, Section 7.1: Interoperable Electronic Health Records (EHRs) Use Cases, New York State Department of Health and The Dormitory Authority of the State of New York, September 2007. Available at: http://www.health.state.ny.us/funding/rfa/0708160258/.

11833:11833Biddle_1 3/18/08 4:57 PM Page 13


11

10 Connect Care Choice Provider Participation Standards Agreement (provided by the state during the interview process).

Medical Home Models in Three States

States are implementing a variety of medical-home type models that seek to intensify the connection betweenMedicaid beneficiaries with complex needs and their providers. Following are three state approaches to establish-ing medical home models that provide an enhanced level of services for high-risk target populations:

North Carolina: Early Adopter of the Medical Home ModelCommunity Care of North Carolina (CCNC) is an EPCCM program built on the tenets of the medical home model.It enrolls approximately 35 percent of the ABD/SSI population and includes core care management elements suchas risk assessment, emergency room utilization review, disease specific case management, and pharmaceuticalmanagement. These care management strategies are delivered through 14 participating Community CareNetworks, which consist of more than 3,000 physicians and numerous community support services. North Carolinais also piloting a Chronic Care Project for its highest-risk, highest-cost ABD/SSI beneficiaries with complex needs.The pilot program uses nine of the 14 Community Care Networks to provide enhanced medical home services(e.g., intense case management and interdisciplinary care plans) through the use of care coordinators.

Rhode Island: Connect Care Choice Medical Home Model The state of Rhode Island developed the Connect Care Choice PCCM program to provide care management serv-ices for a high-risk subset of ABD/SSI beneficiaries. The program targets beneficiaries with moderate- to high-riskscores for intensive nurse care management delivered through participating primary care provider’s (PCPs) offices.The state requires participating PCPs to meet what it defines as “advanced medical home” criteria that include:

• Partnering with patients to ensure all of their health care is effectively managed and coordinated.• Incorporating the “Chronic Care Model” to work with chronic disease patients to help them manage their own

condition and prevent avoidable complications by providing well and preventive visits, self-management sup-ports, and education.

• Using a chronic care coordination team that includes a dedicated nurse care manager, either in the practice oravailable to the practice, who is linked to community supports.

• Linking to behavioral health providers for beneficiaries with co-occurring conditions; providing screening, referral,and ongoing coordination.

• Adopting e-prescribing, e-billing, and computerized evidenced-based clinical decision guidelines at the point ofcare.10

South Carolina: Role of Contractors in the Medical HomeThe Medical Homes Network Program in South Carolina connects each beneficiary with a primary care physician whois part of a network managed by a Care Coordination Services Organization (CSO). CSOs provide disease manage-ment, care coordination, and data management services to help physicians function as medical homes. The CSOs also have a direct link with beneficiaries, providing consumer education on missed primary care appoint-ments and appropriate emergency room utilization and engaging beneficiaries in the care management process.Through the emergency room “high flier” program, CSOs contact beneficiaries who have visited the emergency roommore than twice in the previous three months, offering education about effective primary care use and linkages toadditional services to help avoid future emergency room visits. CSOs also provide high flier information to primarycare physicians. South Carolina reports that the program has been a leading factor in the approximate nine percentreduction in the number of emergency department claims for the state’s Medicaid population from 2003 to 2006.

11833:11833Biddle_1 3/18/08 4:57 PM Page 14

States are also incorporating other non-financial elements to help providers caremore effectively for complex needs popula-tions. These include:

• Provider education, e.g., evidence-basedguideline education in Washington’sChronic Care Management Program;

• Performance feedback, e.g., process, out-come and cost feedback for physicians inthe Community Care of North Carolinaprogram;

• Care manager resources, e.g., state con-tracted nurse care managers for smallpractices in Rhode Island’s Connect CareChoice program; and

• On-site quality improvement training,e.g., practice site facilitators in Oklahoma(see Innovative Practice Supports sidebar).

California is attempting to address many ofthese provider supports in its proposedChronic Care Management Program. Thestate will potentially require its vendor toimplement various quality improvementactivities, including the use of practiceguidelines and assessment tools. The statemay also require contractors to educateproviders on issues ranging from the use ofclinical practice guidelines to the availabil-ity of community resources. As part of theprogram, contractors will also be asked togive providers feedback regarding benefici-ary adherence to treatment plans.11 Theseand other provider education and workflow redesign tools are intended to stream-line the care management process and helpensure the most efficient use of limitedprovider resources.


12

Innovative Practice Supports in Oklahoma

Oklahoma’s new Health Management Program for PCCM beneficiaries includes aninnovative requirement for its contractor to conduct one-on-one practice facilita-tion with 50-100 high-volume primary care physicians. Practice facilitators arerequired to spend approximately one month working full time in selected physicianoffices to facilitate practice improvement by performing the following activities:12

• Review claims and clinical records using an audit tool designed in collaborationwith the state to determine areas for improvement;

• Assess physician care process for potential improvement; • Develop and implement education and other interventions based on the results

of the audit tool and care process assessment; • Provide quarterly continuing practice evaluation reports to primary care physi-

cians that include health management program participation and medical regi-men adherence and physician specific quality monitoring and improvementefforts; and

• Evaluate suggested interventions for acceptance, response, and effectivenessand document successful interventions for inclusion in the state PracticeFacilitation Procedure Manual.

11 Draft Request for Proposal 07-00510 Coordinated Care Management Program, Exhibit A – Scope of Work, California Department of Health Care ServicesOffice of Medi-Cal Procurement, October 23, 2007. Available at: http://www.dhcs.ca.gov/provgovpart/rfa_rfp/Documents/CCMPdraftExh-all.pdf.

12 SoonerCare Health Management Program Request for Proposal, Oklahoma Health Care Authority, May 17, 2007. Available at:http://www.dcs.state.ok.us/solicitations.nsf/84aa51fea272678286256c63004b3542/dd2d32373a61233e862572c9004f2086/$FILE/ATT4R1YB/8070000017%20-%205-17-07.pdf.

