California and Dual Eligible Beneficiaries

Steve Hernandez

Florida Atlantic University

Dr. Nancy Shehadeh

Introduction to Health Care Systems

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HSA 6103

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Table of Contents

Introduction…………………………………………………………………..3

Access to Health Care………………………………………………………...3

“Cal MediConnect” Financing………………………………………………..5

Quality of Care for “Dual Eligibles”………………………………………….6

Concerns About “Cal MediConnect’s” Quality of Care………………………7

Conclusion……………………………………………………………………13

References…………………………………………………………………….14

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Introduction

As the United States of America ushers in a new era in

health care, several states continue to innovate solutions to

address the rising cost associated with individuals who are

eligible to receive both Medicare and Medicaid. Also known as the

“dual eligible” demographic, “Dual Eligibles” are estimated to be

the most expensive demographic in the United States health care

system, and often experience poor continuity of care.

Discrepancies in preventative care also exist among the “Dual

Eligible” demographic (Sundaram, 2014).

California will implement a program that aims to provide

better continuity of health care services and lower costs

associated to providing care for the “Dual Eligible” demographic.

Appropriately named “Cal MediConnect”, the program will begin

implementation in April of 2014. Factors considered below for

“Cal MediConnect” included patient access to health care,

financial model for “Cal MediConnect” and quality of health care

services for “Dual Eligibles”. The pressure to transform “Dual

Eligibles” into a cost efficient health care demographic, is not

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without its challenges. A detailed look at California’s plan for

its “Dual Eligibles” health care program, will reveal “Cal

MediConnect’s” potential issues. However, optimism for the pilot

program’s success exist in regards to its ability to lower costs

and better coordinate care.

Access to Health Care

The “Dual Eligible” demographic include seniors and non-

elderly people with significant disabilities, many who are among

the poorest and sickest beneficiaries covered by either Medicare

or Medicaid. The existing health care delivery models for this

demographic involve very little coordination that frequently

leads to having patients balance their own health care, a process

that has proven very costly (Sundaram, 2014). The current method

to access health care, has led to poor continuity of care and

preventable health problems among the “Dual Eligible”

demographic.

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According to the website Calduals.org (2013), about 80% of

“Dual Eligibles” in California receive care on a “fee-for-

service” basis. When “Dual Eligibles” access health care, they

must carry multiple insurance cards and know different program

regulations in order to successfully navigate multiple separate

systems to receive care. This has led to difficulties in

receiving the appropriate services at the right time and place,

and has lead to duplication of tests and procedures and sometimes

unnecessary hospitalizations.

Furthermore, there exists discrepancies in how “Medi-Cal”

(California’s Medicaid program) enrollees access care. California

Health Care Foundation (2013) states, “Medi-Cal” is the nation’s

largest Medicaid program with nearly two million more enrollees

than the next largest state. Additionally, “Medi-Cal” is the

source of health care coverage for more than one in five

Californians under the age of 65, and one in three children in

California. The California Health Care Foundation (2013) goes on

to mentions that adults with “Medi-Cal” are nearly twice as

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likely to report difficulty getting a doctor appointment, then

other insured adults in California.

Moreover, in 2009, the Kaiser Family Foundation estimated

California’s total “Dual Eligible” demographic to be over 1.2

million. California’s plan to address their “Dual Eligible”

population is called “Cal-MediConnect”, and will be piloted

across the state in eight counties. An estimated 456,000 “Dual

Eligibles” will be eligible for passive enrollment, with a

maximum of 200,000 in Los Angeles County (Davenport, 2010). An

estimated one-third of those beneficiaries already are enrolled

in managed care for “Medi-Cal”, Medicare, or both.

“Cal MediConnect” Financing

“Cal MediConnect” is a three-year pilot project California

will use to promote coordinated health care delivery to seniors

and people with disabilities who are part of the “Dual Eligible”

demographic. According to the website Calduals.org (2013), “Cal

MediConnect” will be implemented no sooner than April 2014 in

eight counties. The “Cal MediConnect” program will coordinate

medical, behavioral health, long-term institutional, and home-and

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community-based services through a single organized delivery

system.

