Guaranteeing Integrated Care for Dual Eligible Individuals

When Medicare and Medicaid services are not integrated, dual eligible individuals must navigate separate programs to receive health care, long-term services and supports, and other services. In states that contract with managed care plans to deliver Medicaid services, some of which may separately provide, or “carve out,” certain benefits, a dual eligible individual must navigate not only separate programs but also multiple Medicaid plans. Individuals may choose to receive Medicare benefits through managed care or fee-for-service. They may obtain some Medicaid services on a fee-for-service basis but may be required to enroll in one or more Medicaid managed care plans for other services. In extreme cases, a dual eligible individual could be enrolled in five separate programs or plans to get the full range of Medicare and Medicaid benefits. These programs include:

1. A Medicare Advantage (MA) plan (or fee-for-service Medicare) for Medicare-covered services.
2. A Medicaid managed care plan for behavioral health services.
3. A Medicaid managed care plan for dental services.
4. A Medicaid managed care plan for long-term services and supports
5. Medicaid fee-for-service or yet another Medicaid managed care plan for health services not covered by Medicare or one of the managed care carve-out plans listed above.

The current system makes it extremely difficult for health care providers to deliver patient-centered care, and incredibly challenging for beneficiaries and their families to navigate care, appeal a coverage decision, or determine who to call for help.

BPC believes that states are best positioned to integrate Medicare and Medicaid services for two reasons. First, states have decades of experience contracting for home and community-based services, which are financed through Medicaid. Second, although some beneficiaries are relatively healthy, others have complex medical conditions, have mental health or substance use disorders, are homeless, or experience a combination of these issues. Accordingly, they may need providers with special training and experience in delivering services and addressing social needs. Many patient advocates believe that these health care providers are best identified at the state level. However, federal intervention is needed when states decide not to integrate services for this vulnerable population.

On average, dual eligible individuals have higher than average health care needs, resulting in greater costs. They may be older adults or younger individuals with disabilities. Average per capita Medicare spending on dual eligible individuals is more than twice that of Medicare-only beneficiaries.¹ Although integration will require short-term investment, particularly in home and community-based services, fully integrating care for dual eligible individuals may improve quality of care and lower total costs over the long term.²

Based on discussions with a broad range of stakeholders, BPC defines “full integration” as:

1. Fully aligned benefits and financing with a single plan or provider organization that is responsible for providing all covered Medicare and Medicaid services to dual eligible individuals within a service area.
2. One benefit package that includes all Medicare- and Medicaid-covered services, including medical benefits, behavioral health, dental, and long-term services and supports.
3. A single enrollment period, a single set of member materials, a single point of access for enrollees to direct questions and coverage decisions, and a single grievance and appeals process.
4. A process that ensures that beneficiaries are informed of and understand their options and rights within an integrated program, and that provides sufficient time to allow them to make decisions regarding enrollment, with strong safeguards to protect beneficiaries.
5. A process that allows plans and providers to identify high-risk enrollees and provide for prompt assessments. This process should also provide for the use of an interdisciplinary care team using a standard assessment to develop an individualized person-centered care plan that is designed to meet the unique needs of high-risk enrollees and that is updated as needed to address beneficiaries’ changing needs over time and across settings.
6. A single and streamlined set of measures across the two programs, including quality and performance measures developed for complex populations, to be used for quality improvement and to help beneficiary decision-making

Existing models that meet that definition include Medicare Advantage Dual Eligible Special Needs Plans (FIDE SNPs), the Program of All Inclusive Care for the Elderly (PACE), and a managed fee-for-service model, based on a program developed in Washington state as part of the Financial Alignment Initiative. Despite nearly 50 years of data showing the benefits of integration for dual eligible individuals, only about 12 percent (or 1.1 million of the 12.3 million dual eligible beneficiaries) ³ receive care through an integrated model.⁴

Despite the commonsense reasons for integrating Medicare and Medicaid services and financing, some states will choose not to integrate care for a range of reasons including lack of resources or competing priorities, resulting in the need for federal intervention.

States should take the lead in integrating care for dual eligible individuals. However, if states do not integrate services, the secretary of HHS should have authority to implement a federally administered integration model–essentially a federal “fallback” program that would operate in states that choose not to integrate care. In these states, the secretary should contract directly with FIDE SNPs or PACE organizations to provide integrated Medicare and Medicaid services. States should provide notice to the secretary of HHS of their intent to either integrate care themselves or request the secretary integrate care through the federal fallback program.

This structure would be based on the framework established for the federal insurance exchange under the Affordable Care Act (ACA). Under the ACA, states may establish and operate health insurance exchanges. If they do not, individuals residing in that state can obtain coverage through the federal exchange. Under this approach, states would retain the right to fully integrate care for dual eligible individuals at a later time.

