Texas Signs Memorandum of Understanding with CMS: Becomes Twelfth State to Adopt Medicare-Medicaid Dual Eligibles Initiative
June 17, 2014 09:13 AM
On May 23, the Centers for Medicare and Medicaid Services (CMS) and the Texas Health and Human Services Commission (the State of Texas) signed a Memorandum of Understanding (MOU) establishing the Medicare-Medicaid Alignment Initiative (MMAI) in a capitated model for beneficiaries eligible for both Medicare and Medicaid, or “dual eligibles.” The new demonstration (the Demonstration) will begin no earlier than March 1, 2015, and continue until December 31, 2018.
Texas’ MOU marks the twelfth MMAI MOU, after Massachusetts, Washington State (fee-for service), Ohio, Illinois, California, Virginia, New York, South Carolina, Washington State (capitated), Colorado, and Michigan. As of this writing, five other states have active proposals submitted to CMS. The MMAI is a joint federal and state project which seeks to improve care and reduce costs associated with dual eligibles. Minnesota has signed a dual eligibles demonstration independent of the MMAI.
In Texas, the Demonstration functions to enroll dual eligibles into managed care plans called STAR+PLUS Medicare-Medicaid Plans (MMPs), and provide long-term services and supports (LTSS). The Demonstration will eventually coordinate care to approximately594,000 dual eligibles in six counties of the state.
The MOU and its appendices “are not intended to create contractual or other legal rights between the parties,” so details will be provided in future three way contracts between CMS, the State of Texas, and the MMPs.
Included population. Dual eligibles who will qualify for the Demonstration include those who meet all of the following conditions: 1) at least 21 years of age at the time of enrollment; 2) eligible for full Medicare Part A benefits; 3) enrolled under Medicare Parts B and D; 4) receiving full Medicaid benefits; and 5) reside in one of the Demonstration’s counties. Further, those who qualify must be Medicaid beneficiaries through the Texas Healthcare Transformation and Quality Improvement Program (THTQIP) section 1115(a) demonstration, i.e. are aged 21 or older and have a physical or mental disability and qualify for SSI or receive Home and Community-Based Services (HCBS) STAR+PLUS Waiver services.
Excluded population. Those excluded from the Demonstration are those who are: 1) residents of an Intermediate Care Facility for Individuals with intellectual Disabilities and Related Conditions (ICF/IID) or receive waiver 1915(c) waiver services from either the Community Living Assistance and Support Services (CLASS), Deaf Blind with Multiple Disabilities Program (DBMD), Home and Community-based Services (HSC) or the Texas Home Living Program (TxHmL) waivers.
Overview of the Demonstration
Capitated model. Texas has opted for a capitation model, where CMS, the State of Texas, and the MMPs enter into three-way contracts in which each plan receives a prospective blended Medicare/Medicaid payment to provide coordinated and comprehensive care. The State of Texas will provide the MMPs the Medicaid component of the rate, while CMS will provide payments for Medicare Parts A, B, and D. MMPs may subcontract services.
Objectives. Key objectives for the Demonstration include: increasing access to supports and services for Medicare-Medicaid enrollees; promoting a person-centered model of care; reducing duplications and improving coordination between Medicare and Medicaid; improve quality of services; and reduced costs to CMS and the State of Texas.
Emphasis on rebalancing. The Demonstration emphasizes shifting LTSS from the institutional setting to a home and community-based setting, thus creating opportunities for home care. One objective of the Demonstration is for enrollees to “live independently in the community.” The MMPs are also tasked to “ensure that medically necessary, covered services are provided in the least restrictive community setting, with a preference for the home and community, and in accordance with the enrollee’s preferences and goals and Plan of Care.” Further, the MOU gives MMPs “significant flexibility to innovate around care delivery and to provide a range of community-based services as alternatives to or means to avoid high-cost services [such as nursing home care].”
CMS and the State of Texas, along with the MMPs, will coordinate all medically necessary Medicare and Medicaid Covered Services, including acute, behavioral health, LTSS, prescription drug, and primary care services. Unlike the Michigan MOU, the Texas MOU defines both LTSS and “Community-based Long Term Services and Supports” (Community LTSS). The definition of Community LTSS appears to be a subset of LTSS generally. LTSS is defined as being “provided predominantly in homes and communities, but also in facility-based settings such as nursing facilities.” Community LTSS is defined as “services provided to STAR+PLUS enrollees in their home or other community-based settings necessary to provide assistance with activities of daily living to allow the enrollee to remain in the most integrated setting possible.”
Flexible benefits. In addition, the MMPs can also offer flexible benefits, i.e. additional optional benefits outside of covered services, as defined in the enrollee’s Plan of Care. These flexible benefits may be LTSS.
Active enrollment. At least 60 days prior to the effective date of a passive enrollment period (described below), beneficiaries will receive a notice to actively enroll, or “opt-in” to the Demonstration. At least 30 days before effective enrollment dates, beneficiaries that have not opted in will be asked to either select a MMP or opt out of the Demonstration.
