Over 12 million Americans are eligible for both Medicare and Medicaid, including roughly 7.5 million adults aged 65 and over and roughly 4.5 million people with disabilities under age 65. Many of these dual-eligible individuals have complex health care needs, and most receive care in uncoordinated Medicare and Medicaid fee-for-service delivery systems, where Medicare pays for their hospital, primary care and preventive care services and Medicaid pays for their long-term services and supports (LTSS), such as nursing facility and home health services, and most behavioral health care.

The lack of coordination between Medicare and Medicaid benefits across these systems increases the likelihood that already high-risk individuals will experience suboptimal care and adverse health outcomes. Federal and state policymakers have pursued various approaches for better coordinating care for dual-eligible individuals nearly since the inception of the Medicare and Medicaid programs. However, one major barrier to the growth of these approaches is the lack of clear financial incentives for states to pursue developing them.

In a report prepared with the support of Arnold Ventures, Manatt Health highlights the existing strategies state policymakers can deploy for improving the financial integration of Medicare and Medicaid and, to the extent possible, allowing states to share in savings accruing to Medicare from Medicaid investments. These strategies present clear opportunities to improve the financial integration of Medicare and Medicaid to discourage cost-shifting across programs, incentivize states to pursue more integrated care models for dual-eligible individuals, and ensure that care delivery across the two programs is as seamless and unified as possible for the beneficiary.

To read the full report, click here.