Author: Jeffrey Kho


ITUP Analysis and Summary of the §1115 Waiver Renewal

ITUP has prepared a six-part summary of California’s Medi-Cal 2020 §1115 waiver, which went into effect at the beginning of 2016. The new waiver aims to build off of the successes of the Bridge to Reform waiver, which expired at the end of 2015.

The analysis is freely available in six parts:

  1. Summary of the Terms and Conditions
  2. Managed Care Expansions and Demonstrations Continuation
  3. Whole Person Care Pilots
  4. Dental Transformation Initiative
  5. Public Hospital Redesign and Incentives in Medi-Cal
  6. Global Payments Program

§1115 Waiver Renewal Analysis: Global Payment Program (GPP)

This is part of an ITUP series on the Medi-Cal 2020 §1115 waiver renewal.

Before the Medi-Cal 2020 waiver, the federal/local financing of care for the uninsured was anachronistic. It incentivizes treating uninsured individuals at the hospital emergency room (the most expensive setting) at the latest possible stage of illness (the most expensive point in an illnesses trajectory). Public Hospital Redesign and Incentives in Medi-Cal (PRIME), a program in the newest waiver, will be assisting public hospitals in transforming their delivery systems to one that is compatible with Medi-Cal managed care; it will replace fee-for-service (FFS) payments with ones involving value, improved patient outcomes, capitation, and other alternative payment methods. Similar to PRIME, the Global Payment Program (GPP) aligns incentives to treat the uninsured population outside the hospital, by improving access to preventive and primary care.

Download the full analysis: §1115 Waiver Renewal Analysis: Global Payment Program (GPP)

§1115 Waiver Renewal Analysis: Public Hospital Redesign and Incentives in Medi-Cal

This is part of an ITUP series on the Medi-Cal 2020 §1115 waiver renewal.

Public Hospital Redesign and Incentives in Medi-Cal (PRIME) is an ambitious follow-up program to the successful Delivery System Reform Incentive Pool (DSRIP) for county, district, and University of California hospitals. Up to $7.5 billion will be used to transition public hospital systems to managed care models. This includes shifting the prevailing current fee for service (FFS) payment model in public hospitals towards alternative payment method (APM) models that incorporate more risk-based methodologies. Public hospital systems will be held even more accountable for cost and quality outcomes for their managed care systems. PRIME will accelerate this transition and root APM as the enduring and new standard for payment to public hospitals. Incentives will help hospitals better integrate different aspects of care, increase team-based care, improve population health and practice resource stewardship.

Download the full analysis: §1115 Waiver Renewal Analysis: Public Hospital Redesign and Incentives in Medi-Cal

Analysis of §1115 Waiver Renewal: Dental Transformation Initiative

This is part of an ITUP series on the Medi-Cal 2020 §1115 waiver renewal.

Under the Medi-Cal Dental program, dental services are provided to about 5.5 million Medi-Cal beneficiaries under the age of 20. The program aims to facilitate consistent and easy access to high quality dental services so beneficiaries achieve good oral health; to implement effective and efficient delivery systems; to maintain engagement with stakeholders; and to hold DHCS and their providers, plans, and partners accountable for performance and health outcomes. Services are provided via two delivery systems: Fee-for-Service (FFS) and Dental Managed Care (DMC). The Department of Health Care Services (DHCS) oversees and facilitates access to oral health services for FFS and DMC delivery systems in multiple ways, such as conducting outreach and education, monitoring utilization, and providing reports to stakeholders. All data associated with DTI will be based on annual reporting period by program year (PY).

The program has two key domains:

  1. Increasing preventative services utilization for children
  2. Caries Risk Assessment and Disease Management Pilot

Read the full analysis: Analysis of §1115 Waiver Renewal: Dental Transformation Initiative

Medi-Cal 2020: ITUP’s Analysis of California’s New §1115 Waiver

Over the next couple of weeks, ITUP will be posting a number of papers analyzing the terms and conditions of the new §1115 waiver. These papers will look closely at the new requirements and their implications for the Medi-Cal program.

Released Papers:

  1. Summary of the Terms and Conditions
  2. Managed Care Expansion on Demonstrations Continuation
  3. Whole Person Care Pilots
  4. Dental Transformation Initiative
  5. Public Hospital Redesign and Incentives in Medi-Cal (PRIME)
  6. Global Payment Program (GPP)

This page will be periodically updated as new reports are released.

