1. MA REFORM: Integrated Care for People Dually Eligible for Medicare and Medicaid Community Stakeholders Meeting December 5, 2011 Minnesota Department of Human Services Pam.Parker@state.mn.us

2. Profile of Medicare and Medicaid “Dual Eligibility” 9.2 million individuals (2008) are “dually eligible” for both Medicare and Medicaid. More likely to have mental illness, have limitations in activities of daily living and multiple chronic conditions Care is fragmented: few are served by coordinated care models and even fewer are in integrated models that align Medicare and Medicaid. Improving efficiency of care and coordination of service delivery for this population are major issues for both States and CMS. The new Medicare-Medicaid Office of Coordination is developing models and incentives for States to work with CMS to improve coordination of Medicare and Medicaid care for people with dual eligibility. New opportunities align with MN’s pioneering role in integrated care for dual eligibles and could enhance current programs. 2

3. Dual Eligible Beneficiaries Account for a Disproportionate Share of Medicare and Medicaid Expenditures Beneficiaries Account for Disproportionate Beneficiaries Account for Disproportionate Shares of Medicare and Medicaid Spending of Medicare and Medicaid Spending Medicaid Spending ate Shares of Medicare and Medicaid Spending Total Medicare Population, 2006: 43 Million Total Medicare FFS Spending, 2006: $299 Billion Total Medicaid Population, 2007: 58 Million Total Medicaid Spending 2007: $311 Billion Dual Eligibles as a Share of the Medicare Population and Medicare FFS Spending, 2006 : Dual Eligibles as a Share of the Medicaid Population and Medicaid Spending, 2007: Source: Kaiser Family Foundation, “The Role of Medicare for the People Dually Eligible for Medicare and Medicaid, January, 2011. http://www.kff.org/medicare/upload/8138.pdf http://www.kff.org/medicare/upload/8138.pdf

4. Figure 13 Medicare and Medicaid Spending Per Capita, 2010 Total = $34,663 Total = $9,273 Number of Enrollees = 9.5 millionNumber of Enrollees = 36.7 million SOURCE: Kaiser and Urban Institute analysis of MSIS-MCBS 2003 linked file, projected to 2010 using the CBO March 2010 Medicaid baseline and the CBO March 2009 Medicare baselines. (Estimated) 4

5. Minnesota Dual Eligible Enrollment and Expenditures Minnesota Full Benefit Dually Eligible Medicare and Medicaid Aged and People with Disabilities July 2009 - June 2010 Cash Basis MA Expenditures Average Monthly Enrollment Basic Care HCBS WaiversInstitutional LTC TotalAverage annual cost per person Age 65 + 53,982 $ 203,991,000$ 221,462,513$ 704,410,923$ 1,129,864,436$ 20,930 Disabled age 18-64 52,646 $ 228,939,277$ 1,308,354,457$ 163,642,669$ 1,700,936,403$ 32,309 TOTAL 106,629 $ 432,930,277$ 1,529,816,970$ 868,053,592$ 2,830,800,839$ 26,548

6. CMS Medicare-Medicaid Coordination Office Authorized by Section 2602 of the Affordable Care Act (ACA) Purpose: Improve quality, reduce costs, and improve the beneficiary experience. Ensure dually eligible individuals have full access to the services to which they are entitled. Improve the coordination between the federal government and states. Develop innovative care coordination and integration models. Eliminate financial misalignments that lead to poor quality and cost shifting. New Initiatives and Opportunities for States: Integrated Care Demonstration $1Million Planning Contracts to 15 states: CA, CO. CN, MA, MI, MN, NY, NC, OK, OR, SC, TN, VT, WA, WI. Integrated Financing Models: Managed Care and FFS vehicles for States to meet design contract goals. Allows states to share in Medicare savings for first time, 38 States submitted Letters of Intent

7. MN Coordinated Care Initiatives MSHO: First fully integrated dual demo in 1995, operates through contracts with 8 Medicare Advantage Special Needs Plans, about 37,000 enrollees statewide (70% of Medicaid seniors). Includes primary, acute and long term care. SNBC: Managed care program for people with disabilities 18-64, developed with stakeholders, about 6,000 enrollees, 2011 legislation expands enrollment but anyone can choose to opt out. SNBC does not include long term care services, provided by 5 plans, 3 SNPs. Health Care Home (HCH): Medicaid benefit provides additional payments to clinics and practitioners certified by MDH as HCH to improve health outcomes and quality of life for people with chronic health conditions and disabilities. Multi Payer Advanced Primary Care Practice (MAPCP) Demo: MN is one of 8 states to get Medicare payments for Medicare FFS beneficiaries served in certified HCH including dual eligibles. Health Care Delivery System (HCDS): Primary care accountable care models operating in and outside of managed care to improve care coordination, population health, patient experience and cost effectiveness, will be expanded to serve duals.

