HINDSIGHT, FORESIGHT, & INSIGHT:

State Financing Innovations to Integrate Physical and Behavioral

Health

October 5, 2011

Tricia McGinnis

Center for Health Care Strategies

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Integration = Opportunity to Improve Care/Reduce $$

► Top 5% highest-cost beneficiaries account for 57% of $$

► Among the most expensive 1% Medicaid beneficiaries (acute care only) 80% have 3 or more chronic conditions

► 49% of those with disabilities also have psychiatric illness► The presence of psychiatric illness increases spending and

hospitalization rates by as much as 75%

Yet, most are in fragmented and disconnected physical & behavioral health delivery systems

*Sources: RG Kronick et al., “The Faces of Medicaid III: Refining the Portrait of People with Multiple Chronic Conditions.” Center for Health Care Strategies, October 2009; C. Boyd, et al. “Clarifying Multimorbidity for Medicaid Programs to Improve Targeting and Delivery of Clinical Services.” Center for Health Care Strategies, December 2010.

Cost Impact of BH Comorbidity Among U.S. Medicaid-Only Beneficiaries with Disabilities

3SOURCE: C. Boyd et al. Faces of Medicaid: Clarifying Multimorbidity Patterns to Improve Targeting and Delivery of Clinical Services. Center for Health Care Strategies, December 2010.

What Ideal Care CAN Look Like:

WITHOUT INTEGRATED CARE INTEGRATED CAREx Multiple physical and behavioral health

providers who rarely communicate Coordinated care team of providers

x Beneficiary confusion regarding how to access the care they need

Dedicated care manager role to help patient navigation

x No centralized information sharing across providers

Real-time, comprehensive data available across all providers

x Health care decisions uncoordinated and not made from the patient-centered perspective

Health care decisions based on the individual’s needs and preferences

x Serious risk for emergency room use, hospitalization, and/or institutionalization

Dedicated commitment across providers to reduce emergency room use and repeat hospitalizations

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Complex Care Management: Critical Elements

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Innovations in Integrated Physical and Behavioral Health FinancingStates are exploring a range of options for integrating the management and financing of physical and behavioral health services with a focus on individuals with serious behavioral health needs.

Two innovations include:

1.Behavioral Health Organization (BHO) as Integrated Care Entity

2.Accountable Care Organizations (ACO) as Integrated Care Entity

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BHO as Integrated Care Entity

• Contract with BHOs to provide both physical and behavioral health services for individuals with serious mental illness (SMI) or other serious BH needs.

► Considerations Established BHO infrastructure is critical

Capacity of contractors to manage PH and BH needs

Adequate provider network

Whether to allow subcontracting

Incorporation into broader health home initiatives

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BHO as Integrated Care Entity

PROS► PH/BH system alignment of

financial incentives► Full integration of

administrative data► Leverages specialty capacity

of BH system for complex need population

► Potential for greater consumer engagement

CONS► Lack of BHO capacity in

providing PH and Rx services► Emerging model, thus limited

experience► Questions regarding oversight

authority

Innovations in Arizona

• RFI for specialty Regional Behavioral Health Authorities (RBHAs)

• RBHA would be full risk for and manage all behavioral health and physical health services for SMI beneficiaries

• Will operate under Department of Behavioral Health Services

• Closely connected to health homes

• MA-SNP capabilities

• No subcontracting

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Innovations in Massachusetts

• Based on PCCM program, which is one of several managed care options

• BHO at full risk for behavioral health and managed fee-for-service for physical health

• Financial incentives for improved outcomes

• BHO required to provide high-risk members:► Care management program to coordinate care► Integration of physical and behavioral health care providers► Integration of mental health and substance abuse treatment

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ACOs as Integrated Care Entities

• Regionally-based provider entities charged to provide both physical and behavioral health services for all individuals, including those with SMI

► Considerations Financial incentives through shared savings are key

Must have capacity to facilitate data sharing among providers

Requires strong behavioral health lead within ACO

Adequate primary care reimbursement is critical

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ACOs as Integrated Care Entity

PROS► Shared savings aligns

incentives and promotes coordinated care

► ACOs can function within managed care, PCCM, or FFS systems

► Potential for true clinical integration

► Potential for patient and community engagement

CONS► Significant start-up costs► Shared savings and

information exchange may be hindered by BH carve out environment

► Statewide implementation may be difficult

► ACOs will likely need to partner with multiple MCOs

ACOs in Minnesota

• Includes behavioral and physical health services delivered to non-dually eligible beneficiaries in FFS and managed care

• Deploys two shared savings models to attract integrated and non-integrated providers

• RFP emphasizes:► Comprehensive care coordination► Meaningful engagement of patients and families► Partnerships with community organizations, social service

agencies, and counties

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Parting Thoughts

• Integrated financial/management systems are critical to effective integration of health services

• States are undertaking a range of approaches to solve this disconnect

• Systems-level integration efforts must be paired with efforts to integrate services at the point of care

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Questions?

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State Technical Assistance

►The Integrated Care Resource Center was recently established by CMS to help states develop and implement integrated care models for Medicaid beneficiaries with high-cost, chronic needs

►Technical assistance (TA) to help states integrate care for: (1) individuals who are dually eligible for Medicare and Medicaid; and (2) high-need, high-cost Medicaid populations via the Health Homes state plan option as well as other emerging models

►Individual and group TA coordinated by Mathematica Policy Research and CHCS

►Visit www.integratedcareresourcecenter.org to submit a TA request and/or download useful resources, including policy briefs, tools, state best practice resources, and the latest CMS guidance

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