The Countdown Begins: California Advancing and Innovating Medi-Cal (Cal AIM) will launch on January 1, 2022

By Jason Bloome

After postponing it’s start due to COVID-19, California’s Department of Health Care Services (DHCS) plans to implement California Advancing and Innovating Medi-Cal (Cal AIM) on January 1, 2022. Cal AIM is California’s ambitious first step towards statewide Managed Long Term Support and Services (MLTSS). MLTSS is gaining
traction in many states as a popular health care delivery system where capitated rates are paid to Managed Care Organizations (MCOs) to manage long term support and services (LTSS) for their members.

Cal AIM was developed to provide a framework for a broad-base delivery system, program and payment across the Medi-Cal program for some of the state’s most
vulnerable populations including the homeless, justice-involved who have clinical care needs, children with complex medical conditions, behavioral health access and the elderly at risk of premature institutionalization or on LTSS in nursing homes.

The three goals of Cal AIM include:
• Identify and manage member risk and need through whole person care approaches and addressing Social Determinants of Health (i.e. conditions in which a person is born, live, work, play, etc. that affect a wide range of health; functioning and quality of life outcomes);
• Move Medi-Cal to a more consistent and seamless system by reducing complexity and increasing flexibility; and
• Improve quality outcomes, reduce health disparities, and drive delivery system transformation and innovation through value-based initiatives, modernization of systems, and payment reform.

Fragmented Care Delivery System
California has multiple Medi-Cal delivery systems which lead to the fragmentation of care delivery and care coordination. Depending on the care needs, many Medi-Cal recipients may have access to 4-6 delivery care systems which include managed care, feefor-service, mental health, substance use disorder, dental, developmental, In Home Support and Services (IHSS), etc. Cal AIM will integrate the various care-delivery systems under one umbrella and align funding, data reporting, quality control and infrastructure. Cal AIM also plans to incorporate various state demonstration programs including the California Coordinated Care Initiative (CCI).

The California Coordinated Care Initiative
California began the California Coordinated Care Initiative (CCI) in 2014 to demonstrate MLTSS pilot programs in 7 counties: Los Angeles, Orange, Riverside, San Bernardino, San Mateo, San Diego and Santa Clara. Enrollees are dual-eligibles (beneficiaries with Medi-Cal and Medicare). CCI has two components: MLTSS where dual-eligibles are mandatorily enrolled with MCOs to manage Medi-Cal benefits and Cal MediConnect in which dual-eligibles have the option of enrolling with the same MCO to manage their Medicare benefits as well. California is expected to end CCI and fully transition the program to Cal AIM by January 2023.

In Lieu of Services (ILOS)
Cal AIM will allow for the first time MLTSS MCOs to use In Lieu of Services (ILOS) to provide services as a substitute (“in lieu of”) covered services impacting hospital or nursing home admission or a discharge delay. ILOS are medically appropriate and “cost effective” substitutes for state plan services. Allowable ILOS includes:
• Housing Transition Navigation Services
• Housing Deposits
• Housing Tenancy and Sustaining Services
• Short-term Post-Hospitalization Housing
• Recuperative Care (Medical Respite)
• Respite Services
• Day Habilitation Programs

Nursing Facility Transition/Diversion to Assisted Living Facilities, such as Residential Care Facilities for Elderly (RCFE) and Adult Residential Facilities (ARF)
• RCFE payments (only for the “assisted living” care portion not for the “room and board” resident contribution)
• Community Transition Services/Nursing Facility Transition to a Home
• Personal Care and Homemaker Services
• Environmental Accessibility Adaptations (Home Modifications)
• Meals/Medically Tailored Meals
• Sobering Centers
• Asthma Remediation\

In their 2016 Medicaid Managed Care Final Rules the Centers for Medicare and Medicaid Services (CMS) authorized ILOS to be considered covered expenses for annual capitated rate setting calculations. Including ILOS as allowable expenses provides MLTSS MCOs with fiscal incentives to develop ILOS programs for eligible members.

Enhanced Care Management
Cal AIM will also incorporate a new, statewide enhanced care management benefit for clinical and non-clinical needs for high-need Medi-Cal recipient populations. Enhanced care management will involve a collaborative and interdisciplinary approach to providing comprehensive care management services.
Target populations for enhanced care management include:
• Children or youth with complex physical, behavioral, developmental, and oral health needs (e.g. California Children Services, foster care, youth with clinical high-risk syndrome or first episode of psychosis).
• Individuals experiencing homelessness, chronic homelessness or who are at risk of becoming homeless.
• High utilizers with frequent hospital admissions, short-term skilled nursing facility stays, or emergency room visits.
• Individuals at risk for institutionalization who are eligible for long-term care services.
• Nursing facility residents who want to transition to the community.
• Individuals at risk for institutionalization with serious mental illness (SMI), children with serious emotional disturbance (SED) or substance use disorder (SUD) with cooccurring chronic health conditions.
• Individuals transitioning from incarceration who have significant complex physical or behavioral health needs requiring immediate transition of services to the community.

Fiscal Incentives
DCHS will provide fiscal incentives to MLTSS MCOs to develop delivery system reform, enhanced care management and ILOS by shared savings/risks, blended capitated rates design and other plan incentives based on quality and performance improvements reported in LTSS and other cross-delivery system metrics. The target of the incentive payments is to drive change at the MCO and provider levels. DHCS anticipates MCOs will partner and share fiscal incentives with on ground providers.

Cal AIM Launch Dates
To achieve a standardized approach to comprehensive care across all populations, DHCS proposes to start Cal AIM in three phases:
1) January 2022: The Coordinated Care Initiative will continue as is with a carve out for Multipurpose Support and Services (MLTSS). DHCS will also implement volunteer ILOS.
2) January 2023: Full transition of all dual-eligibles into MLTSS. All dual-eligibles and non-dual eligible on fee for service Medi-Cal enrolled in a long-term care facility will be enrolled with a MCO by January 1, 2023.
3) January 2025: MLTSS plans in non-CCI counties will be required to operate Medicare Dual Eligible Special Needs Programs (D-SNPs), for special needs people receiving Medicare and Medi-Cal benefits.

Sources: https://www.dhcs.ca.gov/provgovpart/Pages/CalAIM.aspx

Jason Bloome is owner of Connections- Care Home Consultants, an information and referral agency for care homes for the elderly. More information at carehomefinders.com.