Overview The MaineCare Redesign Task Force was established in 2012 by legislative mandate to “provide detailed information that will maintain high-quality, cost-effective services to populations in need of health care coverage, comply with the requirements of the federal Patient Protection and Affordable Care Act of 2010 for state Medicaid programs and realize General Fund savings in fiscal year 2012-13 of $5,250,000” (Public Law, Chapter 657, LD 1746, 125th Maine State Legislature). This report provides an overview of the Task Force findings and recommendations for MaineCare reform and cost containment strategies. Background Task Force membership was established pursuant to PL 2011, Chapter 657, Part T. Mary Mayhew, the Commissioner of Health & Human Services served as the chair of the task force. Eight additional members were appointed to represent MaineCare members and providers and to provide expertise in public health, financing, state fiscal and economic policy. The Task Force convened nine times between September and December, 2012. All meetings were open to the public and provided an opportunity for public input and comment. Additionally, the Department of Health and Human Services contracted with SVC, Inc. and Milliman to staff the Task Force and provide a national perspective and expertise on healthcare reform and Medicaid cost containment strategies. Meeting minutes are available in Appendix 2. Table 1: Task Force Membership Member Role
income level Parents & Caretaker Relatives Mandatory but covered at an optional higher income level 79,793 Children under a State Adoption Assistance Program Optional Category 281 Non-SSI Aged & Disabled to 100% FPL Optional Category 25,246 Residents of nursing homes with income < the private rate Optional Category 3,407 Medically Needy Optional Category - Katie Beckett Coverage Optional Category 911 HCBS for the Elderly, Disabled, Adults with Physical Disabilities & MR ≤300% SSI Federal Benefit Rate Optional Category - Individuals who are HIV Positive Optional Category 417
Eligibility Changes Review of eligibility categories to determine potential duplication with eligibility for tax credits beginning in 2014 Increased tests Reduced eligibility periods for SPA to reduce income eligibility for Medicare Savings Program to federal minimum SPA to eliminate coverage for 19 & 20 year olds SPA to reduce eligibility for parents from 200% to 100% FPL Program integrity initiatives Oversight through data review, survey & certification Increased claims level analysis Contracts with program integrity vendors Utilization of Recovery Audit Contractors Centralized provider enrollment process Centralized program integrity training across all pertinent agencies Annual audit review by external agency or contractor Ongoing review of Medicaid policy and procedure Federal partnership best practice implementation (except CMS best practice annual summary report) Review of repayments due upon TPL payment Reimbursement reforms Expansion of list of hospital acquired conditions (HAC) for which reimbursement is barred beyond CMS required minimum Not reimbursing for potentially preventable readmissions No reimbursement for elective C-Section before 39 weeks Provider taxes Bundled payments Implements federal minimum requirement for HAC MaineCare does not reimburse for readmits within 72 Value Based Purchasing Measuring and reporting comparative performance Paying providers differentially on performance Designing health benefit strategies & incentives to encourage individuals to select high services and providers and better managed their health care Patient Centered Medical Homes Accountable Communities Primary Care Provider Incentive Program Purchasing Strategies Managed Care Health Homes ACOs PCCM HIT Electronic health records Health information exchanges Current MaineCare initiative Managing Special Needs Plans (SNPs) Program of All-Inclusive Care of the Elderly (PACE)
care. Together these strategies are projected to save the State $30.9 million as outlined in Table 20. Table 20: Summary of Task Force Recommendations Proposed Change : Strategy Rank Low = 1 High = 5 Predicted Savings & Federal Prior Authorization Implement concurrent review for inpatient psychiatric services for individuals 21 4.7 $90K $34K Elective surgeries 5.0 $0.8M $0.3M High cost imaging & Radiology 4.7 $2.5M $0.9M Conditions (HACs) Expand list to include all of listed for the State of MD and Payment adjustments made annually based on HACs 3.9 $1.75M $0.7M Readmissions Increase time span for which readmissions are not reimbursed 4.7 $15M $5.6M Leave Days Nursing Facility IMD ICFMR Eliminate reimbursement for hospital leave & therapeutic leave days 3.5 $1.7M $0.6M Total savings from Short-term strategies $21.8M $8.1M Proposed Change : Mid-term Strategy Rank Low = 1 High = 5 Predicted Savings State & Federal State Pharmacy Competitive bid for specialty pharmacy 4.7 $2.1M $0.8M Expand Medication Management Initiative 5.0 Addtl. research needed research needed Monitor use of Anti-Psychotics in Children and Adults and Seniors PA required 4.8 $0.7M $0.3M Restore smoking cessation services 3.7 Addtl. research needed Addtl. research needed Program Integrity Develop operational policy and procedure to handle day to day Medicaid discretionary functions and Internal review of data collected Utilize CMS’s best practice annual summary report Develop policy/procedure and mechanisms for reporting to the Medicaid and CHIP Payment and Access Commission 4.4 $6.5M $2.4M No cash for controlled substances 4.8 Addtl. research needed Addtl. research needed Total savings for Mid-term strategies $9.3M $3.5M
