2012-13 Medicaid Global Spending Cap by hYjZu9vz

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									          2012-13
Medicaid Global Spending Cap
       October 1,2012 Webinar
Overview
 New York State Budget Overview
 Medicaid – Before and After MRT
 Recap of 2011-12 Medicaid Global Cap Results
 Components of $600 Million Annual Medicaid
  Global Spending Cap Growth
 Results through July 2012
 Successfully Maintaining the $15.9 Billion Global
  Cap

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                FY 2013 Enacted Budget Financial
                Projections
$ in billions




                                                   3
FY 2012 and FY 2013 Gap-Closing
Plans




                                  4
Medicaid Growth Before and After MRT
(2010-11 Base Year)
  $80.0
                                                                  $75.2 B
                                                                       Average Annual Growth is 8.7%;
                                                                       Consistent with CBO average growth

                                                                  $62.4 B
                                                                       Average Annual Growth is 4.6%
  $60.0
            $53.8 B

              $52.1 B                                                                  Pre MRT
                                                                                      Base-Level

                                                                                      Enacted
                                                                                      (MRT)
  $40.0



    State statute “bends the cost curve” by holding spending to Medical CPI (currently at 4%).


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Historical Budgeting Process
 Focus on reducing annual Budget gaps; not promoting multi-year
  reforms
 Limited stakeholder buy-in or ability to plan for future

 Controversial; heavily influenced by budget negotiation process

 Primary emphasis on statutory approaches, developed internally, to
  achieve desired savings level:
      Provider reductions & rate cuts

      Across-the-board (ATB) cuts

      Elimination of lower priority services (i.e., optional services)


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MRT Process
 Focus on implementing reforms over time; allows modest growth (4%)
  to facilitate investments and planning
 Collaborative process that encourages stakeholder involvement &
  community education
 Minimizes the number of issues needing to be resolved during budget
  negotiation process
 Primary emphasis on reform and efficiency
    Brings comprehensive solutions to bear on cost drivers in a transparent manner
    Provides a multi-year road map to meeting fiscal targets and ensuring Medicaid
     sustainability
    Emphasizes quality and accountable health care outcomes for all New Yorkers




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Medicaid Spending Cap
 Implementation of Medicaid Global Cap was an essential element in
  changing the budget paradigm.
 Living within the cap has fundamentally changed the relationship
  between the State and Medicaid stakeholders.
 Spending is monitored monthly against category-specific targets and
  reported publicly.
 The incentive is to understand and address unanticipated spending
  patterns. This has spurred creative solutions and unprecedented
  provider collaboration (e.g., repaying accounts receivable balances).
 The focus is on preventing the need for the Commissioner of Health to
  implement traditional cost containment actions to bring spending levels
  back in line.



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Recap of 2011-12 Global Cap
 Spending under the 2011-12 Global Cap was $14 million
  below the $15.3 billion target
 Accounts receivable balance totaled $575 million as of March
  31, 2012
  • Peaked at over $750 million in January 2012
 Health care coverage was provided to an additional 154,000
  fragile and low income recipients
  • Medicaid Managed Care enrollment increase by 230,000
    recipients
  • Fee for Service enrollment decreased by 76,000 recipients


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Recap of 2011-12 Global Cap
   Based upon latest information available, enrollment increased by approximately 136,000 recipients
    between December 2010 and December 2011

                                                                               Net Increase
     By Eligibility Group                  Newly Enrolled    Disenrolled
                                                                                (Decrease)
     TANF (age 0 – 64)                        505,521          423,019            82,502
     Safety Net (age 0 – 64)                  281,836          235,791           46,045
     SSI (age 65+)                            98,513           117,850           (19,337)
     Aliens/Emergency Medicaid                23,699            6,077            17,622
     FHP                                      104,066          94,929             9,137
     Total                                   1,013,635         877,666           135,969


   There were 877,666 members disenrolled (18%) from the Medicaid program as part of the
    “churning” within the program and is higher than prior years. However, the Department is taking
    steps and other streamlining efforts (i.e., phone renewals) to reduce disenrollments.
   DOH and DOB estimate that this enrollment growth (phased in over the year) costs the Medicaid
    program $267 million which is accommodated within the Global Cap.
            Enrollment increased at a slower annual rate -- 4.4% as of December 2010 declining to 2.8%
             as of December 2011.
            Unemployment decreased from 8.6% in 2010 to 8.2% in 2011                                     10
     Components of $600 Million Annual
     Growth
•   Annual growth of $600 million over last year includes costs associated with both price and
    enrollment increases, offset by a net change in one-time revenue and spending actions as
    well as the continuation of MRT initiatives.

