5 Considerations for Payers before Entering Dual Eligible Market

The dual eligible market is changing, creating new challenges and opportunities that health plans should take into account when considering entering the market, experts from Manatt Health found in a white paper.

First, payers should know that the fully integrated dual eligible special need plan enrollment process is growing more selective.

In 2025, fully integrated dual eligible special need plans will only be able to enroll full-benefit dual-eligible beneficiaries. Moreover, fully integrated dual eligible special need plan enrollees must have Medicaid coverage from the Medicaid managed care organization contracted with the Medicare Advantage plan that oversees the fully integrated dual eligible special need plan.

Plans with unaligned enrollment—enrollees who receive Medicaid coverage from a managed care organization that is different from the Medicare Advantage plan that oversees the fully integrated dual eligible special need plan—may transition to highly integrated dual eligible special needs plans. Payers who take this route risk losing the frailty adjustment but will avoid administrative complexities.

“Plans operating FIDE SNPs should assess their current enrollment, gauge the interest of their state partners in this flexibility, and formulate a strategy around the potential need to split enrollment into separate D-SNPs,” the researchers advised.

Second, payers should be aware that CMS is expanding the number of services covered under fully integrated dual eligible special needs plans.

The new benefits that fully integrated dual eligible special need plans will need to cover in 2025 include behavioral healthcare benefits, Medicaid home healthcare, Medicare cost-sharing, and more. As a result, states that have behavioral health carve-outs will have to convert their fully integrated dual eligible special need plans to highly integrated plans.

When deciding whether to enter the dual eligible special needs market in a certain state, the researchers advised payers to be aware of behavioral healthcare carve-outs or impending policies that might introduce carve-outs in the state.

Third, payers who want to enter this market may need to have standalone dual eligible special needs plan contracts, as opposed to dual eligible special needs plans that are under a Medicare Advantage contract. This will depend on the state that the payer wants to enter. Plans may find this administratively encumbering, but the change also opens up an opportunity to distinguish plans through quality.

Payers may seize the chance to discern quality measures that would best demonstrate performance in dual-eligible special needs plans and seek to influence state and federal discussions accordingly.

“Due to timing of MA applications, bids, and contract execution, CMS anticipates that standalone D-SNP contracts established under this process will likely not take shape until plan year 2024,” the researchers explained. “CMS will consider future rulemaking on whether to expand this flexibility to D-SNPs that do not have exclusively aligned enrollment.”

Fourth, CMS will end the Medicare-Medicaid plans established under the Financial Alignment Initiative and offer states the chance to convert those plans into integrated dual special needs plans.

The Financial Alignment Initiative is projected to end in December 2025, at the latest. States that plan to convert Medicare-Medicaid plans into dual-eligible special needs plans have already submitted those requests.

The end of the Financial Alignment Initiative will create markets with a lot of opportunity, since five of the nine states that participated in the demonstration do not have any fully integrated dual eligible or highly integrated dual eligible special needs plans: Illinois, Michigan, Ohio, Rhode Island, and South Carolina.

However, the demonstration’s conclusion will lead to shifts, particularly the end of states’ ability to share Medicare savings. To make up for the loss, states might expand required supplemental coverage in Medicaid.

Finally, dual-eligible special needs plans will have to establish at least one enrollee advisory committee.

As of January 1, 2023, Medicare Advantage plans with dual special needs plans will need to have an enrollee advisory committee. Parameters for these committees will vary by state.

“Plans should identify potential alignment with and draw on best practices from other existing enrollee engagement efforts,” the researchers stated. “Since dual-eligible individuals are more racially diverse than Medicare-only individuals, plans should ensure their enrollee advisory committees adequately reflect the demographic diversity of their enrolled populations.”