Preparing for SNPs and the future of care in senior living

RHONDA DEMENO: Welcome to The Senior Advisor podcast. My name is Rhonda DeMeno. I'm thrilled to be your host for this podcast series. The series is intended to bring you firsthand information on trends and hot topics facing the senior living industry. This is the third episode of our three-part series addressing senior living, special needs plans. This episode is titled Preparing for Special Needs Program and the Future of Care in Senior Living.

We'll focus on the regulatory structure compliance, and we will have our panelists provide an actual case study of a special needs advantage program and how it really benefited the senior living community. I'd like to introduce you to our distinguished panel. Today we have with us Kenny White. Kenny is the North America managed care practice leader for WTW, and he is part of the health care practice group. He joined WTW in 2014. We're thrilled to have Kenny on board with us to share all of his knowledge and his expertise. So welcome, Kenny. Thank you for being here today.

KENNY WHITE: Thank you very much for inviting me.

RHONDA DEMENO: And we also have Amy Kaszak. Amy is the executive vice president of strategic initiatives for Curana Health. Amy is a value-based payment veteran with over 25 years of developing innovative payment and care models for high-risk patient population. Welcome, Amy. So happy to have you.

AMY KASZAK: Thanks, Rhonda. Looking forward to the conversation.

RHONDA DEMENO: My introduction to these panelists did not even give a least a little bit of credit for their long list of credentials. So, if any of you are interested in finding out more about our panelists today, feel free to visit our podcast page where you'll be able to really obtain their bios and their deep level of knowledge and expertise on the topic of ISNP. So, to begin our conversation today, our previous series focused on emerging care solutions for senior living operators.We talked about that in episode two. We really went into some great detail with Dr. Cheryl Philips on our previous episode, episode number one. But today, we're going to get into weeds a bit as we continue to explore special needs plans and how these plans can prepare senior living operators and be utilized for future senior care solution. So, with that said, Amy, let's talk about some of those SNP structure. Can you give us a little bit of information on the structure of a special needs program?

AMY KASZAK: Yes. So just to remind everybody, we are talking about special needs plans, which are Medicare Advantage plans. SNP has three types of specific special needs plans. Typically, in senior housing were focusing on the ISNP or institutional equivalent special needs plan designed for your resident who are either maybe living in your long-term care facility institutional setting. Or you might be living in your assisted living, memory care, or even independent living, but meet the state level of care requirements for institutionalized care.

And then CSNP, our chronic conditions special needs plans sometimes target specific conditions to populations with specific conditions like dementia. And so, for your assisted living memory care that might be a good fit for that population. And like all Medicare Advantage plans, I always say that Medicare Advantage plans are the original value-based payment program for seniors at least.

SNPS offer a way to add more value care savings for your residents, but also can bring in some longterm strategic benefits for your senior living organization as well as in many cases, some real monetary value to help support what you're already doing today.

RHONDA DEMENO: That's really good information that you shared, Amy. I think senior living operator, that hope that they really understand that there is a benefit for them as well. And this is not necessarily a lot of added work if they collaborate with the right partner on this. So, Kenny, when we're talking about special needs programs or institutional special needs program, what does participating in these programs really mean?

KENNY WHITE: Participation from a beneficiary perspective means that you're eligible for Medicare, you meet one of the criteria or one of the special needs plans that Amy just describe for us, and that you have selected, or your legal representative has selected for you to receive your benefits through this form of Medicare. From an organizational standpoint and operator standpoint, it means that you have either a direct contract with CMS as a Medicare Advantage special needs plan, which to be frank is relatively rare.

That you are a contracted entity with a special needs plan. To provide certain services to the special needs plan, or that you have entered into a legal arrangement, usually a joint venture with another entity such as the company that Amy works with, whereby you are providing a chunk of the services, but the other partner is providing all of the administrative infrastructure for participation and adding in a lot of things that your organization probably doesn't have as part of the special needs program. But those are the basics of participation.RHONDA DEMENO: Kenny, how do individuals know, how do the residents, how are they informed that they are in a plan?

KENNY WHITE: I'm going to skip the multiple lawsuits that are spawned by dementia patients knowing anything, but that comes up far more frequently than you would imagine. But generally speaking, just like anything else, anybody that's Medicare eligible has the opportunity to be fee for service Medicare. They get a Medicare card, they go see a Medicare participating provider, which is basically pretty much everyone. Not everyone, but almost everyone.

