While Medicare may be top of mind when it comes to value-based payment models, state-led managed Medicaid programs are gaining ground in the move to adopting reimbursements based on quality and outcomes. Of Medicaid’s 78 million beneficiaries, 69% receive care through risk-based managed care organizations (MCO). A Kaiser Family Foundation survey found that in 25 states with MCOs, more than 75% of their Medicaid beneficiaries are covered by those programs. Further, nearly all states with MCOs reported they used at least one Medicaid managed care quality initiative in fiscal year 2019. That year, more than half of MCO states set targets in their MCO contracts for the percentage of provider payments, network providers or plan members that MCOs must cover via alternative payment models (APM).
Measuring quality is critical as states shift more enrollees to outcomes-based models — and states are using an array of metrics. That makes it increasingly complicated for payers to track and meet the quality measures that help them manage APM risk and prove they are delivering high quality care. Solving the challenge of collecting, managing and reporting outcomes per each state’s requirements is a prerequisite for payers to grow their Medicaid value-based programs.
A mixed bag of quality measures
No single set of Medicaid quality measures exists. As per the National Quality Forum, more than 150 “measure steward” organizations exist, each of which has designed its own quality metrics. CMS has its own Core Sets — Adult and Child. The National Committee for Quality Assurance (NCQA) has its Healthcare Effectiveness Data and Information Set (HEDIS®). There are measures published by the Agency for Health Research and Quality (AHRQ), Physician Consortium for Performance Improvement (PCPI), Pharmacy Quality Alliance (PQA), and also population-specific measures like the Long-Term Services and Supports measures by NCQA and CMS. Less well-known organizations, such as the Bree Collaborative, have yet others.
CMS established the Child and Adult Core Sets in response to congressional directives and consulted states, quality measurement experts and stakeholders in the development process. Reporting still varies by state but has increased overall since voluntary reporting began. As of 2019, 28 states reported more than 75% of Child Core Set measures and 34 states reported more than 50% of Adult Core Set measures.
For FY 2020, there are 24 measures in the Child Core Set, and 33 measures in the Adult Core Set. In the Child Core Set, 18 measures are process related and 20 measures can be calculated using an administrative data collection methodology. In addition, beginning in 2024, CMS will require states to report on its core set of quality measures for children enrolled in Medicaid and the Children’s Health Insurance Program (CHIP), and also a core set of behavioral health measures for adult Medicaid members.
States also create custom measures. Maryland’s Value-Based Purchasing Initiative primarily uses HEDIS measures and its own lead screening and ambulatory care measures. Pennsylvania’s MCO Pay-for-Performance program similarly includes its own metrics along with HEDIS. Rhode Island adopts metrics from several organizations plus two custom measures.
Managing the measures
Healthcare organizations will need robust data collection and analytics capabilities to satisfy these myriad reporting requirements now and as they evolve. Here are some of the capabilities that a Medicaid value-based care reporting strategy should encompass:
Strong support for HEDIS measures. Many states incorporate at least some HEDIS measures in their value-based programs, so it’s important to have good HEDIS-related workflow management in place. Capabilities required include the ability to uncover the root cause of low HEDIS scores and to help analyze poorly performing measures for appropriate action. Reporting needs include care gap and performance reports that summarize provider quality of care and highlight disparities.
Large measures library. Payers offering managed Medicaid value-based care across many states or that have plans to do so will need to support hundreds of state quality measures, ranging from CMS Children and Adult Core Sets and Managed Care Accountability Sets (MCAS) to HEDIS and individual states’ customized measures.
Support state-specific nuances. Some states deviate from the CMS core set technical specifications to account for state-specific billing and coding practices. For example, Massachusetts directs providers to use state-specific modifiers that describe who delivered the service and if a need was identified when billing for developmental screenings.
Payers clearly need to build these capabilities with multiple states and programs in view. Plans can choose to build and maintain their own libraries and reporting capabilities. They may also evaluate third-party tools that support metrics from multiple measure stewards and state-created measures. These solutions should carry NCQA’s HEDIS Certified Measure status to ensure that they are qualified.
Additional steps that healthcare organizations can take to succeed as Medicaid value-based programs expand include:
Understanding state value-based reimbursement models using the Health Care Payment Learning and Action Network (HCP-LAN) APM framework and evaluating their readiness.
Evaluate existing HEDIS and quality measure analytics and assess vendors’ ability to support the reporting requirements of the state value-based payment models.
Evaluate qualification of state Medicaid models as part of Other-Payer Advanced APM for Medicare Access and the CHIP Reauthorization Act of 2015 (MACRA). This will help the Medicaid MCO provider networks to potentially qualify for greater Medicare payments. These can act as incentives for those networks to also participate in Medicaid value-based models.
Slightly more than 17% of Medicaid payments are being made under value-based programs, so there is room for growth and an incentive to catalyze it from various CMS programs. These include the Delivery System Reform Incentive Payment (DSRIP) program and the State Innovation Model (SIM), which reward healthcare organizations for experimenting with programs that improve outcomes while reducing costs through coordinated care delivery, and for focusing on population health outside of traditional clinical care pathways. As of April 2020, $55.4 billion in state and federal funds was approved for such efforts. Twelve states have implemented DSRIP or DSRIP-like programs that invest in provider-led projects designed to advance statewide delivery system reform goals: Arizona, California, Kansas, Massachusetts, New Hampshire, New Jersey, New Mexico, New York, Oregon, Rhode Island, Texas and Washington.
With CMS indicating that it may not approve new DSRIP programs or renew existing ones, states are also exploring directed payment arrangements under 42 CFR 438.6(c) to continue supporting these payment reforms.
Payer organizations that are able to collect and report quality data required by APMs and value-based reimbursements will be in a strong position to partner with states on these initiatives and create new sources of revenue even as they change how care is delivered.