STATE ACO ACTIVITIES

2019

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 began an Accountable Care Collaborative (ACC) program in 2011 designed using accountable care principles to connect all Medicaid beneficiaries to primary care.  In July 2018 the state began phase 2 of their program to expand and enhance the ACC through Regional Accountable Entities (RAEs), and coverage is now mandatory for nearly all of the state’s Medicaid beneficiaries. Although often described as an ACO program, Colorado’s ACC might best be viewed as a more generic value-based payment and quality approach. The state contracts with five RAE organizations to cover seven state-designated regions. The initial focus on primary care now includes integration of behavioral health services and primary care under RAEs, but RAEs do not currently involve coordination of specialty, ancillary or hospital care. Provider payments include incentives for quality and there is no downside risk; savings of $161 million have been attributed to the Colorado ACC program.

For Further Information

https://www.coloradohealthinstitute.org/research/ways-raes

Connecticut

Connecticut is working under a State Innovation Model (SIM) grant toward service delivery reform in the state for Medicaid and all payers, with the goal of using the ACO model to consolidate provider purchasing power. Medicaid reforms are based on a primary care medical home program.  Nearly 200,000 Medicaid beneficiaries are served in the State’s ACO program.  For additional information see:

https://portal.ct.gov/-/media/OHS/SIM/Application-and-Project-Narrative-Documents/sim_operational_plan_ay3_narrative_1-22-18_revisedfinal_submitted.pdf

Iowa

Iowa modified original plans to contract directly with ACOs and moved instead in 2016 to a managed care program for services to nearly all Medicaid beneficiaries.  The current state Medicaid managed care contractors are required to contract with ACOs, however, and these agreements must be risk-based. Payment rates are related to quality scores, and the state is investigating how to include behavioral health as well as social determinants of health measures in future contracting.  For further information:

https://dhs.iowa.gov/ime/about

https://dhs.iowa.gov/sites/default/files/IowaMedicaidTransition_for_ACOs.pdf

https://dhs.iowa.gov/ime/about/initiatives/newSIMhome/VBP

Maine

Maine has an Accountable Communities (AC) initiative that contracts with groups of providers who voluntarily participate in a Medicaid (MaineCare) shared savings program.  Begun in 2014, there are currently four pilot ACs that provide care to about 2 percent of MaineCare’s 260,000 beneficiaries. 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 savings of $4.5 million for the first year of operation. Downside risk is voluntary, but no ACs have chosen to implement downside risk. New providers have joined the AC program each year. Under a new Governor, Medicaid priorities in 2019 will involve implementing an expansion of eligibility for the program; any significant modifications to the AC program would be unlikely until after expansion is completed.

For Further Information:

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

Massachusetts

Massachusetts began a full state-wide ACO program in 2018 to serve approximately 850,000 MassHealth (Medicaid) beneficiaries. 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 and many also serve privately insured patients. 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 through contracted Community Partners, organizations that support members with complex long-term medical or behavioral needs. This is part of the 5-year, $1.8 billion Massachusetts 1115 Delivery System Reform Incentive Payment (DSRIP) waiver. Current priorities include initiating member experience surveys that will be part of ACO quality scores, improving data sharing and reporting, and maintaining operational stability. Massachusetts views this as a major state-wide activity to help drive delivery system reform in 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:

https://www.mass.gov/masshealth-innovations 

https://bluecrossmafoundation.org/publication/what-know-about-acos-introduction-masshealth-accountable-care-organizations

https://www.mass.gov/files/documents/2019/01/17/ACO%20brief%20%231.pdf?_ga=2.70895440.1787034603.1557773141-286146079.1491045752

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/request-for-comment-outcomes-based-purchasing-redesign_tcm1053-318160.pdf 

https://www.usnews.com/news/healthiest-communities/articles/2018-06-15/as-medicaid-costs-soar-states-try-a-new-approach

New Jersey

New Jersey enacted an experimental state Medicaid ACO program in 2011 and certified Medicaid ACO plans in Camden, Trenton, and Newark. These plans began operations in 2015 as demonstration programs that end in mid-2019. The program has a safety-net focus and is based in part on the Camden plan and its well-known population health program. The three demonstration ACOs have covered 120,000 people, about eight percent of the state Medicaid population. Working with existing Medicaid managed care organizations, which were not required to participate with the ACOs, presented substantial challenges and under a new Governor, the ACO demonstration will be folded into a regional health hub model. This model will expand and stress population health approaches, including care management and coordination and an emphasis on data collection and matching. Many evaluation reports of the experiment have been written by the Rutgers University Center for State Health Policy, which will also produce a final review after the completion of the pilot program.

