Delaware Moves Medicaid Managed Care Contracts to Value-Based Purchasing

Topics: Managed CAre,

Delaware Department of Health and Social Services (DHSS), which includes the Developmental Disabilities Services Division (DDS), announced entrance into a value-based purchasing care initiative through contracts in its Medicaid Managed Care Program, which applies to all managed care organizations participating in the Delaware Medicaid program.

 According to a recent news release, Secretary Walker said “beyond accelerating reforms, the purpose of the agreement is to transition the system away from traditional fee-for-service, volume-based care, to a system that focuses on rewarding and incentivizing improved patient outcomes, value, quality improvements and reduced expenditures.” “DHSS seeks to align the incentives of the managed care organizations, providers and members through innovative value-based strategies.”

 "Through this historic initiative, we will reward our Medicaid managed care partners for embracing innovation and for providing our clients with high-quality care that focuses on improved outcomes and reduced expenditures," Secretary Walker said. "Rather than paying solely for volume of care - hospital stays, tests and procedures, regardless of outcomes - we will pay for achieving optimal health for those receiving and give our MCO partners flexibility in meeting that goal."

Steve Groff, director of DHSS' Division of Medicaid and Medical Assistance (DMMA) said the initiative has a two-part approach: quality performance measures and value-based purchasing strategies. Through quality performance measures, Medicaid will select measures that relate to the following: quality, access, utilization, long-term services and supports, provider participation, spending and/or member/provider satisfaction, Groff said. Key measures build on the Common Scorecard created in collaboration with the Statewide Innovation Model (SIM) Award and through the Delaware Center for Health Innovation's work. In the three years of this contract, seven key measures will be monitored including management of diabetes cases, asthma management, cervical cancer screening, breast cancer screening, obesity management, timeliness of prenatal care and 30-day hospital readmission rates.

These measures also will be tied to desired performance levels, with potential penalties being imposed if performance levels are not achieved. Through the value-based purchasing strategies, the managed care organizations will be required to implement provider payment and contracting strategies that promote value over volume and reach minimum payment threshold levels. If minimum threshold levels are not met, potential penalties could be imposed. The changes are subject to approval by the Centers for Medicare and Medicaid Services.