Experiences and Interest in Value-Based Payment Arrangements for Medical Products Among Medicaid Agencies: An Exploratory Analysis.

Policy Points State Medicaid experience with value-based payment (VBP) arrangements for medical products is still relatively limited, and states face a number of challenges in designing and implementing such arrangements, particularly because of the resource-intensive nature of arrangements and data needed to support measurement of desired outcomes. A number of success factors and opportunities to support VBP arrangement efforts were identified through this study, including leveraging established venues or processes for collaboration with manufacturers, engaging external and internal partners in VBP efforts to bolster capabilities, acquiring access to new data sources, and utilizing annual renegotiation of contracts to allow for adjustments. CONTEXT: To date, uptake of value-based payment (VBP) arrangements for medical products and knowledge of their design and impact have been mainly concentrated among private payers. Interest and activity are expanding to Medicaid; however, their experiences and approaches to VBP arrangements for medical products are not well characterized. METHODS: This study sought to characterize the use of VBP arrangements for medical products among state Medicaid agencies through the use of a two-staged, mixed-methods approach. A survey and semistructured interviews were conducted to gain an understanding of state experiences with VBP arrangements for medical products. The survey and interviews were directed at senior leaders from nine states through the survey, with respondents from seven of these states additionally participating in the semistructured interviews. FINDINGS: Although experience with VBP arrangements for medical products among states varied, there were similarities across their motivations and general processes or phases employed in their design and implementation. States collectively identified a number of significant challenges to VBP arrangements, such as manufacturer engagement, outcomes measurement, and the time, expertise, and resources required to design and implement them. We outline a range of strategies to help address these gaps and make it easier for states to pursue VBP arrangements, including more direct engagement from the Center for Medicare and Medicaid Services, state-to-state peer learning and collaboration, data infrastructure and sharing, and additional research to inform fit-for-purpose VBP arrangement approaches. CONCLUSIONS: Findings from this study suggest that it may be easier for states to pursue VBP arrangements for medical products if there is greater clarity on processes employed that support design and implementation as well as effective strategies to address common challenges associated with contract negotiations. As states gain more experience, it will be important to monitor the design and implementation of common VBP arrangements to assess impact on the Medicaid program and the populations it serves.

Linking Medicare-Medicaid Claims for Patient-Centered Outcomes Research Among Dual-Eligible Beneficiaries.

BACKGROUND: Evaluation of Medicare-Medicaid integration models' effects on patient-centered outcomes and costs requires multiple data sources and validated processes for linkage and reconciliation. OBJECTIVE: To describe the opportunities and limitations of linking state-specific Medicaid and Centers for Medicare & Medicaid Services administrative claims data to measure patient-centered outcomes for North Carolina dual-eligible beneficiaries. RESEARCH DESIGN: We developed systematic processes to (1) validate the beneficiary ID linkage using sex and date of birth in a beneficiary ID crosswalk, (2) verify dates of dual enrollment, and (3) reconcile Medicare-Medicaid claims data to support the development and use of patient-centered outcomes in linked data. PARTICIPANTS: North Carolina Medicaid beneficiaries with full Medicaid benefits and concurrent Medicare enrollment (FBDE) between 2014 and 2017. MEASURES: We identified need-based subgroups based on service use and eligibility program requirements. We calculated utilization and costs for Medicaid and Medicare, matched Medicaid claims to Medicare service categories where possible, and reported outcomes by the payer. Some services were covered only by Medicaid or Medicare, including Medicaid-only covered home and community-based services (HCBS). RESULTS: Of 498,030 potential dual enrollees, we verified the linkage and FBDE eligibility of 425,664 (85.5%) beneficiaries, including 281,174 adults enrolled in Medicaid and Medicare fee-for-service. The most common need-based subgroups were intensive behavioral health service users (26.2%) and HCBS users (10.8%) for adults under age 65, and HCBS users (20.6%) and nursing home residents (12.4%) for adults age 65 and over. Medicaid funded 42% and 49% of spending for adults under 65 and adults 65 and older, respectively. Adults under 65 had greater behavioral health service utilization but less skilled nursing facility, HCBS, and home health utilization compared with adults 65 and older. CONCLUSIONS: Linkage of Medicare-Medicaid data improves understanding of patient-centered outcomes among FBDE by combining Medicare-funded acute and ambulatory services with Medicaid-funded HCBS. Using linked Medicare-Medicaid data illustrates the diverse patient experience within FBDE beneficiaries, which is key to informing patient-centered outcomes, developing and evaluating integrated Medicare and Medicaid programs, and promoting health equity.

Health Care Use and Spending Among Need-Based Subgroups of Medicare Beneficiaries With Full Medicaid Benefits.

