Building a Strong Substance Use Disorder (SUD) 1115 waiver demonstration

The American Public Health Association annual conference’s thematic focus on preventing violence provided an illustration of the extent of the overwhelming demands on state public health agencies right now. Not only do you need to face the daily challenges of responding to the COVID-19 pandemic, you also need to address ongoing, complex issues like violence prevention.

The sheer breadth of sessions available at APHA shows the broad scope of public health’s reach and the need for multi-level, multi-sector interventions, all with a shrinking public health workforce. The conference’s sessions painted clear pictures of the critical public health issues our country currently faces, but did not showcase many solutions, perhaps leaving state health agency leaders wondering how to tackle these taxing demands coming from every direction with no end in sight.

BerryDunn has a suggestion: practice organizational self-care! It might seem antithetical to focus maxed-out resources on strengthening systems and infrastructure right now, but state public health agencies have little choice. You have to be healthy yourself in order to effectively protect the public’s health. Organizational health is driven by high-functioning systems, from disease surveillance and case investigation to performance management, and quality improvement to data-informed decision-making.  

State health agencies can use COVID-19 funding to support organizational self-care, prioritizing three areas: workforce, technology, and processes. Leveraging this funding to build organizational capacity can increase human resources, replace legacy data systems, and purchase equipment and supplies. 

1. Funding new positions with COVID sources can create upward paths for existing staff as well as expanding the workforce. 
2. Assessing the current functioning of public health data systems identifies and clarifies gaps that can be addressed by adopting new technology platforms, which can also be done with COVID funding.
3. Examining the processes used for major functions like surveillance or case investigation can eliminate unproductive steps and introduce efficiencies. 

So what now? Where to start? BerryDunn brings expertise in process analysis and redesign, an accreditation readiness tool, and an approach to data systems planning and procurement―all of which are paths forward toward organizational self-care. 

1. Process analysis and redesign can be applied to data systems or other areas of focus to prioritize incremental changes. Conduct process redesign on a broad or narrow scale to improve efficiency and effectiveness of your projects. 

2. Accreditation readiness provides a lens to examine state health agency operations against best practices to focus development in areas with the most significant gaps. Evaluate gaps in your agency’s readiness for Public Health Accreditation Board (PHAB) review and track every piece of documentation needed to meet PHAB standards.
3. Data system planning and procurement assistance incorporates process analysis to assess your current system functioning, define your desired future state, and address the gaps, and then find, source, and implement faster, more effective systems. 

Pursuing any of these three paths allows state health agency leaders to engage in organizational self-care in a realistic, productive manner so that the agency can meet the seemingly unceasing demands for public health action now and into the future.

Truly effective preventive health interventions require starting early, as evidenced by the large body of research and the growing federal focus on the role of Medicaid in addressing Social Determinants of Health (SDoH) and Adverse Childhood Experiences (ACEs).

Focusing on early identification of SDoH and ACEs, CMS recently announced its Integrated Care for Kids (InCK) model and will release the related Notice of Funding Opportunity this fall.

CMS describes InCK as a child-centered approach that uses community-based service delivery and alternative payment models (APMs) to improve and expand early identification, prevention, and treatment of priority health concerns, including behavioral health issues. The model’s goals are to improve child health, reduce avoidable inpatient stays and out-of-home placement, and create sustainable APMs. Such APMs would align payment with care quality and support provider/payer accountability for improved child health outcomes by using care coordination, case management, and mobile crisis response and stabilization services.

State Medicaid agencies have many things to consider when evaluating this funding opportunity. Building on current efforts and innovations, building or leveraging strong partnerships with community organizations, incentivizing evidence-based interventions, and creating risk stratification of the target population are critical parts of the InCK model. Here are three additional areas to consider:

1. Data. States will need information for early identification of children in the target population. State agencies?like housing, justice, child welfare, education, and public health have this information?and external organizations—such as childcare, faith-based, and recreation groups—are also good sources of early identification. It is immensely complicated to access data from these disparate sources. State Medicaid agencies will be required to support local implementation by providing population-level data for the targeted geographic service area.

• Data collection challenges include a lack of standardized measures for SDoH and ACEs, common data field definitions, or consistent approaches to data classification; security and privacy of protected health information; and IT development costs.
• Data-sharing agreements with internal and external sources will be critical for state Medicaid agencies to develop, while remaining mindful of protected health information regulations.
• Once data-sharing agreements are in place, these disparate data sources, with differing file structures and nomenclature, will require integration. The integrated data must then be able to identify and risk-stratify the target population.

For any evaluative approach or any APM to be effective, clear quality and outcome measures must be developed and adopted across all relevant partner organizations.