And therefore, those services are billed directly to Medicare, and they're paid for in accordance with the Medicare fee schedule. Or they can elect to join a Medicare Advantage plan. There are multitudes of them. The vast majority of them are owned by the four or five largest managed care organizations out there. Those are run-- generally, all part A and part B services are included. Many of them included part D services for a fee. Not all of them. Then they also, many of them will add vision or dental services in as well, some wellness programs, et cetera.

Or if you are eligible for Medicare and choose to join a special needs plan you have to affirmatively join. Like anything else, the slamming or the concept of auto enrolling you into a program is illegal, considered fraud, and can send you to jail. You shouldn't do that. Moving residents from one MA plan or a special needs plan to another without their authorization is also illegal. That can also end you in jail. So, it's an authorized item.

There are problems associated when there are powers of attorney involved, or family members are bickering, or you have a resident who suffers from dementia or Alzheimer's, those kinds of things. But generally, it's a requested thing on behalf of the beneficiary.

RHONDA DEMENO: So, say a resident does not have an assigned power of attorney or a surrogate, what happens in that case if they meet the criterion, and they would really benefit from a plan. How do we work through those situations?

AMY KASZAK: Yeah. So, Rhonda, this is where I would say that's part of the power of the specialized special needs plan. Meaning an ISNP or a CSNP who is really focused on seniors living in congregate senior housing who understand how the organizations work, but very importantly, who understand the importance of the family of caregivers. And who, in some cases, even understand the different regulatory processes if there's a guardian who's involved.

So, organizations like ours, again, we only work with residents living in senior living campuses. And that's all we do, so our enrollment processes, our information processes, they are all designed to work for seniors who maybe can't advocate for themselves, who can't make decisions for themselves for different reasons. And we understand how to work with the senior living teams to contact the right people, what questions need to be asked. And then very importantly, how to make sure we're just doing outreach and promotion, not just to the resident, but really to what I call their extended care team.RHONDA DEMENO: Good answer. Thank you very much for that. So, Amy, how are senior living

communities selected? Are they invited to participate, or do they go out on their own? AMY KASZAK: Well, it definitely depends. In some cases, especially if you are assisted living, memory care, independent living, or you are not paid directly by Medicare today, you might not be asked to join an ISNP or a CSNP member. Because there is nothing that cause the ISNP or the CSNP have to contract with you if they are not paying you any dollars. So, you may be a senior living organization today and have residents who are already enrolled in an ISNP or CSNP Medicare Advantage plan.

You don't know about it, you're not engaged in it, and you're not receiving any dollars or additional benefits at least that you know of. My point here is that I would think about being proactive as you're thinking about your future strategy for participating in value-based care. I hear a lot of times that senior living organizations say, I am private pay only. Why do I need to participate in Medicare Advantage? My answer is if you don't participate today, you might not have the option to participate tomorrow.

And we're talking about new dollars many times for these senior living organizations. If you're a SNP, you're still going to be paid your part A, not necessarily new dollars there. But if you're assisted living, memory care, independent living, organizations like ours, to recognize the value that you bring to your residents and their health outcomes, to make our plan successful basically we can include you and pay you for care coordination services that you're providing for our members.

We can pay you when we all achieve quality outcomes, i.e., fewer avoidable hospitalizations, fewer falls in your facility. So, a lot of ways that you can participate with us, a lot of reasons that you might want to. And I would say I would be proactive in seeking out a plan who will work with you. We do come sometimes to specific senior living building to say, hey, you're in our service area. Would you like to join? Let us tell you about it. So, we certainly do that outbound work.

But if you haven't heard from an ISNP or a CSNP and you're wondering about how to get involved, I would encourage you to proactively start reaching out or thinking about options in your market.

RHONDA DEMENO: So, Kenny, here's a question. I'm thinking about our new resident is admitted into the community and there's a lot of requirements in the residency admission agreement. And since you're the legal guru on this call, would there be a requirement to have any disclosure to the resident coming into the community, or is there any work that the community should be doing, collecting any type of paperwork to say that this resident is in this plan?

Or that the community has residents in a plan and that the resident may be eligible? Should there be any type of communication on admission?

KENNY WHITE: First thing, they don't buy me legal or malpractice insurance anymore, so I'm not permitted to give legal opinions. But that said--

RHONDA DEMENO: Don't mean to put you in a bad situation, Kenny.KENNY WHITE: No. That's OK. Most of the disclosure requirements for any of these facilities is governed by state law, not my federal law, so they're licensed locally. And the requirements for disclosure, informed consent will vary from state to state. I am aware of no obligation of an entity to gather additional documentation. Also, I'm aware of none that don't because it makes good sense. I hate to say it this way, but Amy's company has made a lot of money by marketing common sense because so many entities don't seem to employ it.

