Dual eligibles -- individuals eligible for both Medicare and Medicaid coverage -- are among the nation’s sickest and poorest. "Duals” as they are commonly referred to often fall through the cracks of two programs not designed to work together. The result is a lack of coordination that often leads to poor quality, inefficiency, and avoidable costs.
With the Affordable Care Act set to add 16 million people to the Medicaid rolls by 2019, the number of "duals" is certain to increase. Cash-strapped states are increasingly turning to the expertise of managed care companies to tackle skyrocketing dual eligible costs.
To address some of these concerns HRI issued a brief, Medicaid expansion: New patients new challenges.
For more information about caring for "Duals" you may read more here.
Dual eligibles—individuals who qualify for both Medicare and Medicaid coverage—are among the nation’s sickest and poorest. Many have multiple chronic conditions and more than half have annual incomes of less than $10,000.1 “Duals” often fall through the cracks of two programs that were not designed to work together. This lack of coordination often leads to poor quality, inefficiency, and avoidable costs.
Cash-strapped state Medicaid programs report that projected long-term costs for this population are not sustainable. Some researchers say shifting dual eligibles to managed care plans or care coordination programs could save up to $20 billion a year.2 But it will be an adjustment for patients accustomed to fee-for-service medicine in the traditional Medicare program.
With the aging of the baby boomers, the number of today’s approximately 9 million duals will steadily increase, and so will the cost of caring for them. Spending on duals reached nearly $320 billion in 2011, accounting for 39% of total Medicaid and 31% of total Medicare spending.3,4 Federal spending on duals is projected to reach $3.7 trillion during the next decade.5 To manage the cost, the Centers for Medicare and Medicaid Services (CMS) is seeking health plans willing to take on financial risk through capitated managed care plans. Several states also intend to test a managed fee-for-service financial alignment model.
In the CMS Program of All-Inclusive Care for the Elderly, managed care providers receive capped payments to cover medical and related services for duals. An interdisciplinary team coordinates care, enabling many duals to receive care at home. In place for over a decade, the program has reduced hospitalization rates and improved care coordination but has yet to demonstrate savings, since capitated payments have exceeded the amount Medicare would have spent on fee-for-service.6
In 2011, CMS announced a three-year demonstration project that covers two million duals. Of the 26 state proposals, 18 proposed a capitated model paying a combined, risk-adjusted, per-member, per-month amount.7 The first demonstrations begin in April 2013, in Massachusetts with a capitated approach, and in Washington with a managed fee-for-service model.8,9