ACAP ReportIn order to promote coordination between Medicare and Medicaid services and to save money, the federal government and states should create an integrated care model for dual-eligible beneficiaries, a new report recommends.

The 9 million people who qualify for both Medicare and Medicaid accounted for around $230 billion in federal and state spending in 2006, according to the report from the Association for Community Affiliated Plans (ACAP). A majority of these people are eligible for long-term care services.

By creating a new state plan option called the Very Integrated Program or VIP, a permanent integrated, capitated care model could be used by states as their Medicaid state plan.

The VIP is not unlike the Program of All-Inclusive Care for the Elderly or PACE, but the latter has had limited implementation, with only 23,000 dual eligibles enrolled. In order to have enough beneficiaries, the state plan option would have passive enrollment, meaning beneficiaries would have to opt out rather than opt in.

Under the plan, states could provide long-term care services in a managed care environment or with a limited pool of providers, say report authors Jane Hyatt Thorpe, J.D. and Katherine Jett Hayes, J.D. of George Washington University.

“States are uniquely experienced in the provision of long-term care services and supports, as well as behavioral health benefits and services, which often are more robust under Medicaid than Medicare,” the report says. It notes that a dual-eligible in a home-based setting with managed care may require fewer hospitalizations and admittance to a long-term care facility, thus “resulting in savings to the Medicaid programs and the health plans administering the combined benefit.”