Dual Demonstration Update

Virginia providers are paying increasing attention to the status of the proposed Medicare/Medicaid financial alignment demonstration (the Dual Demonstration).   Despite the belief that the Centers for Medicare and Medicaid Services (CMS) would issue a Memorandum of Understanding (MOU) to the Commonwealth in April, the federal agency has not yet added Virginia to the short list of states with approved MOUs.  Senior leadership at the Department of Medical Assistance Services (DMAS) believes the release of the MOU to be imminent.

VHCA members continue to report efforts by managed care organizations to build and document their provider networks as evidenced by ongoing efforts to secure letters of intent (LOIs).  We encourage all member facilities to carefully evaluate any legal document they contemplate signing with health plans in connection with the proposed Dual Demonstration.  Key components necessary to form a valid contract with health plans remain undefined at this time making it practically impossible to finalize participation agreements between providers and MCOs.  Nonbinding LOIs continue to offer the best strategy for providers seeking to develop network relationships with insurers.  

To date, the MCOs that have formally indicated to DMAS their interest in participating in the Dual Demonstration are Anthem/WellPoint, AVP Inova Health System, Coventry Healthcare of Virginia, Humana, MajestaCare/Aetna, Molina Health Care, Optima and Virginia Premier Health Plan, Inc.  MCOs that intend to participate in one or more of the five demonstration regions within Virginia must submit formal proposals by May 15th.

From a national perspective, earlier this week the Wall Street Journal reported that California has once again delayed plans to launch its own dual eligible demonstration program and is now aiming to launch the initiative no sooner than January 2014.  This is a three-month delay from the state's most recent plan, and the schedule had already slipped from earlier hopes to launch the demonstration at the start of 2013.  The California program will cover as many as 465,000 patients for three years through insurers Health Net Inc., Molina Health Care, WellPoint and several state-based health plans.