2. Eligibility. Reliable, integrated eligibility and enrollment systems are crucial points of identification and make it easier to connect to needed services.

• Applicants for one-benefit programs should be screened for eligibility for all programs they may need to achieve positive health outcomes.
• Any agency at which potential beneficiaries appear should also have enrollment capability, so it is easier to access services.

3. Payment models. State Medicaid agencies may cover case management services and/or targeted case management as well as health homes; leverage Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) services; and modify managed care organization contract language to encourage, incent, and in some cases, require services related to the InCK model and SDoH. Value-based payment models, already under exploration in numerous states, include four basic approaches:

• Pay for performance—provider payments are tied directly to specific quality or efficiency indicators, including health outcomes under the provider organization’s control. 
• Shared savings/risk—some portion of the organization’s compensation depends on the managed care entity achieving cost savings for the targeted patient population, while realizing specific health outcomes or quality improvement.
• Pay for success—payment is dependent upon achieving desired outcomes rather than underlying services.
• Capitated or bundled payments—managed care entities pay an upfront per member per month lump sum payment to an organization for community care coordination activities and link that with fee-for-service reimbursement for delivering value-added services.

By focusing on upstream prevention, comprehensive service delivery, and alternative payment models, the InCK model is a promising vehicle to positively impact children’s health. Though its components require significant thought, strategy, coordination, and commitment from state Medicaid agencies and partners, there are early innovators providing helpful examples and entities with vast Section 1115 waiver development and Medicaid innovation experience available to assist.

As state Medicaid agencies develop and implement primary and secondary prevention, cost savings can be achieved while meaningful improvements are made in children’s lives.

Read this if you are a state Medicaid agency (SMA) or managed care organization (MCO).

Value-based care (VBC) can help stabilize healthcare revenues during times of unexpected challenges and market volatility. Implementing or solidifying value-based payment (VBP) or purchasing arrangements between payers and providers is one pathway to stabilizing provider revenues, especially during the era of COVID-19.

On September 15, 2020, the Centers for Medicare & Medicaid Services (CMS) released a letter to state Medicaid directors (SMDs) on how states can advance VBC across healthcare systems. Earlier in 2020, the CMS Administrator indicated that value-based or capitated payments can help promote provider resiliency, allowing providers to focus on quality of care as opposed to increasing utilization for short-term reimbursement gains. 

Promoting the adoption of VBC in Medicaid managed care is a long-term strategy to create stable and predictable revenues for providers, and potentially critical to successfully react to market disruptions caused by COVID-19. Providers are encouraged or obligated to see patients to drive quality outcomes, receiving VBPs or capitation that shifts revenue streams away from traditional fee-for-service models. VBP arrangements focus on quality of care, and can promote beneficiary health while reducing total costs.

A roadmap to advancing VBP in Medicaid

As healthcare costs continue to increase, states, payers, and providers have started transitioning to VBC to reimburse services based upon particular conditions (e.g., diabetes), Episodes of Care (EOC) (e.g., pregnancy and delivery), or different population healthcare needs (e.g., immunizations and well-child visits). VBP arrangements can incentivize the delivery of healthcare innovations that prioritize care coordination and quality outcomes over volume of services rendered, and help to avoid waste and duplication of services. VBP seeks to incentivize providers based on performance, and can result in shared savings for both providers and healthcare payers.

While many states have made significant progress moving towards VBP arrangements in their Medicaid managed care programs, data from the Health Care Payment Learning and Action Network (HCP-LAN) indicates there is still opportunity for improvement. In 2018, 90% of Medicare payments were made through a VBP arrangement, yet only 34% of Medicaid payments were made through VBP.  

Through its recent guidance, CMS provides a roadmap, strategies, and alternative payment methodology frameworks for states and health plans to implement successful VBP models in collaboration with the provider community. Key considerations for successful VBP implementation include:

• Defining level and scope of financial risk, and developing associated performance benchmarks
• Selecting established quality metrics that incentivize provider performance without undue administrative burden
• Encouraging multi-payer participation (e.g., Medicaid managed care, Medicare, commercial health plans) to align provider incentives across payers and delivery systems
• Advancing Health Information Technology (HIT) capabilities across providers and delivery systems
• Assessing health plan and provider/delivery system readiness
• Promoting stakeholder engagement and transparency
• Developing VBC programs focusing on sustainability

Regarding HIT and the exchange of data between providers, MCOs, and SMAs, CMS recommends states take advantage of the Advanced Planning Document (APD) process to request 90/10 funding to address technology infrastructure needs associated to help implement a robust VBC program and help ensure delivery system readiness. Facilitating data sharing and promoting real-time and reliable data transactions between payers and providers engaged in VBC is critical to measurement, monitoring, and programmatic success. Additionally, SMAs can leverage VBP arrangements to focus on areas of waste in the healthcare system, including care delivery, and care coordination. 