11833:11833Biddle_1 3/19/08 10:15 AM Page 15

Factors that Influence Systems ofCare DesignA variety of factors influence a state’s deci-sion about the system of care most appropri-ate and achievable for its beneficiaries.These factors can include existing statecapacity, past experiences in developingalternative managed care models, consumerand provider interests in the state, and theoverall political environment.

State CapacityOur scan found that states are building pro-grams in-house as well as through outsidecontractors, with state efforts influencedboth by past experience and existing infra-structure. Rhode Island, for example, usedits experience with children with specialneeds in its RIte Care managed care pro-gram to help construct the requirements forits new Connect Care Choice (PCCM) andRhody Health Partners (managed care) pro-grams for adults with complex needs. Stateswith sufficient internal capacity and clinicalexpertise (e.g., Pennsylvania andOklahoma) are working directly with partic-ipating providers in PCCM or medical homemodels. Others are partnering with healthplans or specialized vendors that offer dis-ease/care management, programs for subsetsof high-risk beneficiaries, and/or full-riskmanaged care. Many states design programsusing a mix of internal and externalresources. Oklahoma, for example, managesits PCCM program internally, yet contractswith a vendor to implement its HealthManagement Program for high-cost benefi-ciaries with multiple chronic conditions.

Consumer and Advocate PerspectivesMedicaid agencies are seeking opportunitiesto engage beneficiaries and the advocacycommunity early in the process to collabo-rate on program design, incorporate con-sumer feedback into implementation deci-sions, and increase the likelihood for buy-in.Advocates may find non full-risk modelsmore appealing because they may permitgreater choice of providers, particularly thoseproviders with whom the consumer hasestablished relationships. Access to disabili-ty competent providers is very important tomany ABD/SSI beneficiaries as is the optionto “opt out” after trying the care manage-ment program. States have established vari-ous ways of monitoring the availability ofproviders to ensure that there is appropriateaccess to services.

Provider PerspectiveWhile providers may benefit from non-finan-cial supports described earlier in this section,scan states reported that providers are con-cerned that increasing the level of engage-ment with ABD/SSI beneficiaries may addadditional responsibilities without additionalreimbursement. Many states in the scanbrought providers to the table early in thedevelopment of programs for adults withcomplex needs and have adjusted reimburse-ment rates or created additional payments forproviders who agree to perform additionalservices. Some states are exploring pay-for-performance or pay-for-participation strate-gies, such as Pennsylvania, which has aunique financial incentive program forproviders engaged in disease management forchronic conditions (see page 17).


13

11833:11833Biddle_1 3/18/08 4:57 PM Page 16

Finding the “right” financing mechanismsto support providers and contractors inserving high-risk beneficiaries is a chal-lenge. Scan states are testing variations ontraditional payment strategies as well asalternative financing arrangements to bal-ance appropriate reimbursement withaccountability.

Provider Reimbursement StrategiesMost of the provider reimbursement strate-gies highlighted in this report were built onthe existing FFS financing structure. InPCCM programs, providers generallyreceive FFS payments for services rendered,with additional per-member per-month(PMPM) payments for performing caremanagement services. The range of PMPMpayments can vary by state depending onthe scope of services provided. For exam-ple, primary care physicians in the TexasPCCM program receive a $5 PMPM casemanagement fee for specialty referrals,provider access, and EPSDT compliance.Physicians in Indiana’s Care Select pro-gram who agree to meet a number of prac-tice standards, including working with thecare management contractors on patientcare plans, receive a $15 PMPM adminis-trative fee.13 Practices participating in theRhode Island Chronic Care Choice PCCMprogram receive a $30 PMPM for employ-ing nurse case managers.

North Carolina is using the experiencefrom the initial years of its chronic caremanagement pilot program to identify theoptimal PMPM for practices and networksproviding comprehensive care manage-


14

ment. Depending on the needs of an indi-vidual beneficiary, the care managementoffered by the state’s medical home modelmight include: disease management, phar-macy management, mental health referrals,social case management, interdisciplinaryteam review, patient empowerment andeducation, family/care giver involvement,and/or collaboration with communityproviders.14 North Carolina recognizes thatthe state’s standard PCCM care manage-ment fees — $2.50 PMPM for physiciansand $3 PMPM for networks — are insuffi-cient to support the broad scope of servicesneeded by ABD/SSI beneficiaries. Thestate is using non-PMPM direct funding tosupport networks and physicians during theprogram start-up phase. After obtainingtwo years of experience, the state hopes todevelop an appropriate PMPM for bothphysicians and networks based on thenumber of ABD/SSI beneficiaries enrolled.

Risk Adjustment inMinnesota

Minnesota is designing a risk-adjustedrate for its provider-based care coordina-tion program. The state is developing amethodology to pay primary care physi-cians a monthly risk-adjusted care man-agement/coordination fee that is likely toaverage $50 PMPM, with increased pay-ments for beneficiaries at higher-risk anda PMPM lower than $50 for lower-riskbeneficiaries. Risk adjusting the pay-ments may alleviate concerns thatproviders may not agree to serve thehighest risk beneficiaries.

Theme 2: States are developing alternative financing mechanisms for providersand contractors that include shared risk, shared savings, and pay for performance.

Financing and Risk Adjustment Strategies

13 Care Select Program Addendum to the Indiana Health Coverage Programs/Medicaid Provider Agreement, State of Indiana Family and Social Services Administration, Office of Medicaid Policy and Planning, October 2, 2007. Available at: http://www.indianamedicaid.com/ihcp/careselect/content/documents/cs%20pmp%20addendum.pdf.

14 Chronic Care Program Summary, Community Care of North Carolina, 2007. Available at: http://www.communitycarenc.com/PDFDocs/CCNC-Chronic.pdf.

11833:11833Biddle_1 3/18/08 4:57 PM Page 17


Contractor Reimbursement StrategiesMuch like providers, contractors that adminis-ter all or part of the care management pro-gram may also be reimbursed a PMPM rate,with payments varying depending on thescope of services provided. For example, SouthCarolina medical home network vendorsreceive $10 PMPM for administering the pro-gram and providing care management andcare coordination services, but the staterequires vendors to share approximately $2.50of that payment with participating providers.

