SACRAMENTO, Calif.: Amid all the recent worry about people lacking health insurance, one vulnerable group of Californians appears to be suffering from too much, not too little coverage.
Low-income older adults who are dually eligible for both Medicare and Medi-Cal (California’s name for Medicaid). That might sound like a good thing. But the lack of coordination between the federal program for seniors and the state-federal program for the poor may be hurting their health. It is also costing the taxpayers a ton of money.
Now the California is among a number of states trying to fix the problem by combining all of the services available to these people under one administrative roof. That will include not only their health care but social services too, such as in-home workers who bathe and feed patients who can’t take care of themselves but don’t need to be in a nursing home.
Gov. Brown Expects Big Savings
Gov. Jerry Brown says the changes will be a boon to more than a million elderly and infirm Californians – including many formerly middle class people who spent down their savings until their funds were low enough to qualify for Medi-Cal, which now pays their nursing home bills.
Brown is also counting on big savings for the state. He estimates that the reforms could shave a half-billion dollars from the California’s budget for health programs.
But the move also carries risk. If the managed care plans that will be taking charge of people’s needs are not up to the task, their health could suffer. And the health plans themselves might be saddled with unmanageable costs if the rates and rules for the program are not set just right, ultimately causing turmoil and confusion for the very people the changes are designed to help.
The heart of the problem is the fragmented nature of care for this fragile population.
Medicare pays for doctor visits, prescription drugs and short-term hospitalizations, but does so using the traditional “fee-for-service” method. Patients are responsible for managing their own care, finding and choosing doctors and medication, and the federal government pays the tab. The program also offers the Medicare Advantage managed-care option, but that does not cover long-term care and other services included in Medi-Cal.
If an older person is poor, they are also covered by Medi-Cal. The state-run program (financed by federal and state dollars) picks up any deductibles and co-payments charged by Medicare and pays for long-term care, including nursing homes that Medicare does not cover.
But that means that a patient moving from a nursing home to a hospital or back to their own home will often be switching among doctors and caregivers, increasing the potential for confusion, errors or lapses in care. Social services, which many of these patients also need, are managed independently, usually by the counties.
Uncoordinated Care at its Worst
Jane Ogle, deputy director of the state’s Department of Health Care Services, says focus groups with seniors in advance of the governor’s proposal turned up accounts of uncoordinated care at its worst. She said one person had 26 different doctors. Another was on 52 medications.
“These people spent most of their time trying to coordinate their own care, get doctors’ appointments, make sure their medication was proper, get their [in-home care] services, find out if they were eligible for adult day services,” Ogle said. “They were doing it all on their own. This is designed to get them help doing that, a phone number they can call and say, ‘I need this service,’ and someone will be on the other end of the line who knows the entire system.”
The state’s solution: managed care. A single health plan will be responsible for coordinating all of a patient’s services. The plans will have a financial incentive to keep patients out of nursing homes and hospitals whenever possible, to keep them as healthy and independent as they can be.
The change is scheduled to begin sometime after Oct. 1, with a three-year demonstration program in eight counties, including Alameda, Los Angeles, San Bernardino, San Diego, San Mateo, Santa Clara, Orange and Riverside.
Orange County’s CalOptima health plan is one of the models for how the new system is supposed to work. The agency has been managing care for many of those eligible for both Medicare and Medi-Cal since 2005. But while there was one manager, the clients were enrolled in two separate health programs, with social services still managed separately. Now all of those services are supposed to be seamless.
Michael Schrader, CalOptima’s chief executive officer, said the new system should be much better for the patients than the current system.
“From a member’s perspective, I might be getting support at home, with bathing and feeding and general living,” he said. “I am getting that from the county. Perhaps I am fortunate to be one of 300 people in CalOptima’s program [eligible] to get some help installing bars in my bathroom. I am also dealing with Medicare for physician and hospital services, and if things worsen, and I get placed in a facility, now after 100 days I become dependent on CalOptima for long-term care.
“You’re dealing with three different agencies, four different programs, and this is our most vulnerable population. It’s complicated enough for most of us figuring out our single insurance plan, and we’re asking these folks to figure out three different agencies and four plans. It’s fragmented and it doesn’t work for people.”
Claims of Individualized Care Questioned
Javier Sanchez, CalOptima’s chief network officer, said each patient would have an individualized care plan and a doctor in charge of their care. If they need help staying in their home – a ramp, or a safety bar, or a home health aide – the health plan will, in theory, help them get it.
If they are in a nursing home and get sick, instead of being transported to an emergency room, the health plan might arrange for a doctor to visit them. The same might be true for an eye doctor or a lab procedure.
“We’ve had experience managing these programs in the fragmented system,” Sanchez said. “Now we have the opportunity to coordinate all of the services under one health plan. It’s really very beneficial to the members.”
But consumer advocates worry that the health plans might not be up the task. The National Senior Citizens Law Center, for example, pointed out that several of the health plans have been rated very poorly by both Medicare and Medi-Cal, and some have even been sanctioned for their care of older adults. While CalOptima has earned high marks from Medicare, surveys of patients in Medi-Cal have given the health plan a ranking of 1 out of 5 for its care and customer service.
That’s one reason the federal government has said that patients will be able to opt out of managed care and return to traditional Medicare at any time.
However, that turnover could wreak havoc with the new system, making budgeting difficult and introducing the same problems with uncoordinated care that exist today. The state’s nonpartisan legislative analyst has warned that if too many patients opt out of managed care, the savings the state is hoping for could vanish.
But Ogle, the state’s deputy health director, insisted that the state will closely monitor the health plans to ensure that they have adequate networks of doctors and hospitals and that they are treating their patients properly. She noted that the state has already scaled back its plan to ease the transition. The change, at least at first, will affect fewer than half of the 1.2 million Californians who are eligible for both Medicare and Medi-Cal.
“I think consumers will see this as an improvement,” she said.
Daniel Weintraub has covered California Public Policy for 25 years. He is editor of the California Health Report.
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