If you would like more information or have questions about VBC and guidance on assessing, developing or implementing changes to your managed care program, please contact us. We also offer services related to value-based payment, as detailed here. We’re here to help.

Read this if you are a state Medicaid agency, state managed care office, or managed care organization (MCO).

The November 9, 2020 announcement by the Centers for Medicare & Medicaid Services (CMS) outlines updates to the 2016 Medicaid & Children's Insurance Program (CHIP) Managed Care Final Rule (Final Rule), which present new challenges to state Medicaid and CHIP managed care programs to interpret the latest CMS guidance that attempts to relieve current administrative burdens and federal regulatory barriers.

Although the latest guidance by CMS attempts to provide potential relief to states to administer their managed care programs, states will need to coordinate with federal and state partners to further understand the latest updates to federal regulations that are presented by the updated Final Rule.

By providing relief for current reporting requirements for program costs, provider rates, network adequacy, and encounter data, this latest change by the administration enables state managed care programs to reassess current operations to update and improve their current service delivery. The updated Final Rule continues CMS’ efforts to transition state managed care and CHIP programs from a fee-for-service delivery system, and to urge state Medicaid and CHIP agencies to continue to implement payment models to improve quality, control costs, and promote innovation.  

Impacts on Medicaid managed care operations 

Changes for states to consider that impact their Medicaid managed care operations based on the latest Final Rule include:

• Coordination of benefits agreements (COBA): States will have the option to leverage different methodologies for crossover claim distribution to managed care plans, and the updated Final Rule indicates that managed care plans do not have to enter into COBA directly with Medicare.
• Rate setting and ranges, and development practices: CMS provides the option for states to develop and certify a rate range and has provided clarification and different options for rate setting and development practices.
• Network adequacy: CMS will allow for states to set quantitative network standards, such as provider to enrollee ratios, to account for increases in telehealth providers and to provide flexibilities in rural areas.
• Provider directory updates: CMS will allow for less than monthly updates to provider directories due to the increased utilization of digital media by enrollees, emphasizing decreased administrative burden and the costs for state managed care plans. This update also indicates that completion of cultural competency training by providers will no longer be required.
• Provider termination notices: The latest update increases the length of provider termination notice requirements to 30 calendar days (previously 15 calendar days).
• Member information requirements: The latest update outlines flexibilities for enrollee materials as it relates to font size and formatting.
• Quality Rating System (QRS): CMS will be developing a QRS framework in which states must align with, but will be able to develop uniquely tailored approaches for their state.
• External quality review: States that exempt managed care plans from external quality review activities must post this information on their websites for public access on an annual basis.
• Grievance and appeal clarifications: The latest update provides clarification that the denial of non-clean claims does not require adverse benefit determination notices and procedures; adjustments and clarification to State Fair Hearing enrollee request timeframes to align with recent Medicaid fee-for-service requirements

CHIP to Medicaid regulatory cross-references

CMS clarifies several CHIP to Medicaid regulatory cross-references. These cross-references include the continuation of benefits during State Fair Hearings, changes to encounter data submission requirements, changes to Medicaid Care Advisory Council (MCAC) requirements, grievance and appeals requirements, and program integrity standards.

Changing demand on managed care programs

The November 9 announcement follows a series of efforts by CMS during the past few years to modify the Final Rule in an attempt to help states meet the changing demands on their managed care programs. For the 2016 Final Rule, CMS formed a working group with the National Association of Medicaid Directors (NAMD) and state Medicaid directors to review current managed care regulations. The recommendations from the group led to public comment in November 2018 with state Medicaid and CHIP agencies, advocacy groups, health care providers and associations, health insurers, managed care plans, health care associations, and the general public. As a result of this public comment effort, the latest Final Rule seeks to streamline current managed care regulations.

The new Final Rule announcement comes after a series of efforts by CMS to offer guidance and make changes to their provider payment models, including its recent September 15 letter to state Medicaid directors that further promotes a strategic shift towards value based payments to transform the alignment of quality and cost of care for Medicaid beneficiaries.

The effective date for the new regulations will be 30 days after publication of the new Final Rule in the Federal Register (target date November 13, 2020), except for additions §§ 438.4(c) and 438.6(d)(6) for Medicaid managed care rating setting periods, which are effective July 1, 2021.

If you would like more information or have questions about interpreting the Final Rule for changes to your managed care program, please contact us.

Read this if you are a state Medicaid agency, state managed care office, or managed care organization (MCO). 

