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State experienceS DeSigning anD implementing meDicaiD
Delivery SyStem reform incentive payment (DSrip) poolS
Melanie Schoenberg, Felicia Heider, Jill Rosenthal, Claudine Schwartz and
Neva Kaye
March 2015
ConduCted on behalf of the MediCaid and ChiP PayMent and aCCess CoMMission
I I
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
table of contentS
EXECUTIVE SUMMARY 1
INTRODUCTION 3Methodology 3
FINDINGS 6Genesis 6Design of DSRIP Programs 7DSRIPDevelopmentandApprovalProcess 7ParticipatingProviders 8ProgramStructure 9StateSpotlight 9DeliverySystemReformStrategies:DSRIPProjects 10StateSpotlight 11BalancingRisksandIncentives 12StateSpotlight 12DSRIPintheContextofOtherSystemTransformationInitiatives 13Financing of State DSRIP Programs 14FundingAmounts 14RelationshipswithOtherMedicaidSupplementalPayments 15HowDSRIPFundingIsDistributed 17TotalPoolFunding 17CategoriesofFunding 17AllocatingPoolFunds 18ValuationofDSRIPImplementationPlans 18UnclaimedFunding 19PaymentMechanics 19RoleofNon-FederalShare 20DSRIP Measurement and Monitoring 22MeasuringImprovement 22MilestonesandMetrics 23ImprovementPopulation 24ImprovementMethodology 25ReportingAchievement 26DSRIPReportingRequirements 26DataInfrastructure 26DataCollectionandValidation 27UsingDatatoDriveImprovement 27MonitoringandAssessment 28EvaluationofDSRIPPrograms 28
KEY TAKEAWAYS 30
CONCLUSION 34
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
execUtive SUmmary
S ince2010,eightstates(California,Kansas,Massachusetts,NewJersey,NewMexico,NewYork,Oregon,andTexas),havenegotiatedwiththefederalgovernmenttoimplementDeliverySystemReformIncentivePayment(DSRIP)or“DSRIP-like”programs.TheseprogramsareacomponentofSection
1115demonstrationsthatincentivizessystemtransformationandqualityimprovementsinhospitalsandotherprovidersservinghighvolumesoflow-incomepatients.DSRIPsaimtomeetstrategicgoals,basedontheTripleAim1principlesofbettercare,improvedhealth,andlowercostsbyincentivizingreformsthattransitionawayfromepisodictreatmentofdiseasetowardpreventionandmanagementofhealthandwellnessamongpatientpopulations.DSRIPprogramsrestructurehistoricMedicaidsupplementalpaymentfundingthatprovideshospitals2withcriticalfinancialsupporttocareforunderservedpatientsintoapay-for-performancestructureinwhichhospitalsandotherprovidersarerewardedforachievingspecifieddeliverysystemreformmetrics.DSRIPandDSRIP-likeprograms—worthuptoacombined$3.6billioninfederalfunds($6.7billionstateandfederal)infiscalyear2015—providestateswithauniqueopportunitytoredesignMedicaiddeliverysystemswithinthecontextofstate-specificneedsandgoals.
Thisreportprovidesanin-depthcross-stateanalysisofcurrentDSRIPandDSRIP-likeprograms.Itdescribesimplementationexperiencesfromthefederal,state,andproviderperspectives.
WhileDSRIPsarestillintheirinfancy,thisexaminationofDSRIPandDSRIP-likestateprogramshasrevealedseveraltakeaways:
• DSRIPsignalsashiftinMedicaidfinancingtowardgreateraccountabilityassupplementalpaymentsoriginallyintendedtomakeupforMedicaidpaymentshortfallsshifttoincentive-basedpayments.AlthoughtheCentersforMedicare&MedicaidServices(CMS)describesDSRIPasatoolintendedtoassiststatesintransformingtheirdeliverysystemstofundamentallyimprovecareforbeneficiaries,stateshavebeencandidthatDSRIPprogramshavebeenpursuedasameanstopreservesupplementalfunding.Keyfinancingquestionspersist,includingtheuseofDSRIPtomakepaymentsthatexceedpriorsupplementalpaymentsandstates’abilitytocomeupwiththenon-federalshareofDSRIPincentivepayments.
