STATE ACO ACTIVITIES

January 2018

Background: Many ACOs may be interested in working with state Medicaid programs in accountable care arrangements. There is considerable variability across states in regard to Medicaid payment models.  Currently only a handful of states have embraced a substantial commitment to the ACO model or a similar version of an accountable care program for their Medicaid beneficiaries.  Many others are pursuing various value-based purchasing strategies, and many rely on Medicaid Managed Care Organization (MCO) contractors to serve their beneficiaries.  Below is a working list of states where Medicare-like ACO programs have been implemented for Medicaid beneficiaries. If you do not see your state below and wish to inform us of Medicaid ACO efforts or programs in your state, please contact us at [email protected]. 

Colorado

Colorado’s Accountable Care Collaborative Program (ACC) began in 2011 and covers one million Medicaid lives (out of a state total of 1.3 million) in 2018. The program was implemented by seven statewide Regional Coordinating Care Organizations (RCCOs) that were state-contracted networks of primary care providers.  Beginning in July 2018 Regional Acountable Entities (RAEs) replace the RCCOs and will provide behavioral health care as well as primary physical health services. The Cororado program is authorized under a Medicaid state plan amendment, not an 1115 waiver[1], though the state uses extra Federal funding via a State Innovation Model (SIM) grant in some areas. The focus is on primary care change and coordination; this is a Primary Care Case Management (PCCM) program with per member per month payment.There are no requirements for coordination with hospitals or other providers. Payments include incentives for quality, there is no downside risk, and savings have been attributed to the Colorado ACC program.

For Further Information:

https://www.colorado.gov/pacific/hcpf/accphase2 

Maine

Maine has an Accountable Communities (AC) initiative that contracts with groups of providers to voluntarily participate in a Medicaid (MaineCare) shared savings program.  Begun in August 2014, there are currently four pilot ACs. The state describes the ACs as similar to Medicare ACOs, with shared savings if quality benchmarks and cost reduction targets are met. The state ascribes a savings of $4.5 million for the first year of operation, August 2014-July 2015.  ACs are providing care to about 2 percent of MaineCare’s 260,000 beneficiaries. Downside risk is voluntary, but no ACs had chosen to implement downside risk by the end of 2017. New providers have joined the AC program each year.

For Further Information:

http://www.maine.gov/dhhs/oms/vbp/accountable.html 

Massachusetts

Massachusetts begins a full state-wide ACO program in March 2018 contracting with seventeen organizations for services to approximately 850,000 MassHealth (Medicaid) beneficiaries.  This follows a 2017 pilot with the six largest ACOs in the state. Massachusetts has three ACO models: an accountable care partnership plan where an MCO is integrated with or closely partnered with an ACO provider; a primary care ACO, which contracts directly with the state; and, an ACO provider organization that contracts directly with a MassHealth MCO. Most of the ACO provider organizations involved with the Medicaid program are also Medicare ACOs. This is a comprehensive restructuring of MassHealth through ACOs with shared savings and mandatory but limited up- and downside risk for all. It is primary care-based and requires extensive coordination, including with long term supports and services, behavioral health, and with other community providers of social services. This is part of the Massachusetts 1115 waiver that uses federal Delivery System Reform Incentive Payment (DSRIP) funding, including money for systematic processes linking health and social services. Massachusetts sees this as major, difficult change that will drive delivery system reform and involve private sector health care as well as Medicaid and Medicare. The initiative includes a substantial evaluation of the effects of the program.

For further information:

http://www.mass.gov/eohhs/gov/newsroom/press-releases/eohhs/masshealth-partners-with-17-health-care-organizations.html 

Minnesota

Minnesota has a large state-wide Medicaid ACO program referred to as Integrated Health Partnerships (IHP). This program is modeled after the Medicare Shared Savings Program (MSSP) but adapted for Medicaid with different services included or excluded in payments. IHP began in 2013 using Medicaid PCCM authority to contain costs and improve quality. Minnesota had a large, widespread Medicaid managed care program before the IHP. They changed the focus to move to accountable care processes with shared savings payment for physical, behavioral and pharmacy care that includes quality measurement. The IHP program reports saving over $200 million with decreased length of hospital stays and decreased use of emergency rooms. A new IHP phase beginning in 2018 requires measurement of social determinants and partnerships with community social service providers for some contractors, as well as the introduction of population based payment in some cases.  Additional enhancements are planned for 2019.

For further information:

https://mn.gov/dhs/integrated-health-partnerships/

https://mn.gov/dhs/assets/2017-ihp-rfp_tcm1053-294430.pdf

https://mn.gov/dhs/assets/request-for-comment-outcomes-based-purchasing-redesign_tcm1053-318160.pdf 

New Jersey

New Jersey enacted an experimental state Medicaid ACO program in 2011.  There are state-certified Medicaid ACO plans in Camden, Trenton, and Newark that began operations in July 2015 for three year demonstration programs; four additional ACO plans applied but were not certified. The program has a safety-net focus, with the Camden ACO plan doing well based on expanding and enhancing their well-established population health programs.  Working with existing Medicaid managed care organizations, which are not required to participate with ACOs, has presented challenges. The three demonstration ACOs cover about 120,000 people, eight percent of the state Medicaid population. New Jersey sees this as a demonstration that will be reassessed under the new Governor in the first months of 2018.  There is ongoing evaluation  of the experimental program by the Rutgers University Center for State Health Policy.