Appendix 3 - Matrix Previous Initiatives Proposed Changes Predicted Savings Impact Impact on Long-Term Strategies Implementation Requirements & Federal State Prior Authorization PA currently required for: All out-of-state services (including ambulance & air medical transport) Optional treatment services for members under age 21 Transportation for continuous treatments in hospital outpatient setting Dental services (i.e. dentures, orthodontia, TMJ surgery, dental services) Hearing aids Certain medical supplies & DME, i.e. DME costing more than $699, apnea monitor, hospital beds, infusion pump, Implement concurrent review for inpatient psychiatric services for individuals under 21 $90K $34K Pros: • Applies medical necessity criteria to ensure appropriate delivery of services & reduces overutilization Cons: • Increased administrative responsibility for providers • Increased State administrative responsibility May need to be modified with Enhanced PCCM model & for the managed care for LTSS, as those companies will likely establish their own PA Also overlaps with pharmacy initiatives Implementation Timeline: 3-6 mo. Savings Realization Timeline: 6-12 mo. Changes: Systems Communication: Providers Elective surgeries $0.8M $0.3M See above May need to be modified with Enhanced PCCM & for the managed care for LTSS, as those companies will likely establish their own PA See above Elective inductions <39 $0.85M $0.32M Pros: Reduced C-section rate Better outcomes Shorter labors Cons: Challenge on how to implement May need to be modified with Enhanced PCCM model, as those companies will likely establish their own PA See above
Prior Authorization (cont.) wheelchairs, oxygen, etc.) Vision services (i.e. eyewear, frames, low vision aids, orthoptic therapy/visual training) Certain physician services (i.e. breast reconstruction & reduction, gastric bypass, mastopexy, transplant, etc.) PA currently under consideration for: Prosthetics Administrative responsibilities for provider and Less savings than “hard stop” option High cost imaging & Radiology $2.5M $0.9M Pros: • Applies medical necessity criteria to ensure appropriate delivery of services & reduces overutilization Cons: • Increased administrative responsibility for providers • Increased State administrative responsibility May need to be modified with Enhanced PCCM model & for the managed care for LTSS, as those companies will likely establish their own PA See above Rate reductions Support services for adults with intellectual disabilities: 2010 Nursing facilities: 7/1/10 Rehab & community support services for children with cognitive impairments/physical 10% reduction - Medical Equipment & supplies $2.4M $0.9M Pros: Immediate savings Cons: The impact on providers increases over the years as costs rise & reimbursement does not Providers may leave the market creating access issues for recipients May impact savings potential for initiatives. See above
10% reduction - Home health $1.7M $0.6M See See above See above 10% reduction - Outpatient hospital $13.0M $4.9M See above See above See above 10% reduction - Dental $3.5M $1.3M See above See above See above 10% reduction – Physician $12.4M $4.7M See above See above See above 10% reduction – Lab & X-ray $2.4M $0.9M See above See above See above 10% reduction - Optometry, Optician, Ophthalmology $1.4M $0.5M See above See above See above 10% reduction - Private duty nursing $1.3M $0.5M See above See above See 10% reduction $0.2M $75K See above See above See above 10% reduction - Targeted Case Management $4.7M $1.8M See above See above See above
Rate reductions (cont.) limitations: 6/1/11 retro to 9/1/10 Developmental & behavioral clinic services: 7/1/10 Behavioral health services: 7/1/10 Transportation: 8/1/10 Occupational & physical therapy: 4/1/12 (pending) Podiatrist: 4/1/12 Private non-medical services: 10/1/10 Family planning: 7/1/11 Community support services: 7/1/10 Behavioral Health (Methadone): 4/1/12, 1/1/13 (pending) homes: 7/1/12 10% reduction - IMD/ICFMR $4.4M $1.7M See See above See above Benefit changes Eliminate - Smoking cessation products (except for pregnant 10/1/12 (pending) Eliminate - Ambulatory surgical center services: 9/1/12 (pending) Eliminate - STD screening clinic services Limit - Optometry visits for adults (1/3 years) Elimination - Chiropractic care $0.7M $0.3M Pros: Immediate savings Cons: adversely impact chiropractors May reduce savings for long term initiatives, Implementation Timeline: 6-12 mo. Savings Realization Timeline: 12 mo.+ Changes: Systems Communication: Providers Document: SPA
