State Medicaid Director Letter: Three New Opportunities to Test Innovative Integrated Care Models for Individuals Dually Eligible for Medicaid and Medicare

As a 2019 strategic priority, Centers for Medicare & Medicaid Services (CMS) is redoubling efforts to better serve older adults and people with disabilities dually eligible for Medicaid and Medicare. The goal is to create a more seamless experience across the two programs while ensuring that incentives are aligned and pointed toward lower cost and better outcomes.

On April 24, CMS sent a l etter to State Medicaid Directors inviting states to partner on testing innovative approaches to better serve those who are dually eligible for Medicare and Medicaid. Many of these 12 million beneficiaries have complex healthcare issues and often have socioeconomic risk factors that can lead to poor outcomes. This letter opens new ways to address those needs, align incentives, encourage marketplace innovation through the private sector, lower costs, and reduce administrative burdens.

Approaches discussed in the letter:

Capitated Financial Alignment Model: Through a joint contract with CMS, states, and health plans, creates a way to provide the full array of Medicare and Medicaid services for enrollees for a set capitated dollar amount
Managed Fee-for-Service Model: A partnership between CMS and the participating state, allows states to share in Medicare savings from innovations where services are covered on a fee-for-service (FFS) basis
State-Specific Models: CMS invites ideas, concept papers, and/or proposals around state-developed models to better serve dually eligible individuals

This letter complements a State Medicaid Director Letter CMS released in December 2018 that highlighted ten opportunities to improve care for dually eligible individuals. The opportunities in this new letter, together with the Primary Cares Initiative, present an array of options for transforming care delivery.