CMS to Test New Models for Medicare, Medicaid Dual Eligibles

CMS has issued a letter to state Medicaid directors inviting them to test new, integrated care models for individuals dually eligible for Medicare and Medicaid.

There are 12 million dual eligible beneficiaries, CMS noted. Many of them have complex medical issues, including multiple chronic conditions.

The agency’s approaches include capitated financial alignment models, which create a way to provide the full array of Medicare and Medicaid services for enrollees for a set capitated dollar amount.

“The capitated financial alignment model was designed to allow states and CMS to prospectively share in savings that result from integration. We do this by reducing the Medicare and Medicaid components of the capitated rates paid to the Medicare-Medicaid plans up front by an agreed upon ‘savings factor’ that scales up as each demonstration matures,” the letter said.

CMS also described the managed fee-for-service model, a partnership between CMS and the participating state. This model enables states to share in Medicaid savings from innovations where services are covered on a fee-for-service (FFS) basis.

CMS has partnered with Washington and Colorado to test a managed FFS model through which states have an opportunity to share in savings resulting from Medicare FFS interventions. The model has shown promising results in Washington, where Medicaid health homes provide high-intensity care coordination for high-risk beneficiaries.

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