Analysis of §1115 Waiver Renewal: Whole Person Care Pilots

This is part of an ITUP series on the Medi-Cal 2020 §1115 waiver renewal.

As health care systems are focusing on providing more efficient, high quality care, systems around the country are moving towards more integrated patient care. The addition of the Whole Person Care Pilots (WPC) in California’s new §1115 waiver aims to do just this by better coordinating health, behavioral health, and social services for Medi-Cal patients. The goal is that this will lead to more effective and efficient use of resources, while improving patient health. The new program recognizes the need for improved coordination of care within and across system and the importance of addressing the conditions that shape health in the environments where people live, work, and play.

These pilots recognize that an individual’s health is dependent on several external factors outside of a visit to a health care facility. The pilot seeks to bring entities such a community organizations, health care systems, and counties, together to address these issues.

The WPC pilots are designed to encourage innovation in delivery and financing strategies to improve health outcomes of target populations. The pilot aims to improve health outcomes, reduce per capita costs and improving patient experience. By reducing duplication of effort and more efficiently addressing patient needs, a whole-person care approach could improve the health for Medi-Cal population and have positive impact in other publicly financed systems such as behavioral health, social services, education, and public safety.

Read the full analysis: Analysis of §1115 Waiver Renewal: Whole Person Care Pilots

 

Analysis of §1115 Waiver Renewal: Managed Care Expansion and Demonstrations Continuation

This is part of an ITUP series on the Medi-Cal 2020 §1115 waiver renewal.

The Medi-Cal program has grown from a caseload of 7.9 million beneficiaries in 2012-13 to a projected 13.5 million in 2016-17. About 10 million are currently enrolled in a managed care plan. The plans are reimbursed on capitated, per-member per-month (PMPM) basis and provide enrollees with most Medi-Cal benefits including hospital care, physician services, and drugs.   In the early 1990s, California began shifting families with children into managed care, while Medi-Cal eligible seniors and persons with disabilities (SPDs) continued to be served on a fee-for-service (FFS) basis. Low-income childless adults or medically indigent adults (MIA’s) were ineligible for Medi-Cal and were primarily served by county indigent health programs and through charity care.

The passage of the Affordable Care Act extended eligibility for Medi-Cal to these childless adults, and that prompted the state to seek the 2010 “Bridge to Reform” Waiver to help expedite the transition of these eligible beneficiaries into Medi-Cal. For the SPD population that had previously been primarily served on a fee-for-service basis, the authorizing statute for the waiver (Chapter 714, 2010 Statutes) required mandatory enrollment into managed care. The Bridge to Reform waiver also authorized pilot programs to test the benefits of using managed care to serve beneficiaries who were dually eligible for both Medi-Cal and Medicare, and children enrolled in the California Children Services (CCS) Program.

The shift toward increasing reliance on managed care to serve the Medi-Cal population continued in 2012. As part of that year’s budget trailer legislation, the expansion of mandatory managed care was required in rural counties. In addition, Healthy Families Program, which served children in families with incomes between 138% and 250% of Federal Poverty Level, was eliminated, and the eligible children it served were transferred into Medi-Cal. The budget trailer bill legislation also established the Community-Based Adult Services (CBAS) program to replace Adult Day Health Centers and incorporate the services that had been provided into Medi-Cal managed care.

The managed care expansions are primarily a continuation of mandatory managed care for children and families, for seniors and persons with disabilities, for low income pregnant women, and for those newly eligible under the Affordable Care Act (the medically indigent adults or MIAs). The Department of Health Care Services (DHCS) is required to contract for an independent assessment of access and network adequacy in its managed care plans and the establishment of an Access Advisory Committee to provide feedback. In addition, there are a variety of reports on network adequacy, monitoring, grievance procedures and safeguards to assure that the MCOs fulfill their mission of improving care and outcomes for these high cost, vulnerable populations. The waiver continues the following managed care demonstration projects: the Community- Based Adult Services (CBAS) program, California Children’s Services (CCS) pilots; and the Coordinated Care Initiative (CCI) serving dual-eligibles.

Read the full analysis: §1115 Waiver Analysis Part 1: Managed Care Expansion and Demonstrations Continuation

Medi-Cal 2020: Continuing Transformation and New Initiatives to Improve Health Outcomes

On December 30, 2015, the Centers for Medicare and Medicaid Services formally approved California’s §1115 waiver renewal, replacing the existing Bridge to Reform waiver. Medi-Cal 2020: Continuing Transformation and New Initiatives to Improve Health Outcomes, a brief by Harbage Consulting with support from The California Endowment, lays out the key components of the new Medi-Cal 2020 waiver as laid out in the approved Special Terms and Conditions, and explains how they build upon the foundation laid by the Bridge to Reform waiver.