BPC recommends auto-enrollment of dual eligible individuals into fully integrated plans. However, because Medicare provides a guaranteed right to receive Medicare-covered services from the provider of their choice, beneficiaries would retain the right to opt out of the integrated plan and to choose another fully integrated model. They also could return to traditional Medicare fee-for-service. As under current law, states would retain the right to require enrollment in Medicaid managed care for Medicaid-covered services. Under this structure, all dual eligible beneficiaries would have access to services, but they would not be required to receive them through a fully integrated care model. Permitting beneficiaries to opt out is critical to preserving long-standing patient-provider relationships and to ensuring beneficiaries have access to providers with experience in treating patients with special needs.

Many of the policy recommendations in this report were included in BPC’s 2020 report, A Pathway to Full Integration of Care for Medicare-Medicaid Beneficiaries. BPC included those recommendations in this report to provide a comprehensive list of recommendations in a single document and to provide context for the federal fallback program. Recommendations are listed below. Please see the full report for more details.

I. Establish a Framework for the Integration of Medicare and Medicaid Services for Dual Eligible Individuals

To ensure that all full-benefit dual eligible individuals have access to fully integrated care models by a set date, Congress should:

A. Establish a full integration standard of coverage and care for dual eligible beneficiaries as defined above.

B. Require the secretary of HHS to provide access to fully integrated Medicare and Medicaid services for all dual eligible individuals in partnership with states, similar to the approach taken under the Financial Alignment Initiative demonstration. The secretary would make integrated care available in states that decide not to integrate.

C. Provide the Medicare-Medicaid Coordination Office with funding and regulatory authority to establish and oversee full integration in all programs serving dual eligible individuals—including integrated care models implemented by states and the federal fallback program.

D. Provide waiver authority to the secretary of HHS to align administrative differences between the Medicare and Medicaid programs, excluding issues related to eligibility, benefits, access to care, Medicare freedom-of-choice protections, or beneficiary due process rights.

II. Improve Enrollment and Eligibility

To ensure all full-benefit dual eligible individuals can enroll in fully integrated plans, Congress should:

A. Limit enrollment in full integration models to full-benefit dual eligible individuals. The secretary of HHS should also consider limiting beneficiary enrollment to fully integrated MA plans, if such an approach does not limit beneficiary access to supplemental benefits.

B. Allow auto-enrollment into state-implemented or federal fallback integration models with a beneficiary opt-out available at any time for Medicare-covered services.

C. Permit and encourage states to implement 12-month, continuous Medicaid eligibility for dual eligible individuals.

III.Provide Incentives for State-Administered Integrated Care Programs

To incentivize states to integrate Medicare and Medicaid for dual eligible individuals, Congress should:

A. Define and develop full integration models for states that choose to
integrate care.

B. Provide financial and technical assistance to HHS to support state implementation of full integration in states that notify the secretary of HHS of their intention to integrate care. This support should include financial support to plan, develop, and implement these models.

C. Provide the secretary of HHS with authority to develop a guaranteed shared savings program for full integration models.

IV.Establish a Federal Fallback Program for States that Request the HHS Secretary to Integrate Care

To ensure that fully integrated programs are available in states that choose not to integrate care, Congress should:

A. Direct the secretary of HHS to fully integrate Medicare and Medicaid services for full-benefit dual eligible individuals. The federal government should recoup payments for enrolled individuals that would have otherwise been made to the state, similar to the approach taken in Medicare Part D for prescription drugs.

B. Permit state participation in all aspects of policy development for integration programs.

C. To ensure beneficiaries in all counties have options, authorize the secretary of HHS to require MA plans to offer at least one fully integrated plan in each service area in which they offer coverage.

^{1 Bipartisan Policy Center, Update on Demonstrations for Dual-Eligible Medicare-Medicaid Beneficiaries, August 2017, 6. Available at: https://bipartisanpolicy.org/report/update-ondemonstrations-for-dual-eligible-medicare-medicaid-beneficiaries/.
2 MACPAC, Report to Congress on Medicaid and CHIP, June 2020. Available at: https://www.macpac.gov/wp-content/uploads/2020/06/June-2020-Report-to-Congresson-Medicaid-and-CHIP.pdf.
3 Medicare-Medicaid Coordination Office, Data Analysis Brief: Medicare-Medicaid Dual Enrollment 2006 through 2019, November 2020. Available at: https://www.cms.gov/files/document/medicaremedicaiddualenrollmenteverenrolledtrendsdatabrief.pdf
4 Medicare-Medicaid Coordination Office, “People Dually Eligible for Medicare and Medicaid,” Fact Sheet, March 2020. Available at: https://www.cms.gov/MedicareMedicaid-Coordination/Medicare-and-Medicaid-Coordination/Medicare-MedicaidCoordination-Office/Downloads/MMCO_Factsheet.pdf; Medicare-Medicaid Coordination Office, Medicare-Medicaid FY 2020 Report to Congress, June 2021. Available at: https://www.cms.gov/files/document/reporttocongressmmco.pdf.}