The Kaiser Family Foundation (2013) states California’s “Cal

MediConnect” program will test a capitated financial model, in

which managed care plans will receive capitated payments from

Medicare and California’s Medicaid program (Medi-Cal). The

capitation payment for Medicare Parts A and B services will be

determined using a blend of the Medicare Advantage benchmarks and

the Medicare Fee for Services standardized county rates weighted

by whether “Dual Eligibles” who are expected to transition into

“Cal MediConnect” are enrolled in a Medicare Advantage plan or

Medicare Fee for Service in the prior year. According to Kaiser

Family Foundation (2013), the “Cal MediConnect” plans will be

financially modeled as follows:

Plans will be paid the full benchmark amount. Medicare

Advantage baseline spending will include costs that would

have occurred absent the demonstration, such as quality

bonus payments for applicable Medicare Advantage plans. The

baseline capitation payment for Medicare Part D services

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will be the national average monthly bid amount as well as

the average projected low-income cost sharing subsidy and

the average projected federal reinsurance amounts. The

baseline Medicaid capitation payment will be based on

historic state spending… and on a blend of the Medicaid

managed long-term care capitation rate that would apply to

“Dual Eligibles”.

California’s capitated financial alignment also contains

provisions requiring portions of the capitated reimbursement be

withheld. However, “Cal MediConnect” can earn these “withheld”

funds back if certain quality measures are met. California also

requires incentive payments from the “withheld” funds to county

behavioral health agencies based on successful achievement of

service coordination measures (Avik, 2012).

Quality of Care for “Dual Eligibles”

The quality of care for “Dual Eligibles” is a growing

concern across the United States. In our health care system,

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there exist many “loophole” incentives that discourage health

care providers, Medicare and Medicaid programs from coordinating

“Dual Eligible” care. Lack of care coordination directly affects

the quality of care “Dual Eligibles” receives throughout the

delivery of health care services. Furthermore, another reason

quality health care for “Dual Eligibles” has also proved

challenging exist because according to Center for American

Progress (2010), the Medicare and Medicaid programs often work at

cross purposes. Medicare and Medicaid have an incentive to shift

liability to the other through coverage interpretations and other

“loopholes” that avoid costs.

The aforementioned dynamic creates a dilemma for care

provided by Medicare and Medicaid. Each program seeks to limit

its costs and enrollees shift between acute and long-term care

settings. The relationship is worsened because Medicare bears the

most responsibility for acute care while Medicaid covers long-

term care. Because of these separate financing streams and

conflicting incentives, Medicare and Medicaid cannot realize

equal savings from their investments in improved care. The Center

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for American Progress (2010) goes on to say “Better long-term

care coordination, for example, may result in reduced

hospitalizations. But this means any investments by state

Medicaid programs may result in Medicare savings…”. The above

mentioned incentivizes lack of coordination between the Medicare

and Medicaid programs, and proves disappointing for “Dual

Eligibles”.

Concerns About “Cal MediConnect’s” Quality of Care

The “Cal MediConnect” program aims to improve the quality of

care for “Dual Eligibles” by improving its coordination. However,

opposition exist towards the idea of whether or not the quality

of care will actually improve. According to the National Senior

Citizens Law Center (2012), the eight plans selected for four

counties by the California Department of Health Care Services

have cause concern. Seven out of eight plans have received a

global health plan rating of one out of five stars.

