Integrated care has good start

So far, so good for Rhode Island’s Integrated Care Initiative.
The state plan to coordinate long-term care for elderly residents eligible for Medicaid and Medicare through the management of a Health Maintenance Organization is getting positive, if guarded, early reviews.
An alliance of the state’s nursing homes, which warned the introduction of a middleman into Medicaid management would increase costs, reports no “serious consequences” so far.
“In terms of care for patients there is not a whole lot of change and the impacts on our facilities have been peripheral,” said Virginia M. Burke, president and CEO of the Rhode Island Health Care Association, which represents 65 nursing homes in the state. “Neighborhood [Health Plan of Rhode Island] has, for an HMO, shown a lot of care and concern for enrollees. They are not the type to try to grind down on providers with denials or say things are not medically necessary. They are a consumer-centered organization.”
But these are still early days in the effort to integrate management of two government programs responsible for so much of long-term senior care in the state.
Looking ahead to the second phase of the program early next year, the Health Care Association has introduced a set of measures in the General Assembly to prevent potential problems when Medicare is integrated early next year.
A bill sponsored in the House by Rep. Charlene Lima, D-Cranston, and in the Senate by Sen. Maryellen Goodwin, D-Providence, would provide protections for patients and nursing homes from any unwanted cost cutting as part of the Medicare integration.
It would allow beneficiaries to opt out of HMO-run Medicare or Medicaid and, in addition to a raft of reporting and minimum-care requirements, bar the HMO from achieving savings by cutting nursing home reimbursement rates.
The Integrated Care Initiative tries to rein in the high public cost of providing long-term senior care by organizing an often-fragmented system and better aligning its incentives.
Instead of directly reimbursing providers for services, the state is paying an HMO, in this case Neighborhood, a set amount for each person, a concept known as capitation.
“The good side of capitation is it cuts out unnecessary waste,” Burke said. “The bad side is without safeguards it encourages them to limit necessary care, because they keep the savings.”
Both Neighborhood Health Plan and the state oppose the bill, which the House Finance Committee held for further study May 21. “[The state’s] ability to achieve the expected gains in care coordination, health outcomes and cost efficiency will be undermined seriously by the requirement … that health plans participating in the ICI [must] contract with ‘any willing provider’ of services,” Health and Human Services Secretary Steven M. Costantino wrote in a letter to lawmakers. “These restrictions will prevent [the state] from working with the entities participating in the ICI to establish provider-network rate structures that put beneficiaries first.”
Neighborhood President James A. Hooley also sent a letter to lawmakers in March warning of a weakened ability to negotiate rates, contradictory requirements and barriers to cooperation between providers and plan administrators.
The desire to integrate Medicare and Medicaid coverage stems from federally funded Medicare not covering nursing home care for seniors, while low-income Medicaid – the cost of which is shared by state and federal governments – does.
Because nursing home care is so expensive, many seniors on Medicare who go into nursing homes quickly exhaust their resources and end up on Medicaid.
By keeping those on Medicare healthy enough to stay in their own homes, the Integrated Care Initiative intends to significantly lower state Medicaid costs. The initial estimate from Neighborhood is that they will reduce Medicaid utilization by 6 percent.
Phase one of the Integrated Care Initiative began in November, not long enough to measure whether Neighborhood has made progress toward that 6 percent goal, said Dr. Deidre Gifford, medical director for the R.I. Executive Office of Health and Human Services.
“It is far too early,” Gifford said. “We started in November and enrollment has been in waves. We just completed enrollment and will certainly be looking at the results of the transition.”
Rhode Island’s Integrated Care Initiative comes at a time of national change to Medicaid as a result of the Affordable Care Act.
The national health care overhaul gave states the option, which Rhode Island accepted, to expand Medicaid eligibility for residents making up to 133 percent of the federal poverty line, with the federal government covering the entire cost of those newly eligible.
In Rhode Island the expansion had led to 51,000 new enrollments so far, according to the Office of Health and Human Services, with an estimated new annual cost of $492 million. •

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