Monday, September 10, 2012

Fwd: qotd: Herding dual eligibles into low quality plans

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Subject: qotd: Herding dual eligibles into low quality plans
Date: Mon, 10 Sep 2012 10:51:44 -0700
From: Don McCanne <>
To: Quote-of-the-Day <>

September 8, 2012
Obama More Flexible on Medicare Than Rhetoric Suggests
By Margot Sanger-Katz

In his convention speech in Charlotte, President Obama vowed to block
the Republican Medicare reform plan because "no American should ever
have to spend their golden years at the mercy of insurance companies."

But back in Washington, his Health and Human Services Department is
launching a pilot program that would shift up to 2 million of the
poorest and most-vulnerable seniors out of the federal Medicare program
and into private health insurance plans overseen by the states.

The administration has accepted applications from 18 states to
participate in the program, which would give states money to purchase
managed-care plans for people who are either disabled or poor enough to
qualify for both Medicare and Medicaid.

Obama's 2010 health reform law allows experimentation in delivering
health care at lower cost through demonstration projects. Many states
would like permission to shift their entire population of so-called
dual-eligible beneficiaries into the new plans. HHS has indicated that
it will enroll about 2 million beneficiaries, out of about 7 million who
qualify for full benefits from both government health programs.

California is already counting on more than $500 million in budget
savings from its own program this year.

Potential cost savings are a big incentive for states. Patients who
qualify for both federal health programs are a costly population and
include many who need nursing-home care or other expensive services.
About 40 percent of Medicaid's costs go toward patients who are also
eligible for Medicare. Advocates of the pilot program also say it could
lead to better coordination of care for patients who often struggle to
navigate the two different programs.

To get approval, states must guarantee that both Medicare and Medicaid
would save money. They must also agree to accept a fixed payment to
cover all care for each patient. While rules say the private plans must
cover all standard Medicare benefits, they also waive many Medicare
rules and leave insurer selection to the states.

Still, there is powerful opposition to the pilots among doctors,
hospitals, nursing homes, patient groups, and key lawmakers, including
Sen. Jay Rockefeller, D-W.Va., who wrote the provision in the health law
that created the office in charge of the pilot program.

"I urge you to take immediate steps to halt this initiative as currently
structured and to take the time necessary to develop a well-designed and
thoroughly evaluated care coordination model for dual eligibles that
meets the standards outlined in the law," Rockefeller wrote in a letter
to HHS.

The Medicare Payment Advisory Commission, a group of experts who advise
Congress on Medicare policy, has also weighed in with an 11-page letter
to HHS, warning that the speed and scope of the program raised questions
about whether patients would receive the care they need.

The managed-care industry is gearing up for the expansion. Three large
insurers have purchased companies that insure Medicaid beneficiaries.
For years, states have been moving Medicaid patients into managed-care
plans, with mixed results. But this pilot represents a new market: It is
the first large program that would pool Medicare and Medicaid benefits
in a single, state-administered plan.

"The problem with this population is that all the strategies that the
health plans have been used to using historically are going to
backfire," said Chris Duff, executive director of the Disability
Practice Institute, an umbrella organization for small programs that
provide coordinated care to dual-eligibles. He warned that slashing
provider rates, limiting visits, and using other conventional
cost-control measures could lead to expensive hospitalizations for frail
dual-eligible patients.

But the states are enthusiastic about the pilot programs and believe
they will be able to provide better care at lower cost.


National Senior Citizens Law Center
May 2012
Assessing the Quality of California Dual Eligible Demonstration Health Plans

California has proposed a three-year demonstration project to enroll
individuals dually eligible for Medicare and Medi-Cal (dual eligibles)
into managed care. An analysis of both Medicare and Medi-Cal quality
ratings for the eight health plans selected by the California Department
of Health Care Services (DHCS) for the first phase of the project raises
cause for concern.

Approved health plans in participating counties would be responsible for
providing enrolled dual eligibles with all Medicare and Medi-Cal
benefits and services, including all needed medical care, long-term
services and supports, and behavioral health care, beginning in January

According to a DHCS report assessing the quality of health plans in the
Medi-Cal Managed Care (MCMC) Program, seven of the eight plans received
a global health plan rating of 1 out of 5 stars.

Looking at Medicare evaluations, two of the plans selected have received
a notice of non-compliance from the Medicare program. One of those has
been marked as a low-performing plan for three consecutive years and is
at risk for termination of its Medicare contract. Another plan was
recently sanctioned by Medicare as a result of beneficiary access
problems. Medicare continues to restrict enrollment of dual eligibles
into that plan. All eight proposed demonstration plans were found to be
low-performing on a least one composite Medicare quality measure.

Comment: President Obama is currently campaigning against the
Republican proposal to privatize Medicare through a voucher program that
would move Medicare patients into private plans. Yet, based on
provisions in the Affordable Care Act, the administration is moving
Medicare patients whose coverage also is supplemented with Medicaid
(dual eligibles) into private managed care plans.

California has been a leader in health care financing innovations. Look
at the head start that they have on this program. Seven of the eight
plans they have selected to initiate the program have a global health
plan rating of only 1 star out of 5!

These plans greatly limit patients' choices of their providers and will
undoubtedly impair access by eliminating choices of most other health
care providers within the state. Having to transfer buses three times
when you are very ill can make you question whether you have the access
that the state has promised to you. And quality ratings? Forget it.

These low-income patients, under the law, have more coverage than do
traditional Medicare patients... more, but worse. We can do far better.
We can improve Medicare so that it includes the additional benefits
provided by Medicaid. Then you wouldn't need a special "dual eligible"

If the improved Medicare program included everyone, then you wouldn't
have to herd patients into inferior managed care programs just to save
money (precisely what this new dual eligible program is designed to do).
As a beneficent public monopsony, the improved Medicare program would
save us all money while being in a position to demand quality throughout
the health care delivery system. We couldn't ask for more - for all of us!

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