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Preparations Under Way for Medicaid Value-Based Payment

The state took several steps this month to prepare for the launch of its Medicaid value-based payment (VBP) initiative. The VBP plans arise from the state's Medicaid waiver, which invests $6.4 billion in delivery system reform. Coupled with delivery system reform, VBP is intended to improve health outcomes and the cost-effectiveness of the health care system while ensuring the sustainability of the transformation achieved through the waiver dollars.

To advance VBP, the Department of Health (DOH) this month convened a meeting of Medicaid managed care plans to discuss VBP adjustments to payment rates, held a “town hall” meeting with provider associations to discuss outreach and educational resources for providers, and released its managed long term care (MLTC) VBP Clinical Advisory Group report, which outlines the VBP framework for long term care.

MLTC VBP Clinical Advisory Group Report: A summary of the MLTC VBP Clinical Group report is available here. DOH will receive comments on the report until Jan. 9, 2017 here.

Managed Care Plan VBP Meeting: The Department’s meeting with Medicaid managed care plans focused on mainstream managed care but provided insights instructive for MLTC plans. It emphasized that VBP is designed to be budget neutral—not to generate savings to the state financial plan. The Department indicated its intent to reinvest any savings in the health system.

The Department described three types of payment adjustments that would be made to plan rates to support VBP: Guaranteed Stimulus Funding; Plan-Specific VBP Stimulus Adjustments; Efficiency Performance Adjustments; and Quality Performance Adjustments. The Guaranteed Stimulus Funding will not be paid to MLTC plans. In addition to payment adjustments, the Department intends to assess penalties against plans that do not achieve required VBP penetration targets beginning in SFY 2018-19. Penalties and Stimulus Adjustments will be determined based on survey data collected from plans in SFY 2017-18. The timeline for penalties is the same for MLTC and mainstream plans, although the penalty percentages will be lower for MLTC plans. Rate adjustments should be shared with providers that achieve VBP goals, and penalties may be passed on to lagging providers.

Provider Association Town Hall: The Department’s Town Hall meeting described its VBP implementation efforts, including its plans for VBP pilot and innovator programs, and VBP Education and Outreach (VEO) strategies. The presentation is available here. The Department encourages providers to review the questions on the last slide of the presentation and provide questions and comments here. The next Town Hall meeting will be held in early February.

LeadingAge NY would like to hear members' concerns, suggestions, and questions regarding the MLTC Clinical Advisory Group Report, the Managed Care Plan VBP proposals, and the VEO strategies. Please submit any comments or questions to Karen Lipson here. If you would like your comments included in the LeadingAge NY submission, please submit them by Jan. 4, 2017. 

Contact: Karen Lipson, klipson@leadingageny.org, 518-867-8383 ext. 124