Lynn A. Kovich, Assistant Commissioner Raquel Mazon Jeffers, Deputy Director March 27, 2012 The Comprehensive Waiver Application Overview & Health Care.

Lynn A. Kovich, Assistant Commissioner

Raquel Mazon Jeffers, Deputy Director

March 27, 2012

The Comprehensive Waiver Application Overview &

Health Care Reform

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Why Do We Need a Waiver?2

Medicaid programs are matched – in part – with federal funding; all changes to the program must be approved before implemented

NJ has 8 Medicaid waivers (including CCW) for various programs/services; need to consolidate to reduce administrative burden

Medicaid grew in cost by 18% over 3 years; state must spend resources efficiently

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The Patient Protection and Affordable Care Act (PPACA), signed into law by President Obama in

March 2010, reshapes the nation’s health system. The law requires coverage of mental

health and substance use disorders in the minimum benefit package and the new Medicaid

expansion provision for childless adults up to 133% of Federal Poverty Level (FPL).

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The Patient Protection and Affordable Care Act

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Mental health and substance use disorder benefits must be “no more restrictive than the predominant financial requirements applied to substantially all medical and surgical benefits covered by the plan…” and “there are no separate cost sharing requirements than are applicable only with respect to mental health or substance use disorders benefits.”

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Mental Health Parity and Addiction Equity Act

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What is a Comprehensive Waiver?

The Comprehensive Waiver is a collection of reform initiatives designed to:

sustain the program long-term as a safety-net for eligible populations

rebalance resources to reflect the changing healthcare landscape

prepare the state to implement provisions of the federal Affordable Care Act in 2014

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Comprehensive Waiver Development6

February 2011 - Governor Chris Christie calls for a Medicaid reform plan during FY’12 budget address

February 2011 to May 2011 – DHS, DHSS, DCF review every facet of the program, examine other states’ plans, look at every possible opportunity to improve and to reform

May 2011 - Waiver concept paper is released May 2011 to August 2011 - Extensive public input process August 2011 to September 2011 – Input is reviewed/concept

paper revised/waiver application drafted and finalized September 2011 - Waiver is submitted to CMS/posted on

DHS website January 25, 2012 – Final draft of Standard Terms and

Conditions submitted to HHS

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Waiver Highlights7

Model for reform and innovation

Streamlines program administration and operation

Preserves eligibility and enrollment

Does not include ER co-pay

Enhances and coordinates services to specialty

populations

Rewards efficiency in careThe full waiver application can be found online at:

www.state.nj.us/humanservices/dmahs/home/waiver.html

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The Details by Category8

WHAT DOES IT ALL MEAN?

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Need for Care Integration

Currently, BH care under Medicaid FFS is fragmented with an over-reliance on institutional, rather than community-based care

Consumers receive care through managed care organizations (MCOs) with limited or no formal protocols for coordination between medical and behavioral health delivery systems

Approximately two-thirds of Medicaid’s highest cost adult beneficiaries have MI and one-fifth have both MI and a substance use disorder

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Need for Care Integration (cont)10

Individuals with untreated substance use disorders have higher medical costs than those without such disorders, especially for emergency department visits and hospitalizations.

Generally, these individuals use about 8 times more healthcare services.

Similarly, families of untreated individuals with substance use disorders also have significantly higher medical costs than other families; up to 5 times more health care driven by hospitalizations, pharmacy costs and primary care visits. for example: children of alcoholics who are admitted to the

hospital average 62 percent more hospital days and 29 percent longer stays

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Some Interesting Facts11

National studies estimate that during a 1 year period up to 30% of the US adult population meets criteria for one or more MH problems, particularly mood (19%), anxiety (11%, and substance use (25%)

MH problems are 2 to 3 times more common in patients with chronic medical illnesses such as diabetes, arthritis, chronic pain, headache, back and neck problems and heart disease

Left untreated, MH problems are associated with considerable functional impairment, poor adherence to treatment, adverse health behaviors that complicate physical health problems and excess healthcare costs

Most MH treatment is provided in primary care settings, and the percentage provided solely in these settings is rapidly growing

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What Does Medicaid Waiver Mean for Behavioral Health Services?

Integrates behavioral health and primary care

Develops innovative delivery systems – MBHO, ASO

Supports community alternatives to institutional

placement

Braids funding

Provides opportunities for rate rebalancing

No-risk model transitions to risk-based model

Increased focus on SAI and consumers with

developmental disabilities

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Managed behavioral health systems are typically organized around the following processes or core functions

The state, providers, members, and the MBHO each have specific roles and responsibilities within these processes

These may vary based on what the state opts to delegate to the MBHO and what it retains

Some processes may not be delegated to the MBHO; (ie, verification of Medicaid eligibility)

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Roles and Responsibilities in a Managed Behavioral Health System

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Eligibility Network Development and ManagementAssessment and ReferralUtilization ReviewClaims AdministrationData AnalyticsCare ManagementQuality ManagementFinancial Management

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Roles and Responsibilities in a Managed Behavioral Health System

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Aspects of the Risk Model

Non-entitlement services remain non-risk

Advantages of going risk Greater budget predictability Greater flexibility

Rates Services Reinvestment

Aligned incentives

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Safeguards of the Risk Model

Federally mandated consumer protections in a risk model grievance procedures fraud and abuse civil and monetary penalties enrollee rights and must be informed and re-informed of rights quality assurance programs mandatory external Quality review prohibition against provider incentive to decrease care or tie

compensation to utilization decisions Other protections could include:

consumer bill of rights Post-stabilization requirements

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Waiver Impact on Access, Quality, Outcomes

State establishes policy and standards for: MBHO mission/vision to serve BH consumers MBHO performance Provider network participation and performance Consumer outcome indicators and related process measures

Allows for consumer and family participation in the design of access and quality standards and ongoing monitoring of performance and outcome

Per the ‘medical loss ratio’ provision, MBHO must spend majority of resources on care Sets minimum amount on services Limits maximum administrative spending Limits maximum profit to be earned Reinvestment in new capacity

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Delivery System Innovations

Uniform screening and level of care determination

Tiered care management

Behavioral health homes

Special initiatives MATI and DDD

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Bottom Line – Good News

Integrated care SA/MH and BH/PH

Opportunities for rate rebalancing

Increase FFP

Service expansion for SA services

Reinvestment of some savings

Reimbursement for community-based services

instead of acute care

Better access, enhanced quality, improved outcomes

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Stakeholder Involvement20

Stakeholder Involvement

DMHAS, in partnership with NJ Medicaid, have developed a stakeholder input process to: Inform the Department of Human Services’

values and vision regarding the design and implementation ASO/MBHO

Elicit broad stakeholder input regarding the design and development of the various components of the ASO/ MBHO

Initiate a targeted workgroup process to inform more detailed level components of the ASO/MBHO

Identify and leveraging opportunities under Health Care Reform to support a transformed system

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The Steering Group meets March 30, 2012 to discuss the Workgroup reports and advance it’s recommendations to DMHAS and DMAHS

The final Steering Committee report and recommendations will be completed and posted in April 2012

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Stakeholder Involvement

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What are the Next Steps?22

July 2012 – ASO/MBHO RFP Posted

January 2013 – RFP Awarded

January –April 2013- ASO/MBHO

Readiness Review

July 2013 – ASO/MBHO implementation

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Stakeholder Involvement23

Updates on the development of the MBHO and the Steering group can be found at: www.state.nj.us/humanservices/dmhs/home/mbho.html

To provide comment to DMHAS on the proposed changes to behavioral health services under the Waiver, email:[email protected]