Health Affairs Forefront
Medicare And Medicaid IntegrationCMS Proposes Significant Policy Changes To Improve Care For Dually Eligible Individuals

Editor’s Note
This article is the latest in the Health Affairs Forefront major series, Medicare and Medicaid Integration. The series features analysis, proposals, and commentary that will inform policies on the state and federal levels to advance integrated care for those dually eligible for Medicare and Medicaid. The series is produced with the support of Arnold Ventures. Included articles are reviewed and edited by Health Affairs Forefront staff; the opinions expressed are those of the authors. Submissions will be accepted on a rolling basis until January 31, 2025.
In 2022, the Centers for Medicare and Medicaid Services (CMS) provided states a number of new authorities to hold Medicare Advantage (MA) plans accountable and to ensure that dually eligible individuals receive integrated care. This past November, CMS proposed another set of significant changes that have the potential to dramatically improve the care and services, as well as the unbiased counseling and information about enrollment choices that dually eligible individuals receive.
Unlike the rule from 2022, most of the proposed changes in the proposed rule for 2025 do not require action on the part of states. Instead, CMS proposed a number of key changes that would automatically take place. The proposed rule also provides meaningful new tools for states to leverage in their work to increase integration.
Automatic Rules Effective When Rule Is Finalized
Enhancing Guardrails For Agent And Broker Compensation To Deter Biased Enrollment Support
Unlike in the Medicaid program where independent agents and brokers are largely prohibited, MA plans can employ agents and brokers, as well as field marketing organizations, to directly target individuals for enrollment. While the compensation for these enrollment entities is supposed to be standard across plans, it is not.
For dually eligible individuals, paid brokers and agents are deeply problematic. These brokers and agents have financial incentives to continually move individuals from plan to plan. Because dually eligible individuals are entitled to special election periods (and other individuals are not), they are targeted by these brokers—especially outside of the annual election period. The proposed rule would normalize and limit payment across the MA landscape, thereby minimizing some of the incentives for brokers/agents to seek out dually eligible individuals and encourage them to switch.
Increasing The Percentage Of Dually Eligible Managed Care Enrollees Who Receive Medicare And Medicaid Services From The Same Organization
In states that use Medicaid managed care organizations (MCOs) to deliver Medicaid benefits, it is not infrequent for an individual to have two different health plans—one for Medicaid and one for Medicare. Even for those individuals who may have the same health plan, they may have been enrolled in a MA product that is not designed to further integration of care (for example, a coordination only Dual-Eligible Special Needs Plan or D-SNP) (Note 1).
When a full benefit dually eligible individual is receiving their Medicare benefits from one MA plan and their Medicaid benefits from a different company’s Medicaid MCO, there is virtually no chance that they will receive an integrated experience. While being in the same plan for Medicare and Medicaid benefits cannot guarantee an integrated experience, it at least creates the necessary conditions for it to occur. Furthermore, the benefits from exclusively aligned enrollment (for example, single ID card, unified appeals and grievances, and so forth) are completely abrogated when individuals are in different plans (or non-integrated plan offered by the same parent company).
The new proposed rule has several elements that would decrease this occurrence dramatically.
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Special Election Periods (SEPs): Today, dually eligible individuals may switch MA plans up to four times a year. The proposed rule would allow these individuals to switch monthly, but only into integrated MA plans (that is, MA plans designed to align with the individual’s Medicaid MCO). By limiting the SEPs to movement into integrated plans, fewer dually eligible individuals will be subject to confusion from broker/agent marketing into unaligned plans. These types of unaligned plans provide no benefit to dually eligible individuals who are enrolled in a Medicaid MCO. Instead, they create fragmentation and disintegration.
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Limiting Medicaid MCO affiliate D-SNP enrollment: Today, a D-SNP that is affiliated with a Medicaid MCO may enroll any dually eligible individual, which results in situations in which the affiliated D-SNP may enroll an individual that is in another plan’s Medicaid MCO. The proposed rule would limit these D-SNPs to enrolling only individuals who are in their own plan’s Medicaid MCO. Why would a D-SNP enroll an individual that’s not affiliated with its own Medicaid MCO? Simply put, every other D-SNP is doing it, and no D-SNP wants to lose prospective membership. There is, in essence, a collective action problem—a “tragedy of the commons.” Because every D-SNP is attempting to enroll all eligible individuals, every other D-SNP has to do the same, rather than encouraging and focusing on aligned enrollment. By requiring Medicaid MCOs’ affiliated D-SNPs (aligned D-SNPs) to only enroll dually eligible individuals from their respective affiliated MCO, this rule has “solved” that collective action problem.
