Update on MCO (Managed Care Organization) Tax
DHCS Director Jennifer Kent opened with an update on the MCO tax and the need to revise it to meet new federal guidelines to broaden the base to all health plans (learn more here). Last Spring, the Governor called a special session to resolve this and related Medicaid financing issues—but the Legislature was not able during the regular session to strike a deal, as many had hoped. The Special Session will continue through the winter. Elizabeth Landsberg of Western Center on Law and Poverty noted the handful of Medi-Cal bills vetoed by Gov. Brown, as “collateral damage for the MCO tax.” “It’s poor people who pay the price” for delayed action on the MCO tax,” added Landsberg.
Medi-Cal 1115 Waiver Renewal: Status and Next Steps
The state has made significant efforts to develop a robust proposal for renewal of a Medicaid waiver, completing a six-month stakeholder input process and submitting the renewal application on March 27, 2015, well in advance of the current waiver’s October 31 expiration date. Yet in negotiations, the federal government has been noncommittal on key provisions—including the financing, said DHCS’s waiver renewal lead Mari Cantwell. CMS (Centers for Medicare and Medicaid Services) apparently still has questions about how Medi-Cal is financed (learn more about lingering waiver finance issues in this October 13 LAO report), how care is delivered, how managed care works across the state, and the role of the counties—really critical background for understanding the state’s objectives for Medi-Cal 2020.
Much of the structure of the proposed waiver renewal is anchored in the peculiarities of Medi-Cal, particularly in the role of the counties in delivering care, often across cultural barriers and using a proven medical home model. “These details really matter,” said Erica Murray of the California Association of Public Hospitals and Health Systems. But CMS, for its part, would like to see more standardization of Medicaid and how it operates across the states. But, as noted again and again in the stakeholder meeting, California is not Florida, which just completed its waiver negotiation, or Texas which has its renewal coming up soon. Neither state has expanded their Medicaid program. At every step in the waiver negotiations, Cantwell and other officials have tried to show how the state’s approach to uncompensated care aligns with CMS’ own principles on uncompensated care, in particular the notion that coverage is better than limited safety net care.
Where the state and CMS left off as of last Friday was in proposing a scaled back version of the waiver–since the original “shared savings” concept in the original was ruled as not doable legally. Instead of $17 billion “ask” the state is down to $10 billion over the five-year life of the waiver. This narrower scope, said Murray of CAPH, is still worthwhile—with enough waiver content in tact to keep California’s county-based health system “in a lead role on delivery system reform.”
With less available in the DSHP (Designated State Health Program) dollars set aside for uncompensated care –only $150 million instead of the $4 billion the state was counting on—the state is “thinking hard” with CMS about alternatives for the non-federal share of waiver financing. In a cruel ironic twist, fewer DSHP are claimable for California precisely because of the state’s success in covering so many of the uninsured, Even with fewer resources going into the waiver, the state is intent on preserving key waiver provisions, though on a smaller scale:
- The DSRIP (Delivery System Reform Incentive Payment Program) 2.0 would build on the successes and lessons from the first DSRIP, adding designated municipal hospitals to the mix of public hospitals already participating, and focusing on four domains:
- Behavioral health integration;
- Care coordination and medical homes for targeted high-risk populations;
- Redesign of ambulatory care for primary and specialty and integration of post-acute care. This domain includes patient safety, upstream initiatives like the million hearts initiative and other obesity and cancer prevention strategies.
- Resource utilization efficiency, for example through more appropriate use of blood products and antibiotics.
- The global payment for the remaining uninsured would deepen incentives for counties to shift from hospital based care to primary care for uninsured residents;
- Improve dental care in Medi-Cal using the limited DSHP dollars for California.
- Test models for whole person care such as housing supports through voluntary county or regional initiatives and a competitive application process where preference will be given to counties demonstrating strong community partnerships. Under the latest proposal, $300 million would be set aside for each year of this pilot program, to match county funds.
- On the non-programmatic side, the state would undergo an independent assessment of Medi-Cal managed care plans’ compliance with access standards, forming an advisory committee to tackle findings and look at complaints and complaint processes more broadly.
Drug Medi-Cal, A New Medi-Cal Waiver Program
Approved by CMS last August, the Drug Medi-Cal Organized Delivery System (DMC-ODS) will demonstrate how organized substance use disorder care can increase the success of DMC beneficiaries to achieve sustainable recovery while decreasing health care costs system-wide. The waiver starts in a handful of counties and then goes to scale, starting now with technical assistance to pilot counties and creation of stakeholder advisory groups (learn more here or in this fact sheet).
