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California’s §1115 Waiver Implementation

Introduction

California’s §1115 waiver,[1] approved on November 1, 2010, provides the vital infrastructure to bridge current coverage options into 2014 and offers immediate support and relief to the financially hard pressed[2] safety net system and the individuals they serve.  Local communities face the challenge of implementing three new programs at the same time. California counties are at widely divergent starting points[3] and their efforts need to lead to a unified statewide effort by 2014. This paper provides a snapshot overview of local implementation of the three following elements of the waiver.

The LIHP (Low Income Health Program) provides coverage for low-income adults, both MIAs (medically indigent adults) and parents: Counties can match their spending[4] on eligible uninsured adults with an equal amount of federal matching funds; i.e. counties receive a 50/50 match so that a county that spends $100 million through the LIHP can receive $50 million in FFP. They can cover both physical health and behavioral health services to uninsured adults with the federal funds, and have the flexibility to set their income levels at any point up to 200% of the federal poverty level (roughly $22,000 for an individual, $44,000 for a family of four).

LIHP funds come with important requirements to upgrade county care to the MIAs in preparation for 2014: 1) timely and geographic access[5] to primary, specialty and urgent care, 2) eligibility determinations that comply with federal DRA (Deficit Reduction Act) rules, including enrollment and issuance of ID cards, 3) inclusion of at least one FQHC (federally qualified health center) clinic[6] paid at FQHC rates in the provider network, and 4) a minimum payment for genuine emergency care[7] to county indigents enrolled in LIHP, regardless of where services are delivered.

DSRIP (Delivery System Reform Incentive Pool): This aspect of the waiver provides funding for public hospitals[8] to upgrade and integrate their delivery systems so that by 2014 they have the requisite quality, performance and efficiency to participate in a competitive health market with patient choice of providers and plans through Medi-Cal and the Exchange. These systems must strengthen their ability to manage care of the chronically ill in outpatient settings, integrate with behavioral health, develop medical homes, implement disease registries, improve patient satisfaction and reduce common and avoidable errors in hospital inpatient care.[9] Public hospitals will be eligible to receive incentive payments based on level of achievement of various DSRIP milestones established over the 5-year period. Counties can finance their DSRIP improvements with Intergovernmental Transfers (IGTs).

Mandatory Managed Care for Seniors and Persons with Disabilities (SPDs): In California’s managed care counties, most seniors and persons with disabilities (SPD) will be enrolled in managed care; those with joint Medicare and Medi-Cal coverage (Medi-Medis) are exempt, but may enroll voluntarily. Other voluntary groups include foster care children, those identified as long term care (LTC) recipients, those with other health insurance, those with share-of-cost Medi-Cal, and California Children Services (CCS) children. Enrollment is phased in over the course of the year. Managed care plans must assure continuity of care, risk assessments and treatment plans for the new enrollees.[10] Between a quarter and a third of the new managed care population has both physical and behavioral health diagnoses, requiring better coordination of the physical and mental health sectors.[11]

In preparing this report, we reviewed county documents submitted to the state, the discussions at ITUP regional and issue workgroups[12] and interviewed over 40 individuals involved in local implementation efforts. These are ITUP’s conclusions and characterizations should not be considered as the views of any individual, county, clinic, health plan or other entity.

Continue reading the full text (pdf):

1115_Waiver_Implementation_01202011 1115_Waiver_Implementation_01202011.pdf

[1] California’s Section 1115 Medicaid Demonstration, entitled “California’s Bridge to Reform” (Waiver II-W­ OO193/9), under the authority of section 1115(a) of the Social Security Act (the Act) is granted for the period November 1,2010, through October 31, 2015.

[2] Realignment revenues to counties fell by about 10%, numbers of uninsured increased by about 10%, community clinics uncompensated care increased by 15%, and hospital bad debt and charity care increased by 54%. See Yoo, 2010 Health Care Financing Report (ITUP, January 24, 2011) at www.itup.org and Statewide Overview of the Uninsured 2006-09 (ITUP, 11/9/2010). Zavis, Alexandra. A Fraying Safety Net. Los Angeles Times. July 31, 2011. Article available at: http://articles.latimes.com/2011/jul/31/local/la-me-safety-net-20110731/2

[3] Centers for Medicare & Medicaid Services. Medicaid Waivers and Demonstration List. Official Programs information available at:                       https://www.cms.gov/MedicaidStWaivProgDemoPGI/MWDL/list.asp?filtertype=dual&datefilterinterval=&filtertype=data&datafiltertype=2&datafiltervalue=California&keyword=&intNumPerPage=10&cmdFilterList=Show%252bItems

[4] County spending is known as CPEs or Certified Public Expenditures. Centers for Medicare & Medicaid Services, California Department of Health Care Services. California Section 1115 Comprehensive Demonstration Project Waiver, Bridge to Reform. June 2010. Low Income Health Program. Sec 36-42 and 100-105. See Wulsin, Identification of Certified Public Expenditures under California’s Section 1115 Waiver (ITUP, 3/21/2011) at www.itup.org

[5] Center for Medicare and Medicaid Services, California Department of Health Care Services Bridge to Reform Demonstration, 11-W-00193/9 (November 2, 2010) Special Terms and Conditions. §72. Primary care appointments must be within 30 business days in the first year of the waiver and 20 business days in the second and third years. Specialty care appointments must be within 30 business days of request. Access to primary care must be not more than 30 miles or 60 minutes from a patient’s address.

[6] Ibid. 72 f.  The county must contract with at least one FQHC and pay it at FQHC rates. The clinic could be a county FQHC or a non-profit community FQHC.

[7] Ibid. §63 f. The care must meet EMTALA (Emergency Medical Treatment and Active Labor Act) standards. It applies to diagnosis, treatment, required stabilization and limited post-stabilization care. This applies to in county and out of county care.

[8]Ibid. §35-41

[9] See California Association of Public Hospitals and Health Systems, The Delivery System Reform Incentive Program: Transforming Care Across Public Hospital Systems, a Policy Brief (CAPH, June 2011)

[10]It should be noted that enrollees must request continuity of care if they wish to remain with providers not a part of the managed care network. The provider can then approach the managed care plan about contracting, although some plans may not be open to expanding their network. If a provider is not a part of the managed cared plan’s network, an enrollee may apply for exemption of the mandated transition. Some advocates believe measuring the number of exemption request is a better way of gauging the success of the transition.

[11] See Jans, Stoddard and Kraus, Chartbook on Mental Health and Disability in the US (National Institute on Disability and Rehabilitation Research, 2004) at www.infouse.com/disabilitydata/mentalhealth Marshall Williams S, Chapman D, Lando J. Centers for Disease Control and Prevention. The Role of Public Health in Mental Health Promotion. Morbidity & Mortality Weekly Report, Sept 2, 2005;54(34):841-842. Available at http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5434a1.htm.             

[12] Executive summaries of the ITUP Regional Workgroups 2011 are available at www.itup.org/public-coverage/2011/09/19/2011-regional-workgroup-executive-summaries/  

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