• Thougheachstateprogramisintentionallyunique,DSRIPscontinuetoevolvetowardbeingmorestandardized,increasingaccountabilitybyincorporatingmoreoutcomes-basedpayments,andoperatingthroughcommunitypartnerships.Whilerespectinglocalflexibilityandinnovationforprojectstoachieveimprovements,DSRIPsmustbeabletodemonstrateoutcomesandensureaccountabilityforallocatedfunding.
• DSRIPsarebeingdesignedtosupportbroaderdeliverysystemreforms,yetquestionsremainregardingDSRIP’slifespananditslinkagetootherMedicaidfinancingstrategies.AccordingtoCMS,whileDSRIPscanprovidecriticalsupport,theyarenotintendedtobealong-termsolutionforMedicaidunder-reimbursement,noraretheyintendedtobethesolefundingsourceforsystemtransformationoverthelong-term.
• WhilelackingcomprehensiveDSRIPevaluationdata,therearemultipleexamplesofqualityimprovementandcaredeliveryredesignactivitiesimplementedasaresultofDSRIP.Statesandprovidersnoteanecdotallythatastheyfocusondrivinginnovation,notallimprovementscanbecapturedbyDSRIPmetrics(e.g.culturaltransformation),yetCMSisincreasinglyfocusedon
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
2
standardizingmetricsinareaswherethereisstrongevidence.
• Providers,states,andthefederalgovernmentmustspendsignificanttimetolaunchDSRIPprograms;asaresult,afive-yeartransformationprojectmayinrealitybeonlythreetofouryears.Additionally,mostDSRIPsrequiresignificantresourcesforadministrationandimplementation.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
introDUction
A tatimeofsweepingnationalhealthcarereforms,stateshaveanumberofopportunitiestostrengthenthesystemsprovidingcaretolow-incomepatientpopulations.Ofthenumerousinitiativesstatesarepursuing,DeliverySystemReformIncentivePayment(DSRIP)programsare
amorerecentmechanismtoincentivizesystemtransformationandqualityimprovementsinhospitalsandotherprovidersthatservehighvolumesoflow-incomepatients.OperatingundertheauthorityofSection1115demonstrationwaivers,DSRIPprogramsprovidestateswithauniqueopportunitytoredesigndeliverysystemsandincreasecapacityforpopulationhealthmanagementwithinthecontextofstateneedsandgoals.
ThisreportaimstoelucidatethepotentialroleofDSRIPprogramsintheMedicaiddeliverysystembyprovidinganin-depthcross-stateanalysisofcurrentDSRIP(andDSRIP-like)programs,anddescribingimplementationexperiencesfromthefederal,state,andproviderperspectives.
ThisreportfocusesonsixcurrentDSRIPandtwo“DSRIP-like”programs;allprovidefundingcontingentuponprovidersachievingspecificmetricstiedtoareassuchasprogramplanning,deliverysystemreformstrategies,reporting,andresults.3SixDSRIPs(California,Kansas,Massachusetts,NewJersey,NewYork,andTexas)aimtoaccomplishsystemreformthroughtheuseof“projects.”Thoughtheyvarydependingoneachstate’sDSRIPdesign,projectsareinitiativesthatgenerallyfocusoninfrastructuredevelopmentandredesignofcareprocesses.Thisreportalsoexamines“DSRIP-like”programsinNewMexicoandOregon.Whiletheseprogramsresemblethoseoftheotherstates,theyarelesscomprehensiveanddonotincludefundingforprojects.Alleightprogramsprovidefundingafterprovidersmeetreportingandbenchmarkrequirementsonclinicaloutcomemeasures.
Thisreportistheproductofa10-monthprojectconductedbytheNationalAcademyforStateHealthPolicy(NASHP)undercontractwiththeMedicaidandCHIPPaymentandAccessCommission(MACPAC).ThegoalofthisprojectwastoshedlightonDSRIPsbydocumentingandanalyzingtheirvarietyandcommonfeatures,andunderstandingtheirroleintheMedicaiddeliverysystem.Specifically,thisprojectaimedtoprovideacomprehensivereviewofallexistingDSRIPs,andtoprovideanin-depthexaminationoftheirgenesis,goals,andfunctioninginthreestatestoexplainvariousapproachesandhelpinformtheworkofMACPAC.NASHPsoughttogainabetterunderstandingoffundamentalissuesandquestionssurroundingDSRIPs,suchas:thekeyfeaturesofeachstate’sDSRIPapproach,theactivitiesandmilestonesrequiredtoimplementtheprograms,howprogramsoperate,thestatusofDSRIPimplementationandresultstodate,programevaluationmethods,andthedifferencesandcommonalitiesamongstateDSRIPprograms.