In programs managed by contractors, statesmay use financing mechanisms that put someor all of the contractor’s payment at risk formeeting cost savings or other performance tar-gets. The scan found that some states arewithholding fees or requiring contractors topay back between 20 and 100 percent of theirfees if quality, financial, and/or operationalperformance targets are not met. Indiana, forexample, withholds 20 percent of contractorfees for performance-related payments in itsCare Select program. Half of the withhold isreleased if contractors beat the annual costgrowth trend for enrolled beneficiaries by aspecific percentage. The remaining half of thepayment is earned by meeting performancegoals related to provider network compositionand quality. Contractors are also required topass on at least 75 percent of any perform-ance-related payments to providers. Like pro-grams in other scan states, New York’s proposedChronic Illness Demonstration Projects (CIDP)for adults with medically and behaviorally com-plex conditions puts a portion of the contrac-tors’ monthly care coordination fee at risk formeeting quality and cost performance standards.New York is unique, however, in that the pro-gram sets aside dedicated funds for CIDP con-tractors to receive one-time, limited reimburse-ment for initial startup and enrollment costsduring the first year of operation.

Some states have also created shared savingsprograms that provide vendors with addition-al payments if spending reductions are moresignificant than expected. South Carolina,California, and Mississippi have or are con-sidering shared savings programs for theircontractors; in South Carolina, contractorsare required to share at least part of such sav-ings with providers.

Programs in states like Pennsylvania,Oklahoma, North Carolina, and Texas thatprovide care management for high-need,high-cost subsets of the PCCM populationhave all developed unique financing mecha-nisms. In Texas, the state is developing a program that will reimburse a contractor forproviding advanced case management servic-es above and beyond those currently avail-able in its PCCM and disease managementprograms.

As California develops its new CoordinatedCare Management Program it will also designa separate payment system. Currently thestate pays $17 PMPM to a disease manage-ment vendor to provide traditional diseasemanagement services in a two-county pilotprogram. In contrast, according to the draftRFP for the new program, the state willrequest PMPM bids from contractors to pro-vide comprehensive care coordination forbeneficiaries with disabilities or multiplechronic conditions. Unlike the diseasemanagement program, the CoordinatedCare Management Program will requirethe contractor to guarantee that netmedical costs for program members willnot increase. The proposed guaranteedsavings calculation includes the carecoordination PMPM as a cost, so thecontractor must reduce medical expendi-tures by at least the aggregate PMPMpayments in order to receive full payment.

15

11833:11833Biddle_1 3/18/08 4:57 PM Page 18

States that design programs for adults withchronic illnesses and disabilities can eitheradapt existing measures, adopt new meas-ures, or do both to more accurately reflectthe complex needs of the population. Manystates use the National Committee forQuality Assurance’s (NCQA) HealthcareEffectiveness Data and Information Set(HEDIS) measures for full-risk capitatedMedicaid programs. Some are also usingHEDIS, including newer provider-levelmeasures, in partial- and non-risk programs;although, there is no comparable NCQAaccreditation process as the one that existsfor managed care organizations. Whilestates have found that HEDIS measurescover a range of chronic conditions (e.g.,asthma, diabetes, and hypertension) andprovide a standardized way to hold healthplans accountable, they are not designed toaddress co-occurring conditions, physicaldisabilities, or care coordination. NCQA iscurrently researching these areas for futuremeasurement development. Timely creationof these types of measures is needed asmany states described a large gap betweenthe areas addressed by existing measure-ment sets and the clinical and non-clinicalindicators needed to accurately assess thecare provided to the ABD/SSI population.

A handful of scan states (e.g., Indiana andPennsylvania) have begun to create morerobust measurement strategies in their non-risk programs that address specific issuesrelated to ABD/SSI beneficiaries. Forexample, Indiana’s Care Select programuses indicators related to care management,disease management, and service utiliza-

tion. The state tracks care planning andcoordination through the following mecha-nisms: percentage of beneficiaries screened;development of a care plan based on indi-vidual needs; timeliness of prior authoriza-tion responses; and care management callsanswered. As a proxy measure for care man-agement, contractors in the Care Selectprogram must report on a subset of theAgency for Healthcare Research andQuality’s Prevention Quality Indicators(PQIs).15 The PQIs capture data on hospitaladmission rates for conditions common topeople with chronic illnesses (e.g., dehydra-tion, bacterial pneumonia, urinary tractinfections, and respiratory failure) that areseen as avoidable or preventable if propercare management and ambulatory care hadbeen provided. In introducing new meas-ures and reporting requirements, scan statesacknowledged the importance of clearlyunderstanding how the measurement datawill be used and setting realistic expecta-tions for changes in outcomes.

One of the most important, yet difficult,areas to quantify and measure for programsserving beneficiaries with complex needs iscare management. Some states are testingthe use of PQIs as well as process measures(e.g., number of calls made by care manageror number of referrals made to specialists)to determine the effectiveness of thesemeasures in assessing the delivery of caremanagement. While tracking these processindicators is an important first step, statesmay want to consider developing mecha-nisms to link these process measures to clin-ical outcomes. Pennsylvania, for example, is


Theme 3: Measuring clinical and non-clinical aspects of care managementprograms can be difficult, but states have begun to develop and test moreappropriate performance measurement and monitoring strategies.

Performance Measurement Approaches

16

15 Prevention Quality Indicators Overview, Agency for Healthcare Research and Quality, July 2004. Available at http://www.qualityindicators.ahrq.gov/pqi_overview.htm.

11833:11833Biddle_1 3/18/08 4:57 PM Page 19


17

using an innovative approach to assess theeffectiveness of care coordination in itsACCESS Plus program. Physicians whotreat high-risk beneficiaries are eligible fora bonus if they achieve certain quality ofcare process improvements for beneficiarieswith asthma, diabetes, coronary artery dis-ease, congestive heart failure, and chronicobstructive pulmonary disease. Pennsylvaniafeels that tracking the completion of specificprocesses critical to high-risk beneficiariescan help the state evaluate whether or nota physician is providing good care manage-ment for its high-risk beneficiaries.

