Posted May 21, 2013 at 4:13 p.m., updated May 21, 2013 at 5:12 p.m.
RICHMOND, Va. — RICHMOND, Va. (AP) - Federal officials approved a four-year Virginia cost-saving experiment intended to simplify and consolidate health care coverage for about 78,000 Virginians who are eligible for both Medicaid and Medicare, a major change Gov. Bob McDonnell set as a condition for expanding Medicaid.
Virginia got the go-ahead Tuesday for McDonnell's new Commonwealth Coordinated Care program, which is estimated to save the state $11 million in its first six months after it begins on Jan. 1. In fiscal year 2015, beginning July 1, 2014, officials estimate it will cut state costs by $22.6 million.
The program is designed to cut costs by developing a single program to serve people who now must navigate two different programs: Medicaid, the federal-state program that helps pay for health care for the poor, elderly, blind and disabled and low-income families with children, and; Medicare, the federally funded health insurance program for the disabled or people 65 or older, generally the same eligibility standards as Social Security.
"(S)ome of Virginia's most vulnerable adults will now benefit from a program where their health care and long-term services and supports are better coordinated," McDonnell said in a statement announcing the program's approval. Not only will it eliminate hassles for beneficiaries, increased managed care will save state and federal governments money, he said.
The initiative for consolidating services for "dual-eligibles" was among several pending federal approval as a condition the governor set and the General Assembly approved for expanding Medicaid to about 400,000 Virginia working poor.
Others generally call for broader flexibility in administering Medicaid, including benefits that are tighter and commensurate with those in most private insurance coverage, demanding co-payments or cost-sharing of new recipients and greater use of managed care.
A special 12-member commission of five state senators, five House of Delegates members and two members of McDonnell's cabinet has been formed to certify that the reforms McDonnell requires for Medicaid expansion have been achieved.
Virginia Secretary of Health and Human Services Bill Hazel, who did the heavy lifting in putting together the tricky pilot pact among two levels of government and the private insurance industry, said the agreement "has the potential to be one of the most significant to date."
"For many years, the commonwealth has been working toward this significant reform opportunity. We view this achievement as a testament to the willingness of Virginia's Medicaid providers and interested health plans to work collaboratively with the department to implement innovative models of care," he said in a press statement.
With an agreement-in-principle in place between the state Department of Medical Assistance Services and the Centers for Medicare and Medicaid Services - the federal agency that administers the two huge entitlement programs and the State Children's Health Insurance Program - the two sides will contract with health plans to provide services for enrollees across the state.
The program's demonstration period runs through December 2017, but Congress would have to approve making it permanent beyond that.