MethodologyAspartoftheprojectthatinformedthisreport,NASHPconductedanenvironmentalscanofeightstateDSRIPandDSRIP-likeprogramsandcompiledtopicsforcomparison,including:stategoalsandDSRIPcategories,participatingproviders,financingmechanisms,providerprojects,clinicaloutcomes,programreportingandmonitoring,andoutputstodate.Theprimarydocumentsusedtoinformthescanwerewaiverapprovaldocuments,specificallythespecialtermsandconditions.Additionally,NASHPreviewedDSRIPprogramprotocols,stateDSRIPmasterplans,providerDSRIPplans/applications,stateannualDSRIPaggregatereports,andothersupportingstateandfederaldocumentsanddatathatdescribebasicinformationabouteachstate’sDSRIPprogram.Uponcompletionoftheenvironmentalscan,NASHP
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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compiledsevenstatefactsheetsthatcondensedinformationcollectedfromthescaninadigestibleformatandsentthesefactsheetstostatesforreview.4
Followingtheenvironmentalscan,NASHPconductedkeyinformantinterviewswithstateandfederalDSRIPstakeholderstoverifymaterialcollectedinthescanandgatheradditionalinformationthatcouldnotbeobtainedfromthescan,suchasstateexperienceswithDSRIPimplementationandlessonslearned.NASHPinterviewedkeyDSRIPprogramleadersintheMedicaidofficesinNewYork,NewMexico,Oregon,andMassachusetts.
Finally,NASHPvisitedDSRIPsitesinCalifornia,NewJersey,andTexas.NASHPworkedwithMACPACtoidentifyaconceptualframeworkforthesitevisitsanddecidedtoselectstatesatvariousstagesofdevelopmentandimplementationtoidentifynewandemergingissuesalongwithpastexperiences.Thesethreestatesmettheselectioncriteria;Californiaisinthefinalyearofitsprogram,Texasismid-waythroughimplementation,andNewJersey’sprogramisfairlyrecentwithprojectimplementationhavingbegunattheendof2014.Inadditiontothesestatesbeingatdifferentstagesofimplementation,theprogramsvaryconsiderablyonkeyfeaturessuchasmaximumpoolfunding,participatingproviders,projects,andfinancing.Thesedistinguishingcharacteristicsallowedforin-depthcomparisonandanalysisofDSRIPprogramsandprovidedinsightintotheroleofDSRIPprogramsintheMedicaiddeliverysystem.Aspartofthesesitevisits,theprojectteammetwithstatehealthdepartmentsandMedicaidagencies,hospitalassociationsandDSRIP-participatinghospitalexecutive,clinical,andfinancialrepresentatives.InCalifornia,theteamalsotouredafacilityheavilyimpactedbyDSRIPfundingandinitiatives.
