by David Cole, CCP
Many providers have been wondering about the future of Medicaid waiver programs, in light of the efforts by congress to reduce Medicaid benefits and funding. However, it appears that most of the waiver programs may be spared the sword this time around, and for some very good reasons.
At the most basic level it becomes an issue of cost and resources. As the 65 million American “baby boomers” age into a health care system that is woefully inadequate to handle their needs, at least one truism is that: lowest cost solutions will win! Today it’s all about cost reduction (often even at the expense of cost avoidance.) This is good news for the waiver programs.
When the federal government created rules that can make patients who are eligible for Medicare also eligible to qualify for state Medicaid (known as “dual eligible”), they achieve two huge benefits: 1) the patient becomes eligible for services not provided under Medicare, such as personal care services and homemaking, and 2) the patient is now in a cost split between Medicare and Medicaid (Medicare being 100% federally funded, while Medicaid is a 50-50 split with the states.)
With the groundwork in place for waiver programs and making patients dual eligible, states need a way to manage the waiver programs. Since most of the waiver programs involve significant federal funding (that could disappear quickly) and are setup as “temporary” waiver programs, states have been reluctant to build out infrastructure and hire new state employees to manage them. The solution most states are employing is hiring insurance companies to “manage the care.” This model of course is known as managed care.
Under managed care, the state feeds beneficiary and authorization information to the managed care organization (MCO) that won the bid to run the program. They in turn refer the beneficiary to an agency in their provider network. The agency provides the services and bills the MCO. The MCO adjudicates the claims and sends them to the state’s MMIS system for payment to the agency.
With the passage of the 21st Century Cures Act, by 2019 all of these services will be verified through electronic visit verification (EVV). Under this funded mandate each state will create its own model for EVV compliance.
The term “managed care” now encompasses all non-medical homecare services. Even private duty services are managed, but by the consumer rather than the state.
Waiver programs have emerged in many different forms, providing a plethora of different benefits combinations. Some include skilled services and others don’t. They are managed in every conceivable way, including consumer directed services, the fastest growing waiver programs nationally.
Consumer directed services (CDS) is the culmination of tinkering with new benefits until something sticks. Under CDS, the consumer is the employer of record. The agency is merely a pay agent for the state. In some states, the agency has limited oversight and can assist the consumer, but issues of an agency “accidentally” becoming the co-employer by providing services such as training or scheduling for CDS attendants dramatically limit the role of the agency.
CDS is becoming the fastest growing waiver program in the country. It’s a true win-win for all involved… CMS loves it because it saves a huge amount over skilled care. The state loves it for the same reason, it’s the least costly program that there is. The patient loves that their family member is now getting paid to do what they were doing all along, and the attendant loves that they’re finally getting paid for their work. Even the agencies love the limited responsibility they have and the profits from the differences between bill rate and pay rate.
So, everybody wins. Well maybe the patient doesn’t get the benefit of more highly trained homecare staff and the outcomes haven’t shown to be great, but it is the cheapest alternative for CMS and the state. And in this age of lowest cost solutions, CDS certainly fits the bill.
Other managed care programs have similarly shown benefits in excess of their cost. These are the darlings of the cost cutters and state legislators are finally starting to see that investing in non-medical waiver programs is a cost-cutting strategy for the state. For all the above reasons, the future of waiver programs is pretty good. Even the most conservative lawmakers have expressed an interest in “keeping what works” and that means the waiver programs. Oh sure, the funding is bound to be changed and states will be tightening the Medicaid roles more than ever in an effort to reduce budgets, but it is very unlikely that any state can afford to cut out the waivers once the savings are reviewed.
About Dual Eligible Patients
Dual eligibility refers to a patient who is eligible for Medicare but also qualifies for Medicaid services. Many Medicare eligible seniors have personal needs outside of the services covered by Medicare, such as the need for long term care. The options for the patient are to cover non-medical care in the patient’s home for a long term, or institutionalize them – a far costlier option.
Medicare has some very stringent restrictions for eligibility, including: 1) the patient must be 65 years or older, 2) be homebound, 3) require skilled services and 4) require only intermittent care. So, if a patient requires long term care for their illness Medicare does not provide coverage. But Medicaid might. This “dual eligibility” closes a huge gap in care for the elderly.
Another advantage of dual eligibility is that when seniors can get non-medical personal care services through a non-medical waiver program more expensive in-patient care can often be avoided. And with many of the newer monitoring technologies homecare agencies can dramatically reduce hospital readmissions and further assist in improving patient outcomes, often without the need for expensive skilled nursing visits.
David Cole, CCP, is Ankota's Chief Operating Officer. He is a seasoned veteran of the home care industry with over 25 years of experience. David co-founded StatChek, Inc., a pioneer in home care voice telephony, which was later acquired by Computer Outsourcing Services, Inc. (NASDAQ: COSI), today a part of Wi-Pro (NYSE:WIT). He was a part of the startup team at AccentCare, Inc., has founded and managed homecare agencies and served as the Medicare administrator for Interim Healthcare of Atlanta. He is also one of the principal developers of a novel model for post-discharge patient management.
©2017 by Rowan Consulting Associates, Inc., Colorado Springs, CO. All rights reserved. This article originally appeared in Tim Rowan's Home Care Technology Report. homecaretechreport.com One copy may be printed for personal use; further reproduction by permission only. firstname.lastname@example.org