Senator Jay Rockefeller, Chairman of the Senate Finance Subcommittee on Health Care, today expressed his strong concerns about efforts to coordinate care for beneficiaries eligible for both Medicare and Medicaid, during a Senate Finance Committee hearing entitled "Improving Care for Dually-Eligible Beneficiaries: A Progress Update."
"I have long been concerned about the health care needs of the 9.4 million Americans -- and more than 80,000 West Virginians -- who are simultaneously eligible for Medicare, because of age or disability, and Medicaid, because of income," said Rockefeller. "The Federal Coordinated Health Care Office was created to test new and innovative models of care coordination for dual eligibles. It was not created to recycle old ideas already proven to be ineffective for this population, thereby risking the health of millions of Medicare-eligible seniors by forcing them to comply.
"Medicaid managed care is a model that has not been shown to work for even small numbers of dual eligibles because of the varying range and intensity of services required to meet their special health care needs. And it is clear that with the number of people involved in the demonstration plans that they aren't really demonstrations, but rather policy, which isn't the intent of the programs nor is it best for those enrolled. This is a losing situation for dually eligible beneficiaries as well as federal and state programs trying to deliver the effective, high-quality care they need and deserve."
On July 10, Rockefeller sent a letter to U.S. Health and Human Services (HHS) Secretary Kathleen Sebelius, calling on HHS to revisit the way it is implementing the Financial Alignment Demonstrations for beneficiaries who are eligible for both Medicare and Medicaid under the Federal Coordinated Health Care Office. Click here to view the letter.
Rockefeller and five other members requested a Government Accountability Office (GAO) report on the consumer protections for individuals enrolled in Medicare and Medicaid. Click here to view the GAO report released on December 6.
Below is Senator Rockefeller's statement as prepared for delivery:
Statement of Senator John D. Rockefeller IV
Senate Committee on Finance
Improving Care for Dually-Eligible Beneficiaries: A Progress Update
December 13, 2012
Thank you, Mr. Chairman, for holding this very important hearing today. And, let me extend a warm welcome to all of our witnesses. I look forward to hearing your testimony.
As I reflect on the title of this hearing -- "Improving Care for Dually-Eligible Beneficiaries: A Progress Update" -- the first question that comes to mind is progress for whom?
My serious concerns about the direction of the Federal Coordinated Health Care Office generally and the Financial Alignment Initiative specifically are well-documented in a July letter that I sent to Secretary Sebelius. Mr. Chairman, I'd like to ask that a copy of that letter be submitted for the record.
Unfortunately, despite CMS's guidance and public comments to the contrary, most of the concerns described in my letter have not been addressed. As MedPAC so eloquently stated in its July letter to CMS, "Even if the Commission agrees with CMS's stated guidelines, there is no assurance that the final structure of a demonstration within any given state will be fully consistent with CMS's guidelines." It is clear both from ongoing press reports and from the very agreements that CMS has reached with some of the states present here today that the rights and choices of Medicare beneficiaries -- rights and protections I have vigorously defended for years -- are being diluted.
So, again, I ask the question progress for whom? Surely, we cannot mean progress for dual eligibles.
The Financial Alignment Initiative, as currently structured, runs counter to both the letter and the spirit of the statute regarding the Federal Coordinated Health Care Office. And, today, I again call on HHS and CMS to take immediate steps to halt this initiative as currently structured and to take the time necessary to develop a well-designed and thoroughly evaluated care coordination model for dual eligibles that meets the standards outlined in the law.
As the saying goes, "The best laid plans of mice and men often go awry." That seems to be an appropriate way to describe the Financial Alignment Initiative.
I have long been concerned about the health care needs of the 9.4 million Americans -- and more than 80,000 West Virginians -- who are simultaneously eligible for Medicare, because of age or disability, and Medicaid, because of income. One of the most troubling aspects of the care provided to dual eligibles is the income inequality that is perpetuated by the two programs.
As I have said many times before, we should not continue to treat low-income individuals eligible for Medicare as if they are less deserving of the benefits and protections of Medicare coverage simply because they are poor.
The complex health care needs of dual eligibles are often poorly managed, as they are forced to navigate a complex health care system with different eligibility rules, coverage standards, and benefits between the Medicare and Medicaid programs. This lack of coordination results in fragmented care and coverage gaps, increasing the need for costly treatment that might have been avoided. This is a losing situation for dually eligible beneficiaries as well as federal and state programs trying to deliver the effective, high-quality care they need and deserve.
In 1965, when we created Medicare, it was created as a universal benefit to all who qualify. It was the promise that society made to our seniors, regardless of where they live or their income. [Click here to view a floor statement from June 23, 2003.]