Importance: Beneficiaries dual eligible for Medicare and Medicaid account for a disproportionate share of expenditures due to their complex care needs. Lack of coordination between payment programs creates misaligned incentives, resulting in higher costs, fragmented care, and poor health outcomes. Objective: To inform the design of integrated programs by describing the health care use and spending for need-based subgroups in North Carolina's full benefit, dual-eligible population. Design, Setting, and Participants: This cross-sectional study using Medicare and North Carolina Medicaid 100% claims data (2014-2017) linked at the individual level included Medicare beneficiaries with full North Carolina Medicaid benefits. Data were analyzed between 2021 and 2022. Exposure: Need-based subgroups: community well, home- and community-based services (HCBS) users, nursing home (NH) residents, and intensive behavioral health (BH) users. Measures: Medicare and Medicaid utilization and spending per person-year (PPY). Results: The cohort (n = 333 240) comprised subgroups of community well (64.1%, n = 213 667), HCBS users (15.0%, n = 50 095), BH users (15.2%, n = 50 509), and NH residents (7.5%, n = 24 927). Overall, 61.1% reported female sex. The most common racial identities included Asian (1.8%), Black (36.1%), and White (58.7%). Combined spending for Medicare and Medicaid was $26 874 PPY, and the funding of care was split evenly between Medicare and Medicaid. Among need-based subgroups, combined spending was lowest among community well at $19 734 PPY with the lowest portion (38.5%) of spending contributed by Medicaid ($7605). Among NH residents, overall spending ($68 359) was highest, and the highest portion of spending contributed by Medicaid (70.1%). Key components of spending among HCBS users' combined total of $40 069 PPY were clinician services on carrier claims ($14 523) and outpatient facility services ($9012). Conclusions and relevance: Federal and state policy makers and administrators are developing strategies to integrate Medicare- and Medicaid-funded health care services to provide better care to the people enrolled in both programs. Substantial use of both Medicare- and Medicaid-funded services was found across all need-based subgroups, and the services contributing a high proportion of the total spending differed across subgroups. The diversity of health care use suggests a tailored approach to integration strategies with comprehensive set benefits that comprises Medicare and Medicaid services, including long-term services and supports, BH, palliative care, and social services.

Paying For Value From Costly Medical Technologies: A Framework For Applying Value-Based Payment Reforms.

Innovative medical products offer significant and potentially transformative impacts on health, but they create concerns about rising spending and whether this rise is translating into higher value. The result is increasing pressure to pay for therapies in a way that is tied to their value to stakeholders through improving outcomes, reducing disease complications, and addressing concerns about affordability. Policy responses include the growing application of health technology assessments based on available evidence to determine unit prices, as well as alternatives to volume-based payment that adjust product payments based on predictors or measures of value. Building on existing frameworks for value-based payment for health care providers, we developed an analogous framework for medical products, including drugs, devices, and diagnostic tools. We illustrate each of these types of alternative payment mechanisms and describe the conditions under which each may be useful. We discuss how the use of this framework can help track reforms, improve evidence, and advance policy analysis involving medical product payment.

National estimates of price variation by site of care.

OBJECTIVES: Recently, researchers and policy makers have demonstrated growing interest in differences in payments across sites of care for the same healthcare service, such as in a hospital outpatient department (HOPD) versus a physician office (PO). Our objective was to examine the price differential for individuals with employer-sponsored insurance by site of care for 7 commonly performed services at the national and regional level. STUDY DESIGN: We analyzed 2008 to 2013 claims data from Truven Health MarketScan Commercial Claims and Encounters Database, containing administrative data for 44 to 53 million individuals covered by employer-sponsored health insurance. METHODS: We selected 7 services based on total payments from different clinical categories-categories in which differences in clinical quality and patient morbidity are less likely to be sources of the price differential. We calculated payment amounts at the visit level for each healthcare service by site of care, then calculated the price differential by site of care as a ratio of average HOPD price to the average PO price or average ambulatory surgery center price for the same service. RESULTS: Across all 7 services, prices at a HOPD were statistically significantly higher than payments to a PO, ranging in 2013 from 21% more for an office visit to 258% more for chest radiography. The increase in the price differentials, combined with a shift in volume in favor of hospital outpatient departments, was associated with a 44% increase in total spending between 2008 and 2013. CONCLUSIONS: Our study shows that price differentials by site of care exist at a national level, and that they are increasing over time.

Characterizing health plan price estimator tools: findings from a national survey.

OBJECTIVES: Policy makers have growing interest in price transparency and in the kinds of tools available to consumers. Health plans have implemented price estimator tools that make provider pricing information available to members; however, systematic data on prevalence and characteristics of such tools are limited. The purpose of this study was to describe the characteristics of price estimator tools offered by health plans to their members and to identify potential trends, challenges, and opportunities for advancing the utility of these tools. STUDY DESIGN: National Web-based survey. METHODS: Between 2014 and 2015, we conducted a national Web-based survey of health plans with commercial enrollment (100 plans, 43% response rate). Descriptive analyses were conducted using survey data. RESULTS: Health plan members have access to a variety of price estimator tool capabilities for commonly used procedures. These tools take into account member characteristics, including member zip code and benefit design. Despite outreach to members, however, challenges remain with respect to member uptake of such tools. CONCLUSIONS: Our study found that health plans share price and provider performance data with their members.

