1. Managed Care Nursing Facility Quality Initiatives February 2, 2015

2. Project Overview Nursing Facility Carve-in Quality Program Minimum Payment Amount Program Dual Eligible Integrated Care Demonstration Programs Quality Withhold Shared Savings Program Page 2

3. Nursing Facility Carve-in Quality Program S.B. 7 (83 rd Legislature, 2013) Health and Human Services Commission (HHSC) was directed to develop a process for measuring quality of care in nursing facilities in a manner that could be used to incentivize managed care organizations (MCOs). HHSC worked with the Department of Aging and Disability Services (DADS) and stakeholders to develop a set of quality indicators. Topics addressed : Carve-in impact Potentially preventable events Member perception of care Care transitions Page 3

4. Nursing Facility Carve-in Quality Program Measures included in the 2015 Performance Indicator Dashboard Rate of admissions to nursing facility from community pre- vs post- carve-in Rate of admissions to nursing facility from hospital pre- vs post- carve-in Number of individuals who went from community to hospital to nursing facility and remained in nursing facility Potentially preventable hospital admissions Potentially preventable hospital readmissions Consumer Assessment of Healthcare Providers & Systems Nursing Home Long Stay Questionnaire Number of individuals who transitioned from the nursing facility to the community who were readmitted to the nursing facility. Page 4

5. Minimum Payment Amount Program- Phase 1 Beginning in 2013, nursing facilities began receiving payments to cover the difference between their Medicaid payments and the Medicare upper payment limit (UPL) amount. CMS prohibits this program from continuing after Medicaid nursing facility services transition to managed care. Between March 1, 2015, and September 1, 2016, (Phase I), the difference between the nursing facility Medicaid payment and the Medicare UPL amount will be included in nursing facility payments. Page 5

6. Minimum Payment Amount Program- Phase 2 After September 1, 2016, (Phase II), nursing facilities will be required to use this money for significant projects aimed at transforming how they provide care to Medicaid members in Texas. In order to receive these funds, nursing facilities will be required to demonstrate how they intend to use the funds for allowable purposes. The specifics of how Phase II will be implemented are in development now, but the emphasis is expected to be on movement towards a small house model. Page 6

7. Dual Eligible Integrated Care Demonstration Shared Savings Programs HHSC is developing a program that will require Medicare-Medicaid Plans (MMPs) to pass a percentage of HHSC’s savings to nursing facilities participating in the Demonstration who meet specific performance standards. HHSC will determine areas of focus for the initiative, but each MMP will develop its own program based on the unique characteristics of the MMPs population and nursing facilities. Page 7

8. Dual Eligible Integrated Care DemonstrationShared Savings Program Areas of focus under consideration include: Preventable emergency department visits Preventable hospital admissions (mandatory) Preventable hospital readmissions Member perception (obtained through surveys) Anticipated implementation in 2016 HHSC intends to obtain MMP feedback on the initiative Page 8

9. Dual Eligible Integrated Care DemonstrationQuality Withhold Page 9 CMS and HHSC will evaluate the STAR+PLUS MMP’s performance according to specified required metrics to earn back the quality withhold for a given year. These withholds will not apply to the Part D component of the capitation rate. Under the Demonstration, both CMS and HHSC will withhold a percentage of their respective components of the Capitation Payment. The withheld amounts will be repaid subject to the STAR+PLUS MMP’s performance consistent with established quality thresholds.

10. Dual Eligible Integrated Care Demonstration Quality Withhold Page 10 Demonstration Year 1 (1% withhold) Demonstration Years 2 and 3 (2% and 3% withhold, respectively) Encounter data Assessments Beneficiary governance board Customer service Getting appointments and care quickly Long-term services and supports Plan of Care update Plan all-cause readmissions Annual flu vaccine Follow-up after hospitalization for mental illness Screening for clinical depression and follow-up care Reducing the risk of falling Controlling blood pressure Part D medication adherence for oral diabetes medications Long-Term Services and Supports Plan of Care update

11. Dual Eligible Integrated Care Demonstration Quality Withhold Quality Withhold Measures for Demonstration Year 1 Encounter data submitted accurately and completely in compliance with contract requirements. Percent of enrollees with initial assessments completed within 90 days of enrollment. Establishment of beneficiary advisory board or inclusion of beneficiaries on governance board consistent with contract requirements. Percent of best possible score the plan earned on how easy it is to get information and help when needed. In the last six months, how often did your health plan’s customer service give you the information or help you needed? In the last six months, how often did your health plan’s customer service treat you with courtesy and respect? In the last six months, how often were the forms for your health plan easy to fill out? Percent of best possible score the plan earned on how quickly enrollees get appointments and care In the last six months, when you needed care right away, how often did you get care as soon as you thought you needed? In the last six months, not counting the times when you needed care right away, how often did you get an appointment for your health care at a doctor's office or clinic as soon as you thought you needed? In the last six months, how often did you see the person you came to see within 15 minutes of your appointment time? Number and percent of members reporting that service coordinators asked about their LTSS waiver preferences. Number of individuals who went from the community to the hospital to the nursing facility and remained in nursing facility Number/percent of enrollees who's plan of care is updated annually before the expiration date. Page 11

12. Dual Eligible Integrated Care Demonstration Quality Withhold Continued: Percent of best possible score the plan earned on how quickly enrollees get appointments and care In the last six months, when you needed care right away, how often did you get care as soon as you thought you needed? In the last six months, not counting the times when you needed care right away, how often did you get an appointment for your health care at a doctor's office or clinic as soon as you thought you needed? In the last six months, how often did you see the person you came to see within 15 minutes of your appointment time? Number and percent of members reporting that service coordinators asked about their LTSS waiver preferences. Number of individuals who went from the community to the hospital to the nursing facility and remained in nursing facility Number/percent of enrollees who's plan of care is updated annually before the expiration date. Page 12

13. Dual Eligible Integrated Care Demonstration Quality Withhold Quality Withhold Measures for Demonstration Years 2 and 3 Percent of enrollees discharged from a hospital stay who were readmitted to a hospital within 30 days, either from the same condition as their recent hospital stay or for a different reason. Percent of plan enrollees who got a vaccine (flu shot) prior to flu season. Percentage of discharges for enrollees six years of age and older who were hospitalized for treatment of selected mental health disorders and who had an outpatient visit, an intensive outpatient encounter or partial hospitalization with a mental health practitioner. Percentage of patients ages 18 years and older screened for clinical depression using a standardized tool and follow-up plan documented. Percent of enrollees with a problem falling, walking or balancing who discussed it with their doctor and got treatment for it during the year. Page 13

14. Dual Eligible Integrated Care Demonstration Quality Withhold Continued: Percentage of enrollees 18-85 years of age who had a diagnosis of hypertension and whose blood pressure was adequately controlled (<140/90) during the measurement year. Percent of plan enrollees with a prescription for oral diabetes medication who fill their prescription often enough to cover 80% or more of the time they are supposed to be taking the medication. Number and percent of members reporting that service coordinators asked about their LTSS waiver preferences. Number of individuals who went from the community to the hospital to the nursing facility and remained in nursing facility Number/percent of enrollees whose plan of care is updated annually before the expiration date. Page 14