Download - ALTCI Actuarial Study — Final Results
ALTCIActuarial Study — Final Results
September 14, 2005
Mercer Government Human Services Consulting 2
Actuarial Study Objectives
Determine key cost drivers
Identify financing options that promote the goals of ALTCI
Recommend a Medi-Cal rate structure that will best match payment to the risk of the enrolled population
Assess adequacy of Medicare reimbursement for ALTCI population
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Key Considerations
Individual health plan risk is driven by a number of factors, including
– Program design Who will be eligible (population subgroups)? What services will be covered? Integration with Medicare?
– Contracting approach Mandatory vs. optional enrollment Number of health plans competing
– Operational Issues Enrollment and screening/assessment process Case management and care coordination requirements Administrative responsibilities
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Assumptions
For our analysis, we assumed
– Mandatory enrollment (for completeness purposes only - i.e., so that the entire population would be subject to analysis, allowing creation of a reimbursement model that would work for a voluntary program)
– All adult SPD eligibles (21 and older)
– All services, except specialty mental health, dental, and DD waiver services
– ALTCI participating health plans would also have to participate in Medicare
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What’s New from the Previous Presentation?
Change in population definitions
– Medicare Part B only population included in Medi-Cal only population group
– Blended IHSS, MSSP, and Home Care together to create a rating category of Community At Risk
Chronic condition analysis for Medi-Cal community population
Medicare sufficiency analysis
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Methodology
Review historical Medi-Cal and Medicare CY1998 – 2000 FFS data
Adjust data to include only populations and services expected to be covered under ALTCI
Project data forward to CY2007 by category of service
Adjust data for significant program changes including Medicare Part D
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ALTCI Eligibles (81,700)
DD5%
At Risk15%
NH8%
Not At Risk72%
CY2000 Medi-Cal DataSan Diego County
Nursing Home Residents, DD, and At Risk account for 28 percent of the total ALTCI membership in San Diego, but 74 percent of the total San Diego Medi-Cal expenditures
ALTCI Medi-Cal Expenditures ($434M)
Not At Risk26%NH
46%
At Risk24%
DD4%
Not AtRisk
DD
At Risk
NH
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San Diego CountyCY2000 Dually Eligible vs. Medi-Cal Only* ABD Membership
Duals48%
Medi-Cal Only52%
Dually Eligibles
DD4%
At Risk18%
NH14%
Not At Risk64%
* Includes recipients with Part B only coverage.
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San Diego CountyCY2000 Dually Eligible vs. Medi-Cal Only* ABD Medi-Cal Expenditures
Duals45%
Medi-Cal Only55%
Dually EligiblesDD2%
At Risk24%
NH70%
Not At Risk4%
* Includes recipients with Part B only coverage.
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San Diego CountyCY2000 Elderly vs. Disabled Membership
Elderly36%
Disabled64%
Elderly
DD0%
At Risk16%
NH14%
Not At Risk70%
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San Diego CountyCY2000 Elderly vs. Disabled Medi-Cal Expenditures
Elderly37%
Disabled63%
Elderly
DD0%
At Risk20%
NH70%
Not At Risk10%
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Chronic Condition Analysis
Reviewed 23 chronic disease categories
Analyzed 3 years of data from CY1998 – CY2000 for 3 counties (Alameda, Contra Costa, and San Diego) to enhance credibility
Separate analysis for Community At Risk and Not At Risk
Reviewed cases with annual Medi-Cal costs in excess of $100,000
Findings show highest cost condition overall for Medi-Cal is ventilator dependents
Of the cases in excess of $100,000 annually, 20% were ventilator dependent
Recommendation is to consider a separate risk adjustor for ventilator dependents in the community
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San Diego CountyCY2000 Medi-Cal ALTCI PMPM Costs
Total $443
Total
NH $2,487
Community $261
Setting
NHC
$2,487
Frailty DD
$367
At Risk
$731
Not At Risk
$157
Medi-Cal Only*
$4,230
Dual
$2,099
Medicare Status
Medi-Cal Only*
$438
Dual
$238
Dual
$542
Medi-Cal Only*
$1,003
Dual
$26
Medi-Cal Only*
$253
Aged
$2,240
Disabled
$1,789
Aged
$3,188
Disabled
$4,589
Category of Aid
Aged
$513
Disabled
$564
Aged
$694
Disabled
$1,135
Aged
$23
Disabled
$28
Aged
$119
Disabled
$304
Aged
$215
Disabled
$238
Aged
$1,998
Disabled
$438
*Includes Part B only recipients.
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San Diego CountyDually Eligible vs. Medi-Cal Only CY2000 PMPM ALTCI Medi-Cal and Medicare Costs
$0 $50 $100 $150 $200 $250 $300 $350 $400 $450
Other
Inpatient
Outpatient
Inst LTC
Comm LTC
Physician
Pharmacy
Medi-Cal Only Dual Medicare Dual Medi-Cal
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Medicare Sufficiency Analysis
Used base data (1999 and 2000) to calculate estimated Medicare reimbursement for 2000
Utilized 2005 Medicare Reimbursement Rules
Compared estimated Medicare reimbursement to actual Medicare FFS costs for 2000
Reviewed by population subgroup
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Medicare Sufficiency Findings
In 2000, Medicare reimbursement would have been sufficient for the ALTCI population in total (across all population subgroups)
Sufficiency of Medicare reimbursement is highly variable by population subgroup
See details on the next slide
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San Diego CountyCY2000 ALTCI Medicare Sufficiency
All ALTCI Dual Eligibles 2000 Costs $725 Rate $730 Sufficiency 0.67%
Total
*Includes only recipients with both Part A and B coverage.
NH
$1,366 $986-28%
SettingCommunity
$634$694 9%
NHC$1,366$986-28%
Frailty At Risk$1,115$914-18%
Not At Risk$513$64125%
DD$282$49576%
Dual*$1,366$986-28%
Medicare Status
Dual*$1,115$914-18%
Dual*$513$64125%
Dual*$282$49576%
Aged$1,304$1,082-17%
Disabled$1,463$834-43%
Category of Aid
Aged$1,100$980-11%
Disabled$1,128$857-24%
Aged$438$67955%
Disabled$580$6065%
Aged$1,120$780-30%
Disabled$280$49477%
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Medicare SufficiencyOther Points
Need to update the analysis
Because Medicare beneficiaries would not be forced to select an ALTCI Plan, the mix of the population that chooses is important
Medicare still working on a frailty adjuster for non-PACE plans. This will not be implemented before 2007
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ResultsKey Medi-Cal Cost Drivers
Identified 10 key rating categories
Setting — Nursing Home vs. Community
Frailty — Nursing Home Certifiable/At Risk vs. Not At Risk and DD
Medicare Status — Dually Eligible vs. Medi-Cal Only
Category of Assistance — Aged vs. Disabled
Chronic High Risk Conditions — Ventilator Dependents
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Recommendations
Reimbursement needs to be sufficiently sophisticated to promote program goals
– Utilize multiple capitation risk groupings
– Include some risk adjustment mechanism
Incentives should be included to promote increased community based services
Savings achievable through more appropriate use of hospital, emergency room and nursing home services
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Recommendations (continued)
Administrative costs should be reflected in rates with sufficient consideration of start up costs
Increased care management should be supported and funded
Implement early reinsurance or risk sharing
Capitated model should allow for flexibility of both Medi-Cal and Medicare funding sources
Reimbursement mechanisms should continue to be refined as the program matures