Virginia approved to begin offering coordinated healthcare for Medicare-Medicaid enrollees

medicine2Gov. Bob McDonnell today announced that Virginia has been approved to implement a new healthcare initiative, the Medicare-Medicaid Enrollee (dual eligible) Financial Alignment Demonstration, aimed at coordinating care for more than 78,000 Virginians currently enrolled in Medicare and Medicaid.

The new initiative, recently branded as Commonwealth Coordinated Care, will coordinate care for individuals who meet certain eligibility requirements and are served currently by both Medicare and Medicaid. Commonwealth Coordinated Care is designed to be the single program accountable for coordinating the delivery of primary, preventive, acute, behavioral, and long-term services and supports for this population.

The goal of this initiative is to provide Virginians high quality health care and supports coordinating the Medicare and Medicaid benefits into a single person-centered program. Through this effort, taxpayers will see greater savings through the delivery of cost-effective and appropriate treatment and services for some of Virginia’s most vulnerable citizens.

“I applaud the work of the Department of Medical Assistance Services, which has worked tirelessly with stakeholders and the federal government in order to achieve this milestone,” said McDonnell. “We have long known that the efficiencies and benefits of coordinating Medicare and Medicaid services are far reaching. Most importantly, some of Virginia’s most vulnerable adults will now benefit from a program where their health care and long-term services and supports are better coordinated. This enhanced care model will improve and sustain the health of beneficiaries while allowing the state and federal government to realize cost savings as a result of increased care management.”

Upon taking office, the governor committed to ensure that Medicaid operates as efficiently as possible. For years, the department has struggled with how best to manage and finance the care of those receiving both Medicare and Medicaid. Securing the federal agreement to launch Commonwealth Coordinated Care is a significant victory for these beneficiaries and the Commonwealth.  It aids the department’s ability to better structure and coordinate services tailored to the health, behavioral health, and long-term service needs of Virginia’s most vulnerable adults.

Efficiencies gained through this program are expected to yield financial savings to Virginia. DMAS budget forecast for state fiscal year 2014 included $11.3 million in general fund savings. These savings assumed a January 1, 2014 implementation date as well as a 50 percent match rate. Due to timing of the DMAS forecasting process, the savings were estimated before the agreement with CMS was reached which laid out the rate setting methodology and cost savings sharing agreed upon for the program. These factors may alter the initial forecast which will be updated in the next budget cycle.

Medicare and Medicaid were originally not designed to work together, yet there are more than 78,000 Virginians who currently participate in both programs and will now be eligible for Commonwealth Coordinated Care.

Under the existing structure, Medicare-Medicaid enrollees must use three separate ID cards for Medicare, Medicaid and prescription drugs, have three different sets of benefits, receive bills when they should not, and are routinely frustrated over challenges in understanding which plan pays for which services. By choosing this voluntary program, individuals will have one ID card for all aspects of their care, a 24 hour/seven day a week toll-free number for assistance, person-centered service coordination and case management, and one appeals process.

Secretary of Health and Human Resources, William A. Hazel, MD. said, “For many years, the Commonwealth has been working toward this significant reform opportunity. We view this achievement as a testament to the willingness of Virginia’s Medicaid providers and interested health plans to work collaboratively with the department to implement innovative models of care. DMAS is always working towards the development of more effective and efficient service delivery opportunities. This program has the potential to be one of the most significant to date. I am grateful for the governor’s consistent push to ensure that Medicaid operates more efficiently and am proud of the leadership of the department in developing and obtaining federal approval for this demonstration. I am confident that participants in this demonstration will have better health outcomes while the state will achieve associated cost savings.”

U.S. Sen. Mark R. Warner released a statement upon the announcement of the agreement.

“I applaud this collaboration between the Commonwealth and CMS, which will offer improved care for some of our most vulnerable citizens. Ensuring better delivery of care was an important part of the Affordable Care Act, and this is a excellent opportunity for Virginia to be a leader on innovative new ways to ensure care is better coordinated and more focused on the patient,” Warner said.

Under Commonwealth Coordinated Care, Virginia and the federal Centers for Medicare and Medicaid Services (CMS) will enter into a contract with health plans for the delivery of coordinated services and supports to enrollees. Eligible individuals include older adults and individuals with disabilities, including those receiving long-term services and supports, and who live in designated regions around the Commonwealth. The regions include the areas surrounding: Central Virginia/Richmond, Charlottesville, Tidewater, Roanoke and Northern Virginia.

Since 2011, DMAS has actively engaged stakeholders to advise the agency in their development of the Memorandum of Understanding (MOU) and program.  Virginia is the 6th state in the nation to finalize a MOU with the Centers for Medicare and Medicaid Services (CMS) for delivery of a coordinated care program.

Commonwealth Coordinated Care begins in January 2014, and will continue throughDecember 31, 2017.  Congressional action will be needed in order for the program to continue beyond 2017. A rigorous evaluation will be conducted throughout the demonstration period.

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