As part of Pennsylvania’s pay for perform-ance (P4P) program, each participatingphysician can receive a bonus payment of$17 for conducting certain care processes(e.g., LDL tests for beneficiaries with dia-betes) and for each beneficiary who reportsto be taking key medications (e.g., con-troller medications for beneficiaries withasthma, beta blockers for beneficiaries withcongestive heart failure, etc.). Additionalbonus payments physicians can receiveinclude:16

• $200 (one-time bonus) for participatingin the P4P program;

• $40 for each high-risk beneficiary thephysician enrolls into the disease man-agement program;

• $30 (one-time bonus) when the physi-cian provides the state with updated con-tact information pertaining to the high-risk beneficiary; and

• $60 (up to twice a year) for completing aChronic Care Feedback Form for eachhigh-risk patient.

The state attributes certain improvementsin results, including an increase in appro-priate prescriptions filled for cholesterollowering medication for beneficiaries withcoronary artery disease and for beta-block-ers for beneficiaries with congestive heartfailure, to the P4P program.17

Performance measures that reflect the clini-cal and non-clinical needs of beneficiariesare fundamental components of everyMedicaid program and are perhaps evenmore critical when it comes to monitoringthe effectiveness of care for high-risk bene-ficiaries. Many of the scan states are testingnew measurement approaches, but muchcan still be done in this area to ensure thatthere are more sophisticated appropriatemeasures for adults with a complex array ofneeds.

16 ACCESS Plus P4P program description is available at http://www.accessplus.org/PayForPerformance.aspx.17 ACCESS Plus P4P Program Overview, Pennsylvania Department of Public Welfare, November 7, 2007. Available at

http://www.accessplus.org/downloads/P4P/P4P_PhysicianPresentation.pdf.

11833:11833Biddle_1 3/18/08 4:57 PM Page 20

11833:11833Biddle_1 3/18/08 4:57 PM Page 21


18 Conversations with officials at Schaller Anderson, Inc.

19

tates are developing alternative sys-tems of care for adults with complex

needs. In so doing, they are breaking newground in how to best structure the“levers” (i.e., operational, clinical, andfinancial) available to their contractors toensure accountability for both quality andcosts. States and their partners will con-tinue to experiment with how to structure“levers” in these new models, not only topermit sufficient flexibility, but also toensure appropriate accountability.

The recognition that in FFS there are vir-tually no levers and, therefore, no account-ability, has led many states to move fromFFS toward more coordinated systems ofcare. On the other end of the spectrum, infully capitated models, the strongest“lever” tends to be financial in that thehealth plan is at risk for outcomes andcosts. In exchange for accepting full risk,the contractor has a significant amount offlexibility and control over those things(e.g., services/benefits, medical manage-ment, provider networks, payment rates,claims processing, etc.) that impact out-comes and costs. States using non-riskmodels are testing ways to balance flexibil-ity and control with risk and overallaccountability.

By definition, these non-risk models donot have the same financial leverage.Nonetheless, there are other importantlevers for states and their care manage-ment contractors to consider.

Medical Management: These models dif-fer regarding the scope of medical manage-ment authority given to contractors.Medical management “tools,” such as priorauthorization, concurrent review, and dis-

charge planning, provide information vitalto: (a) understanding and changing pat-terns of care; (b) ensuring appropriatereferrals, discharge planning, and caretransitions; and (c) linking adults withcomplex needs with appropriate care man-agement interventions. As one contract-ing organization described it, prior authori-zation serves as a “flag” when someoneenters the system; concurrent review trackswho is in the system; and care manage-ment attempts to help people avoid unnec-essary utilization by coordinating and inte-grating care. Care management is likely tobe enhanced by combining these otherfunctions, which can help align incentivesboth clinically and financially. Thisincreases the potential for a contractor toimpact both quality and costs. Internalcalculations by one of the plans inter-viewed found a positive return on invest-ment (ROI) for concurrent review, priorauthorization, and care management; how-ever, the ROI for concurrent review is fourto five times that of prior authorization,with both exceeding the ROI for casemanagement.18

As states think through how to structurecontractors’ scope of authority over med-ical management activities, it may be ben-eficial to consider which functions havethe greatest potential impact on both qual-ity and cost as well as how these functionsreinforce one another. As the flexibilityand authority a state allows its contractorincrease, so should the degree to which thecontractor is held accountable. Conversely,the less latitude a contractor is given overthese activities, the more likely a state mayneed to adjust its performance expecta-tions accordingly.

Conclusion: Considerations for States

S

11833:11833Biddle_1 3/19/08 4:45 PM Page 22


20

Provider Networks: Systems of care foradults with complex needs usually rely onprimary care providers to coordinatepatients’ clinical and psychosocial needs.States interviewed are recognizing thatthere are tradeoffs if care management con-tractors are expected to change providerbehavior but lack the authority to build ormodify provider networks. Contractors innon-fully capitated models generally do notcontract directly with physicians, thereforelack much leverage over the type and scopeof care delivered. While financial incen-tives and specific provider agreementrequirements may help allay some of theseconcerns, states recognize that the parame-ters they establish for contractors vis-à-visprovider network responsibility and author-ity influence the ability of contractors toensure appropriate care delivery. Similarly,the requirements that states establish forworking with existing providers or casemanagers has an impact on how much con-tractors can be expected to influence boththe utilization of care and program costs.