Read the report: Medi-Cal 2020

ITUP’s Summary of the Kaiser Family Foundation’s National Employer Health Benefits Survey

  • Premiums increased by 4%; offer rates and take up rates did not change; worker’s wages increased by 2% and inflation fell by 0.2% between 2014 and 2015.
  • Some employers (4%) reduced full time workers to part time while others (10%) increased part time workers to full time.
  • Workers paid on average 18% of the premiums for single coverage and 29% for family coverage. Small business employees pay a smaller share (15% vs. 19%) of single coverage and a significantly larger share (36% vs. 26%) of family coverage than do the employees of large employers.
  • 52% of covered employees are in PPOs and 24% in high deductible plans with a savings options.
  • Deductibles did not change much year over year, but are significantly higher ($1806 vs. $1105) in small employer than in large employer plans.
  • The percentages of workers in a high deductible plan with a savings option grew from 6% in 2006 to 24% in 2015. The percentages of workers enrolled in a plan with at least a $1000 deductible grew from 10% in 2006 to 46% in 2015.
  • The offer rate for large employers (over 100 employees) was 97% in 2015 as compared to 98% in 1999.
  • The offer rate for mid sized employers (50-100 employees) was 89% in 2015 declining from 96% in 1999.
  • The offer rate for small employers (3-50 employees) was 54% in 2015 declining from 63% in 1999.
  • 23% of large firms offer retiree health benefits.
  • 83% of large firms’ employees are in self-funded plans as compared to 17% of small business employees.
  • 25% of workers are in grandfathered plans.
  • There has been little change in employer plans associated with the implementation of the ACA; long time trends have continued. The Cadillac benefits tax beginning in 2018 could accelerate the search for improved cost efficiency in employer plans as could the return of higher rates of inflation in premiums.

Read the full report on the Kaiser Family Foundation’s website: http://kff.org/health-costs/report/2015-employer-health-benefits-survey/

ITUP’s Summary of the California HealthCare Foundation’s California Employer Health Benefits Survey

  • Employer offer rates have declined from 69% to 58% in California from 2000 to 2014 – a slightly better performance than the national average.
  • 48% of very small (3-9 employees) California businesses offer coverage; 71% of small (10-49) employers offer coverage; 87% of mid sized (50-199) employers offer coverage; 98% of large (200-999) employers offer coverage and 100% of jumbo (1000+) employers offer coverage.
  • 85% of eligible California employees take up coverage – better than the national average of 80%.
  • Worker coverage rates have been stable for the past decade except for small business employees where the offer rates fell.
  • The average increase in premiums for employees who stayed with the same plan was 6% in 2014; however the average increase for employees who changed plans was 1.7%.
  • HMO premiums in California were slightly above the national average for individual employees ($526 vs. $519 per member per month) and slightly below for family coverage. PPO plan premiums were far above the national average for both individual ($659 vs. $518) and family coverage. High deductible plans with a savings option were somewhat above the national average for individuals ($472 vs. $442) and families.
  • Worker’s shares of premiums were 17% for individual coverage and 26% for family coverage.
  • Only 14% of California employees enrolled in HMOs have a deductible and that deductible averages $1231. 74% of California employees enrolled in PPOs have a deductible and that deductible averages $667. Deductibles are far less common for California employees that their national counterparts. However the incidence of large deductibles has been increasing, particularly among small employer PPO plans.
  • 80% of California employees have an HMO option available to them as contrasted with 31% of the nation’s employees. 21% of California employees have a high deductible plan with a savings option available to them as compared to 45% of the nation’s employees.
  • 54% of California’s employees are enrolled in HMO’s as compared to 13% of their national counterparts. 10% of California’s employees are in high deductible plans with a savings option as compared to 20% of the nation’s employees.
  • 30% of California’s employees are in self-insured plans as compared to 61% of their national colleagues.
  • 9% of California businesses reduced the scope of covered benefits or increased employee cost sharing in 2014 as compared to 24% in the prior year. Large firms were far more likely (24%) to do so than small firms (8%).
  • Only a very small fraction of small businesses were very familiar with SHOP.

Read the full report on the California HealthCare Foundation’s website: http://www.chcf.org/publications/2015/04/employer-health-benefits