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Limiting plan benefit packages (PBPs) in Medicaid MCO service areas: A PBP is the means by which MA plans submit “bids” to CMS. Most importantly, from an individual perspective, it is the essence of what they are choosing when they choose an MA plan. When an individual goes onto the Medicare Plan Finder, they see the various PBPs (and plans can list multiple PBPs from which individuals can choose). The proposed rule would prohibit health plans from offering more than one PBP in the same area in which they operate Medicaid MCOs. Similar to the above, this proposed provision will minimize the potential “games” that health plans play to garner incremental membership in D-SNPs. By restricting the number of PBPs that an affiliated Medicare health plan can offer in a given service area, the proposed rule limits confusion for individuals and encourages more individuals to choose an aligned D-SNP.
Overall, this section of the proposed rule recognizes that too much supposed “choice” of MA plans is, in fact, no choice at all for dually eligible individuals. These new rules ensure that those health plans that are already working in partnership with states as Medicaid MCOs are only able to offer products that incent integration—a significant difference from the current situation in which these plans are often doing just the opposite. Importantly, individuals are offered choice: They can choose a different Medicaid MCO, or they can choose to not enroll in a D-SNP.
Contracting Standards For Dual-Eligible Special Needs Plan Look-Alikes
Because of the additional burdens that are imposed on being a D-SNP (for example, getting the state to sign a State Medicaid Agency Contract [SMAC], coordination with Medicaid, and so forth), some health plans created what the industry calls “D-SNP look-alikes.” These plans set premiums, benefits, and cost shares that mimic those of a D-SNP, but they are not subject to state and federal regulation that requires integration. From the individual’s perspective, look-alike plans have financial components that make them seem like D-SNPs, but they do not coordinate services or communicate with Medicaid. Because of the fragmentation and confusion these products cause, in previous rulemaking CMS mandated that any MA plan with dually eligible individuals in excess of 80 percent of its membership—a telltale sign of a D-SNP look-alike—would not receive a contract from CMS.
The proposed rule would lower the threshold to 70 percent in plan year 2025 and 60 percent in plan year 2026 to further weed out these look-alikes and reduce confusion for individuals. Additionally, if the proposed rules mentioned above go into effect (that is, those that limit Medicaid MCO affiliate D-SNP in their Medicaid service areas), some plans may attempt to further use look-alikes to circumvent these rules. By lowering the thresholds, this proposed rule will minimize this risk.
New Tools For States
Expanding Permissible Data Use And Disclosure For MA Encounter Data (Sect. 422.310)
Encounter data are, essentially, the collection of all of the payments made to providers on behalf of individuals (also known as claims data). States currently have timely access to traditional Medicare data (for those individuals not in a MA plan). The proposed rule will ensure states have similar timely access to the growing MA data for dually eligible individuals. In the rule, CMS noted the benefits of ensuring that states have earlier access to the data, including improved care coordination, coordination of benefits, provider oversight, care transitions, and alignment with Medicaid long-term services and supports.
States who make use of this data will have the further benefits of:
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Identification of unaligned dually eligible individuals: Today states are not able to easily identify those individuals who are “unaligned” (that is, in an MA plan and a separate, unaligned Medicaid MCO plan). Access to the full MA encounter data set will enable states to identify these individuals and then appropriately counsel them on integrated options.
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Payer of last resort: Earlier access to MA encounter data will empower states to ensure that MA plans are covering benefits first and that they are following Medicaid as payer of last resort rules with minimal disruption to providers.
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Enhanced rate setting: Today states can only require encounter data from D-SNPs via their SMACs. Given that some dually eligible individuals reside in “look-alike” plans, access to the entire MA data set will empower states to set Medicaid rates accordingly. For example, a dually eligible individual may be in the look-alike plan of the same company as a Medicaid MCO. With access to this encounter data, the state would be able to appropriately adjust the Medicaid MCO rate, as applicable.
We have focused on the major provisions of the proposed rule. There are several other important provisions in the proposed rule that will have benefits for dually eligible individuals (for example, preferred provider organization out-of-network cost-sharing limitations).
Summary
CMS has taken another large step forward to ensure that dually eligible individuals can receive integrated care and services. We know that such care integration has the potential to improve the quality of life of these individuals. Further limiting the “gaming” that MA plans play will limit confusion for individuals and create more conditions for integrated care across the two programs. Furthermore, the ability of states to receive more timely, critical information will enable them to hold their health plans more accountable and to drive integration.
Authors’ Note
Michael Monson is president and CEO of Altarum, a nonprofit organization focused on improving the health of individuals with fewer financial resources and populations disenfranchised by the health care system. Sarah Barth is executive director of Altarum Medicare-Medicaid Services for States. Altarum Medicare-Medicaid Services for States is a nonprofit organization that helps states create financially sustainable solutions to advance health, health equity, wellness, and independent living for dually eligible individuals.
Note 1
Coordination Only DSNPs have fewer requirements and, can therefore, be more profitable for health plans.