Concierge care for dual eligibles pushed as cost-cutting measure

Patients who qualify for both Medicare and Medicaid accounted for 27% of Medicare spending in 2006.

By Charles Fiegl — Posted June 27, 2011

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Paying upfront fees for enhanced coordinated care for patients eligible for both Medicare and Medicaid might produce improved outcomes and lower program costs over the long run, according to a strategy that Rep. Michael Burgess, MD (R, Texas), has suggested to federal officials.

Dr. Burgess approached Centers for Medicare & Medicaid Services Administrator Donald M. Berwick, MD, with the idea this year. Offering what's known as concierge care for dual-eligible patients would be just one of several Medicare payment models put in play as Congress tries to move the program away from a strict fee-for-service system, Dr. Burgess said.

Patients eligible for both programs typically have multiple, costly chronic conditions. They would particularly benefit from the enhanced care management offered by concierge practices, which typically charge a monthly fee in exchange for devoting more time and resources to individual patients' care. Under such a model, the doctor would be responsible for coordinating care, keeping the patient healthy and containing costs.

Medicare typically doesn't permit payment for concierge fees, but doing so for the dual-eligible population could reduce overall costs to Medicare and Medicaid programs, Dr. Burgess said. He believes CMS has the regulatory authority to develop such a program without first seeking congressional approval.

"We are all looking for offsets to pay for [cost increases]," Dr. Burgess said in an interview with American Medical News. "This may be a big one that's right under our nose."

Dual-eligible costs high

In 2008, 9.2 million people were eligible for both Medicare and Medicaid. About 15% of Medicaid enrollees also are enrolled in Medicare, but Medicare-Medicaid patients accounted for 39% of Medicaid spending in 2007, according to the Dept. of Health and Human Services. A majority of these patients have multiple chronic conditions, and 43% have at least one mental or cognitive impairment.

The Medicaid program spent about $120 billion on this population in 2007, which is twice as much as Medicaid spent on the 29 million children it covered that year.

A June 2010 Medicare Payment Advisory Commission report on dual eligibles found a disproportionate share of Medicare spending on the patient population during the 2006 program year. They represent only 16% of the Medicare population but 27% of aggregate Medicare spending. About $15,400 is spent per dual-eligible patient in a year, and about $7,000 is spent per non-dual-eligible patient.

Most Medicare spending on dual-eligible patients is concentrated on a small group. The costliest 20% of dual-eligible patients accounted for 62% of spending on the entire population, according to MedPAC.

Common features offered by a concierge practice include same-day appointments, 24-hour telephone access, extended office visits, access to doctors by email, and a wellness and nutrition plan, according to Government Accountability Office reports. In 2005, the GAO studied concierge care when fewer than 150 physicians offered such services. A 2010 study found that 756 physicians had retainer-based arrangements.

"Unless a concierge physician opts out of Medicare, the question of Medicare coverage is central to whether a concierge care agreement complies with the program's limits on patient charges," one of the GAO reports noted.

Current CMS rules don't make concierge care arrangements impossible, but they are very difficult. Medicare allows participating physicians to charge fees for services not covered by Medicare. But the HHS Office of Inspector General has cautioned participating physicians against charging too much in the process for services reimbursable by Medicare.

For instance, the OIG described one concierge physician who offered coordination of care, a comprehensive assessment and plan for optimal health, and extra time spent on patient care in exchange for a $600 fee. Because some of that was covered by Medicare, the agreement violated Medicare's prohibition against charging patients more for their care than the Medicare deductible and co-payment.

New dual-eligible data available

In May, CMS announced an alignment initiative proposal that would allow state Medicaid programs access to Medicare data in an effort to coordinate patient care. States could use the data to identify the dual-eligible patients, determine primary health risks, and provide client profiles to care management contractors in an effort to customize interventions, HHS said.

For instance, a state looking to expand long-term care and behavioral health management programs to low-income seniors could access Medicare data to identify people with disabilities.

"Medicaid costs are largely driven by the complex medical needs of low-income seniors and people with disabilities who are eligible for both Medicare and Medicaid," Dr. Berwick said in a statement announcing the initiative. "We know that by working together, we can provide better, more coordinated care while lowering health care costs and saving money for states."

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