Special Needs Plans for dual eligibles (D-SNPs) account for a large and growing category of Medicare Advantage Special Needs Plans (SNPs), reaching 1.2 million or 83 percent of SNP enrollees in 2012.

Medicare Advantage Special Needs Plans for dual eligibles, commonly an HMO, are often key players in new integrated Medicare-Medicaid health plan demonstrations under development in several states – Ohio and Minnesota, for example – and starting in 2013 all D-SNPs must contract with state Medicaid agencies.

A recent report from the Government Accountability Office (GAO) found a few areas for improvement among D-SNPs, state Medicaid agencies, and the Centers for Medicare and Medicaid Services (CMS). A quick overview of GAO’s findings:

  • Only about one-third of the 2012 contracts with state Medicaid offices contained any provisions for benefit integration.
  • One-fifth of contracts included active care coordination between D-SNP health plans and Medicaid agencies.
  • Comparing D-SNP performance is difficult because there are no standardized measures of outcomes.
  • Representatives from both D-SNPs and state Medicaid agencies were concerned about limited state resources to to develop and oversee contracts, and about whether Congress will maintain D-SNPs after 2013. For some insight, see MedPAC’s 2012 report to Congress, which includes an analysis of D-SNPs.

Recommended Improvements to D-SNP Oversight:

The GAO recommended several measures to remedy those issues, such as requiring Special Needs Plans for dual elgibles to report standardized data and having CMS systematically analyze that data. CMS mostly agreed with them. The SNP Alliance also responded to the report, saying the ability of D-SNPs integrate benefits fully through contracts is limited by the interest and capacity of state Medicaid agencies.

D-SNPs are an important part of efforts to reform and integrate financing and care for dual eligibles, who are low income seniors and people of all ages with severe disabilities. The nation’s 9.4 million dual eligibles – about 7.4 million of whom are full-benefit dual eligibles – will use about $350 billion in healthcare services in FY 2013, worth 39 percent of Medicaid spending and 31 percent of Medicare spending.

Business Briefings for Health Plans on Integrated Care Demonstrations:

Sellers Dorsey recently hosted two helpful webinars on dual eligibles: one is a basic overview and the other describes business opportunities and risks for health plans in the large and growing dual eligibles market.

In the later, Mike Fox and Kip Piper of Sellers Dorsey provide a 90-minute briefing for health plan executives on the new demonstrations to integrate Medicare and Medicaid financing and care delivery for dual eligibles. Mike and Kip describe the current $350 billion dual eligibles marketplace, state plans to contract with health plans, steps health plans should take in assessing the business opportunities and risks of serving this market, and key considerations for entering the integrated Medicare-Medicaid health plan business.  Watch the briefing online for free here on Vimeo.

Read more blog posts on dual eligibles here.


Kip Piper is a Medicare, Medicaid, and health reform consultant, speaker, and author.  A senior consultant with Sellers Dorsey and Fleishman-Hillard, Kip advises health plans, hospitals and health systems, states, drug and device manufacturers, and investment firms throughout the U.S.  For more, visit KipPiper.com.  Follow on Twitter at @KipPiper and connect with Kip on LinkedIn.