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States’ surging role in healthcare-payment reform

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Readers would do well to read this Hospitals and Health Networks article by Ian Morrison about the states’ expanding role  in healthcare reform. He focuses on the fact that more  and more states, with huge purchasing power, are consolidating their purchasing  activities and coordinating with private players.

“Increasingly, states including Washington and Arkansas are using this combined purchasing power to transform the healthcare marketplace and coordinate their payment reform efforts with private purchasers. Public purchasers (acting in concert with willing private purchasers) can have a powerful influence on healthcare transformation.”

He writes that the states will:

  • “Drive value-based purchasing across the community, starting with the state as ‘first mover.”’
  • “Improve health overall by building healthy communities and people through prevention and early mitigation of disease throughout the life course.
  • “Improve chronic illness care through better integration of care and social supports, particularly for individuals with physical and behavioral ‘co-morbidities.”’

Mr. Morrison cites Washington State’s Health Care Innovation Plan, which we at Cambridge Management Group are very familiar with because of our ongoing work in Oregon and Washington State.

In that plan, “foundational building blocks” include, he notes, “robust quality and price transparency, activated and engaged individuals and families, regionalized transformation efforts, accountable communities of health, leveraged state data capabilities, practice transformation support, and increased workforce capacity and flexibility.”



Other examples in his piece include:


  • “Arkansas has initiated multi-payer-based episodic payment initiatives and patient-centered medical home programs.
  • “Minnesota’s multi-payer payment and delivery system reform strategy primarily is tied to spreading an ACO concept (the Minnesota Accountable Health Model framework) among Medicare, Medicaid, commercial payers and self-funded populations in the state.
  • “Oregon’s recent multi-payer efforts center on spreading the coordinated care organization model {like ACOs} introduced into the state Medicaid program in 2012.
  • “Vermont is at the forefront of state efforts to reform its health insurance payment and delivery system, and continues to actively test value-based payment approaches with multiple public and private payers.”

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