DOH Finalizes Level 2 Value-Based Payment for MLTC

The Department of Health (DOH) announced last week that it has finalized the Level 2 model for value-based payment (VBP) under the partially-capitated managed long term care (MLTC) program. Like the Level 1 model, Level 2 is a pay-for-performance model based on quality meaures. Financial incentives under the Level 2 model, as well as the Level 1 model, must take into account performance on the potentially avoidable hospitalization (PAH) measure. By contrast to Level 1, the Level 2 model must include a penalty for poor performance of at least one percent of total annual expenditures under the provider contract. Plans and providers may use any reasonable methodology to calculate the quality bonus or penalty amount, including the use of the prior year´s expenditures. Level 2 arrangements must also include a social determinants of health (SDH) intervention and a contract with a "Tier 1" community-based organization (CBO). For more information about SDH interventions and Tier 1 CBOs, click here.

Licensed Home Care Services Agencies (LHCSAs), Certified Home Health Agencies (CHHAs) and Skilled Nursing Facilities (SNFs) may enter into Level 2 agreements with MLTC plans. Although the nursing home benefit for permanently-placed residents in partially-capitated MLTC plans will be limited to three months, it appears that nursing home contracts will continue to be included in VBP requirements for 2018.

In addition to the PAH measure, Level 2 arrangements must also include a second quality measure selected from the list of DOH-approved MLTC VBP measures. DOH is calculating performance on quality measures for LHCSAs, CHHAs, and SNFs and providing the results to the MLTC plans. Plans, in turn, are expected to transmit the performance results to the applicable providers. LHCSA and CHHA performance is calculated on a plan-specific basis based on each agency's patients attributed to each plan. Nursing home performance is facility-wide, based on all long-stay residents, rather than the residents attributed to each plan. 

MLTC plans will be subject to penalties if their VBP penetration does not reach the targets specified by the Department's VBP Roadmap. Under the Roadmap, MLTC partial capitation plans must shift at least five percent of total plan expenditures to Level 2 by April 1, 2019 and 15 percent to Level 2 by April 1, 2020.

DOH has updated several resources to reflect the new Level 2 model:

• MLTC VBP Frequently Asked Questions have been updated here.
• DOH-approved  Quality Measure Sets for MLTC for 2018 are available here.  Additional measures may be selected at the discretion of the contracting parties.
• Updated reporting specifications and member attribution guidance are available here.
• A recording of the first program in the MLTC VBP Learning Series is now available here.

MLTC plans may submit contracts to the DOH Office of Health Insurance Programs Division of Long Term Care at any time for review. Questions may be submitted to DOH here. 

Contact:  Karen Lipson, klipson@leadingageny.org, 518-867-8838.