Passive enrollment. Following active enrollment, the Demonstration will incorporate a passive enrollment model, whereby eligible individuals following the 30 day period described above do not make an active choice whether or not to be in the Demonstration. The State of Texas and CMS reserve the right to modify the rate of passive enrollment based on their ability to manage those that have previously been both actively and passively enrolled. Passive enrollment phases will occur in at least six-month intervals, and passive enrollments will be capped at 3,000 or 5,000 beneficiaries per month, depending on the county. However, beneficiaries receive advanced notice, and can opt out or disenroll up until the last day of the month prior to the effective date of passive enrollment, and on a monthly basis during the Demonstration. For the full details on enrollment, see pages 7 and 53-56, here.
Populations excluded from passive enrollment include: certain enrollees in Medicare Advantage (MA), the Program of All-Inclusive Care for the Elderly (PACE), or the CMS Independence at Home (IAH) demonstration. These populations are eligible for the Demonstration as long as they first disenroll from the programs mentioned. For details, see page 6, here.
Uniform enrollment/disenrollment forms. The Demonstration will have uniform enrollment and disenrollment forms and opt out letters, which both CMS and the State of Texas will provide to stakeholders.
Prior to the signing of the final Demonstration agreement, each MMP will take part in a readiness review to make sure it is prepared to implement the Demonstration. For details, see page 26, here.
CMS and the State of Texas will jointly set rates for payments to the MMPs, and have a reasonable expectation for MMPs to achieve savings. The rate settings will be based on four principles, including that: 1) Medicare and Medicaid will both contribute to the capitation payment based on baseline spending contributions; 2) MMPs are fully responsible for the covered services under the Demonstration; 3) the savings percentages will be applied equally to Medicare A/B and Medicaid; and 4) CMS and the State of Texas will base their components of the blended rate from baseline spending rates, savings percentages, and other factors, as found in provisions of the MOU in pages 38-52, here.
HCBS incentives. Payments to the MMPs are structured to incentivize HCBS over nursing facility utilization. MMPs are paid an enhanced payment rate for enrollees that move in or out of a nursing home, while receiving lower rates for three months for enrollees who move to a nursing home from HCBS. For details, see pages 40-41, here.
Payment withholds. Both CMS and the State of Texas will withhold a percentage of their payment components to the capitated rate, which will be awarded to the MMPs subject to meeting established quality and other thresholds. The withhold amount will be 1% in Demonstration Year 1, 2% in Demonstration Year 2, and 3% in Demonstration Year 3. It remains to be seen whether or not this withhold will influence MMP behavior.
Quality thresholds. Demonstration Year One quality thresholds incorporate some standards relating to the same factors in the Michigan MOU (encounter data, assessments, beneficiary governance board, customer service, ability to get appointments and care quickly), in addition to a new measure: annual plan of care update. Unlike the Michigan MOU, the Texas MOU does contain two LTSS specific measures, but these are to be determined based on stakeholder and CMS approval. A full list of LTSS performance measures is set to be implemented by 2015.
Demonstration Years Two and Three incorporate more clinically-based quality measures, many of which are also in the Michigan MOU, including: readmissions, annual flu vaccine, screenings, and follow-ups. For the full lists of quality thresholds, see pages 44-48, here. For the full list of quality metrics that the MMPs are required to report, see pages 79-96, here.
In-network rates. In-network payment rates to future providers are not detailed in the MOU. Those who wish to be network providers must prepare to negotiate payment rates.
Out-of network rates. Emergent or urgent services must be covered “at the prevailing Medicare or Medicaid FFS rate applicable for that service.” For details on the out-of-network rates, see page 67, here.
MMPs are required to allow enrollees to keep their existing providers for up to 90 days following enrollment, with exceptions. MMPs must also honor service authorizations for LTSS up to six months following enrollment. MMPs must extend this period of time to nine months following enrollment for the terminally ill. For details, see pages 66-67, here.
Model of Care
MMPs must partner with contracted providers to implement an evidence-based model of care (MOC) that meets all CMS standards for Special Needs Plans (SNP). CMS will approve the MOC based on scoring of eleven clinical and non-clinical elements, and must achieve a score of at least 70% to be approved by CMS. The eleven clinical and non-clinical elements are the same as the eleven elements in the State of Michigan’s MOU: 1) care management for the most vulnerable subpopulations; 2) description of the plan-specific target population; 3) health risk assessment; 4) integrated communication network; 5) interdisciplinary care team; 6) measurable goals; 7) MOC training for personnel and provider network; 8) performance and health outcomes measurement; 9) plan of care; 10) provider network having specialized expertise and use of clinical practice guidelines and protocols; and 11) staff structure and care management goals.
Quality reviews of the MMPs for Medicaid services are provided by External Quality Review Organizations (EQROs). EQROs are independent entities contracting with the state to assess access, timeliness, and quality of care.
Network Adequacy and LTSS
In the Demonstration, LTSS will use Medicaid network adequacy standards, whereas Medicare standards will be used for the services for which Medicare is primary, like pharmacy benefits. Home health, in addition to other services where Medicaid and Medicare overlap, shall use the standard more favorable to the enrollee.
