CMS is looking for states to test integrated care models for dual eligible beneficiaries. CMS Administrator Seema Verma sent an eight-page letter to state Medicaid directors Wednesday inviting them to take part in the new models.
The agency is hoping the programs will improve outcomes for people eligible for both Medicare and Medicaid, a population that makes up 20% of Medicare and 15% of Medicaid enrollees, but accounts for 34% of Medicare and 33% of Medicaid spend.
In her letter, Verma discussed three possible approaches: a capitated model through a joint contract with CMS, states and health plans, a managed fee-for-service model or other state-specific proposals. The first two options would require risk, while state-specific models could include anything from alternative payment methods or episode-based bundled payments to value-based purchasing.
There are almost 12 million dual-eligible beneficiaries in the U.S. Many of them have serious health concerns, including multiple chronic conditions, and face socioeconomic headwinds that could further harm their health. CMS said the federal and state governments spend more than $300 billion per year on that patient population, dollars that largely don't lead to better health outcomes or care.
With the new initiative, CMS wants states to seek new ways to "address those complex needs, align incentives, encourage marketplace innovation through the private sector, lower costs, and reduce administrative burdens for dually eligible individuals and the providers who serve them."
In a statement, Verma said one issue is that few dual eligibles are enrolled in care that integrates Medicare and Medicaid services.
"This lack of coordination can lead to fragmented care for individuals, misaligned incentives for payers and providers, and administrative inefficiencies and programmatic burdens for all," Verma said.
The letter follows a December 2018 CMS correspondence to state Medicaid directors about 10 opportunities to improve dual eligible care. CMS said Wednesday's letter and a new primary care Medicare payment model announced this week demonstrate avenues to rework care delivery.
That model, called the Primary Cares Initiative, includes partial shared risk to full downside risk. It's slated to roll out in January.
That's just the latest move into alternative payment models. In recent months, CMS also introduced the Emergency Treatment, Triage and Transport program. That program pays for onsite or virtual care from EMTs and ambulance transports to urgent care clinics or other non-hospital settings. Another example is the kidney care model, which seeks early and home-based treatments. A possible post-acute payment model could be coming down the road.
It's not just CMS that's hoping to test new payment systems and Medicaid models. States have increasingly sought ways to experiment in Medicaid, most controversially with work requirements. CMS has also granted waivers to state Medicaid programs for other initiatives, including revamping payment systems and improving behavioral health.