Implementation of SB 75 Coverage for All Kids by May of 2016
Per Health Access and other advocates’ request in the last stakeholder meeting, DHCS provided an overview of its plan to implement SB 75, the expansion of full scope Medi-Cal coverage to all kids that was included in the final budget agreement last June. So far the state has drafted notices to families known to have eligible children (see its Cal SIM-based estimates of how many in each county are in restricted scope Medi-Cal now) and sought feedback from county-based enrollers on the notices. Beyond that, the timeline and to-do list will be very compressed. Much of this work is happening in the AB 1296 Committee’s immigration subgroup established for this project.
To reach eligible kids not yet in limited scope Medi-Cal or otherwise known to Medi-Cal, outreach and enrollment strategies are also under development with input from foundations and community stakeholders (any ideas or questions should go here: SB75EligibilityandEnrollment@dhcs.ca.gov).
To date, the Coordinated Care Initiative has 117,000 enrolled, with high opt-out rates of a third to a half of enrollees, not surprising to those skeptical about the transition of the Duals into CCI (learn why here). As noted in a recent overview of the 2015-16 state budget by the Senate Committee on Budget and Fiscal Review, since its inception the CCI program has had a higher than expected opt-out rate-even higher for diverse populations like Asian groups and LEP groups in certain counties and for older enrollees. For those who stay in the program, it’s not clear whether or to what extent the program is improving health outcomes and therefore cost effectiveness.
From today’s update, we learned of DHCS’ and others’ efforts to understand the high opt-out rates using focus groups and surveys of enrollees. Once enrolled, the satisfaction rate is high, suggesting a need to minimize the confusion about the program and helping enrollees understand their benefits, starting with a Health Risk Assessment and use of enrollment and utilization data to better target interventions. DHCS is also working on a beneficiary toolkit and Choice Book to help beneficiaries better understand their health plan options and benefits.
Health Homes for Patients with Complex Needs (ACA Section 2703) Update
Authorized under ACA Section 2703 (and by California Assembly Bill 361 of 2013, which authorized the state to submit a Section 2703 application), the Health Homes Program will serve Medi-Cal beneficiaries with multiple chronic conditions and high utilization who may benefit from enhanced care management and coordination. Last week, DHCS released a Request for Interest (RFI) to see which Medi-Cal managed care and Cal Medi-Connect plans may have interest and capacity to undertake a Health Home Program (also see FAQs here) by July 2016. The plans have until October 30th to respond. To participate, all plans in a given county must participate. DHCS will release its Concept Paper 3.0 in December of this year, and managed care plans will have until February 5th to respond to the full RFP. To receive notices or submit questions or issues about the HHP, send email to HHP@dhcs.ca.gov.
CCS Advisory Group Update
The CCS (California Childrens Services, serving children with special health care needs) program has been moving toward a “Whole-Child Model” of delivering care to children with special health care, with full implementation planned for January 2017. Under the Whole-Child Model children and youth with special health care needs will receive comprehensive, coordinated services that address the child’s full range of needs rather than only the special health condition, through partnerships with County Organized Health System (COHS) health plans and up to four managed care plans (learn more here).
A Workgroup on Data and Quality measures is exploring different ways to measure quality and publish that data in a community dashboard and another Eligible Conditions workgroup is sorting out which conditions to target in the program.
Review of Medi-Cal Kids Utilization Data
These slides are worth a look, to better appreciate how the Medi-Cal population and utilization by children has evolved since 1966 when the program began in California. Covering only 15% of California kids in that first year, today Medi-Cal covers more than half (52%) of California kids. That number may grow with the #Health4All kids expansion is implemented in May of 2016.
Where there are more families living in poverty, we see higher Medi-Cal enrollment, and this explains the variation in enrollment from a low of 21% to a high of 71% (mainly Central Valley and parts of Northern California). The presentation provided a timely reminder of why efforts are underway to transform the way care is paid for and delivered in Medi-Cal starting populations with complex conditions: For example, the most costly 1% of Medi-Cal children accounted for 24% of total spending on children. By drilling down into some of those differences by diagnostic categories we can see where to prioritize delivery system reforms and interventions.
Future Meetings of the DHCS Stakeholder Committee
- February 25, 2016
- May 16, 2016
- August 11, 2016
- October 2016
For updated meeting schedules and materials visit: http://www.dhcs.ca.gov/Pages/DHCSStakeholderAdvisoryCommittee.aspx