Intervention Flexibility: Fully capitatedprograms for ABD/SSI populations providemanaged care plans with considerable lati-tude to direct their resources to beneficiar-ies who have a high risk of future utiliza-tion/costs and the potential for positiveoutcomes. In other words, the plans havethe flexibility to develop targeted and tai-lored interventions for subsets of the popu-lation. This same flexibility generally doesnot exist in non-fully capitated models andcan leave many states with a relativelyrigid one-size-fits-all care management

approach that strictly defines covered serv-ices and target populations. The complexand varied needs of the adults targeted forthese new care models suggest that stateswould benefit by allowing contractors suffi-cient flexibility to: (a) focus on high-riskbeneficiaries; and (b) provide the servicesand targeted clinical interventions thatthose individual beneficiaries most need.A key consideration of the former is trans-parency and consensus on the classificationof and stratification into different levels ofcare/risk. With regard to the latter, manyof the states interviewed seem to under-stand the importance of flexibility in thisarena. While many require a minimum setof core care management elements, theyare encouraging contractors to customizespecific interventions that meet the needsof individual beneficiaries. The more flexi-bility a contractor has in tailoring inter-ventions, the more the state can hold itaccountable for developing holistic,patient-based plans of care.

Other issues that have an impact on thelevers available to states and their contrac-tors in these models include: integrationwith carved-out services, especially behav-ioral health care; incentives, especially atthe provider level and/or linked to medicalhomes; primary care provider assignmentvs. open models; and access to real-time,actionable data. The importance of anintegrated data set cannot be understatedand has a direct impact on a contractors’ability to ensure appropriate utilization, tailor services, and control costs.

11833:11833Biddle_1 3/19/08 3:02 PM Page 23

21

An overarching theme we heard through-out our interviews is the need to set realis-tic expectations for both quality and costs.A concern of some plans/contractors is thatstates may be expecting the same level offinancial and clinical accountability as isfound in full-risk models. These non full-risk approaches typically do not providethe same flexibility and authority to con-tractors, and therefore cannot be expectedto have the same accountability. However,these models are uncovering additional“levers” that have an impact on quality,cost, and satisfaction. While a natural ten-sion exists as these programs evolve, thehope is that states and their partners arelearning together about how to best bal-ance expectations and accountability withauthority and flexibility.

In sum, the state leaders highlighted in thisreport are testing this balance as theyexplore new approaches to caring forMedicaid beneficiaries with complex andcostly health care needs. It is clear throughtheir experiences that there is no one-size-fits-all approach. Rather, states are using avariety of innovative care models, financ-ing structures, and performance measure-ment strategies to best address beneficiaryand state needs. As more states look to

enhance care management for high-riskpopulations, the findings herein may guidethem in developing their own programs toboth improve patient outcomes and controlcosts.

As indicated at the outset of this report,the only hard and fast rule is that stateswill not and can not sit still. New modelswill continue to emerge in state laborato-ries across the nation. More states andtheir partners will gain experience aboutwhat works – and what does not work – forpopulations with complex needs.Subsequent efforts to scan the field willsurely uncover new ways of enhancingintegration among the state, care manage-ment contractors, and primary careproviders. The growing budget pressures onpublicly financed health care spending aswell as the momentum for national healthcare reform will inevitably place states in aleadership role in balancing coverage,costs, and quality. This, of course, meansthat state Medicaid leaders will find them-selves again and again back in the labora-tory, testing new approaches, and embrac-ing opportunities to demand more value forpublic dollars.


11833:11833Biddle_1 3/19/08 2:30 PM Page 24

11833:11833Biddle_1 3/18/08 4:57 PM Page 25

23

Ap

pen

dix

1:

Syst

ems

of

Car

e fo

r A

BD

/SSI

Ben

efic

iari

es in

Sca

n St

ates

Stat

ePr

ogra

m N

ame

Targ

et P

opul

atio

nTy

pe o

f Pr

ogra

ms

Enro

llmen

t fo

r A

BD/S

SIG

eogr

aphy

FFS

PCC

M

Full-

Risk

Man

aged

Car

eVo

lunt

ary/

Man

dato

ryLi

mit

ed o

r St

atew

ide

Cal

ifo

rnia

Ind

iana

Min

neso

ta

Mis

siss

ipp

i

Dise

ase

Man

agem

ent

Pilo

t

Coo

rdin

ated

Car

eM

anag

emen

t Pro

gram

(R

FP in

dev

elop

men

t)

Med

i-Cal

M

anag

ed C

are

Car

e Se

lect

ABD

and

non

-disa

bled

HC

BS w

aive

r ben

efic

iarie

s(e

xclu

ding

dua

ls)

Adu

lt be

nefic

iarie

s w

ithdi

sabi

litie

s

Hig

h-co

st, h

igh-

need

be

nefic

iarie

s

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y2

Cou

ntie

s

3-4

Cou

ntie

s

22 C

ount

ies

Twin

Citi

es M

etro

A

reas

Stat

ewid

e

To b

e de

term

ined

To b

e de

term

ined

Stat

ewid

eM

anda

tory

Top

300

chro

nica

lly il

lbe

nefic

iarie

s

Bene

ficia

ries

with

ast

hma,

CO

PD, C

HF,

chr

onic

rena

lfa

ilure

, dia

bete

s, h

yper

-te

nsio

n, o

r oth

er h

igh-

risk

bene

ficia

ries

Min

neso

ta D

isabi

lity

Hea

lth O

ptio

ns

Prov

ider

Dire

cted

Car

eC

oord

inat

ion

Inte

nsiv

e C

are

Coo

rdin

atio

n

Dise

ase

Man

agem

ent

Prog

ram

(RFP

out

for

bid)

Bene

ficia

ries

with

as

thm

a, d

iabe

tes,

hea

rtfa

ilure

, cor

onar

y ar

tery

dise

ase,

chr

onic

obs

truc-

tive

pulm

onar

y di

seas

e(C

OPD

), an

d at

hero

scle

-ro

tic d

iseas

e

Seni

ors

and

peop

le w

ithdi

sabi

litie

s w

ho h

ave

chro

nic

cond

ition

s or

who

may

be

serio

usly

ill a

ndne

ar e

nd o

f life

; and

peo

ple

with

chr

onic

hea

lth c

ondi

-tio

n(s)

and

ser

ious

men

tal

illne

sses

(exc

ludi

ng d

uals)

All

bene

ficia

ries

✔ ✔

✔

✔

✔

✔ ✔ ✔

cont

inue

d

11833:11833Biddle_1 3/18/08 4:57 PM Page 26

24

Ap

pen

dix

1:

Syst

ems

of

Car

e fo

r A

BD

/SSI

Ben

efic

iari

es in

Sca

n St

ates

(co

ntin

ued

)

Stat

ePr

ogra

m N

ame

Targ

et P

opul

atio

nTy

pe o

f Pr

ogra

ms

Enro

llmen

t fo

r A

BD/S

SIG

eogr

aphy

FFS

PCC

M

Full-

Risk

Man

aged

Car

eVo

lunt

ary/

Man

dato

ryLi

mit

ed o

r St

atew

ide

New

Yo

rk

No

rth

Car

olin

a

Okl

aho

ma

Pen

nsyl

vani

a

Med

icai

d M

anag

edC

are

& P

artn

ersh

ip P

lan

Prim

ary

Car

e Pa

rtial

Cap

itatio

n Pr

ovid

ers

Med

icai

d D

iseas

e an

dC

are

Man

agem

ent

Dem

onst

ratio

nPr

ogra

ms

Varie

s by

regi

on

Chr

onic

Illn

ess

Dem

onst

ratio

n Pr

ojec

ts(R

FP o

ut fo

r bid

)

Com

mun

ity C

are

ofN

orth

Car

olin

aA

ll be

nefic

iarie

s

ABD

/SSI

and

chr

onic

ally

ill

ben

efic

iarie

s

All

bene

ficia

ries

(exc

ludi

ng d

uals,

inst

itu-

tiona

lized

, HC

BS w

aive

r,st

ate

or tr

ibal

cus

tody

)

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

44 C

ount

ies

5 C

ount

ies

6 Re

gion

s

11 C

ount

ies

Mul

tiple

regi

ons

acro

ss th

e st

ate

Stat

ewid

e

Stat

ewid

e

Stat

ewid

e

42 C

ount

ies

25 C

ount

ies

27 C

ount

ies

42 C

ount

ies

Stat

ewid

e

10 N

etw

orks

Man

dato

ry

Man

dato

ry

Man

dato

ry

Man

dato

ry

5,00

0 hi

ghes

t cos

t be

nefic

iarie

s w

ith c

hron

icco

nditi

ons

All

bene

ficia

ries

All

bene

ficia

ries

(exc

ludi

ng d

uals,

nur

sing

hom

e re

siden

ts)

Chr

onic

Car

e Pr

ojec

t(p

ilot)

Soon

erC

are

Cho

ice

Hea

lth M

anag

emen

tPr

ogra

m

AC

CES

S Pl

us

Hea

lthC

hoic

es

All

bene

ficia

ries

Volu

ntar

y M

anag

edC

are

Bene

ficia

ries

with

mul

tiple

chro

nic

cond

ition

sIn

tens

ified

Med

ical

Cas

e M

anag

emen

t

Bene

ficia

ries

with

ast

hma,

diab

etes

, CO

PD, c

oron

ary

arte

ry d

iseas

eD

iseas

e M

anag

emen

t

All

bene

ficia

ries

Man

aged

car

e el

igib

lebe

nefic

iarie

s

Med

ically

or b

ehav

iora

llyco

mpl

ex a

dult

bene

ficia

ries

(exc

ludi

ng d

uals,

inst

itutio

n-al

ized,

HCB

S w

aive

r)

✔ ✔

✔

✔ ✔ ✔ ✔

✔ ✔

✔ ✔✔

✔ ✔

cont

inue

d

11833:11833Biddle_1 3/18/08 4:57 PM Page 27

25

Ap

pen

dix

1:

Syst

ems

of

Car

e fo

r A

BD

/SSI

Ben

efic

iari

es in

Sca

n St

ates

(co

ntin

ued

)

Stat

ePr

ogra

m N

ame

Targ

et P

opul

atio

nTy

pe o

f Pr

ogra

ms

Enro

llmen

t fo

r A

BD/S

SIG

eogr

aphy

FFS

PCC

M

Full-

Risk

Man

aged

Car

eVo

lunt

ary/

Man

dato

ryLi

mit

ed o

r St

atew

ide

Rho

de

Isla

nd

Sout

h C

aro

lina

Texa

s

Was

hing

ton

Con

nect

CA

RRE

Car

eM

anag

emen

t and

Wel

lnes

s Pr

ogra

m

Con

nect

Car

e C

hoic

e

Rhod

y H

ealth

Par

tner

sAd

ult b

enef

iciar

ies

(exc

lud-

ing

dual

s, in

stitu

tiona

lized

)

Med

ical

Hom

esN

etw

ork

Prog

ram

All

bene

ficia

ries

(exc

ludi

ngnu

rsin

g ho

me,

hos

pice

,w

aive

r pro

gram

s)A

ll be

nefic

iarie

s (e

xclu

d-in

g nu

rsin

g ho

me,

ho

spic

e, w

aive

r pro

gram

s)

Volu

ntar

y

Volu

ntar

y

To b

e de

term

ined

Man

dato

ry(v

olun

tary

for S

SI c

hild

ren)

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Volu

ntar

y

Prov

iden

ce a

ndN

ewpo

rt M

etro

Are

as(e

xpan

ding

to s

tate

wid

e)

Stat

ewid

e

Stat

ewid

e

36 C

ount

ies

43 C

ount

ies

28 C

ount

ies

12 C

ount

ies

202

Cou

ntie

s

13 C

ount

ies

Stat

ewid

e

To b

e de

term

ined

Stat

ewid

e

1 C

ount

y

52 C

ount

ies

Man

dato

ry

Man

dato

ry(v

olun

tary

for S

SI c

hild

ren)

Man

dato

ry(v

olun

tary

for S

SI c

hild

ren)

All

bene

ficia

ries

(exc

ludi

ngdu

als,

fost

er c

are,

nur

sing

hom

e, m

edic

ally

nee

dy)

All

bene

ficia

ries

SSI a

nd H

CBS

wai

ver

bene

ficia

ries

(exc

ludi

ngin

stitu

tiona

lized

, par

tial

bene

fit b

enef

icia

ries)

