Medicare’s Future for Addressing Complex Needs: The CHRONIC Care Act


By Bruce Chernof, MD, President and CEO, The SCAN Foundation

Over the past several decades, health care costs have consumed an ever greater percentage of all United States spending. However, for most Americans, particularly those with complex medical and social needs, it doesn’t feel like quality has improved much, if at all.

The reality is people are living much longer and will face significant needs, both medical and social, in later life. For those with serious chronic conditions and functional limitations today, the current state of the health care system seems disorganized, opaque, and full of unexpected surprises. As a result, families often face the pressure of being the default care coordinators and full-time advocates for loved ones with complex needs. 

Form follows funding in health care. While the structure and financing of health care will not change overnight, policymakers have made significant strides over the past decade to better align payment strategies with the outcomes that matter to all stakeholders — not just those who deliver care and pay for it, but also those who receive it. Fundamental to this shift has been a concerted effort to move away from unfettered fee-for-service toward value-based payment.

Congress recently passed a federal budget incorporating the CHRONIC Care Act, which capitalizes on and grows early successes in many of these programs. Specifically, the CHRONIC Care Act addresses three aspects of care for Medicare and dually eligible beneficiaries:

  1. It encourages use of flexible new tools and strategies to better manage individuals with complex care needs. The law gives Medicare Advantage (MA) plans greater flexibility to cover non-medical benefits for members with complex and costly needs, such as bathroom grab bars and wheelchair ramps. Also, MA plans may now offer a broader array of telehealth benefits.
  2. It protects and builds on key programs serving individuals with complex needs. The law permanently authorizes Special Needs Plans (SNPs) whereby managed care organizations can target and serve Medicare beneficiaries with complex needs (i.e., people dually eligible for Medicare and Medicaid, people with chronic health conditions, people living in institutions). It also extends and expands a demonstration intended for physicians serving very high-need, and often functionally limited, Medicare beneficiaries in their homes to avoid institutional care.
  3. It signals that care coordination and integration are explicit and essential purposes of SNPs. The law requires SNPs to better integrate care by creating unified plans for people who are dually eligible, as well as a single pathway for grievances and appeals.

The CHRONIC Care Act creates an opportunity for health plans, providers, and consumer advocates seeking improved value through Medicare dollars. The law allows delivery systems to offer many more benefits to effectively address the health needs and daily living challenges of adults with complex needs. Specifically, Medicare Advantage plans will be able to cover services such as community-based care coordination, home-delivered meals, adaptive equipment, and transportation. This coverage, in turn, this will allow health systems and Accountable Care Organizations (ACOs) to help adults with complex care needs live well and safely in their homes while staving off re-hospitalization.

How should a health plan or ACO build these services into their benefit structure?  What’s the best way to build or access a network of providers to deliver these services? What strategies work best to deliver this more intense, comprehensive, and person-centered approach to care coordination? Numerous resources highlighted in The Playbook demonstrate how to use these types of non-medical services, when part of a person-centered care plan, in order to improve both quality and total cost of care for this vulnerable population. As the new law ventures into the federal regulatory and guidance process this fall, it is critical for all interested parties to remain engaged to shape its implementation and ultimate success on behalf of Medicare beneficiaries of today and tomorrow who want to live well in spite of substantial need.