Never has Medicaid been in such a state of flux, with dozens of new policies evolving in the states in response to delivery and financing challenges, as millions more Americans join the program.
From ACOs to home- and community-based long-term care, states are adopting a wide variety of reforms and experimental policies while designing future changes under waivers with the Centers for Medicare & Medicaid Services, with the goal of sustainably managing the program.
"These changes represent some of the most significant to Medicaid since its enactment in 1965, and taken together, are transforming the role of Medicaid in the health care system in each state," Kaiser Family Foundation researchers wrote in a recent report.
This year the country as a whole is spending more than $400 billion on Medicaid coverage and up to 16 million new enrollees are expected by the end of the decade. Within that same time frame, up to half of all Medicaid spending could be through capitated payments that more broadly share financial risk beyond the federal government, CMS Deputy Administrator Cindy Mann said at a recent conference.
The challenge for states and the federal government is making Medicaid work for more people, and more diverse populations -- it's not just "adults with children" that are eligible, as Mann said.
Among the new Medicaid population will be parents of children currently covered by Medicaid, women previously covered by Medicaid during pregnancy, childless adults who may be earning just above minimum wage, 40-and 50-year-olds struggling to find long-term or salaried employment, and people with disabilities that don't yet qualify for federal disability benefits.
All of which leaves states that want to expand eligibility under the Affordable Care Act (and even some that don't) turning to alternative payment and delivery models, in certain states carving out monies from some areas and redirecting them elsewhere.
California is also one of eight states incorporating accountable care policies into Medicaid, with a demonstration currently in San Mateo County, a part of Silicon Valley where an estimated 50,000 people live at the poverty level.
Colorado, Iowa, Minnesota, Oregon and South Carolina, among others, are adopting accountable care Medicaid policies mostly in pilot programs.
Under a federal waiver, Iowa is rolling out the Iowa Wellness Plan, blending managed and accountable care coverage for beneficiaries earning up to 100 percent of the federal poverty level, and offering subsidized private health plans for those earning between 100 percent and 133 percent of the federal poverty level, much as Arkansas is doing.
In Oregon, about 90 percent of Medicaid beneficiaries are receiving care through regional Coordinated Care Organizations made up of local providers, support organizations and care managers, and overseen by the Oregon Health Authority. The OHA requires all of the 15 CCOs to manage care through patient-centered medical home models, with recognized PCMHs getting extra reimbursement at the same time that target performances are included in contracts.
The goal in Oregon is among the most ambitious: reducing the growth in Medicaid spending by 2 percentage points per member over the next two years.
Colorado introduced accountable care to Medicaid in 2011, with a variation on the the patient-centered medical home model and about 20 percent of the state's Medicaid population enrolled through the first year.
The Colorado Department of Health Care Policy and Financing describes the program's use of data and analytics for care management and benchmarking as "unprecedented." The seven regional collaborative care organizations work with primary care providers to support care coordination and to gather certain quality information, while a data and analytics contractor reports on performance to the state.
The state reimburses primary providers with fee-for-service, pays a monthly per-member fee for home services and pays the RCCOs a monthly-per member fee, along with quality-based incentive payments.
Early results appear promising. In the first year, the program saw reduced ER rates, hospital readmissions and high-cost imaging services, with at least $9 million in overall savings and $3 million going back to state and federal coffers, according to the Colorado Department of Health Care Policy and Financing.
Other states are looking at accountable care for Medicaid, too, even if they're not expanding eligibility. In Alabama, a law passed recently would transition Medicaid to a system of Regional Care Organizations by October 2016.