Man

aged

Car

e H

ealth

Pla

ns

STA

R M

edic

aid

Man

aged

Car

ePr

ogra

m

STA

R+PL

US

Prim

ary

Car

e C

ase

Man

agem

ent

Inte

grat

ed C

are

Man

agem

ent

SSI i

nclu

ding

dua

ls,

com

mun

ity b

ased

al

tern

ativ

e pa

rtici

pant

s

Enha

nced

Car

ePr

ogra

m (d

iseas

e m

anag

emen

t)

Bene

ficia

ries

with

ast

hma,

diab

etes

, CH

F, C

OPD

,co

rona

ry a

rtery

dise

ase

Bene

ficia

ries

with

hig

hco

sts

and/

or h

igh

risk

ofch

roni

c ill

ness

Hea

lth M

anag

emen

tPr

ogra

m

(in d

evel

opm

ent)

Chr

onic

Car

eM

anag

emen

t (pi

lot)

High

-risk

adu

lt be

nefic

iarie

s(ex

cludi

ng H

CBS

waive

r, hos

pice

)

SSI a

nd S

SI-re

late

d be

nefic

iarie

s W

ashi

ngto

n M

edic

aid

Inte

grat

ion

Partn

ersh

ip

300

disa

bled

and

chr

oni-

cally

ill a

dult

bene

ficia

ries

with

CH

F, C

OPD

, sic

kle

cell

anem

ia, a

sthm

a, d

ia-

bete

s, d

epre

ssio

n, a

ndot

hers

at h

igh

risk

Adul

t ben

efici

arie

s (e

xclu

d-in

g du

als,

inst

itutio

naliz

ed)

✔

✔

✔

✔

✔ ✔ ✔

✔ ✔✔

✔ ✔

✔

✔

✔

11833:11833Biddle_1 3/18/08 4:57 PM Page 28

26

Ap

pen

dix

2:

Sele

cted

Fin

anci

ng M

echa

nism

s fo

r Sy

stem

s o

f C

are

for

AB

D/S

SI B

enef

icia

ries

Stat

ePr

ogra

m N

ame

Targ

et P

opul

atio

n

Type

of

Prog

ram

s

FFS

PCC

MFu

ll-Ri

skM

anag

ed

Car

e

Des

crip

tion

of

Fina

ncin

g M

echa

nism

Ind

iana

Min

neso

ta

Okl

aho

ma

Car

e Se

lect

PCC

M v

endo

rs re

ceiv

e ap

prox

imat

ely

$25

PMPM

car

e m

anag

e-m

ent f

ee fo

r eac

h be

nefic

iary

enr

olle

d in

Car

e Se

lect

. The

sta

tein

itial

ly w

ithho

lds

20 p

erce

nt o

f the

tota

l fee

. Hal

f of t

he w

ithho

ldca

n be

ear

ned

by m

eetin

g th

e fin

anci

al p

erfo

rman

ce ta

rget

(b

eatin

g an

agr

eed-

upon

tren

d ra

te),

whi

le th

e ot

her h

alf c

an b

eea

rned

by

mee

ting

certa

in p

roce

ss a

nd o

utco

me

qual

ity m

easu

res.

Vend

ors

mus

t ret

urn

75 p

erce

nt o

f any

of t

he p

erfo

rman

ce-re

late

dpa

ymen

ts to

pro

vide

rs th

roug

h pa

y fo

r per

form

ance

and

con

-su

mer

s th

roug

h pe

rson

al re

spon

sibili

ty in

cent

ives

.

Prim

ary

care

phy

sicia

ns w

ho s

ign

a C

are

Sele

ct a

dden

dum

to th

eM

edic

aid

prov

ider

agr

eem

ent r

ecei

ve a

$15

PM

PM fo

r eac

hen

rolle

d C

are

Sele

ct M

embe

r.

The

prog

ram

ven

dor r

ecei

ves

one

PMPM

fee

to p

rovi

de in

-per

son

nurs

e ca

se m

anag

emen

t ser

vice

s to

Tie

r 1 (1

,000

in h

ighe

stex

pect

ed c

ost b

rack

et) e

nrol

lees

and

a lo

wer

PM

PM to

pro

vide

tele

phon

ic c

ase

man

agem

ent t

o Ti

er 2

(rem

aini

ng 4

,000

)en

rolle

es. T

he v

endo

r also

rece

ives

a o

ne-ti

me

paym

ent f

or e

ach

bene

ficia

ry e

nrol

led,

and

a m

onth

ly p

aym

ent f

or e

ach

full-

time

in-

offic

e pr

actic

e fa

cilit

ator

.

Prim

ary

care

pro

vide

rs in

the

prog

ram

con

tinue

to re

ceiv

e a

par-

tially

cap

itate

d pr

imar

y ca

re fe

e th

at p

uts

them

at r

isk fo

r pro

vid-

ing

a de

fined

set

of b

asic

offi

ce v

isits

and

labs

. Thi

s fe

e in

clud

es a

$2-3

PM

PM c

are

man

agem

ent a

dd-o

n. T

he p

artia

l cap

itatio

n fe

eis

adju

sted

for a

ge, g

ende

r, an

d ai

d ca

tego

ry (T

AN

F or

ABD

/SSI

).

Parti

cipa

ting

prov

ider

s re

ceiv

e a

care

man

agem

ent/

coor

dina

tion

fee

that

will

ave

rage

$50

-$55

PM

PM. T

he s

tate

is w

orki

ng w

ith a

num

ber o

f sta

keho

lder

s to

dev

elop

a ri

sk a

djus

tmen

t stra

tegy

that

adj

ust p

aym

ents

from

aro

und

$20

PMPM

to o

ver $

100

PMPM

dep

endi

ng o

n in

divi

dual

ben

efic

iary

risk

.