You would want to have that information available on all of your residents, so that you can coordinate the care, you know who to contact with. It wouldn't be a whole lot different than finding out whether or not there's a living will, whether or not there's a health care surrogate agreement, whether or not somebody has a power of attorney or doesn't have a power of attorney. You need to know that up front because you need to know who's signing on the dotted line at the very beginning to where they even have the ability or legal right to sign the documents.

So that happens all the time with arbitration agreements with regard to these entities. The argument is, is that the person who signed wasn't authorized to do so. So, collecting that kind of information is very, very important. Now, as we discussed, one of the hallmarks of a special needs plan is that your enrollment in a special needs plan is a little bit different than your enrollment in an MA plan. And you can move in and out of special needs plans easier than you can out of MA plans or into fee for service.

And the member can do that. They may not tell the long-term care provider or the senior living facility. They may or may not know. So, following up and making sure that you have that data on at least twice a year basis is probably a good idea. I'm sure, Amy. I'm sure you guys have them do it all the time.

AMY KASZAK: Well, I was going to say when I get the question about hey, what's my first step in developing a value-based care strategy, it typically is, well, do an inventory first of your existing residence. How many are already on the Medicare Advantage plan, who are they with, who's their primary care doctor. Just some of the basics, so I'm glad to hear you say that, hey, you don't know of anything that certainly prohibits that. But that's step number one, and that leads me down the path of data collection.

And while we work, our model is flexible where we can work with a lot of types of senior living organizations. As they plan, there are some things that we are kind of picky about when we say, who do we want to bring on as a partner. But also, how do we want to bring them on as a partner? Meaning that on some of those payments that I mentioned, if we're going to pay you for care coordination, we're going to need some information about what you're doing around care coordination, for example.

We're going to need for you to help participate and letting us know when one of your residents leaves your campus or your AL, for example, so that we can make sure and do the follow up on the back end. So, I would encourage all senior living organizations to be thinking about their value-based care strategy. I would also encourage you to go back to the basics and say, hey, are you doing some of these initial things. What are you capable of doing?Because that's, I think, going to help you understand who maybe should you be working with and how did that make sense to work with them given your current capabilities as well as where you want to go in the future.

KENNY WHITE: I actually have a question for Amy. So, from a traditional Medicare and/or-- let's skip Medicaid for a second-- traditional Medicare reimbursement. Most of the services that are generally provided in senior living, memory care, et cetera are not reimbursable. Correct?

AMY KASZAK: Correct.

KENNY WHITE: So, in order to quote, unquote bring value, you have to be willing to do other things or to assist in helping other providers do other things that have the end result of improving the outcomes and the long-term outcomes of the patient, correct?

AMY KASZAK: Yeah. So, I think two things. There are first of all, there are things that senior living operators are already doing. Care coordination, helping with transportation, for example, things like that. Things you're already doing for your resident you are not paid under fee for service Medicare. You are not a Medicare provider if you're on assisted living memory care, right? So, you're not paid for those by Medicare. And that is part of what we can do as Medicare Advantage.

We can pay for things that Medicare does not reimburse through supplemental benefits. And definitely can also bring in partners who are providing some of the services that we need to provide to our residents like transportation coordination, et cetera. So, in a lot of cases, I would say one, it's the opportunity to be paid for some of the things that you're not paid for today outside of your private fees to your residents. And then two, we do have some partners that in some cases have said, hey, if you pay me to do this, I can actually add some benefits or bring in new resources to provide things I'm not doing today for members. So, combination of those two.

RHONDA DEMENO: That brings me to any time we're dealing with federal dollars, we know that there's some risk associated with those dollars. So, I have a two-part question. The first part goes to Kenny. Again, I know I'm not supposed to be asking you legal questions, Kenny. But are there legal concerns or risk concerns that you would think about that might surface because of this type of relationship? KENNY WHITE: Yes. Obviously, there are compliance issues with regulatory compliance and contractual compliance. And then there are issues related to getting and keeping money that you're not supposed to have. So, the three big ones in there are many of these statutes and state law too that might apply to Medicaid or to other avenues in health care, but the three big are obviously the False Claims Act or FCA, the anti-kickback statute, and the Stark Law.

Now, those three in combination with one another are supposed to prevent you from billing and/or receiving-- because you can just bill and not get paid and still have violated the False Claims Act-- dollars that you're not entitled to. The False Claims Act does not have a scienter or knowledge aspect. So, you can do this completely innocently, but if you find out that you did it and you don't give the money backwithin a relatively short period of time, which I think is 60 days once you are aware of it, you have still violated the act.