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Furthermore, The Medicare evaluations for these eight plans

have done little to ease concern. Although total participation in

“Cal-Mediconnect” will be from eight counties, eight plans

selected for Los Angeles, Orange, San Diego and San Mateo

counties have seen The National Senior Citizens Law Center (2012)

declare them “low-performing on at least one composite Medicare

quality measure”. The eight plans in the four counties mentioned

above, possessed quality concerns such as receiving notices of

non-compliance from the Medicare program, and low rankings on

performance. The National Senior Citizens Law Center (2012)

stated “One of those has been marked as a low-performing plan for

three consecutive years…Another plan was recently sanctioned by

Medicare as a result of beneficiary access problems.”

In Los Angeles, Health Net and L.A. Care Health Plan

received a one out of five star rating pertaining to Medi-Cal

quality ratings, and a 2.5 star rating pertaining to Medicare

quality ratings. Problems areas identified in Medicare audits

consisted of access to services and plan performance. Health Net

has received below-average ratings for their drug plan’s customer

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services. According to National Seniors Citizens Law Centers

(2012), these low scores were due to low ranking for timely

decisions on appeals of claim denials. In the past, Centers for

Medicare and Medicaid Services (CMS) has sanctioned Health Net by

suspending Health Net’s drug plan auto enrollment privilege, and

suspending marketing and general enrollment in Health Net’s drug

and health plans.

Moreover, L.A. Care Health Plan’s additionally scored poorly

on overall ratings from past members. Key patient safety measures

were rated low, and have caused concern since the poorly

preforming categories are related to proper administration of

blood pressure, cholesterol and oral diabetes medication.

Additionally, National Seniors Citizens Law Centers (2012) states

that the L.A Care’s health plan also under preformed in key

individual measures related to managing chronic long term

conditions and care for older adults, specifically “Yearly

Assessment of How Well Members Do Activities of Daily Living” and

“Yearly Pain Screening/Management”.

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In Orange County, CalOptima has been the plan selected for

the “Cal-Mediconnect” pilot program. CalOpitma is a county

organized health system that administers health insurance

programs for low-income families, children, seniors and persons

with disabilities in Orange County, California. The health plan

is the second largest health insurer in the county. According to

the CalOptima.org (2014) website. The CalOptima health plan

provides coverage to one in seven residents and almost a third of

Orange County’s children through two major programs, Medi-Cal

(California's Medicaid Program) and OneCare (a Medicare Advantage

Special Needs Plan) intended for low-income seniors and persons

with disabilities who qualify for both Medicare and Medi-Cal.

However, there exist concern regarding CalOptima’ s Part C

health plan. Although preforming above average overall in

Medicare quality of care ratings, CalOptima performed poorly on

key measures related to the managing of chronic long term

conditions and the care for older adults including yearly

assessment of how well members do activities of daily living and

yearly pain screening/ management. Additionally, CalOptima’s Part

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D plan was under par for members’ abilities to get prescriptions

filled easily when using Part D. The National Seniors Citizens

Law Centers (2012) reports CalOptima’s Medicaid plan also

received poor results. CalOptima earned one out of five stars

rating from Medi-Cal for “Rating of All Health Care and Getting

Care Quickly” and earned a two star rating for the category of

“Getting Needed Care and Shared Decision-Making”, a report that

causes alarming concern about the potential quality of care that

“Dual Eligibles” will receive in the “Cal-Mediconnect” program.

In San Diego, four plans have been selected to provide care

to the “Dual Eligible” demographic. San Diego is California's

second largest city with a population of 1.3 million in the city,

and almost 3 million residents throughout the county. The city is

the eighth largest in the United States, according to the

SanDiego.gov website (2014). The reasonable need for multiple

plans is justifiable in San Diego, just as in the case of Los

Angles.

Nevertheless, the health plans selected to participate in

the pilot program have ranked overall average in quality ratings

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in the past. However, the health care plans have fared poorly on

key measures. The plans selected for San Diego are Care 1st,

Community Health Group, Health Net and Molina Healthcare.