               Price            Price includes an increase in managed care premiums and fee-for-service
           (+$363 million)      pharmacy costs, as well as various inpatient and outpatient rate changes.

                                Utilization reflects the annualization of 2011-12 net enrollment growth
             Utilization
           (+$433 million)      (154,000 recipients) as well as assumed new enrollment for 2012-13 (ranging
                                from 90,000 to 120,000 recipients)
                                One-Timers primarily include the loss of enhanced FMAP which expired in
             One-Timers
            (-$67 million)      June 2011 (+$703 million), offset by 53rd Medicaid cycle in 2011-12 (-$325
                                million) and accounts receivable recoupments in 2012-13 (-$259 million).

            MRT/Other           Other reflects the annualization of MRT Phase I savings ($156 million) offset by
           (-$129 million)      MRT Phase II initiatives ($27 million).

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   2012-13 Medicaid Global Spending
   Cap – Monthly Projections
                                       Medicaid Global Spending Cap
                                                 2012-13
                     $18,000
                                                                      $15,912
                     $16,000
                               Projected
                     $14,000
                               Actual
                     $12,000
                     $10,000
          Millions




                      $8,000
                      $6,000
                      $4,000
                      $2,000
                         $0




 Monthly projections range from a low of $950 million in September 2012 to a high
  of $1.7 billion in August 2012


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     Results through July 2012
•   Medicaid expenditures through July 2012 are $63 million or 1% below projections




       Total Fee For Service                  $3,792         $3,700        ($92)
           Inpatient                          $1,048         $1,036        ($12)
           Outpatient/Emergency Room            $187           $176        ($11)
           Clinic                               $229           $240         $12
           Nursing Homes                      $1,144         $1,120        ($24)
           Other Long Term Care                 $624           $622         ($2)
           Non-Institutional                    $561           $507        ($54)
       Medicaid Managed Care                  $2,914         $2,919          $5
       Family Health Plus                       $310           $311          $1
       Medicaid Administration Costs            $122           $134         $13
       Medicaid Audits                         ($86)          ($76)         $10
       All Other                                $424           $425          $2
       Local Funding Offset                  ($2,378)       ($2,378)         $0
         TOTAL                                $5,097         $5,035        ($63)


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A/R Balance – July 31, 2012
                    •   The accounts receivable
                        balance is expected to decline
                        by $259 million during SFY
                        2012-13
                    •   Balance as of March 31, 2013
                        is projected at $316 million
                    •   DOH will continue to work
                        with providers asking for
                        voluntary payment of
                        outstanding liabilities
                          • Avoids interest costs
                          • Mitigates adverse
                              impact on Global Cap



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    Medicaid Enrollment
 Medicaid total enrollment reached 5,044,044 enrollees (excludes CHP) at the end of July
   2012. This reflects an increase of roughly 52,000 enrollees, or 1.0%, since March 2012.

           5,200,000

           5,000,000

           4,800,000

           4,600,000

           4,400,000

           4,200,000

           4,000,000



            Source: NYS DOH/OHIP Medicaid Enrollment Database
            *Most current four months counts are adjusted by lag factors (3.33%, 1.26%, 0.50% and 0.17%, respectively)




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     MMC/FHP Enrollment
 Medicaid Managed Care enrollment in July 2012 (includes FHP and Managed LTC and
  excludes CHP) reached 3,624,998 enrollees, an increase of almost 86,000 enrollees, or 2.4%,
  since March 2012.




         Source: NYS DOH/OHIP Medicaid Enrollment Database and Managed Care Roster
         *Includes FHP, Managed LTC, Primary Care        Capitation Provider, Partial Managed LTC, PACE, Medicaid
         Advantage, Medicaid Advantage Plus and HIV SNP.

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Keys to Successfully Maintaining the
$15.9 Billion Global Cap
 Continue working collectively with the health care industries
  to
  • Shift less severe patients from the hospital and emergency room
    to more appropriate ambulatory/primary care settings
  • Better management of the dual-eligible (Medicaid-Medicare)
    population and control of Long Term Care spending
  • Shift Medicaid recipients from costly fee-for-service into
    Medicaid Managed Care where services are better coordinated
    and financial incentives are more rational
  • Voluntarily repay over $500 million to the State for outstanding
    liabilities owed by providers

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Keys to Successfully Maintaining the
$15.9 Billion Global Cap
 Improvement in economy will drive lower enrollment
  growth
 Continued successful implementation of MRT Phase I and
  Phase II initiatives




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