Legislature Examines Duals Transition

by David Gorn

TOPIC ALERT:

Toby Douglas took a good amount of heat last Wednesday at an Assembly joint hearing of the committee on Aging and Long-Term Care and the Budget subcommittee on Health and Human Services.

Douglas -- director of the state Department of Health Care Services -- with a full array of budget cuts, program transitions and agency reorganization on his plate, has been making presentations and fielding questions at a number of legislative hearings recently. None of them has been a cakewalk, but this hearing was a little more barbed than most.

Complaints and concerns ranged from a perceived lack of choice to worry over rapid-fire changes.

If California accepts the managed care, passive enrollment plan being advanced by DHCS, "essentially what you've said is, the [health care] providers are held hostage to contracting [only] with those plans," according to Assembly member Linda Halderman (R-Fresno). "The only way this whole thing works, financially, is to remove patient choice."

Most of the criticism at the hearing centered on the timeline for duals transition.

At issue is the passive enrollment and transition of 1.2 million Californians eligible for both Medicare and Med-Cal benefits to managed care plans. California is one of 15 states working on a federal demonstration project to convert duals to managed care. By consolidating funding and coordinating services from the two agencies, the ultimate goal is for beneficiaries to receive better care at a lower cost to the state.

Originally, four counties were to be tapped as the testing ground for that conversion, but DHCS now wants to boost that project to 10 counties. The state's goal is to have all California counties participating in managed care for duals by 2013.

"I find it a little surprising that we're moving so rapidly," Assembly member Bill Monning (D-Carmel) said. "We have serious financial and budget considerations, but I want to make sure we're not being driven by those decisions [in shaping policy]. Help me understand why we can move so rapidly, when we haven't even completed the first pilot."

Douglas said that, in evaluating demonstration-project proposals from many counties, 10 of them stood out.

"As we've gone out … we have seen and learned so much more about the readiness of our plans and their prior experience," Douglas said. "The reason we're saying 10 is because we've developed a very high level of readiness and requirements and protections, and based on that, we have identified that there are 10 counties with plans that can meet those standards."

That argument didn't fly with Assembly member Mariko Yamada (D-Davis). "We're talking now about moving 1.2 million of the Medi-Medi's over a three-year period," Yamada said. "When you compare that to five other states that have much more modest proposals, what is it that makes California so different from all of those other states? Can we really, with confidence, say we can get this done?"

Douglas said it would not be easy, but it was an opportunity that shouldn't be missed, given the federal support for reforming the duals system.

The Legislative Analyst's Office disagreed -- not about the duals demonstration project itself, but about the recent expansion of it.

"We think the governor's proposed timeline is too aggressive," Ross Brown of the LAO said. "And you risk not getting some of these details right for statewide implementation."

The LAO recently released a report on the care coordination initiative, which was generally in favor of the concept. But the expansion to 10 counties in the initial demonstration project and the rapid expansion to the rest of the state's counties did not sit well with the LAO.

"We think the proposal to implement statewide is premature," Brown said. "The proposal assumes the success of the demonstration project before it's even been implemented, much less evaluated. And it proposes to roll it out statewide. It also doesn't give time to evaluate pilots in other states. By implementing the demonstration plan in four counties, it would give the state time to learn lessons from other states before it makes a decision about statewide implementation."

Brown also suggested that the Legislature consider launching a demonstration project in one county that does not include Medicare integration, so that if the state finds that the main demonstration project doesn't work, there is something else to fall back on.

Frank Mecca, executive director of the County Welfare Directors Association of California, said moving too fast could cause much more than administrative chaos.

"We see the potential to do harm [to beneficiaries] if done poorly," Mecca said. "We think the proposal tries to do too much, too quickly. You know, the county welfare departments are used to big system changes. And our studied and experienced opinion is that it can't be done right, being done so quickly."

Assembly member Holly Mitchell pointed out that the duals conversion to managed care is "a major policy shift contained in a budget document." She said that could be problematic. She also had a hard time with the idea of ceding monitoring authority over the expansion of the project.

"If it turns out," Mecca said, "that everyone else is wrong and this actually can roll out this quickly, I don't know that building in opportunities for the Legislature to make affirmative decisions to allow the next phase is such a bad idea. I mean, if the data proves it, then we can move on to the next phase."


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