S.C. Duals Demo Illustrates How Hard It Is to Get Such Projects Going in Timely Way

Just how difficult it is to have a smooth launch of a large-scale demonstration program for Medicare-Medicaid dual eligibles is apparent in the CMS-backed South Carolina demo now in its final approach to startup. Like most of the other demos launched so far, it will start well behind the original schedule and is facing opposition from segments of the provider sector. It also had two early defections of health plans chosen to participate in the demo, and now must cope with a change at the top of the state agency running the duals program.

Despite these obstacles, however, all parties queried by AIS express confidence that the demo indeed will get started early next year, and executives of two remaining plans praise the South Carolina government for a thoughtful approach that has included working closely with them. What the obstacles will do to the chances of achieving the state’s cost-savings objectives from the demo, however, is a big question.

South Carolina in October 2013 became the eighth state to win approval for a federally backed duals demo, and early the next month named five health plans to participate in it. The state disclosed then that another insurer — Humana Health Plan, Inc. — had applied to participate in the initiative via the state’s open rather than competitive bidding process but later had opted “not to continue to pursue the application.”

Humana spokesperson Alex Kepnes this month told AIS only that “Humana made the decision to focus on implementing in states where we had already been awarded Medicaid business.” An executive of one of the selected plans, though, said Humana, which is relatively new to Medicaid, had problems in preliminary stages of assembling a duals provider network in South Carolina.

The demo originally was supposed to start in July 2014, with passive enrollment beginning Jan. 1, 2015. But in May 2014 one selected insurer, WellCare Health Plans, Inc., withdrew from the program, which now, like many other duals demos, has had its start date pushed back. The new target, which all parties directly involved say is doable, is Feb. 1, 2015, to launch voluntary enrollment, with passive enrollment starting Aug. 1 in some areas and Oct. 1 in others.

A South Carolina health plan industry source indicates to AIS that WellCare’s decision apparently was based on the payment rates that plans would receive, information that wasn’t available when the plans were selected. WellCare spokesperson D. Marq Caughell, however, tells AIS, “We currently serve the dual-eligible population in South Carolina through our Dual Eligibles Special Needs Plan (D-SNP). We believe this product is well-suited to provide coordinated care for our dual-eligible members. Because of this, in May 2014, we decided not to participate in the South Carolina Duals Demonstration Project.”

Excerpted from the 11/20/2014 issue of AIS’s Medicare Advantage News