ALTCIActuarial Study
June 22, 2005
Mercer Government Human Services Consulting 2
Actuarial Study Objectives
Determine key cost drivers
Identify financing options that promote the goals of ALTCI
Recommend a rate structure that will best match payment to the risk of the enrolled population
Mercer Government Human Services Consulting 3
Methodology
Review historical Medi-Cal and Medicare CY1998-2000 FFS data
Adjust data to include only populations and services expected to be covered under ALTCI
Project data forward to CY2007 by category of service
Adjust data for significant program changes including Medicare Part D
Mercer Government Human Services Consulting 4
ALTCI Eligibles (76,700)
DD5%
MSSP1%
IHSS/HC16%
NH9%
Well70%
CY2000 DataSan Diego County
Nursing Home Residents, MSSP, DD, IHSS, and Home Care (HC) account for 30 percent of the total ALTCI membership in San Diego, but 74 percent of the total San Diego Medi-Cal expenditures.
ALTCI Expenditures ($455M)
Well26%
NH44%
IHSS/HC24%
MSSP1%
DD4%
Well
MSSP
IHSS/HC
NH
DD
Mercer Government Human Services Consulting 5
San Diego CountyCY2000 Dually Eligible vs. Medi-Cal Only ABD Membership
Duals60%
Medi-Cal Only40%
Dually Eligibles
DD3%
MSSP1%
IHSS/HC20%
NH13%
Well63%
Mercer Government Human Services Consulting 6
San Diego CountyDually Eligible vs. Medi-Cal Only CY2000 PMPM ALTCI Medi-Cal Costs
Dually Eligible vs. Medi-Cal Only
$0 $50 $100 $150 $200 $250
Other
Inpatient
Outpatient
Inst LTC
Comm LTC
Physician
Pharmacy
PMPM
Dually Eligible
Medi-Cal Only
Mercer Government Human Services Consulting 7
San Diego CountyElderly vs. Disabled Membership
Elderly37%
Disabled63%
ElderlyDD0%
MSSP1%
IHSS/HC17%
NH14%
Well68%
Mercer Government Human Services Consulting 8
Alameda, Contra Costa, and San Diego CountiesCY1998–2000 Medi-Cal CostsHigh Cost Chronic Conditions
Rank Disease MMs Dollars PMPM
1 Ventilator Dependent 24,827 43,510,194$ 1,752.54$
2 Traumatic Brain Injury 28,126 48,908,704$ 1,738.91$
3 Alzheimer's/Dementia 260,537 398,485,707$ 1,529.48$
4 Mental Retardation 96,634 129,363,417$ 1,338.69$
5 Developmental Disability 30,613 32,904,568$ 1,074.86$
6 AIDS/HIV 81,127 82,925,845$ 1,022.17$
7 Parkinson's Disease 38,228 36,850,967$ 963.98$
8 Cerebrovascular Disease 363,170 342,848,676$ 944.04$
9 Medical Disability 76,807 62,304,149$ 811.18$
10 Neurological Disability 46,791 35,995,578$ 769.28$
11 Congestive Heart Failure 282,867 182,996,911$ 646.94$
12 Psychosis 106,756 53,671,050$ 502.75$
13 Alcohol/Substance Abuse 31,409 12,501,001$ 398.01$
14 OTHER 142,134 56,564,122$ 397.96$
15 Physical Disability 162,133 56,824,366$ 350.48$
16 Chronic Heart Disease 498,099 167,223,359$ 335.72$
17 Diabetes 383,384 126,338,157$ 329.53$
18 Schizophrenia 108,289 33,792,198$ 312.06$
19 COPD/Asthma/Emphysema 287,108 87,673,104$ 305.37$
20 Depression 341,197 99,417,646$ 291.38$
21 CMI Disability 29,551 8,340,346$ 282.24$
22 Arthritis 240,961 54,637,740$ 226.75$
23 Sensory Disability 109,206 16,868,404$ 154.46$
24 NONE 1,341,957 195,834,916$ 145.93$
Grand Total 5,111,911 2,366,781,125$ 462.99$
TOTAL
Mercer Government Human Services Consulting 9
San Diego CountyCY2000 Medi-Cal ALTCI PMPM Costs
Total $495
Total
NH $2,492
Community $303
Setting
NHC
$2,492
MSSP
$1,172
IHSS
$752
Well
$182
DD
$436
Frailty
Medi-Cal Only
$4,708
Dual
$2,153
Medi-Cal Only
$710
Dual
$1,174
Dual
$28
Dual
$557
Medi-Cal Only
$368
Medi-Cal Only
$1,337
Medi-Cal Only
$532
Dual
$277
Medicare Status
Aged
$2,291
Disabled
$1,855
Aged
$3,023
Disabled
$4,910
Aged
$537
Disabled
$577
Aged
$963
Disabled
$1,363
Aged
$36
Disabled
$18
Aged
$196
Disabled
$402
Category of Aid
Mercer Government Human Services Consulting 10
Preliminary ResultsKey Cost Drivers
Setting – Nursing Home vs. Community
Frailty – Nursing Home Certifiable/At Risk vs. Well
Medicare Status – Dually Eligible vs. Medi-Cal Only
Category of Assistance – Aged vs. Disabled
Chronic High Risk Conditions – TBD
Mercer Government Human Services Consulting 11
Preliminary Recommendations
Reimbursement needs to be sufficiently sophisticated to promote program goals
Incentives should be included to promote increased community based services
Savings achievable through more appropriate use of hospital, emergency room and nursing home services
Administrative costs should be reflected in rates with sufficient consideration of start up costs
Increased care management should be supported and funded
Mercer Government Human Services Consulting 12
Preliminary Recommendations (continued)
Implement early reinsurance or risk sharing
Capitated model should allow for flexibility of both Medi-Cal and Medicare funding sources
Mercer Government Human Services Consulting 13
Next Steps
Complete projections
Assess adequacy of Medicare reimbursement
Finalize recommended rating structure
Submit final report and recommendations