Value-Based Purchasing in NY Medicaid

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Value-Based Purchasing in NY Medicaid
Care Coordination and Payment Reform
Presentation to State Coverage Initiatives
National Meeting July 30, 2009

• Deborah Bachrach, Esq.
• Medicaid Director
• Deputy Commissioner
• Office of Health Insurance Programs
• New York State Department of Health

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Coverage

• Streamlining enrollment and renewal.
• Expanding eligibility.
• Changing the message.

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Access to Care

• Supporting practices in medically underserved
  areas and specialties.
• Loan repayment.
• Start-up grants.
• Enhanced Medicaid payment rates.
• Expanding Medicaids physician network.
• Improving access to care outside of business
  hours.

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Medicaid Managed Care

• Mandatory program began in 1997 under an 1115
  Waiver.
• 2.9 million beneficiaries are enrolled in managed
  care plans.
• Improved quality and contained costs.
• Significant and sustained improvements over time
  even as a sicker population enrolls (SSI, SPMI).
• Narrowing of the gap between commercial and
  Medicaid rates of performance.

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Reward Good Performance

• Health plans earn rewards up to 3 of premium for
  good performance
• HEDIS or NYS-specific quality measures.
• CAHPS measures.
• Regulatory compliance (reporting, access and
  availability, provider network).
• Plans must qualify for incentive to receive
  auto-assignments.

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Medicaid Childrens Measures
2000-2007
Measure 2000 2007 change
Immunization Status 54 70 16
Lead screening 76 86 10
Well Child 0-15 months 57 79 22
Well Child 3-6 years 65 81 16
Adolescent Well Care 41 58 17
Annual Dental visit, ages 4-21 29 48 19
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Medicaid Diabetes Care Measures
2000-2007
Measure 2000 2007 change
HbA1c tested 76 87 11
HbA1C poor control 52 34 -18
Cholesterol Screening 68 85 17
Nephropathy 45 82 37
Eye Exam 49 62 13
A lower rate is better
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Build on Managed Care Successes

• Expanding mandatory to more complex and costly
  populations.
• Evaluating the benefit package.
• Phasing-in risk adjusted rates.
• Adjusting for case mix differences.
• Priced regionally, not plan-specific.
• Aligning Medicaid fee-for-service.

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Medicaid Fee-For-Service Payment Policies

• Demanding transparency and accountability.
• Rationalizing and updating payment methodologies
  for hospitals, clinics, nursing homes and home
  care.
• Rationalizing payment levels reducing inpatient
  rates and investing in outpatient rates.
• Incentivizing the development of patient-centered
  medical homes.
• Medical home incentives both fee-for-service and
  managed care.
• Adirondack multi-payer medical home pilot (except
  Medicare).
• Primary care case management in non-mandatory
  counties.
• Paying for quality not paying for poor quality.

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Medicaid Fee-For-Service Program Policies

• Focusing on specific services and populations
  to improve quality of care and control costs.
• Selective Contracting.
• Bariatric surgery.
• Breast cancer surgery.
• Retrospective utilization management.
• Chronic illness demonstration programs.
• Prior authorization of certain radiology
  services.

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Selective Contracting for Bariatric Surgery

• Medicaid will contract with 5 New York City
  hospitals to perform bariatric surgery currently
  25 perform such surgeries.
• Why Bariatric Surgery?
• New York, like the rest of the nation, has an
  obesity epidemic.
• The volume of bariatric surgery is increasing, in
  part because of claims that bariatric surgery
  cures Type 2 diabetes and greatly diminishes
  many co-morbidities associated w/ long term
  obesity.
• The literature and our own research indicates
  that there are significant complication rates
  associated with bariatric surgery.
• There is significant variation in outcomes and
  re-admissions across NYC hospitals.

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Selective Contracting for Breast Cancer Surgery

• The literature documents significantly higher
  5-Year survival rates for women who have breast
  cancer surgery at high volume facilities.
• New York Medicaid now limits reimbursement for
  breast cancer surgery to sites that have
  performed more than 30 surgeries per year (both
  hospitals and ambulatory surgery centers).
• Exceptions granted to some sites due to access
  and provider experience.

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Retrospective Utilization Review of
Fee-For-Service Claims

• Contract awarded to APS through RFP process.
• 7 million fee-for-service claims per month will
  be reviewed.
• Evidence based guidelines, disease management
  analysis and resource utilization review
  techniques will be used to identify patterns of
  over-utilization and under-utilization.
• Providers demonstrating patterns above or below
  the norm will be notified and educated by peer
  consultants.
• Interventions will be identified for high-cost,
  high risk Medicaid beneficiaries.
• Total annual cost (with FFP) of 7 million
  anticipated annual State share savings of 15M,
  or 45M over the 3 years of the contract.

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Coordinating the Care of High-Cost, Medically
Complicated Beneficiaries

• The Chronic Illness Demonstration Program (CIDP)
  will run for three years at seven sites at a cost
  of 30M (including FFP).
• Each project is required to have an integrated
  network of providers to assure facilitated access
  to medical, mental health and substance abuse
  services for participants and collaboration with
  community-based social services.
• CIDP uses a predictive algorithm to identify
  patients at high risk (est. 70) for medical,
  substance abuse, or psychiatric hospitalizations
  in the next 12 months.

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Coordinating the Care of High-Cost, Medically
Complicated Beneficiaries (cont.)

• These patients have largely uninterrupted
  Medicaid eligibility, but limited engagement in
  primary care.
• Per patient average cost in the prior 12 months
  was 37,500.
• Average cost in the next 12 months is expected to
  be 46,000 without intervention.
• Shared risk and savings will be introduced in the
  second and third years of the project.

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Moving Forward

• Continue to streamline and expand coverage and
  enhance access.
• Continue with finance reforms that hold
  providers accountable and support delivery
  system reform.
• Reduce potentially preventable complications.
• Reduce potentially preventable readmissions.
• Consider bundling of inpatient services.
• Support integrated care models.
• Continue with program reform.
• Support meaningful use of EHRs.
• Evaluate improvement in quality and reduction in
  costs.
• Align with federal health care reform.

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