Where are the opportunities when it comes to delivery system reform?
For Medicaid and dual populations, the greatest opportunity to improve care is for those with the greatest degree of disability, frailty and medical complexity. This is not news, but improving care for this subset representing about 15 percent of the Medicaid or dual beneficiaries [and] accounting for over 60 percent of expenditures is also the best strategy to reduce costs. That, in a nutshell, is the opportunity.
This high-cost set of beneficiaries is very heterogeneous with respect to their illness spectrum, but they share many common characteristics. They have multiple complex chronic illnesses and concurrent disabilities. Some with serious persistent mental illness or intellectual disabilities were wards of the state in another era. Many have continuous-care needs that span medical, behavioral health and long-term care domains. And all experienced missed opportunities to effectively intervene on predictable complications of preexisting chronic illness or disability, which is also the main driver of hospitalizations, nursing facility placements and costs.
Put your clinician coat on and say a bit more about the challenges of treating these populations.
Let me describe the characteristics of this high-cost group where the opportunities with primary care redesign are the greatest. The first group is frail elders with significant functional impairments in addition to a complex array of medical issues. This is the highest risk group for permanent nursing home placement, a major source of Medicaid costs.
The second group is Medicaid or dual beneficiaries with physical disabilities, mental illness or intellectual disabilities. Here, primary care is virtually non-existent, care coordination [is] abyssal and back-end costs extraordinary.
A third group [includes] those with multiple chronic illnesses, often with concurrent behavioral health needs that overwhelm primary care physicians. In the last few decades, HIV/AIDS has become prominent in this group. The mix of chronic illness, behavioral health needs, difficult social circumstances all conspire to make their primary care very challenging and mostly ineffective.
Finally, there are the pediatric counterpart populations with significant cognitive disabilities, mental illness disabilities or special health care needs.
How effectively are primary care providers at treating these populations now?
In the usual mode of primary care practice in [fee-for-service] or typical MCO financing arrangements, not very effective at all. Given the productivity exigencies, the typical primary care physician has to see about 10 patients in a morning, and 10 patients in the afternoon, with visit times rarely exceeding 20 minutes. How then can a primary care physician possibly meet the complex needs of a quadriplegic individual with partial ventilator dependence, or a bedbound frail elder, or a reclusive middle-aged man with schizophrenia, diabetes and morbid obesity in this set of circumstances? It is the mismatch between the needs of such individuals and the resources going to primary care, along with its poor design, that results in recurrent hospitalizations, preventable nursing home placements and spiraling costs.
If that's the problem and the opportunity, what do solutions look like?
A much greater primary care investment and a much more robust primary care model is needed. Primary care today is grossly underresourced, over-hassled, disempowered and poorly designed. All of that has to change. These high-cost, high-need populations require interdisciplinary clinical teams with a capacity to respond [that] same day or same hour for new problems. This response capacity needs to move beyond the walls of a practice or a health center into a person's home, day center, shelter or long-term care facility. The clinical teams will be somewhat different for the different clinical groups but generally include nurses, nurse practitioners, social workers, integrated behavioral health clinicians and community health workers.
Secondly, it is our experience working in a global payment context that the clinical teams must go well beyond just "coordination." They must also provide enhanced primary services and function as empowered allocators of services in accordance with individualized care plans. The case loads of the teams are small and thus the additional resources going to primary care to fund this are not trivial. It's certainly not a $6 per person per month bump in primary care payments as seen in person-centered medical home models. In our experience, the level of investment per high-cost beneficiary ranges from $200-$800 per month.
Some states -- Community Care of North Carolina comes to mind -- do make an effort to provide systemic case management, though not at the level you say is necessary. However, most states are taking a very different approach. They are expanding Medicaid managed care to these complex and vulnerable populations. What do you think of that strategy?
If the same managed care strategies that have evolved for the commercial population, or the TANF population is used for these populations, they will fail. The evidence in support of this viewpoint is overwhelming. The goal of Medicaid managed care approaches is to rationalize a fragmented care system from an insurer platform and the methods used are a toolbox of case management, utilization management, benefit management and network management strategies. All of these strategies are not designed to respond to both the fundamental problem and the opportunity -- the need for care system transformation.
Expand on the problems of doing that.