Perpetuating an arbitrary distinction among Medicare-eligible populations, and denying the universality of Medicare, has historically undermined efforts to improve benefits and coordinate care for seniors and individuals with disabilities who happen to be low-income.
The absurdity of such a division between populations eligible for Medicare becomes even more evident when we take a look at the facts. Whether low-income or not, Medicare-eligible populations with multiple chronic conditions and functional impairments have similar health care needs, including access to a wide array of benefits and services. There is no single health problem that is completely unique to the dually-eligible population in comparison to the Medicare-only population.
In fact, a significant portion of Medicare-only enrollees have medical needs that mirror the dually eligible population. For example, 55 percent of dual eligibles have three or more chronic conditions compared to nearly half (44 percent) of Medicare-only beneficiaries. Whether low-income or not, Medicare-eligible populations need high-quality, better coordinated care.
A major reason that states currently have a long-run problem in their fiscal outlook is that they have absorbed responsibility for Medicare-eligible populations who happen to be low-income. So, the question remains -- why are we continuing to advance policies that treat low-income individuals eligible for Medicare differently than we treat everyone else eligible for Medicare?
Fortunately, we took a crucial step toward righting this wrong with passage of the 2003 Medicare prescription drug law, which included my amendment to provide Medicare prescription drug coverage to dual eligibles -- a statutory benefit that is also in jeopardy under this misguided initiative.
Building on this provision for duals in the Medicare prescription drug law, the National Governors Association published a 2005 paper entitled, "Dual Eligibles: Making the Case for Federalization." In this paper, the NGA outlined five key reasons for ending the income-based distinction between Medicare-eligible populations:
Improved care coordination.
States cannot sustain the fiscal burden related to dual eligibles.
The federal government is responsible for retirement programs.
Medicare beneficiaries are not equally distributed among the states. On this point, it is important to note that many of the states represented on this Committee -- including my home state of West Virginia, Florida, and Maine -- have a higher than average number of Medicare beneficiaries and, therefore, bear a disproportionate cost burden for low-income Medicare-eligible populations.
Medicare's historic role is to serve as a comprehensive health insurance benefit attendant to retiree income.
Mr. Chairman, I ask that a copy of this paper be submitted for the record.
The Federal Coordinated Health Care Office, as initially envisioned in the Medicare Prescription Drug Coverage Improvement Act of 2009 and as enacted in the final health reform law, was created to test new and innovative models of care coordination for dual eligibles. It was not created to recycle old ideas already proven to be ineffective for this population, thereby risking the health of millions of Medicare-eligible seniors by forcing them to comply.
Managed care plans have not demonstrated success with even small numbers of dually eligible beneficiaries. Dual eligibles require a varying range and intensity of services--including an often vital need for services such as home health or personal care aides--that most Medicaid managed care plans are simply not structured to administer. If more Medicaid managed care had been the goal, Congress would have passed legislation saying that.
We had an opportunity through the Coordinated Care Office to test alternative models of care for duals in the Medicare program. For reasons unknown to me and many of my colleagues, the Coordinated Care Office is relying solely on unproven state-based models of care instead of testing comprehensive and uniform models of care through the Medicare program. Ironically, duals in this so-called "demonstration" are losing their access to Medicare benefits and coverage and the freedom of choice that has long been a hallmark of the Medicare program. I think this is a huge mistake and a fundamental flaw with the design of this initiative.
In creating the Coordinated Care Office, Congress sought better evidence about the effectiveness of new care coordination models for dually eligible beneficiaries. The process Congress envisioned was one that invested in testing well-designed, thoroughly evaluated demonstrations before expanding successful demonstrations more broadly.
Regrettably, we do not have to wait for implementation of the Financial Alignment demonstrations to see the negative effects that under-evaluated Medicaid managed care models can have on dually eligible beneficiaries. California is already two years along in an experiment to enroll dual eligibles into managed care models that are very similar to the proposed demonstrations under the Initiative. A report by the California Health Care Foundation determined the movement of duals into Medicaid managed care in California was too rushed, creating numerous problems and challenges.
Dually eligible beneficiaries in California have been deprived of sufficient specialist networks, forced to sever bonds with trusted doctors, suddenly switched onto new medications and struggled with onerous processes to opt-out or become exempt from Medicaid managed care enrollment. We need look no further than California's experience to justify the need for more extensive evaluation and assessment of the Financial Alignment Initiative's proposed models of care.
Exponentially greater harm will come to dual eligibles if CMS continues to rush and get this wrong instead of taking the necessary time to think this through and develop a proven model to get this right. True progress for dual eligibles requires an immediate reversal of the Financial Alignment Initiative.
I thank the Chair.