For Further Information:

http://www.nj.gov/humanservices/dmahs/info/aco.html 

New York

New York passed a Medicaid ACO statute and released regulations governing certification of these entities in 2012, but only a few of the 11 ACOs certified for Medicaid contracting became or remain operational.  Medicaid ACOs in New York are best considered within the context of the large New York federal Medicaid DSRIP 1115 waiver, which stresses population health models and is pushing MCO plans toward coordinated health goals via networks like those often seen in ACOs. There are many Medicaid managed care organizations affiliated with ACOs, but the ACOs are viewed as delivery system contractors. Current state policy emphasis involves twenty-six Performing Provider Systems (PPSs) with integration and coordination among providers in each PPS.  The PPS initiative receives extensive funding from the state’s DSRIP waiver program.

 For Further Information:

https://www.health.ny.gov/health_care/medicaid/redesign/aco/ 

Oregon

Oregon began its statewide Coordinated Care Organization (CCO) program for all Medicaid beneficiaries in 2012 using an 1115 waiver that included substantial initial Federal funding. The CCO program is patterned on Medicare ACOs and is a state-wide reform program that includes a Medicaid global budget capped at 3.4 percent growth per year and a quality pool bonus program.  The global budget places CCOs at risk for health care; sixteen regional CCOs receive per capita payments to cover the cost of their members’ physical, behavioral and oral health care. CCOs work at a local level to transform the health care delivery system and lower costs; there is extensive monitoring and reporting of quality, access, financial, and benchmarking data. Studies of the Oregon CCO program have shown substantial decreases in inpatient admissions and ED use, and the budget cap has been maintained.

For Further Information:

http://www.oregon.gov/oha/HPA/Pages/CCOs-Oregon.aspx 

https://www.healthaffairs.org/doi/10.1377/hlthaff.2016.1298 

Rhode Island

Rhode Island has a pilot program for Medicaid “Accountable Entities” (AE) that started in 2016. There are six organizations in the AE program, which is designed to develop the state’s knowledge and experience before moving to a full state certification program. Several of the designated six have not been active as of the end of 2017. The Rhode Island AE initiative is based on a 2015 report on “Reinventing Medicaid” from a work group convened by the Governor. The report describes ACOs as being the next step in Medicaid Managed Care, a theme of other states, and the AE program is actually built on contracts between AEs and MCOs. About 40 percent of Medicaid beneficiaries are currently being served in AEs, which are moving slowly through a five year 1115 waiver period toward risk-sharing arrangements. Infrastructure grants are available from the state to certified AEs using the federal 1115 funding, and the state has added a new Specialized AE pilot program to focus on development of ties to organizations that provide long term supports and services.

 For further information:

http://www.eohhs.ri.gov/Initiatives/AccountableEntities.aspx 

 http://www.eohhs.ri.gov/Portals/0/Uploads/Documents/Acc_Entitites/MedicaidAERoadmap.pdf 

Utah

Most Utah Medicaid beneficiaries who are not elderly or disabled are enrolled in state-defined Medicaid ACOs. Utah adopted this program in 2011 before the MSSP began and the current Utah Medicaid ACO approach is different than Medicare models. Utah Medicaid ACOs are described as an expanded approach to Medicaid managed care; it is tied to a statute that required the state agency to move to risk-based MCOs. The Utah Medicaid ACO program includes quality measurement but no payment withhold or downside risk. Certain ACOs have engaged in shared savings arrangemenets with some of their contracted providers. There is some movement away from calling this an “ACO” program toward referring to it as a general Medicaid value-based payment activity.

For Further Information:

https://medicaid.utah.gov/managed-care 

Vermont

Vermont is moving to a state-wide, single-payer ACO for all citizens.  The program, based on Medicare ACO models, began to cover Medicaid and some commercial beneficiaries under shared savings programs in 2014. Medicare beneficiaries are included in the program beginning in January 2018. Extensive payment and delivery system reform is underway and required. The state reported first year savings of $14 million in their Medicaid Shared Savings Program and expects continued savings from all population groups.  Vermont has been pursuing global health care coverage under an 1115 waiver for a number of years; the waiver was approved for an additional 5 years in 2016 and included the ACO-based all-payer model. Important portions of the ACO-based delivery and financing reforms were begun with a federal State Innovation Model (SIM) grant in 2013.

For Further Information:

http://healthcareinnovation.vermont.gov/sites/vhcip/files/documents/VHCIP%20Status%20Reports%20for%20April%202017.pdf 

Organizations with Expertise in Medicaid ACO Programs 

NAMD (National Association of Medicaid Directors)

http://medicaiddirectors.org/key-issues/delivery-and-payment-reform/ 

CHCS (Center for Health Care Strategies, Princeton NJ)

https://www.chcs.org/topics/medicaid-accountable-care-organizations/ 

National Academy for State Health Policy

https://nashp.org/ 

Children’s Hospital Association

https://www.childrenshospitals.org/Issues-and-Advocacy/Medicaid

[1] Section 1115 of the Social Security Act allows States to seek waivers from the existing provisions of Medicaid statute to implement demonstration, pilot, or experimental programs.  These waivers, which must be approved by the Centers for Medicare and Medicaid Services (CMS),  are sometimes accompanied by substantial federal funds.  1115 waivers have been used by many of the states that have developed ACO-like programs.  For a full description of these waivers, see https://www.medicaid.gov/medicaid/section-1115-demo/about-1115/index.html