Leave Days (cont.) IMD: 10 hospital leave days & 36 therapeutic leave days ICFMR: 25 hospital leave days & 52 therapeutic leave days Eliminate - Nursing Facility: 10 hospital leave days & 36 therapeutic leave days Eliminate - IMD: 10 hospital leave days & 36 therapeutic leave days Eliminate - ICFMR: 25 hospital leave days & 52 therapeutic leave days Depending on supply of beds, patient may not have a place to return to, or have to go to another facility Communication: Providers Document: SPA SAVINGS for Short-term strategies $70.8M $26.6M Mid-Term Pharmacy Rebates for crossover claims Supplemental rebate agreements Restrictions on narcotics use to begin 1/1/2013 PAs for more costly to begin 1/1/2013 Tried & failed requirements Additional step therapy Restrictions on scripts to 1/1/2013 Competitive bid for specialty pharmacy $2.1M $0.8M Pros: Aggressive pricing discounts (due to volume purchasing) Additional benefits (i.e. clinical outreach to providers & members to ensure proper medication use) May duplicate care management organization efforts Implementation Timeline: 12+ mo. Savings Realization Timeline: 12-18 mo. Changes: Systems (potential) Communication: Providers, Members CMS waiver approval Document: RFP process, Contract development, Potential 1115 waiver Increase generic dispensing rate by $3.6M $1.4M Pros: Reduce costs from brand name prescriptions N/A Implementation Timeline: 3-6 mo.
Etc. (listed in MaineCare manual) Transportation Broker Procurement in progress N/A N/A N/A N/A N/A N/A Program Integrity Utilization of Recovery Audit Contractors Centralized provider enrollment process Centralized program integrity training across all pertinent agencies Annual audit review by external agency or contractor Ongoing review of Medicaid policy and procedure Federal partnership best practice implementation (except CMS best practice annual summary report) Develop operational policy and procedure to handle day to day Medicaid discretionary functions and Internal review of data collected Utilize CMS’s best practice annual summary report Develop policy/procedure and mechanisms for reporting to the Medicaid and CHIP Payment and Access Commission $6.5M $2.4M Pros: Internal safeguard against fraud, abuse, and waste Promoting uniform standards Understanding of current fiscal enrollment status Improve accuracy of strategic forecasts Stronger for federal reimbursement Provide state with safeguards in disputes with the federal government N/A Implementation Timeline: 6-12 mo. Savings Realization Timeline: 12+ mo. Changes: Systems, Human resource expansion or redirect Communication: Data review team, Internal policy team Document: Develop criteria TOTAL SAVINGS for Mid-term strategies $16.5M $6.3M Long-Term – Investment in Primary Care Value-based purchasing Patient Centered Medical Accountable Communities Primary Care Provider Incentive Program Increase promotion of targeted initiatives ED Maternal & child health $5.2M $2.0M Pros: Encourage appropriate level of care in appropriate care setting Better health outcomes Cons: N/A Implementation Timeline: 18-24 mo. Savings Realization Timeline: 1-3 years Changes: Systems (possibly)
Care Coordination to assist transition Provider incentive program associated with oversight & monitoring Communications: Providers, Members Member Incentive program ($7.5M) ($2.8M) Pros: Pay for outcomes and quality (not just quantity of services) Cons: Not much research done on long-term health outcomes N/A Implementation Timeline: 1-3 years Changes: Systems Communication: Providers Document: Incentive criteria & benefits Value-based purchasing with Care Management Organization (CMO) N/A Care Management Organization $1.8M $0.7M Pros: Tie in savings guarantee (funding goes back to if savings not met) Technical expertise, specialized knowledge Brings together all initiatives 1 responsible entity Cons: Perception of duplication with services provided in medical home (can be overcome with contracting strategies) State needs resources to monitor CMO Less potential savings than Capitation (softer model) May overlap with short- and mid-term strategies Implementation Timeline: 18-24 mo. Savings Realization Timeline: 2-4 years Changes: Systems (IT) Communication: Providers, Members Document: RFP process, Contract development, CMO readiness review