Hig

h-co

st, h

igh-

need

be

nefic

iarie

s Pr

ovid

er D

irect

ed C

are

Coo

rdin

atio

n

Hea

lth M

anag

emen

tPr

ogra

m

5,00

0 hi

ghes

t cos

t be

nefic

iarie

s w

ith

chro

nic

cond

ition

s

ABD

and

non

-disa

bled

HC

BS w

aive

r ben

efic

iarie

s(d

uals

excl

uded

)

✔

✔

✔

cont

inue

d

11833:11833Biddle_1 3/18/08 4:57 PM Page 29

27

Ap

pen

dix

2:

Sele

cted

Fin

anci

ng M

echa

nism

s fo

r Sy

stem

s o

f C

are

for

AB

D/S

SI B

enef

icia

ries

(co

ntin

ued

)

Stat

ePr

ogra

m N

ame

Targ

et P

opul

atio

nTy

pe o

f Pr

ogra

ms

FFS

PCC

MFu

ll-Ri

skM

anag

ed

Car

e

Des

crip

tion

of

Fina

ncin

g M

echa

nism

Pen

nsyl

vani

a

Rho

de

Isla

nd

Sout

h C

aro

lina

Parti

cipa

ting

prov

ider

s re

ceiv

e st

anda

rd fe

e-fo

r-ser

vice

rate

s, b

utth

ose

rate

s w

ere

incr

ease

d to

80

perc

ent o

f Med

icar

e fo

r spe

cifie

dco

des

in 2

007.

Pro

vide

rs a

lso re

ceiv

e $3

0 PM

PM to

cov

er th

e co

sts

of a

nur

se c

are

man

ager

resp

onsib

le fo

r chr

onic

car

e co

ordi

natio

n.

Car

e C

oord

inat

ion

Serv

ice

Org

aniza

tions

that

con

tract

with

the

stat

e to

pro

vide

car

e m

anag

emen

t rec

eive

$10

PM

PM, a

nd a

rere

quire

d to

sha

re $

2.50

PM

PM o

f tha

t pay

men

t with

par

ticip

atin

gpr

ovid

ers.

If en

rolle

d be

nefic

iarie

s, o

n av

erag

e, c

ost l

ess

than

the

$184

PMPM

HM

O ra

te, c

ontra

ctor

s an

d th

e st

ate

split

the

shar

ed s

av-

ings

50-

50. C

ontra

ctor

s ar

e th

en re

quire

d to

sha

re th

eir p

ortio

n of

the

savi

ngs

with

par

ticip

atin

g pr

ovid

ers,

and

hav

e hi

stor

ical

lysh

ared

60

perc

ent w

ith p

rovi

ders

, whi

le re

tain

ing

40 p

erce

nt.

Prov

ider

s ar

e re

imbu

rsed

und

er th

e cu

rrent

PC

CM

pay

men

t stru

c-tu

re a

nd th

e st

ate

uses

inte

rnal

reso

urce

s to

hire

nur

se m

anag

ers

in th

e In

tens

ified

Med

ical

Cas

e M

anag

emen

t uni

t to

cond

uct c

are

man

agem

ent a

nd c

oord

inat

ion

for e

ligib

le b

enef

icia

ries.

Prov

ider

s pa

rtici

patin

g in

the

dise

ase

man

agem

ent p

rogr

amre

ceiv

e ex

tra p

aym

ents

for c

ondu

ctin

g ce

rtain

pro

cess

es in

clud

-in

g: p

rovi

ding

pat

ient

enr

ollm

ent s

uppo

rt an

d co

ntac

t inf

orm

a-tio

n; c

ompl

etin

g a

chro

nic

care

feed

back

form

; and

app

ropr

iate

chro

nic

care

pre

scrib

ing.

Bene

ficia

ries

with

m

ultip

le c

hron

ic

cond

ition

s

Bene

ficia

ries

with

ast

hma,

diab

etes

, CO

PD, c

oron

ary

arte

ry d

iseas

e

Inte

nsifi

ed M

edic

alC

ase

Man

agem

ent

Dise

ase

Man

agem

ent

Con

nect

Car

e C

hoic

eM

oder

ate-

or h

igh-

risk

ABD

/SSI

adu

lt be

nefic

iarie

sex

cludi

ng d

uals,

inst

itutio

nal

All

bene

ficia

ries

excl

udin

g nu

rsin

g ho

me,

hosp

ice,

wai

ver p

rogr

ams

Med

ical

Hom

esN

etw

ork

Prog

ram

✔ ✔✔✔

✔

11833:11833Biddle_1 3/18/08 4:57 PM Page 30

11833:11833Biddle_1 3/18/08 4:57 PM Page 31

Additional CHCS Resources

The Center for Health Care Strategies (CHCS) works with Medicaid stakeholdersacross the country to design, implement, and evaluate programs that moreeffectively address the needs of adults with chronic conditions and disabilities.Visit www.chcs.org for information and resources from the following initiatives:

Managed Care for People with Disabilities Purchasing Institute: Resourcesfor developing, enhancing, or expanding managed care programs for SSI benefi-ciaries. Online materials include sample requests for proposals, contracts,health assessment tools, and other administrative resources.

Medicaid Value Program: Health Supports for Consumers with ChronicConditions: Resources for designing/implementing programs for beneficiarieswith multiple chronic conditions. Online materials include pilot project case stud-ies and intervention logic models.

Rethinking Care Program: Under this new program, CHCS is working withregional or state multi-stakeholder collaborative teams to implement new caremodels and tools for improving the care of high-need, high-cost beneficiaries.The pilot projects will be linked to a national learning network of policy makers,researchers, and practitioners focused on disseminating replicable solutions toimprove care for high-opportunity patient populations. A variety of hands-ontools, including a Users’ Guide for Predictive Modeling, will be developed andshared nationally.

www.chcs.org

11833:11833Biddle_1 3/18/08 4:57 PM Page 32

Center for Health Care Strategies, Inc.CHCS200 American Metro Blvd., Suite 119Hamilton, NJ 08619 Phone: (609) 528-8400Fax: (609) 586-3679

www.chcs.org

11833:11833Biddle_1 3/18/08 4:57 PM Page 1

Purchasing Strategies to Improve Care Management for Complex ...

Documents

Transcript of Purchasing Strategies to Improve Care Management for Complex ...