Here’s the second part of our three-part blog series exploring the hurdles and prospects for health plans in managing Dual Special Needs Plans (D-SNPs). These plans are receiving an increasing amount of attention from both the Centers for Medicare and Medicaid Services (CMS) and various state governments. This installment focuses on claims and benefit adjudication, emphasizing the importance of seamless coordination between Medicare and Medicaid. This coordination is crucial as it influences benefit packages, service integration, pricing, encounter reporting, and the specific CMS D-SNP model used for this unique set of beneficiaries.
Embracing the Opportunity
The coverage of individuals who qualify for both Medicare and Medicaid, also known as dual-eligibles, presents a growing opportunity for managed care plans. Both CMS and about half of the states have shown a keen interest in merging Medicare and Medicaid into unified coverage models. Yet, navigating the intricacies involved in this integration poses significant operational challenges. The key questions below can aid in forming a clear strategy and identifying investment needs:
- What adjustments need to be made to our system and administrative frameworks?
- What technology will be necessary to effectively run the D-SNP program?
- Are there specific D-SNP operational services that can be outsourced?
- Does our plan have dependable partners to bridge operational gaps in D-SNP coverage?
A Generous but Complicated Combination
If you missed the first blog in this series, which covers strategies for D-SNP eligibility and enrollment, it might be worth catching up on that material for better context. As previously discussed, Medicare offers Special Needs Plans (SNPs) tailored to address specific care situations. These plans are especially beneficial for Medicare enrollees who simultaneously qualify for Medicaid due to their limited income. These individuals, known as "Qualified Medicare Beneficiaries" (QMBs), receive a dual benefit package.
For QMBs, Medicare covers acute care, hospital services, time-limited skilled nursing care, and most prescription drugs under Part D. Meanwhile, Medicaid steps in to cover long-term services and supports (LTSS) that help individuals remain in their homes or in permanent skilled nursing facilities, including coverage that Medicare doesn’t provide, such as dental and vision services or extensive behavioral treatments.
The dual coverage offers these beneficiaries an expansive medical package, surpassing what is typically available through commercial or employer-based plans. Their drug coverage under D-SNPs is also substantial, with automatic qualification for Low Income Subsidies under Medicare Part D, capping copays at minimal amounts. For drugs not covered by Part D, Medicaid picks up the slack in many states.
This comprehensive coverage is essential given that dual eligibles often have significant medical and everyday support needs due to a range of disabilities and chronic conditions. Around a third of this population requires a level of care akin to that provided in nursing homes.
CMS and State Integration Initiatives
To enhance coverage for dual eligibles, CMS has rolled out several policies over the past decade to improve D-SNP benefit coordination and integration. One such initiative, part of the Affordable Care Act, allowed CMS and states to jointly contract with new D-SNP types known as Medicare-Medicaid Plans (MMPs). At the height of their implementation in 2022, these MMPs served over 400,000 dual eligible enrollees across nine states.
Despite high satisfaction levels, MMPs had limited adoption due to the complexities involved in establishing them, alongside no financial advantages over conventional D-SNPs. However, lessons from MMPs have led to the creation of three integrated models requiring separate CMS and state contracts:
- Fully Integrated Dual Eligible (FIDE) SNPs: These cover all Medicare and Medicaid services under a single entity, promoting coordinated care for high-risk beneficiaries.
- Highly Integrated Dual Eligible (HIDE) SNPs: These plans offer a mix of Medicare coverage and specific Medicaid benefits, like behavioral health or long-term care.
- Applicable Integrated Plans (AIP): These plans, with affiliated Medicaid managed care, cover primary, acute, and specific additional Medicaid services.
These models, along with traditional Coordination Only (CO) D-SNPs, offer flexibility to states and health plans, effectively doubling the number of states now involved in D-SNP integration with CMS.
Components Necessary to Structure D-SNP Benefits
Designing a D-SNP requires careful consideration to offer value to enrollees and providers while adhering to federal and state regulations:
- Benefit Coverage: D-SNPs start with full Medicare coverage, with the possibility of adding limited Medicare supplemental benefits. However, Medicaid eligibility already encompasses what would typically be Medicare supplementary benefits in many areas.
- Structure and Integration: The degree to which Medicare and Medicaid are merged within a plan impacts operations, costs, and staffing. Integration of claims processing is often the most efficient method if a plan covers comprehensive Medicaid benefits. Alternatively, a targeted approach may suffice if the scope is narrower.
- Provider Payment Pricing: The payment rates for D-SNPs are driven by provider contracts and state fee schedules. Complexities arise where both Medicare and Medicaid coverage overlap, requiring sophisticated pricing strategies or skilled staff to navigate different reimbursement structures.
- Provider Network: Networks must reflect the complete area covered by Medicare providers, including additional Medicaid services like long-term care or behavioral health offerings.
- Encounters: Accurate submission of Medicare and Medicaid encounters to their respective authorities is essential. To aid in this process, SS&C offers solutions to streamline encounter submissions and financial tracking.
Part 3 of our series will delve into the critical importance of care management and coordination within D-SNPs. These elements are vital for managing severe and chronic conditions while preventing unnecessary care use. Stay tuned as we explore how intensive management can enhance outcomes and quality of life for dual-eligible beneficiaries by working closely with primary care providers and local resources.
SS&C Health specializes in operational solutions for all D-SNP variations, supported by our expertise and cutting-edge technology. Reach out to us to discover how we can assist your plan in navigating and thriving in the dual eligibles landscape.