Concern that takes away some local control at patient/doctor level Reduce neonates & increase normal births N/A Healthy Babies Initiative/Also combines with Care Management Organization $3.7M $1.4M Pros: Better health outcomes Long-term savings (by having babies healthier) Could be tied into CMO; Could be a CMO-driven initiative Implementation Timeline: 12-18 mo. Savings Realization Timeline: 2-4 years Changes: Systems (possibly) Communication: Providers, Members ER utilization Working with ER departments to identify high utilizers, identify drivers of high utilization, & encourage appropriate treatment settings Adult (non-ICF-MR) dental covers: Acute surgical care following traumatic accident Oral surgical procedures not involving dentition & gingiva Tooth extraction if posing a serious health threat or during radiation therapy Treatment to relieve pain, eliminate Allow dental benefits for individuals using the ED for dental services ($8.4M) ($3.2M) Pros: Address dental needs to prevent future costs Better health outcomes Cons: Initial costs be tied into CMO; Could be a CMO-driven initiative Implementation Timeline: 12-18 mo. Changes: Systems Communication: Providers, Members Expand on current initiatives and use findings to identify and mitigate high utilizers N/A N/A Pros: Ensure delivery of services in appropriate setting Reduce hospital ER costs See above Implementation Timeline: Current Changes: Systems Communication: Providers, Members
ER utilization (cont.) infection, or prevent imminent tooth loss dental services (i.e. full & partial dentures, medically necessary, services that would be more cost-effective than alternative treatment for same condition) Long Term – Coordinated, quality services for Maine’s most vulnerable citizens Capitation for top 20% N/A Aggressive case & disease management Home & community-based care Continually & periodically clients to assure appropriate level of care Carve outs Reduce waitlist Risk adjustment Performance bonus for meeting quality incentives Withhold to assure that process measures achieved $45.9M $17.2M Pros: Increased coordination Contracting strategies to improve performance Prevent disease progression, hospitalization & institutionalization Members able to stay in their home/community Cost savings Ensure that members receiving appropriate level of care Specialty care provided by experienced providers MCOs/HMOs will not be penalized for taking higher-risk members (for Risk adjustment) Incentive for providers to provide quality care (for Performance Cons: State resources required for oversight Could be tied into HMO/MCO; Could be a HMO/MCO-driven initiative May have some challenges coordinating care with MCO/HMO (for Carve outs) Implementation Timeline: 18-24 mo. Savings Realization Timeline: 1-3 years Changes: Systems Communication: Providers, Members Document: RFP process, Contract development, HMO/MCO readiness review, Quality measures, Determine (for Performance bonus)
Capitation for top 20% (cont.) Some studies have not shown cost savings Potentially fragmented care (Carve outs) May require administrative/actuarial assessment & modifications (for Risk adjustment) Financial & administrative burden (for Performance bonus) Long Term – Effective & efficient use of services Elective inductions to 39 weeks N/A Put “hard stop” to elective inductions prior to 39 weeks gestation $0.85M $0.32M Pros: Reduced C-section rate Better outcomes Shorter labors Cons: Challenge on how to implement N/A Implementation Timeline: 3-6 mo. Savings Realization Timeline: 6-12 mo. Changes: Systems Communication: Providers Document: SPA Radiology Benefits Manager (RBM) (PA requirements link from MaineCare manual broken) Implement Radiology Benefits Manager Require PA Utilize clinical decision support (CDS) – no PA Implement online interactive PA $2.5M $0.9M Pros for RMB: More effective management of radiology services Reduce incidence of medically unnecessary services Cost savings from prevented services Cons for RBM: Costs shifted to providers Administrative burden on providers for PAs Pros for CDS: Reduce incidence of medically unnecessary services May overlap with CMO and MCO models, and PA Implementation Timeline: 18-24 mo. Savings Realization Timeline: 2-4 years Changes: Systems Communication: Providers, Members Document for RBM: RFP process, Contract development Document for CDS and online interactive PA: Develop criteria, (If vendor)
RBM (cont.) Can integrate into EHRs or access via the Web Cons for CDS: Administrative burden on providers to go through CDS May have lower savings than RBM Pros for online interactive PA: Reduce incidence of medically unnecessary services Requests meeting criteria automatically approved in real time RFP process, Contract development Care Coordination for LTSS Plan to implement Care Coordination in 2013 N/A N/A N/A N/A May be duplication of PCCM/MCO services N/A Cost barrier reduction N/A Eliminate co-pays ($9.2M) ($3.5M) Pros: Encourage primary care utilization SAVINGS for Long-term strategies $34.9M $13.0M Additional Task Force Strategy Recommendations Program Integrity N/A No cash for controlled substances research needed Addtl. research needed Pros: Discourage improper use of controlled substances Cons: Potential administrative burden for pharmacies Implementation Timeline: 6-12 mo. Savings Realization Timeline: 12+ mo. Changes: Systems, resource expansion or redirect Communication: Data review team, Internal policy team Document: Develop criteria