CMS offers states chance to test new integrated care models for dual eligibles 

Medicaid on paper and a stethoscope
The Centers for Medicare & Medicaid Services sent a letter to state Medicaid directors proposing several new care models for dual eligibles. (Getty/designer491)

The Trump administration wants to allow state Medicaid programs to test new models of integrated care to treat dual-eligible beneficiaries. 

In a letter (PDF) to state Medicaid directors Wednesday, the Centers for Medicare & Medicaid Services offers several models they could adopt that would better serve this population. Under the first option, Medicaid programs could enter in a joint contract with CMS and private payers to cover services for dual eligibles at a capitated rate. 

CMS Administrator Seema Verma wrote in the letter that some of the administrative burdens associated with operating a Medicare-Medicaid Plan have been rolled back, making this option more attractive. 

“Since the outset of these demonstrations, our shared goal with state partners has been development of models that improve quality, enhance beneficiary engagement, and lower costs, which if successful, could be implemented on a broader scale,” she wrote. 

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A second model included in the letter is a managed fee-for-service payment approach. In this model, CMS and a state would enter into an agreement in which the state would be allowed to keep some of the shared savings for integrated care in Medicare. 

Washington state has been testing such a model and has earned $36 million in shared savings over the first three years of the demonstration, Verma wrote. CMS notes, though, that this model could run into balanced budget constraints and may not be a workable approach in every state. 

Lastly, CMS is open to states developing their own integrated models to serve dual eligibles, Verma wrote in the letter. State Medicaid officials are invited to bring potential individualized solutions to the agency, which will evaluate them for a demonstration. 

Fewer than 10% of dual eligibles are enrolled in an integrated model, Verma wrote in a blog post published by Health Affairs. Connecting more of these high-cost beneficiaries with integrated Medicare and Medicaid services can reduce the costs for their care and provide them with more effective coordination, she said. 

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“Medicare and Medicaid were originally created as distinct programs with different purposes and have operated as separate systems despite a growing number of people who depend on both,” Verma wrote. “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 added in the blog post that CMS’ new interoperability rule and its work on gathering and sharing data also play into improving care for dual-eligible beneficiaries. 

Medicare and Medicaid data for a single patient may be disparate, so the agency is working to more effectively link that information, which can also contribute to improved care coordination, she said.