Fallon to cut dual-eligible insurance program

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By Emily Micucci

Citing problems with economic sustainability, Fallon Health of Worcester has announced it will end its insurance program that serves members eligible for both Medicaid and Medicare insurance, known as Fallon Total Care, effective Sept. 30.

Launched in October 2013, Fallon is one of three Bay State insurers participating in One Care, an insurance program offered in collaboration with MassHealth, the state’s Medicaid program, and Medicare.

The One Care program is a pilot program designed by the Centers for Medicare and Medicaid (CMS) to reduce the high cost of managing the health care of people who are covered by both public payers. In Massachusetts, the program is geared toward people between the ages of 21 and 64 with disabilities. A handful of other states are also participating in the program.

“After careful consideration and a thoughtful, comprehensive assessment of our experience, we have decided reluctantly to end our participation in the Commonwealth’s One Care demonstration program,” Bob Nolan, a spokesman for Fallon, said in an emailed statement. “We explored alternatives with MassHealth and (CMS), but ultimately determined that our continued participation was not economically sustainable.”

Nolan declined to comment further on why the program is not sustainable for Fallon.

According to Fallon, there are 5,400 members enrolled in Fallon Total Care. That’s short of the 8,000 to 10,000 that former CEO Mary Ritter said the company expected to enroll back in 2013. The company will work with MassHealth to find new coverage for those members, who live in Worcester, Hampden and Hampshire counties, after the program ends in September.

“MassHealth is committed to the One Care program … We will work with Fallon Total Care members to ensure a smooth transition and continuation of coverage either under another One Care plan or through MassHealth and Medicare directly,” Michelle Hillman, spokeswoman for MassHealth, said in an emailed statement.

Hillman added that “MassHealth believes in the long term that we will see positive results from the One Care model.”

Tufts ‘breaking even’ on One Care

Aside from Fallon, Tufts Health Plan of Watertown offers a One Care plan, known as Unify, through its public plans division, while Boston-based Commonwealth Care Alliance, a health care delivery system serving Medicare and Medicaid recipients, offers a One Care plan as well.

According to Dr. Kit Gorton, president of Tufts Health Plan’s public plans division, the Unify program is currently breaking even, which is the goal. Gorton said insurers investing in One Care programs are not expecting to generate large profits.

“We are fully committed and staying in the program for foreseeable future,” Gorton said.

He added that the Unify program has a small number of members, about 1,800, and keeping the program small is part of the Tufts strategy, given the high cost of health care for the dual-eligible population. That model is different from those offered by Fallon and Commonwealth Care Alliance, he said.

Lois Simon, president of Commonwealth Care Alliance, said in a statement that the organization was sorry to hear that Fallon would end its One Care program.

"We certainly understand the challenges faced in caring for this population. Commonwealth Care Alliance ... is committed to continuing our participation in One Care and in working with MassHealth and (CMS) as we navigate the challenges associated with this unprecedented demonstration," Simon said.

Initially, Fallon Total Care was launched as a joint venture between Fallon and Magellan Health Services of Connecticut, but Magellan exited the venture before it launched. Fallon had leased space for its Fallon Total Care offices at 100 North Parkway in Worcester.

(Note: This story was updated from its original version to include a statement from Commonwealth Care Alliance.)