And that comes with some sizable penalties to it in addition to a great deal of headache and then the possible banning from the program, which is far worse on your future revenue. Stark is a law that is designed to prevent you from referring business to yourself or to relatives, primarily. So, if you happen to own an acute care facility has an individual, and there are of course family-owned hospitals out there, that also own family-owned or relative-owned long-term care facilities, then there are some strict rules that you have to follow before you can refer from one to the other or you may have violated the Stark Law. Then the anti-kickback law is basically what it suggests. You're not permitted to get things back for recommending things to Medicare beneficiaries. So, in those three issues there are compliance issues associated with it that could land you in some significant hot water, trouble damages, a lot of attorney's fees, and the possible blacklisting from the program completely.

RHONDA DEMENO: So best practice would be that if a community is considering getting involved or partnering, collaborating-- of course, they should have their legal counsel work through the agreements, make sure that they're not putting themselves in any situation where they shouldn't be entering into a specific agreement.

KENNY WHITE: Yes.

AMY KASZAK: Rhonda, I would just add on there that Medicare Advantage plans are risk products, right. And that's why we always think of the financial risk first, but there is a tremendous amount of regulatory and compliance risk that goes along with Medicare Advantage as well. We are regulated as insurance companies at the state level. So, we have state audit requirements. And then we also are, of course, regulated at the federal level through CMS as a CMS program.

So, while you we're talking to new potential partners, and they are thinking about how are you going to work with Medicare Advantage plans or value-based care programs overall. To me, the participation risk and financial benefit go hand in hand with your ability to successfully manage compliance and regulatory risks.

Specifically, what I mean by that is for most senior living partners, and especially those who do not bill today for Medicare services, we strongly recommend that they think about starting by participating with an existing Medicare Advantage plan special needs plan partner. They wouldn't have the resources to do that.

RHONDA DEMENO: That's right. You don't have the resources, but you're also limited. You're protected from some of those regulatory risks?

AMY KASZK First of all, through participation you are going to find a contract with that Medicare Advantage plan for the services that you are providing. And it is the Medicare Advantage plan. They needto be paying for the right services. And CMS, by the way, most of those contracts. So, they give us a heads up if there is a concern about it. So, you're protected somewhat or a lot actually on the regulatory. You are financially and contractually obligated to make sure that you are keeping your end of the contract.

So, you're doing the things that you're saying and the contract. But all of the other information that the plan is maybe reporting in general about your residence, et cetera-- that's done in aggregate to CMS. You're not being singled out as a senior living operator. CMS doesn't yet need a big dashboard with your name on it and that type of thing. So, you've got a fair amount of protection from the regulatory risk. You do not have reporting obligation through the plan. It's just like working with most other vendors, probably.

As you move down that risk spectrum and again, financial and compliance risk going hand in hand. And that's a level that we typically talk about is what I call the own your own risk criterion that you have upside, potentially downside risk for the overall outcomes, clinical outcomes of your population. So, this is a little bit more complicated contract. It will require careful legal review, obviously. But something that is very much allowed under CMS routes today.

You're still a participating provider at this point. You don't have to be an owner of the plan to actually receive dollars based on the outcomes of your overall population. So, I think that's a really important step that a lot of people skip because they think, oh, I can participate and maybe get some pay for performance dollars. Or I have to own my own plan, so that I can actually get paid based on the clinical outcomes in that medical cost budget.

RHONDA DEMENO: Well, this is all very, very helpful information. And I'm trying to keep an eye on the amount of time that we have.

AMY KASZAK: OK. Got it. I'll be real fast then. Let me just go to the third one because I think--

AMY KASZAK: Those who are considering a JV or an ownership model where you are owning the plan, this is where you get into that high regulatory, high compliance risk model. So, you you've invested at the state level, your insurance company at the state level. You have state level audit. We have mandatory CMS, financial audit every three years as the plan multiple regulatory filings that happened with CMS. And you also-- a lot of owners or potential owners don't realize that senior living operators-- You also are more heavily regulated if you are a related entity to the plan. What your contract looks like with the plan for services is more regulated than if you were a third-party unrelated provider with the plan. So, I'll just stop there. And we're running out of time, but to me, just think about that financial compliance risk. As you move up the spectrum of financial risk, you're also going to have more compliance and regulatory.RHONDA DEMENO: So real quick if we could just recap. I'm going to start with Amy. What is the return on investment for senior living operators would be in collaborating in a relationship with an ISNP or a special needs program?