8. MN Design and Financing Proposals Integration Demonstration Design Contract Proposal: Builds on existing initiatives to focus on care delivery improvements specific to people with dual eligibility Development of performance metrics, risk adjustment, payment models and provider feedback mechanisms specific to dual eligibles across managed care and FFS for HCH, HCDS/Total Cost of Care models Develop closer links between HCH and community services Capitated Financing Model for Seniors: Aligns with current managed care programs for seniors (MSHO/MSC+) Revise Medicare SNP bid process for dual eligible SNP demos Shared Savings: Ask CMS to consider addition of HCH under Medicare primary care benefit Streamline administrative and operational features Further discussion of integration options for people with disabilities: CMS wants integrated financial accountability for long term care But State policy excludes long term care from managed care programs for people with disabilities And SNP vehicle for integration is unstable due to lack of appropriate risk adjustment under Medicare for people with disabilities

9. Process and Timelines Internal DHS interdivisional, leadership and work teams established Pam Parker and Jeff Schiff are co-managing the project with Medicaid Director David Godfrey’s leadership Project Coordinator hired: Deb Maruska Site visit, interim reports and monthly calls with CMS CMS is conducting financial modeling for shared savings models CMS is providing access to additional Medicare data Stakeholder processes are required by CMS (and are a MN expectation!) CMS Technical Assistance Contractor: Mathematica CMS Evaluator: RTI with multiple additional contractors MN participates in the CHCS Dual Demonstration Technical Assistance and Innovations Initiative with the other 14 Dual Demonstration States

10. Next Steps Work with CMS on financing and shared savings questions Build an integrated Medicare Medicaid data base Explore and identify appropriate measures for dual eligibles: DHS Medical Director Dr. Jeff Schiff is working through HSAC and also closely with NCQA and the National Quality Forum DHS will also be working with own actuarial contractors on financial models Continue coordination with related MA Reform proposals Continue to consult stakeholders Demonstration Design proposal is due March 2012 It will be posted with a comment period Must agree to begin implementation within 2012 but can phase in: Phase 1: Amend seniors managed care contracts in 2012 for 2013 Phase 2: Further coordination with Medicare within FFS and SNBC managed care models for populations with disabilities

11. Stakeholder Information and Opportunities Dual Demo Website: http://www.dhs.state.mn.us/main/idcplg?IdcService=GET_DYNAMIC_C ONVERSION&RevisionSelectionMethod=LatestReleased&dDocName=d hs16_163573 http://www.dhs.state.mn.us/main/idcplg?IdcService=GET_DYNAMIC_C ONVERSION&RevisionSelectionMethod=LatestReleased&dDocName=d hs16_163573 Includes MN’s proprosal to CMS and interim reports etc. Disability Managed Care Stakeholders Group SNBC Website: www.dhs.state.mn.us/SNBCwww.dhs.state.mn.us/SNBC Multiple subgroups have been meeting, with extensive outreach for SNBC expansion as well as Dual Demo updates, see workgroup schedules on website. Statewide Video Conference Thursday December 8, 1PM. New sites added, contact Cindy Czech (cindy.czech@state.mn.us)cindy.czech@state.mn.us Seniors Managed Care Stakeholders Group Initial Invited Group Meeting: Friday December 9, 2011 1PM Still looking for senior enrollees and/or family members to participate! Contact: Sue Kvendru (sue.kvendru@state.mn.us)

12. Dual Demo Team Contact Information: Medicaid Director: David.Godfrey@state.mn.us Co-Manager: Pam.parker@state.mn.us Co-Manager: Jeff.Schiff@state.mn.us Project Coordinator: Deb.Maruska@state.mn.us David.Godfrey@state.mn.usPam.parker@state.mn.usJeff.Schiff@state.mn.us Deb.Maruska@state.mn.usDavid.Godfrey@state.mn.usPam.parker@state.mn.usJeff.Schiff@state.mn.us Deb.Maruska@state.mn.us