Colorado to Partner With CMS on Medicare-Medicaid Payment Pilot

Colorado has become the latest state to partner with CMS to test a new payment and integrated care model for people enrolled in both Medicare and Medicaid.

The demonstration project will involve the state expanding its Medicaid Accountable Care Collaborative Program — an established managed fee-for-service program — to 48,000 dual-eligible patients in July. If the state successfully improves care and lowers Medicaid and Medicare costs, CMS will share some of those savings with the state.

Dual eligible beneficiaries are often the sickest and poorest patients covered by either healthcare program, and existing care models typically don't involve much if any coordination between Medicare and Medicaid, according to The Kaiser Commission on Medicaid and the Uninsured.

Colorado launched the ACC Program in 2011 to improve care for Medicaid beneficiaries while containing costs. Beneficiaries are linked with a primary care medical provider, which serves as a medical home. PCMPs receive support from regional care collaborative organizations, and the statewide data and analytics contractor provides analytics support and feedback on performance. Because of the program, the state has reported improvements in hospital readmissions and approximately $44 million in avoided costs or gross savings in fiscal year 2012 through 2013.

CMS has partnered with a number of other states to integrate care and align financing for dual-eligible patients. The agency has finalized memoranda of understanding with California, Virginia, Ohio, Massachusetts and Illinois to test a capitated model, while Washington has received approval to test a managed fee-for-service model.

Under the capitated financial alignment model, the baseline payment for Medicare Parts A and B will be determined using a combination of Medicare Advantage benchmarks and Medicare fee-for-service standardized county rates weighted by whether enrollees transitioning into the project were previously enrolled in a Medicare Advantage plan or a Medicare fee-for-service plan. Under the Washington project model, providers will keep receiving fee-for-service payments for services covered by Medicare and Medicaid.

More Articles on Medicare and Medicaid Payments:
State Projects to Align Financing for Dual Eligible Patients
Managed Care Demonstration From Massachusetts Approved by CMS
Massachusetts Becomes First State to Participate in CMS Dual Eligible Demonstration