First, it must be recognized that many beneficiaries with the most complex needs are simply not found in typical MCO networks. Secondly, the most costly subsets of the high-need population have very high long-term support service needs that most MCOs have little or no experience in managing, and which managed long term contractors have powerful incentives to cost shift to hospital or SNF [skilled nursing facility] care. Third, Medicaid managed care is rooted in the concept of an insurance contract, where "covered benefits," "medical necessity criteria" and "prior approval" are examples of the language of this approach. However for these complex populations, what has proven to be effective is anything but "insurance contract management strategies." What has proven to be effective is care delivery redesign and resource allocation based on a clinically derived "individualized care plans". Managed care interventions are designed to respond to a different problem and its solutions are as mismatched to the need as is the current state of primary is.
So is something like North Carolina-style case management a better answer?
From my understanding, which may well be incomplete, North Carolina is attempting to respond primarily to the problem of poor care coordination in their initiative. This is certainly worthwhile, but the far greater need is to fundamentally increase the capacity of primary care practices to deliver care, above and beyond coordinating care. And that capacity includes a greatly enhanced ability to do the thing that I previously described.
Do you think the Affordable Care Act (ACA) will promote that?
Yes, absolutely! The ACA makes an extraordinary contribution towards this needed care delivery transformation goal because it envisions the elements of the primary care and care system transformation that are essential to meaningfully improve care and reduce costs for those whose needs account for the lion share of expenditures in many of its provisions. Some of these include health homes, [accountable care organizations], [Center for Medicare and Medicaid Innovation], and the Medicare-Medicaid Coordination Office, among others.
Describe what the Commonwealth Care Alliance is.
We are a fully integrated, dual eligible, special needs plan; a creature of the first generation of Medicare/Medicaid dual demonstrations. We are paid a patient-centered, prospective risk-adjusted premium that approximates the expected cost an individual or population for the entirety of Medicaid (and Medicare) benefits. We enroll dual and Medicaid senior and younger beneficiaries that are predominantly in this high-need and high-cost subset with complex needs, and are fully at risk and responsible for all aspects of care. We are nearly statewide in Massachusetts with a network of 25 practices (many in the [community health center] safety net system), in eight hospital systems all in varying states of primary care redesign and enhancement. We have about 4,300 enrollees with the vast majority requiring considerable continuous long-term care supports, and we manage about $200 million in Medicare and Medicaid premiums on an annualized basis, with an average risk adjusted premium of about $4,000 per member per month.
Talk about the investments you make and the returns on investment you've seen.
Today we have 82 teams -- nurse practitioner, nurse, social work teams -- with integrated behavioral health, palliative care services, working within these 25 practices. In 2010, to fund these clinical teams and the necessary management and IT infrastructure, we spent about $17 million more than Medicare or Medicaid would have spent for these enrollees at these 25 sites in typical fee-for-service or managed care payment approaches. That is the level of investment that has proven to be needed to achieve care improvement and cost reduction goals. That investment has reduced hospital admissions and days to about 55 percent of a risk adjusted expected average of for the dual-eligible population and permanent nursing home placements to 40 percent of that benchmarked in Massachusetts for a Medicaid eligible home-bound beneficiaries with "nursing home certifiable" status in 2005.
When you put on your old Medicaid director's hat and talk to your Medicaid colleagues, what do you say to them? What have your experiences in the Commonwealth Care Alliance taught you that you would like to convey to them as they begin to think about systems transformation themselves?
This experience has taught me three things. First, we are not going to solve Medicaid's care and cost problems without a fundamental redesign of care delivery for those with the greatest need and highest costs. Second, there are important beneficiary subsets such as those with severe physical, intellectual or mental illness disability, for which mainstream primary care approaches will be ineffective under any conceivable scenario. These individuals need entirely new models and locations of primary care to achieve the desired care improvement and cost reduction goals. Efforts to push these most vulnerable beneficiaries into vanilla mainstream MCO networks, will be at great peril -- mostly theirs! Finally, because new models of care delivery that have never been seen before in any kind of scale, will need to be developed for this beneficiary subset with heavy long term support service needs, a widespread demonstration and learning collaborative process that can significantly scale is far more appropriate then the familiar competitive procurement processes in the upcoming dual and Medicaid contracting initiatives.
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