According to The National Seniors Citizens Law Centers

(2012) report, Care 1st received and overall average plan rating

from Medicare. However, Care 1st Part D ranked below average on

ten out of twenty key Medicare measures including the

“Availability of help or information when members need it” and

“The ability of members to easily fill prescriptions”. Care 1st

also performed poorly on patient safety measures, specifically

related to the proper administration of blood pressure,

cholesterol and oral diabetes medication. Care 1st Plan C also

received below average ratings specifically on Medicare measures

of “Getting needed care” and “overall rating of health care

quality”. Medicare also gave below average scores to measures

relating to managing chronic long term conditions and care for

older adults and a measure called “Yearly review of all

medication taken”

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Although Care 1st’ s total Medicare rating was overall

average, its Medicaid rating was poor. The health plan received a

one star rating in all medical quality measures. Key Medi-Cal

measures included in the evaluation were “Rating of Health Plan”,

“Rating of All Health Care”, “Getting needed care”, “Getting Care

Quickly” and “Shared Decision Making”.

Community Health Group is San Diego’s second health plan

that will participate in the “Cal-MediConnect” pilot program.

Because of the health plan’s relative small size, there is

insufficient data to accurately calculate Medicare quality

measures. However, The National Seniors Citizens Law Centers

(2012) reports that the ratings that do exist, have caused

concern over the ability of the plan to provide quality health

care. Community Health Group received below average ratings on

four measures that include “Complaints About Health Plan” and

“Complaints About Drug Plan”. Furthermore, Medi-Cal rated

Community Health Group’s adult plan far below average in measures

relating to responsiveness care, prompt appointment and care, and

attaining a needed specialist.

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Health Net of California is the third plan selected to

participate in the “Dual Eligible” demonstration program in San

Diego. Of the four participating San Diego plans, Health Net

received the highest overall rating in its Medicare plan. Health

Net received an above average rating of 3.5 stars for its

“Overall Plan Rating” measure. However, Health Net did preform

below average in certain measures due in large to problems

Medicare found with the plans “access to services” and Health

Net’s “Plan Performance”, due to serious problems identified in

Medicare audits, according to The National Seniors Citizens Law

Centers (2012).

Additionally, great concerns arises in Health Net’s drug

plan. According to The National Seniors Citizens Law Centers

(2012), “CMS sanctioned Health Net by suspending its drug plan

auto-enrollment privileges for some low-income Medicare

beneficiaries (including dual eligibles) and by suspending

marketing and enrollment of new members in its drug and health

plans”. Health Net’s poor preforming key measures related to

timely decisions on appeals of claims denials and managing

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chronic long term conditions and care for older adults. In

addition, the plan’s Medi-Cal ratings were poor overall. Health

Net received a one star rating in all key Medi-Cal quality

measures.

San Diego’s forth health care plan participating in the

“Cal-Mediconnect” program is Molina Healthcare. Molina Healthcare

possessed the worse combined ratings for Medicare and Medicaid

plans of the four health plans in San Diego. The plan’s Medicare

rating received a 2.5 overall plan rating. Molina’s Part D drug

plan received below average marks on 9 of 21 quality measures.

Additionaly, Molina performed poorly in key measures such as

“Members Choosing to Leave Drug Plan” and “Member Experience with

Drug Plan”. The Part D plan also received the lowest possible

rating on patient safety measures, according to a report from The

National Seniors Citizens Law Centers (2012). Additionally Molina

stands at risk of termination of its Medicare contract due

largely in part of consecutive years of poor Medicare summary

plan ratings. Molina’s Medi-Cal ratings reflected poor results as

well, receiving only one star in all Medi-Cal quality measures.

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The final county that will be discussed is San Mateo. San

Mateo’s “Dual Eligibles” population is estimated to be slightly

under 14,000, according to the California Health Care Foundation

(2013). The San Mateo plan participating in the “Cal-Mediconnect”

program is called Health Plan of San Mateo. Of the eight health

plans discussed, Health Plan of San Mateo stands as one of the

better rated plans overall in both Medicare and Medi-Cal quality

ratings. The plan received a 3.5 star rating, an above average

rating from Medicare for “Overall Plan Rating”. However, Health

Plan of San Mateo received below average ratings on its Part D

drug plan, with the key measure of “Member Experience with Drug

Plan” rated below average.