The COVID-19 pandemic and resulting economic downturn has led to increased Medicaid member enrollment and has placed a strain on state budgets to support Medicaid and other health and human services programs. It has also impacted traditional Medicaid utilization patterns and has challenged provider reimbursement models, forcing managed care programs and supporting MCOs to:

• rethink the control of program costs, 
• seek MCO program flexibilities to expand coverage such as telehealth, and 
• make operational changes to support their growing member populations.

Managed care opportunities

While COVID-19 has created many challenges, at the same time it has given managed care programs the opportunity to restructure their delivery of services not only during the public health emergency, but for the longer term. Flexibilities sought this year from the Centers of Medicare & Medicaid Services (CMS) put in place through waivers and state plan amendments have helped expand services in areas such as the delivery of COVID-19 testing, medical supplies, and behavioral health services via telehealth. 

These flexibilities have relieved the administrative burden on Medicaid programs, such as performance and reporting requirements outlined under federal law and 42 CFR §438. Although these flexibilities have helped managed care programs expand services during the pandemic, the benefits are temporary and will require MCOs to make programmatic changes to meet the demands of its population during and after the public health emergency.

A recent study by Families USA cited 38 states reporting 7% growth in member enrollment since February. As the Medicaid population continues to grow in 2020 and beyond, managed care programs have numerous opportunities to consider: 

Managing care coordination and establishing efficiencies with home- and community-based services (HCBS)

The increased risk of adverse health outcomes from COVID-19 due to older age and chronic illness, and the demands on providers and medical supplies, has forced Medicaid programs to seek waiver flexibilities to expand HCBS. As part of HCBS delivery, MCOs may focus on the sickest and most costly of their member populations to control costs and preserve quality. 

MCOs will most likely monitor cost drivers such as chronic conditions, catastrophic health events, and frequent visits to primary care providers and hospitals. MCOs have the opportunity to establish efficiencies and improve transitions across different providers and multiple conditions to better manage the over-utilization of services for members in skilled nursing facilities, and for those who receive HCBS and outpatient services.

Adjusting and monitoring Value-Based Payment (VBP) models

With the continued transition to VBP models, Medicaid programs face the challenge of added costs and adapting plan operations and services to address pandemic-related needs, chronic conditions, and comorbidities. 

Building on the latest guidance to state Medicaid directors from CMS on value-based care, Medicaid programs can look at COVID-19 impacts on provider reimbursement prior to the rollout of VBP models. Medicaid programs can continue establishing payment models that improve health outcomes, quality, and member experience. States can adjust contracts and adherence to local and state public health priorities and national quality measures to advance their VBP strategy. Managed care programs may need to consider a phased rollout of their VBP models to build buy-in from providers transitioning from traditional fee-for-services payment models, and to allow for refinements to current VBP models.

Continued stratification and the assessment of risk

By analyzing COVID-19’s impact on the quality of care and member experience, improved outcomes, and member and program costs, managed care programs can improve their population stratification methodologies factoring as population demographic analysis, social determinants of health, and health status. Adjustments to risk stratification during and after the COVID-19 pandemic will inform the development of provider networks, provider payment models, and services. Taking into account new patterns of utilization across its member population, managed care programs may need to refine their risk adjustment models to determine the sickest and most costly of their populations to project costs and improve the delivery of services and coordination of care for Medicaid members.

Telehealth

As providers transition back to their traditional structures, MCOs can continue to expand telehealth to improve service delivery and to control costs. Part of this expansion will require MCOs to balance the mentioned benefits of the telehealth model with the risk of over-utilization of telehealth services that can lead to inefficiencies and increased managed care program costs. In addition, because of the loosening of federal restrictions on telehealth, managed care programs will most likely want to update program integrity safeguards to reduce the risk of fraud, waste, and abuse in areas such as provider credentialing, personal identifiable information (PII), privacy and security protocols, member consent, patient examinations, and remote prescriptions. 

Continued focus on data improvement and encounter data quality

Encounter data quality and data improvement initiatives will be critical to successfully administer a managed care program. As encounter data drives capitation rates for MCOs, a continued focus on encounter data quality will likely enable Medicaid programs to better leverage actuarial services to establish sound and adequate managed care program rates, better aligning financial incentives and payments to their MCOs. 

States have pursued a number of flexibilities to establish a short-term framework to support their managed care programs during the COVID-19 pandemic. However, the current expansion of services and the need for MCOs to rapidly identify additional areas for operational improvements during the pandemic have allowed Medicaid programs to further analyze longer-term needs of the populations they serve. These developments have also helped programs increase their range of services, to expand and manage their provider networks, and to mature their provider payment models. 

If you would like more information or have questions about opportunities for adjustments to your managed care program, please contact MedicaidConsulting@BerryDunn.com. We’re here to help.