Minimum LTSS standards. MMPs must offer provider agreements to all “community-based long term care providers that provide a significant level of care to Medicaid clients.” MMPs must provide “at least one LTSS provider of each service type required by [the State of Texas] in the network within 75 miles of the enrollee’s residence.”
For details on network adequacy, see pages 60-62, here.
Self-determination. In addition to having a general right of “self-determination” as promoted by the MMPs, enrollees have the option to “direct their own services,” including with regard to employer and budgeting, and have access to a financial management service agency to assist them in obtaining HCBS service providers. Additionally, enrollees can hire personal assistants.
Risk Stratification and Assessment
Risk stratification. The MMPs will develop a risk stratification process using assessment tools, software, and other resources to ascertain enrollees’ care needs, including LTSS. MMPs will then classify enrollees into high risk (Level 1) and moderate to low risk (Level 2) groups.
Comprehensive health risk assessment and plan of care. MMPs shall give all enrollees a comprehensive health risk assessment. The assessment will be used to confirm that the MMPs made the correct risk stratification, and will also be used to form the enrollees’ plans of care. The plan of care will address all care needs, including LTSS. Both the comprehensive health risk assessment and the plan of care must be in place within 90 days following enrollment. The MMPs will conduct annual reassessments thereafter for each enrollee.
HCBS services. The MMPs will also determine the enrollees’ eligibility for HCBS when the enrollees either 1) have “an unmet need for at least one waiver service” or 3) they request such an eligibility determination. If HCBS eligibility is found, the service coordinator will develop an Individual Service Plan (ISP) along with the enrollee. The ISP will be a part of the enrollee’s plan of care.
For details on risk stratification and assessment, see pages 57-60, here.
Service coordination team. The MMPs will build a service coordination team for each enrollee, comprised of a service coordinator, the enrollee’s primary care physician, the enrollee, and others as requested by the enrollee. The team will work to integrate the enrollee’s care, including behavioral health and LTSS.
For the Demonstration, the State of Texas will leverage its existing Ombudsman. The Ombudsman will serve to monitor the MMPs on behalf of the State and CMS, and will also be an enrollee advocate. The Ombudsman will oversee the MMPs’ “compliance with principles of community integration, independent living, and person-centered supports and services in the HCBS [home and community based services] context.”
Limited Cost Sharing
The MMPs will not be allowed to assess cost sharing for Medicare Parts A and B services, and cannot charge Medicare Parts C or D premiums. Co-pays are permitted for drugs and pharmacy products under Medicare Part D and Medicaid. No cost sharing besides that permitted above is allowed for Medicaid services. For a full description of the Demonstration’s limited cost sharing provisions, see page 12, here.
No Balance Billing
Providers are not allowed to balance bill enrollees for services under the Demonstration.
For enrollees who choose to receive Medicare hospice benefits, they will remain in the Demonstration but will obtain hospice benefits through Medicare FFS, and the MMPs will not receive the Medicare Part C payments for these enrollees. For details, see page 65-66, here.
The Texas MOU creates opportunities for home care providers.
HCBS payment incentives. The Texas MOU, unlike some of the other MMAI MOUs, does not stipulate which HCBS services it must cover. However, it does contain payment incentives for the MMPs to encourage HCBS over institutional services. The Council emphasizes that such incentives can be even stronger. For example, the State of Texas and CMS could further agree to include a rebuttable presumption that all enrollees found to need LTSS must receive HCBS, and to also provide enhanced payment rates to MMPs for each enrollee they enroll with HCBS, where clinically applicable, regardless of prior nursing home utilization.
Pending LTSS quality measures. It remains unclear as to how the two pending LTSS quality measures will apply, if at all, to HCBS and home care providers. The Council encourages home care providers in Texas to advocate for being a part of the “ongoing stakeholder process” used to determine these quality measures. The Council believes that specific LTSS quality thresholds tailored to HCBS could hopefully provide MMPs with more incentive to engage in HCBS, both in regards to utilization and quality. This in turn would create greater opportunities between plans and home care providers.
Minimum LTSS network. The Council approves of language extending provider agreements to all “community-based long term care providers that provide a significant level of care to Medicaid clients.” That said, the Council calls for greater clarification on what constitutes “a significant level of care to Medicaid clients.” The Council hopes that greater specificity will foster greater inclusion of more home care providers in the MMPs’ networks.
Unknowns. This MOU contains many of the unknowns previously uncovered by the Council in the other MOUs. The MOU does not give detailed information on provider compensation. While MMPs must partner with contracted providers to establish MOCs, it is unclear to what extent these providers, and home care providers specifically, will play a role. The MOU also does not mention if there are any quality standards to which home care providers will be held as part of the Demonstration.
Notwithstanding persistent stakeholder concerns (see here, here, and here) regarding MMAI, home care providers can look to MMAI as an opportunity to increased clinical coordination among the dual eligible population.
In addition, MMAI will give home care providers rebalancing opportunities, as a stronger emphasis is placed on community based systems over institutional settings. Home care providers are encouraged to keep abreast of MMAI developments on CMS’ website, and to contact the National Council on Medicaid Home Care – a NAHC affiliate - with any questions or concerns.