Last week, I wrote about the very apt comparison of surfers and executives in health and human services painted by Gus Giraldo, the President of Commercial Markets at Magellan Healthcare, in his keynote address, A Commercial Health Plan’s Perspective”: Magellan’s Philosophy & Approach To Value Based Payment Arrangements, at The 2018 OPEN MINDS Performance Management Institute (see Catching The Wave). He talked about getting ready to ride the “big wave” and the importance of positioning and timing in preparing for the shift to value-based reimbursement.
Over the last couple weeks, I’ve been thinking about a different comparison—how waves begin—as I’ve been reading about the initial value-based contracting initiatives between payers and intellectual/developmental disabilities (I/DD) provider organizations. We’ve reported on these developments as they have been happening.
In March, Superior HealthPlan, a Medicaid managed care organization (MCO) in Texas, launched a new “center of excellence” model for accessing physical, speech and occupational therapy services in two parts of the state (see Texas’ Superior Health Plan Launches New Access For Physical, Speech & Occupational Therapy Services). And, the New York Office for People With Developmental Disabilities (OPWDD) announced it had selected six provider organizations to provide a new Medicaid care coordination organization/health home (CCO/HH) care management service to people with I/DD (see New York Announces Six Care Coordination Organizations For People With I/DD).
In January, Pennsylvania launched a new 1915(c) home- and community-based services waiver, called Community Living Waiver, for individuals with autism and I/DD (see Pennsylvania Launches New HCBS Waiver For Individuals With Autism & I/DD)—under the waiver, eligible individuals may receive up to $70,000 in services per fiscal year, excluding supports coordination. And in December the Iowa Medicaid IA Health Link managed care organizations (MCOs) began using a tiered rate payment methodology to reimburse organizations providing full-day services to people enrolled in the state’s home- and community-based services (HCBS) waiver (see Iowa Medicaid MCOs Shift I/DD HCBS Waiver Reimbursements From FFS To Tiered Rates).
When you read about how waves start—the result of the friction of the wind over the water—you can see the similarities. The sources of friction are many—increasing population needing service, rising cost of service, longer lifespans, competition for Medicaid dollars, and more. And now we’re seeing the start of the value-based wave in financing services for this consumer population. This will be propelled by the decision by state Medicaid plans—the largest payer of support services for I/DD—to move these consumers and the funding to serve them to Medicaid health plans. Right now, in the $282.9 billion long-term services and support (LTSS) market (see The Big Medicaid Spend On The 65+ Population), 50% of consumers with I/DD already get their health/behavioral health benefits through Medicaid health plans; and 15% have LTSS that also included in managed care models (see State Medicaid Programs With MLTSS: The 2016 OPEN MINDS Update and What Are The Major Provisions Of The 2016 CMS Medicaid Managed Care Final Rule?: An OPEN MINDS Market Intelligence Report).
These developments made me think about how provider organization executives can plan for this disruption and position their organization to be sustainable. But how? For more, I reached out to my colleagues Stacy DiStefano, OPEN MINDS chief operating officer and former vice president of Resources for Human Development (RHD), and George Braunstein, OPEN MINDS senior associate and former executive director of the Fairfax-Falls Church Community Services Board. Stacy focused on the importance of preparing you organization sooner, rather than later—particularly the importance of sowing the seeds of culture change.
Many organizations I speak with are assuming value-based reimbursement (VBR) models in the I/DD system are far down the road. While it’s true we don’t know the timeline for a broad, system-wide adoption, we can clearly recognize the trends driving pilots programs, and we understand that health plans need better cost containment. The things that executive teams can do today to prepare for VBR center around staff training and development. Just as it was a paradigm shift for institution-based staff to move to a HCBS mindset in the 1990s and early 2000s, such is the culture change necessary to move from a focus on volume to revamping service lines to focus on delivering value.
Direct care staff and mid-level managers should be hearing about the concept of VBRs on a regular basis. An understanding of the reimbursement models, billing mechanisms, and outcome measures needed are critical to repositioning service lines. While the obvious players to bring to the table are the finance folks, revenue cycle managers and business development teams, organizations should not overlook the need for buy-in from the front line staff delivering the care itself. Identifying clear outcomes measures that include input from staff, payer, and consumer will ultimately provide the highest levels of satisfaction and value. Those conversations can start now.
George’s focus was on the tactical—the changing organizational infrastructure and competencies that are needed. He said:
Over the last several years I have worked with a number of organizations providing services to individuals with I/DD. The most common theme I have noted is that they are collecting and reporting a significant amount of data on functionality levels and support needs, but it is not necessarily the data they need for a value-based environment. I think that the major challenge for these organizations is finding the right tech platform to manage in this new reimbursement environment. They need the ability to identify costs and margins for defined service lines, estimating service line-specific margins (and deficits), and developing the performance indicator data that reflects “value” of the services they provide.
My takeaway? For organizations preparing their health and behavioral health services for the “big wave” of value-based reimbursement, long-term services and support for the I/DD population should be included. By being prepared opportunities may arise where they are least expected.
For more on this topic, don’t miss this year’s 2018 I/DD Executive Institute on June 4 in New Orleans. Opening the day will include Olivia J. Garland, Ph.D., Vice President State Consulting and Solutions Architecture for Individuals with Intellectual & Developmental Disabilities, Optum Government Solutions; and Lilli Correll Vice President, Product Development and Solution Design Optum Behavioral Health, bringing a health plan perspective to the issue in their opening plenary presentation, Managed Care & The I/DD Population: The Health Plan Perspective On The Strategic Challenges & Partnership Opportunities In A New Market.
The day also includes sessions on Finding A Competitive Advantage Through Strategic Financing: How Private Equity, Strategic Partnerships, & Mergers & Acquisitions Can Propel Your Operations To New Heights and The Shifting I/DD Marketplace: The Implications Of Moving From Fee-For-Service To Managed Care & Value-Based Reimbursement. And, I’ll be closing the day with, The I/DD Service Landscape: An Executive Briefing & Market Discussion, and update on the trends shaping the I/DD market.