For Further Information:

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

http://www.cshp.rutgers.edu/publications/update-on-aco-operations-and-care-management-strategies-in-the-new-jersey-medicaid-aco-demonstration-project 

http://www.cshp.rutgers.edu/publications/spending-and-utilization-indicators-in-the-new-jersey-medicaid-aco-demonstration-project

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 value-based payment and coordinated health goals, often via independent practice association (IPA) networks like those often seen in ACOs. There are many Medicaid managed care organizations affiliated with IPAs/ACOs, but they are viewed as delivery system contractors. Current state policy emphasis involves twenty-five mostly hospital-led 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. In 2019, Oregon will solicit bids for new CCO contracts (“CCO.2”) for 2020-2024, with realigned service areas based on counties.

For Further Information:

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

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

https://www.chcs.org/refining-oregons-medicaid-transformation-strategy-through-cco-2-o-a-qa-with-the-oregon-health-authority/

Rhode Island

Rhode Island has a Medicaid “Accountable Entities” (AE) program that began as a pilot in 2016. The Accountable Entities are a key enhancement of Rhode Island’s long-standing Medicaid managed care program and are viewed by the state as a reinvention of Medicaid based on value-based care principals. AEs contract with Rhode Island managed care organizations (MCOs) to deliver more cost-effective, coordinated and population-focused care. The pilot helped develop knowledge and experience before the full program started in 2018. The AE program, which serves 70 percent of Medicaid beneficiaries, is built on contracts between five AEs and the state’s MCOs. The state is moving through a staged five-year implementation plan (2018-2023) using an 1115 waiver, with infrastructure grants available to certified AEs using the federal waiver funding. The state requires MCOs and AEs to adopt a defined population health approach that includes screening, assessment and referral to community partners to address population health issues and to provide better care for complex patients. From shared savings in the first two years of implementation, AEs will progress toward full risk under future contracts. 

 For further information:

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

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

https://nashp.org/qa-how-rhode-island-tackles-social-determinants-of-health-through-its-accountable-entity-model/

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; the program 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 arrangements 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, aiming to reduce the growth of health care spending, create an integrated delivery system, and prioritize population health.  The current program, refined over the last five years, is based on the Medicare Next Gen ACO model with Vermont-specific modifications. The state began to cover Medicaid and some commercial beneficiaries under shared savings programs in 2014. Medicare beneficiaries were included in the program in 2018. Extensive payment and delivery system reform is underway and required, with a state regulatory and technical assistance system in place to oversee these efforts. 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.

For Further Information:

https://nashp.org/wp-content/uploads/2018/06/NASHP-ACO-Model-Issue-Brief-final-6_8_2018.pdf 

https://hcr.vermont.gov/legislation 

http://www.commonwealthfund.org/publications/case-studies/2018/may/onecare-vermont

 

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

MEDICAID ACOs AND SOCIAL DETERMINANTS OF HEALTH

Many of the States that organize their Medicaid programs around the ACO model for care delivery have identified social determinants of health (SDOH) as a critical problem. ACOs are designed to deliver more effective and efficient care, but medical care is one of many factors affecting health outcomes. Thus, these states are requiring or encouraging ACOs to address social determinants such as living environment and nutrition, often through partnerships with community service organizations. Massachusetts, Oregon, Minnesota, Rhode Island, and others are experimenting with a variety of measures of SDOH within their Medicaid ACO programs. For further information, see:

https://www.healthaffairs.org/doi/abs/10.1377/hlthaff.2018.05171

https://www.chcs.org/addressing-social-determinants-health-medicaid-accountable-care-organizations/

https://www.chcs.org/prioritizing-social-determinants-health-medicaid-aco-programs-conversation-two-pioneering-states/

https://www.chcs.org/resource/history-evolution-future-medicaid-accountable-care-organizations/

[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