RD429 - Report on Implementation Progress of the Financial Alignment Demonstration Waiver (Duals) - November 2014


Executive Summary:
Nationally, and in the Commonwealth of Virginia, dual eligible individuals have the most complex health care needs of any Medicaid or Medicare members, including multiple chronic health conditions, behavioral health needs, and disabling conditions. Medicaid-Medicare beneficiaries comprise 15 percent of the Medicaid population and 39 percent of the expenditures. In Virginia, individuals who are eligible for both programs are currently excluded from participating in Medicaid managed care programs and receive care driven by conflicting state and federal rules and separate funding streams, potentially resulting in fragmented and poorly coordinated care. Therefore, addressing quality and costs for these individuals has been a priority in the Commonwealth.

Legislative and Executive leadership have provided exemplary support as demonstrated from 2011 through 2014 in the Acts of the Assembly, which directed the Department of Medical Assistance Services (DMAS) to implement an integrated support model for individuals who are dually eligible for Medicare and Medicaid services. DMAS has made significant strides in implementing a coordinated, integrated model of care for dual eligible individuals via the Medicare – Medicaid Financial Alignment Demonstration (FAD). Virginia’s FAD, termed Commonwealth Coordinated Care (CCC), is an opportunity authorized by the Patient Protection and Affordable Care Act to integrate covered Medicare and Medicaid benefits under one system of coordinated care using a full-risk capitated model or through a fee-for-service model operated jointly by the state and the Centers for Medicare and Medicaid Services (CMS).

In October 2011, DMAS submitted a letter of intent to CMS that indicated the Commonwealth’s desire to pursue a capitated, managed care model of service delivery. After many months of negotiation, Virginia became the sixth state to sign a Memorandum of Understanding with CMS which signifies Virginia’s formal acceptance into the FAD. The goals of CCC includes removing systematic barriers to providing seamless care across the full spectrum of services and removing financial disincentives that have discouraged states from providing care coordination services to dual eligible individuals.

Under this capitated model, Virginia, CMS, and three Medicare-Medicaid health plans (MMP’s) have entered into three-way contracts through which the health plans will receive a blended capitated rate for the full continuum of benefits provided to full benefit dual eligible individuals enrolled in CCC.

CCC blends Medicare and Medicaid services and financing to provide high-quality, person-centered care to Virginians who are dually eligible for Medicare and Medicaid. Under the CCC Program the MMPs receive a blended capitated rate to provide and coordinate the full continuum of benefits currently provided under Medicare and Medicaid, including: primary care, acute care, behavioral health services, nursing facility care, long-term care services through the Elderly or Disabled with Consumer Direction (EDCD) Waiver, and the added benefit of care coordination services for all eligible beneficiaries. MMP’s also have additional benefits such as dental, vision and podiatry.