Additionally, Health Plan of San Mateo’s Part C health plan

received a below average mark in measures associated to

responsiveness of care and customer service. Moreover, Health

Plan of San Mateo received the highest ratings of the plans

discussed in its Medi-Cal quality ratings. According to The

National Seniors Citizens Law Centers (2012), the plan garnered

the third highest adult score statewide for the key measure

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“Rating of Health Plan” as well as the third highest adult score

for the measure “Rating of All Health Care”.

Conclusion

The transformation of health care delivery in the United

States will prove to be a long journey. The ideas vary across the

country on methods necessary to improve health care efficiencies

in the United States, and state’s Medicaid plans have an

important role to play going forward. “Dual Eligible”

beneficiaries accounted for more than 250 billion dollars on

health care benefits through the Medicare and Medicaid programs

across the country, according to the Congress of The United

States Congressional Budget Office (2013).

California’s “Cal-Mediconnect” will test efficiencies of

providing improved coordinated care between both Medicare and

Medicaid beneficiaries. The state hopes improved coordinated care

for the “Dual Eligible” demographic, will not only lower the cost

of care for this demographic, but also improve the quality of

care through improved coordination.

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References

Cal Duals Organization (2013). Dual Eligibles Fast Facts. Retrived from: http://www.calduals.org/background/fast_facts/#5

CalOptima (2014). Retrieved from: https://www.caloptima.org/en.aspx

California Department of Health Care Services (2013). Low Income Health Program. Retrieved from: http://www.dhcs.ca.gov/provgovpart/Pages/lihp.aspx

California Health Care Foundation (2013). Medi-Cal Facts and Figures: A Program Transforms. California Health Care Almanac. Retrieved fom: http://www.chcf.org/~/media/MEDIA%20LIBRARY%20Files/PDF/M/PDF%20MediCalFactsAndFigures2013.pdf

Congress of The United States Congressional Budget Office (2013).Dual-Eligible Beneficiaries of Medicare and Medicaid: Characteristics, Health Care Spending, and Evolving Policies. Retrieved from: http://www.cbo.gov/sites/default/files/cbofiles/attachments/44308_DualEligibles.pdf

Davenport, K., Markus, R., Feder, H., Feder, J. (2010). ImprovingCare and Reducing Costs for Individuals Eligible for Medicare and Medicaid. Retrieved from: http://www.communitycatalyst.org/doc-store/publications/dual_eligibles.pdf

Kaiser Family Foundation (2013). Financial and Administrative Alignment Demonstrations for Dual Eligible Beneficiaries Compared. Retrieved from: http://kaiserfamilyfoundation.files.wordpress.com/2013/11/8426-05-financial-and-administrative-alignment-demonstrations-for-dual-eligible-beneficiaries-compared1.pdf

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National Senior Citizens Law Center (2012). Assessing the Qualityof California Dual Eligible Demonstration Health Plans. Retrieved from: http://www.nsclc.org/wp-content/uploads/2012/05/Plan-Ratings-Report-May-2012.pdf

Roy, Avik (2012, November). Forward! Obama Privatizes Medicare for 3 Million 'Dual-Eligible' Low-Income Seniors. Forbes. Retrieved from: http://www.forbes.com/sites/aroy/2012/11/30/forward-obama-privatizes-medicare-for-3-million-dual-eligible-low-income-seniors/

Sundaram, Viji (2014, January). Coordinating Health Care for California’s 'Dual Eligibles'. New America Media. Retrieved from: http://newamericamedia.org/2014/01/new-program-will-allow-elders-to-age-in-place.php

The City of San Diego Administration Department. (2014). Facts History. Retrieved from: https://www.sandiego.gov/administration/programs/assistance/factshistory/facts.shtml