Managed care plans that integrate Medicare and Medicaid services have the potential to improve quality and reduce spending for dually eligible enrollees. Medicare Advantage (MA) dual-eligible special needs plans (D–SNPs) have the largest enrollment of any integrated plan type, but many of these plans have a low level of integration. This report provides an overview of the D-SNP and Medicaid managed care market, explains the unique benefits offered by D-SNPs, and identifies three underlying causes for low levels of integration: (1) the limited impact of enrollment in these plans among “partial-benefit” dual eligibles; (2) the limited number of D-SNPs that do not have capitated Medicaid contracts for long-term services and supports; and (3) misaligned enrollment where enrollees are enrolled in plans from separate managed care companies for Medicare and Medicaid services.
Policy changes to improve integration for D-SNP enrollees include new requirements to prohibit enrollment of partial-benefit dual eligible in D-SNPs, or to establish separate D-SNPs for this population. Aligned enrollment, which would require plan sponsors to offer companion Medicaid plans and could limit dual eligibles from enrolling in D-SNPs and Medicaid plans from separate companies, would also facilitate greater integration. Finally, this report addresses challenges related to D-SNP “look-alike” plans, which can undermine the overall integration of D-SNPs. These policy changes could reduce D-SNP enrollment in the short-term, but would lead to more integrated plans over time.