Filling the State Toolbox to Integrate Care

Imagine a world in which doctors in different offices and specialties coordinate to make sure that no patient’s need slips through the cracks; patients get the right care at the right time; providers have the right incentives, and are rewarded not just the volume of services they provide but for partnering with their peers to deliver more valuable care. Opportunities made possible by the Affordable Care Act (ACA), such as the State Innovation Models Initiative and the State Demonstrations to Integrate Care for Dual Eligibles, are offering states new opportunities to make this a reality. States participating in these initiatives are taking steps to change the way care is paid for, and thereby promote better integration between care providers.
But even outside of ACA initiatives, states can make progress toward the same goal. In fact, one NASHP project is finding that state governments—which have critical, catalytic roles to play in integrating care—already have many tools for bringing about change. NASHP is working with the Kaiser Permanente Community Benefit to bring together experts and leading states to help states of all political stripes chart a path toward a more tightly knit delivery system.
A recent webinar highlighted just how full state toolboxes are. State are major purchasers of health care services, through Medicaid programs and state employee benefits; regulatorsoverseeing health insurance plans and the health insurance exchanges; partners to andconveners of private sector payers and providers; and shapers of market conditions, including addressing antitrust concerns that may arise in multi-payer initiatives.
But as project participants noted, none of this work is simple. Having the tools to make change is one thing, but deploying them can be complex. A conversation with state leaders yielded the following lessons:

• It is difficult for Medicaid programs alone to drive broad delivery system reform. Washingtonstate found that when convening a multi-payer reform pilot it needed to bring a broad group to the table, including Medicaid, commercial insurance plans, health care providers, purchasers, associations, legislators, and organized labor.
• In preparation for a new payment reform model, Tennessee is conducting market analyses to determine how best to target reforms. Knowing the degree of financial leverage that states—and their partners—have over different health care providers can help target specific payment reform efforts to maximize their impact and allow states to pick where to begin.
• Minnesota is aligning a payment strategy across Medicaid managed care and fee-for-service delivery systems as it implements new gain-sharing and risk-sharing payment models. Medicaid programs can harmonize fee-for-service programs and state “asks” of Medicaid managed care plans to send a stronger and more coherent message to health care providers.
• Maryland applies incentive payments to capitated payments made to Medicaid managed care plans. State Medicaid programs can tie payment levels for managed care plans to performance improvement. Such arrangements include an expectation that plans will implement payment improvements to providers as a way to receive additional payment.

The full summary of that conversation can be found here. And you probably have even more to add on the topic. Weigh in with insights from your own state government by joining State Refor(u)m’s multi-sector payment reform discussion, or in a comment below.
We’ll post more documents, reports, and insights as NASHP’s integrated delivery system project continues. The results of this work, along with additional related resources—including a summary of a discussion among state policymakers on this topic held by NASHP in late 2011, and a NASHP publication exploring the role of safety net providers in a more integrated world—can be found on State Refor(u)m in an Integrated Delivery Systems Toolkit. Also check back here for additional blog posts. This is just the first in a short series that will distill some of the lessons emerging from our work.