COMPARATIVE EFFECTIVENESS RESEARCH AND the California MEDI-CAL Program

COMPARATIVE EFFECTIVENESS RESEARCH

AND THE CALIFORNIA

MEDI-CAL PROGRAM

Len Finocchio, Dr.P.HAssociate DirectorCalifornia Department of Health Care Services

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BACKGROUND

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Beneficiary Profile

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California HealthCare Foundation. Medi-Cal Facts & Figures. September 2009

Income Limits for Eligibility

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Scope of Benefits

± - Covered for those under 21 and in nursing homes

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Managed Care & Fee-for-Service

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$45 billion Total

2010-2011

Expenditures

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Highest Expenditures8


Managing Medi-Cal Expenditures• Better delivery of existing services

• Care coordination & management, focus on prevention

• Reduce the number of beneficiaries• Scale back income eligibility thresholds

• Reduce scope of benefits• Curtail or eliminate optional benefits (e.g. dental, chiropractic)

• Reduce provider reimbursements• Value-based purchasing

• Delegate financial risk & measure performance• Non-payment for health care-acquired conditions• Evidence-based service design

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Proposed Reductions FY2102-13

Health & Human Services

CalWorks $946.2

Medi-Cal $842.3

In-Home Supportive Services $163.8

Other HHS Programs $ 86.9

Education

Prop 98 $544.4

Child Care $446.9

Cal Grants $301.7

Other Education $ 28.0

All Other Reductions

State Mandates $828.3

Other Reductions $27.3

Total Expenditure Reductions $4,215.8

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Governor’s Proposed 2012-2013 Budget. Health & Human Services. http://www.ebudget.ca.gov/pdf/BudgetSummary/HealthandHumanServices.pdf

http://www.ebudget.ca.gov/pdf/BudgetSummary/HealthandHumanServices.pdf

Cost Saving Proposals in Budget• Improved care coordination for senior & disabled beneficiaries

• Federally Qualified Health Center payment reform

• Managed care expansion to rural areas

• Align open enrollment with commercial plan policies

• Value-based service design

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Reasons for Better Purchasing• Buy better value with limited public resources

• State budget shortfalls: $26 billion last year & $9 billion this year

• “Bend the cost curve”

• Improve quality of care & health of beneficiaries

• Maintain income eligibility and benefit levels

• Prepare for large program expansion in 2014

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VALUE-BASED SERVICE DESIGN

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Key Issues & Questions• Medical interventions often adopted without rigorous

evidence

• New interventions are more effective than the previous standard of practice

• Can we perform technology assessment retrospectively?

• Can we selectively purchase health services using evidence?

• Can we selectively purchase health services in a systematic & transparent, not haphazard, way?

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Value-Based Service Design• Assure beneficiary access to necessary health care services

• Identify and reduce services that:

• Do not improve health outcomes

• May cause harm to patients

• Are overused & should only be provided under limited conditions.

• Not synonymous with addition or removal of benefits covered under the State Plan.

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Systematic Evidence Review• Evidence-based treatment guidelines from organizations

whose primary mission is to conduct objective analyses of the effectiveness of medical interventions:

• National Institute for Health and Clinical Excellence (NICE)

• Agency for Healthcare Research and Quality

• US Preventive Services Task Force

• Patient-Centered Outcomes Research Institute

• Individual studies in peer reviewed literature

• Clinical practice guidelines published by medical and scientific societies.

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Ranking Interventions

HazardousHigh-volumeExpensive

EffectiveHigh-volumeCost-saving

Questionable effectivenessModerate-volumeModerate expense

UNDESIRABLE DESIRABLE

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Examples of Candidates Where evidence shows little or questionable value:

• Vertebroplasty

• Implantable cardioverter difibrillators

• Arthroscopic surgery for knee osteoarthritis

• Exercise electrocardiogram for angina

• Lumbar imaging for lower back pain

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Determine Costs & Feasibility• Determine potential costs and savings from modifying,

curtailing or eliminating targeted services.• Determine feasibility of implementation:

• Evaluate the cost and timeframe for computer system changes

• Staffing & expertise needed to craft policies that effectively limit inappropriate use of a service without interfering with appropriate (i.e., scientifically justified) use of that same service

• Ability to use utilization management staff to effectively manage the targeted services

• Identify services requiring prior authorization for any particular beneficiary

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Transparency & Stakeholder Engagement• Consult with stakeholders

• Including health professionals, Medi-Cal providers, and consumer advocacy organizations prior to modifications to targeted services

• Notification about proposed changes• To targeted services, rate methodologies and payment policies

• Receive, review and respond to written input • Regarding changes and provide a public stakeholder meetings

• Provide for an appropriate and meaningful response

• Notify the legislature • Of the action taken and reasons for the action.

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Issues with Implementation• Systematizing evidence review

• Consumer preferences, fear, knowledge

• Managing stakeholder engagement

• Lobbying by professional and advocacy groups

• Push me – Pull You of expanding coverage while contracting services/benefits

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For Research Community• Build body of related research – comparative effectiveness

of services and:

• Consumer perceptions

• Practitioner behaviors

• Deepen working relationships with major payers

• Communicate effectively and strategically about findings

• Take the long view

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THANKSLen Finocchio, [email protected]

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mailto:[email protected]

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COMPARATIVE EFFECTIVENESS RESEARCH AND the California MEDI-CAL Program