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Medicare beneficiaries may receive services in a hospital, and are discharged to a Medicare reimbursed skilled nursing facility.  Without an active discharge plan, they may spend down to become Medicaid eligible.  Better planning might have prevented the patient from becoming dual eligible.

Medicare-reimbursed physicians often are able to order Medicaid-reimbursed therapies, home health benefits, and durable medical equipment without having to coordinate with Medicaid providers.  This could lead to duplication of efforts.

Medicaid reimburses for some long-term custodial nursing facility stays.  Without adequate quality control, those stays may result in avoidable hospitalizations, for example, pressure ulcers, pneumonia or falls.  Those hospitalizations are paid for by Medicare.

Role of Special Needs Plans

Medicare Advantage Special Needs Plans (SNPs), a type of Medicare Advantage plan, were authorized by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA).  SNPs were authorized by Congress so that health plans could target specialized high needs sub-populations within Medicare, and design provider networks and care management approaches focused on the unique characteristics of these sub-populations.  One of the designated special needs populations was dual eligibles, because of the issues described earlier.  When SNPs first were authorized, CMS had high hopes:  “SNPs [for dual eligibles] have the potential to offer the full array of Medicare and Medicaid benefits, and supplemental benefits, through a single plan so that beneficiaries have a single benefit package and one set of providers to obtain the care they need,”10 without having to secure special demonstration authority from CMS.11

Under the MMA, SNPs only were authorized through December 31, 2008.  In the summer of 2008, Congress acted to extend the SNP authority through December 2010.  When Congress enacted this extension, though, it tried to correct some missing opportunities under the MMA.

The bill that extended SNP authority, the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), introduced a new set of requirements for dual eligible SNPs.  Prior to MIPPA, dual eligible SNPs were not required to coordinate in any way with state Medicaid programs – a dual eligible SNP could simply manage its contracted Medicare benefits, ignore Medicaid, and essentially not improve upon the problems associated with the underlying disconnect between Medicare and Medicaid. MIPPA sought to address this lack of coordination.  Now, when a dual SNP expands its service area, or first enters a state, it must enter a contract with the state Medicaid agency to negotiate the forms and methods of coordination between the two (regarding one or more of benefits, marketing, enrollment, grievances, third-party liability, etc.)  

10 Centers for Medicare and Medicaid Services, “Improving Access to Integrated Care for Beneficiaries Who Are Dually Eligible for Medicare and Medicaid,” July 27, 2006. Available at http://www.cms.CMS.gov/apps/media/press/release.asp?Counter=1912.

11 Paul Saucier and Brian Burwell, The Impact of Medicare Special Needs Plans on State Procurement Strategies for Dually Eligible Beneficiaries in Long-Term Care. Thomson Medstat, January 2007.

Health Management Associates/Harbage ConsultingPage 24

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