Results from a national survey on chronic care management by health plans.

OBJECTIVES: The growing burden of chronic disease necessitates innovative approaches to help patients and to ensure the sustainability of our healthcare system. Health plans have introduced chronic care management models, but systematic data on the type and prevalence of different approaches are lacking. Our goal was to conduct a systematic examination of chronic care management programs offered by health plans in the commercial market (ie, in products sold to employers and individuals. STUDY DESIGN AND METHODS: We undertook a national survey of a representative sample of health plans (70 plans, 36% response rate) and 6 case studies on health plans' programs to improve chronic care in the commercial market. The data underwent descriptive and bivariate analyses. RESULTS: All plans, regardless of size, location, and ownership, offer chronic care management programs, which identify eligible members from claims data and match them to interventions based on overall risk and specific care gaps. Plans then report information on care gaps to providers and offer self-management support to their members. While internal evaluations suggest that the interventions improve care and reduce cost, plans report difficulties in engaging members and providers. To overcome those obstacles, plans are integrating their programs into provider work flow, collaborating with providers on care redesign and leveraging patient support technologies. CONCLUSIONS: Our study shows that chronic care management programs have become a standard component of the overall approach used by health plans to manage the health of their members.

Provider performance measures in private and public programs: achieving meaningful alignment with flexibility to innovate.

In recent years there has been a significant expansion in the use of provider performance measures for quality improvement, payment, and public reporting. Using data from a survey of health plans, we characterize the use of such performance measures by private payers. We also compare the use of these measures among selected private and public programs. We studied twenty-three health plans with 121 million commercial enrollees--66 percent of the national commercial enrollment. The health plans reported using 546 distinct performance measures. There was much variation in the use of performance measures in both private and public payment and care delivery programs, despite common areas of focus that included cardiovascular conditions, diabetes, and preventive services. We conclude that policy makers and stakeholders who seek less variability in the use of performance measures to increase consistency should balance this goal with the need for flexibility to meet the needs of specific populations and promote innovation.

Posing a framework to guide government's role in payment and delivery system reform.

Innovative payment reform initiatives occur in both the public and private sector, but the optimal role in such reforms of the public sector, specifically the Centers for Medicare and Medicaid Services, is up for debate. In this article we examine recent experiences with public-private collaboration on payment and delivery reform and present a framework for determining the role of the government in spurring reform. We argue that as a purchaser, the government should consider the scale and maturity of private-sector activity in determining how to approach designing and implementing payment and delivery system reform. The government can further spur innovation by implementing payment reform for providers less ready to participate in it-such as smaller provider groups with limited organizational and technological capacity to implement reform-through identifying best practices related to attribution models and quality benchmarks and promoting dialogue with the private sector about the testing of new reform programs.

Early lessons from accountable care models in the private sector: partnerships between health plans and providers.

New health care delivery and payment models in the private sector are being shaped by active collaboration between health insurance plans and providers. We examine key characteristics of several of these private accountable care models, including their overall efforts to improve the quality, efficiency, and accountability of care; their criteria for selecting providers; the payment methods and performance measures they are using; and the technical assistance they are supplying to participating providers. Our findings show that not all providers are equally ready to enter into these arrangements with health plans and therefore flexibility in design of these arrangements is critical. These findings also hold lessons for the emerging public accountable care models, such as the Medicare Shared Savings Program-underscoring providers' need for comprehensive and timely data and analytic reports; payment tailored to providers' readiness for these contracts; and measurement of quality across multiple years and care settings.

Measuring the performance of individual physicians by collecting data from multiple health plans: the results of a two-state test.

Quality measurement and reporting have emerged as important tools that providers, health plans, and other stakeholders can use to identify gaps in quality and focus resources on improving care. Yet identifying, measuring, and evaluating the care that physicians and other health care providers deliver is complicated by limited data, privacy concerns, and the challenge of trying to compare data from diverse sources. This article describes an effort to pilot-test in Florida and Colorado a consistent approach to individual physician performance measurement using data compiled from multiple health plans. Our approach could be used as the basis for making comparable performance information available nationwide. Additional efforts are needed to address key issues, including ways to effectively engage providers in the use of performance information.

Measuring outcomes and efficiency in medicare value-based purchasing.

The Medicare program may soon adopt value-based purchasing (VBP), in which hospitals could receive incentives that are conditional on meeting specified performance objectives. The authors advocate for a market-oriented framework and direct measures of system-level value that are focused on better outcomes and lower total cost of care. They present a multidimensional framework for measuring outcomes of care and a method to adjust incentive payments based on efficiency. Incremental reforms based on VBP could provoke transformational changes in total patient care by linking payments to value related to the whole patient experience, recognizing shared accountability among providers.