AMY KASZAK: Sure. So, I think the first thing I would say to senior living operators is that you do add a value. We know it and you know it. Your residents know it. You add value to the health and quality outcomes for your residents. So, claim it. Claim it now. And when you do that, when you find the right partner and began-- talk a lot about Medicare Advantage plan, special needs plans, but it might even be through an ACO MFFP plan, et cetera.

When you work with value-based care you should expect that your payer partner is funding initiatives that are going to directly impact the quality of life for your resident. They are going to make it more convenient for you and your staff to provide more services on-site. And that there is a real tangible short-term financial benefit back to you when joint goals are met for your residents. So, I would look at that as the short-term.

And then the long term is that as you develop longer-term relationships with Medicare Advantage or other value-based payers, should expect to see the benefit accrue year over year. So, you should be seeing more benefits for your residents over time.

And you should also expect more opportunities if you desire to participate financially with that valuebased payer. So, as you become more experienced and you get more data, you should be able to have more options in what you want to take on in terms of caring for your residents or providing services for your residents versus what your plan partner is providing.

RHONDA DEMENO: Very, very informative. Kenny, to end this conversation, what do you think are the glaring insurance implications for a SNP plan or ISNP?

KENNY WHITE: Other than the obvious needs that everybody would think of, the P&C needs for property and casualty, the licensed medical provider coverage, HPL, cyber, and cyber risk associated particularly with HIPAA and with personal identifiable information as well as financial information which the entities have-- you run into things where people do not understand that their HPL product that provides essentially for medical malpractice coverage doesn't normally cover them for managed care operations. So, if they are performing utilization review, if they are engaged in credentialing at all, if they are participating in quality assurance or other things that fall outside of the actual definition of provision of medical services in an HPL policy, then they're flying without insurance, which is a risk that they would normally not think of. From an administrative services organization or an MSO organization, they often think of everything as being financial.

So, if they have their financial institution coverage, they think that they're OK. They forget that they could become a defendant in the bodily injury claim, and they don't normally have coverage for that. So, the reverse is also true. The biggest hole out there is the regulatory coverage. The further along that line thatAmy was describing before, from just being a contracted provider all the way to becoming a direct contracting entity with CMS. The further along that line you get, the more regulatory entanglements you can have.

And that requires a specialized amount of coverage because most policies will have regulatory coverage, but it usually is supplemented, so there's very little of it. And these things can take on a life of their own, particularly in larger institutions. And that coverage is not normally thought of as a separate coverages is necessary. So those are the main things that I'd bring to people's attention.

RHONDA DEMENO: Amy, did you want to add any final comments or thoughts before we wrap up? AMY KASZAK: No. I don't have anything else, Rhonda. I think you all have done a great job of making sure that your clients are well-informed about their options, and I appreciate being part of the conversation.

RHONDA DEMENO: We appreciated having you today, Amy. Thank you so much for sharing all of that knowledge and expertise. And Kenny, we always appreciate you participating. The senior living center of excellence really appreciates both of your time today. So, thank you very much.

KENNY WHITE: Well, thank you. And for a shameless plug, the Willis Towers Watson Health Care Risk Conference is July 19 through the 21st in Nashville, Tennessee. Day one is senior living and long-term care focused. Parts of day two and three are managed care and health system focused. So, you're invited to join us in Nashville in July, and we look forward to seeing you there.

RHONDA DEMENO: Good points, Kenny. Thanks for sharing that. Really appreciate that. That will be found on our WTW CO senior living web page as well as the health practice web page. So, for our clients, they should be receiving an invite for that. I want to thank all of you today for attending our podcast. Special thanks again, to the panelists. We hope you found our information very helpful.

Our goal is really to provide firsthand information and knowledge and best practice for our senior living providers. If you'd like additional information on ISNP plans, again, our information of our panelists will be found on our podcast page. Or feel free to reach out to me, rhonda.domino@wtwco.com. Keep in mind this was a three-part series. This is the third episode to that series. We hope you had time to join the first two podcasts as well.

This concludes today's podcast. Again, thanks to Amy and Kenny for their time today. And thanks to all who have attended this event. Thank you.

SPEAKER 2: Thank you for joining us for this WTW podcast featuring the latest perspectives on the intersection of people, capital, and risk. For more information, visit the insight section of wtwco.com. WTW hopes you found the general information provided in this podcast informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors.In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, WTW offers insurance products through licensed entities, including Willis Towers Watson Northeast Incorporated in the United States, and Willis Canada Incorporated in Canada