Patrick-Murray Administration Announces Health Care Cost Containment Measure to Serve 111,000 Dually Eligible Individuals

BOSTON — The Patrick-Murray Administration today announced that MassHealth has initiated a competitive procurement process to select health care organizations to provide integrated, coordinated care to 111,000 individuals between the ages of 21 and 64 that are dually eligible for services from MassHealth and Medicare.

“This initiative will improve health outcomes for some of our neediest residents,” said Governor Deval Patrick. “By emphasizing integrated, community-based care, Massachusetts will again lead the nation in providing comprehensive, cost-effective care.”

This demonstration will create a new option for “dual eligibles” to access both MassHealth and Medicare services, providing additional, coordinated behavioral health and community support services through health plans that provide integrated care. Selected plans will begin accepting enrollments in January 2013 for coverage effective April 1, 2013.

“This demonstration represents an exciting and important option for dually eligible residents to receive care in a more integrated and coordinated way,” said Health and Human Services Secretary Dr. JudyAnn Bigby. “For the first time, dually eligible adults who enroll will be able to work with a team of medical, behavioral health and community providers to develop a care plan that more fully addresses their needs.”

Today MassHealth issued an initial Request for Responses (RFR) to organizations interested in participating. The demonstration is a partnership between MassHealth and the federal Centers for Medicare and Medicaid Services (CMS). Under the new model, selected organizations will receive one global payment from the state MassHealth office and Medicare, and will be accountable for the total care of each enrollee. The global payment will give these integrated care organizations significant flexibility to cover a range of community-based services, as recommended by the member’s care team, to promote independent living and as alternatives to high-cost traditional services.

The target population for this demonstration is approximately 111,000 adults in the Commonwealth, ages 21 to 64, who are already receiving full MassHealth and Medicare benefits.

In 2008 this target population had the following care needs:

• More than two-thirds of this target population had a behavioral health diagnosis;
• 35% of the target population had Serious Mental Illness (SMI);
• 41% had a chronic physical condition; and
• 11% had an intellectual or developmental disability.

"This is the first time that people with complex mental health, physical and intellectual needs will have the opportunity to be actively involved in the decision making process about the health care and long term support services they receive," said Dennis Heaphy, co-chair of Disability Advocates Advancing Our Healthcare Rights (DAAHR). "The disability community is seizing on the duals demonstration project as a once in a generation opportunity and we look forward to continued involvement in the development and oversight of this project as it evolves."

Under this demonstration, comprehensive services, beyond currently covered standard Medicare and Medicaid benefits will be available to address members’ full range of health and functional needs.

Each member will work with an interdisciplinary care team that includes a primary care or behavioral health care provider and a care coordinator. For enrollees who need long term services and supports, an independent living coordinator from a community-based organization will be part of the care team. Working together, the interdisciplinary care team will comprehensively assess the member’s needs and develop an individualized care plan for addressing them.

“This initiative will allow us to work with CMS to coordinate, improve and simplify health care for individuals enrolled in both Medicare and MassHealth,” said MassHealth Director Dr. Julian Harris. “This integrated system will give providers and patients the flexibility to customize and coordinate the optimal set of services to help more of our members with complex care needs maintain their independence in the community.”

Should a dually eligible individual select enrollment in a plan that is part of this demonstration, each member will receive clear and accessible information from MassHealth and Medicare about their enrollment choices; MassHealth will manage enrollments and ‘opting out’ of the plans by members. Members have the ability to change which integrated care organization they are a part of, or opt out of the demonstration completely, at any time.

The policies reflected in the RFR are based on extensive stakeholder input from dually eligible individuals, community organizations, advocates, providers, and other stakeholders. MassHealth has held more than 20 open public meetings on the demonstration and many other member- and provider-focused meetings related to this demonstration.

As a result of Governor Patrick’s push to lower the cost of health care, the average increase of base rates has fallen dramatically in the past three years. In April 2010, Governor Patrick directed the Division of Insurance (DOI) to use existing authority to review small-group health insurance rates and use statutory powers to disapprove rates that were unreasonable or excessive. The Division disapproved 235 of 274 rates at that point, and later negotiated lower rate increases with carriers. In the summer of 2010, the legislature passed and Governor Patrick signed a bill that gave the health care industry new tools to try to deal with rising health care costs. Those measures included expanded review authority for DOI, the creation of group purchasing cooperatives and the creation of limited or tiered network plans that cost subscribers at least 12 percent less than regular plans.

These measures, together with market innovations in integrated care, new cost-sharing models enabled by the federal Affordable Care Act and renegotiated contracts between some insurers and providers, have helped Massachusetts make significant progress in controlling health care costs. Governor Patrick is working with the Legislature to bring a final cost-containment bill to his desk that will give the industry more tools to continue moving toward the kind of integrated care that improves health care quality and lowers total cost by rewarding the quality of care, not the quantity.

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