Table1providesbasicinformationabouteachstateDSRIPprogram,includingprogramname,stageofimplementation,andlength.Formoreinformationabouteachstate’sDSRIPprogram,AppendixAincludesafactsheetoneachstate,includinginformationaboutparticipatingproviders,financing,monitoring,andoutcomes.AlltablesandfactsheetslistDSRIPprogramsinchronologicalorderofwaiverapprovaltoillustratehowprogramshaveevolved.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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table 1: dsRiP Key featuRes
State Program Name Program Length
Stage of Implementation
Date Approved
Date
Expires
CaliforniaDeliverySystemReformInventivePayment(DSRIP)Pool
5years DSRIPYear5 11/1/2010 10/31/2015
TexasDeliverySystemReformIncentivePayment(DSRIP)Pool
5years DSRIPYear4 12/12/2011 9/30/2016
MassachusettsDeliverySystemTransformationInitiative(DSTI)
6years5 DSTIRenewalYear1 12/22/2011 6/30/2014
New MexicoHospitalQualityImprovementIncentive(HQII)Program
5years HQIIYear1(planningonly) 9/04/2012 12/31/2018
New JerseyDeliverySystemReformIncentivePayment(DSRIP)Pool
5years DSRIPYear3 10/2/2012 6/30/2017
KansasDeliverySystemReformIncentivePayment(DSRIP)Pool
3years DSRIPYear1 12/27/2012 12/31/2017
New YorkDeliverySystemReformIncentivePayment(DSRIP)Pool
6years DSRIPYear1(planningonly) 4/14/2014 12/31/2019
OregonHospitalTransformationPerformanceProgram(HTPP)
2years HTPPYear1 6/27/2014 6/30/2016
Note: Forthepurposesofcross-stateanalysis,thefirstyearofeachDSRIPprojectisdescribedasDSRIPYear1,thoughstatesmaydescribeplanningyearsorgeneraldemonstrationyearsdifferently.TheinformationinthistableistrueasofMarch2015.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
finDingS
genesisHistorically,stateshaveusedflexibilityintheMedicaidprogramtoprovidesupplementalpaymentstoprovidersthatensureaccesstohealthcareforvulnerablepopulations.Asamajorpayer,Medicaidisacoresourceoffinancingforsafetynethospitalsservinglow-incomecommunities,includingmanyoftheuninsured.Federalpaymentpoliciesallowstatestoclaimsupplementalfederalmatchingpaymentstohospitals(UpperPaymentLimit,orUPL),setattheamountthattheFederalMedicareprogrampaysforservices.
In2010,California’sdesignatedpublichospitalsystems6partneredwiththeMedicaidagencytoproposethattheirwaiverrenewalincludeincreasedsupplementalpaymentsasamechanismtostabilizepublichospitalsgivenfinancingchangesin2005thatreducedmuchoftheirfunding.7TheCentersforMedicare&MedicaidServices(CMS)expressedinterestinprovidingcomparablefundinglevelsasproposedtothepublichospitalsinCalifornia,butnotthroughatypicalsupplementalpaymentprogramdisconnectedfromqualityofcare.Inthecontextofanationalhealthreformdebate,CMSandCaliforniaagreedtoanewfundingsourceforpublichospitalsthatwaslinkedtobettercare,improvedhealth,andlowercosts.BasedontheframeworkputforthbyCMS,California’spublichospitalsproposedthefirsteverDSRIPprogrambuildingontheirdecade-longexperienceswithqualityimprovementprograms.Thegeneralconstructoftheprogramwasshapedthrougheightmonthsofnegotiationsbetweenthepublichospitals,CMSandthestate.TheCaliforniaDSRIPwasconsideredaspartofa“bridgetoreform”asthesafetynetwastransitioningandtransformingintoacoordinatedsystem.
SincetheCaliforniaexperience,DSRIPscontinuetoevolve.AccordingtoCMS,DSRIPsareintendedfirstandforemosttodrivedeliverysystemreformandholdthesystemaccountableforfundamentallyimprovingcareforbeneficiaries.DSRIPprogramstendtofocusonprovidingbettercareintheoutpatient,ambulatorycare,andcommunity-basedsettingsinordertoavoidtheneedforanduseofhospitalinpatientservices.Theyaregearedtowardincreasingcapacityinthesesettings,redesigningservicesaroundpopulationhealthmanagement,integratingservices,andincreasingcommunicationamongprovidersinvarioushealthcaresettings.However,exceptinthecaseofacoupleofstates,statesinterviewedspokeofDSRIPasamechanismtopreservefundingforthesafetynetwhilesimultaneouslyprovidingperformance-basedpayments.
StateinterestinaDSRIPoftenoriginatesfromatransitiontoMedicaidmanagedcare.ManystateMedicaidprograms,recognizingunsustainablecosts,havepursuedmanagedcareasanopportunitytoimprovecareandcontrolcosts.Morethanhalfofthenation’s67.9millionMedicaidbeneficiariesnowreceivetheirhealthcareincomprehensivemanagedcareorganizations(MCOs)–andthenumberandsharearegrowing.8However,UPLpayments,whicharecalculatedbasedonthevolumeoffee-for-servicecareprovided,areprohibitedbyfederalregulationsundercapitatedMedicaidmanagedcarearrangementsbecausefederalregulationsrequiremanagedcareratestoaccountforthefullcostofservicesunderamanagedcarecontract.9AsstatesshiftMedicaidfinancingtocapitatedmanagedcarecontracting,theyfacechallengesinmaintainingtheirhistoricUPLsupportforsafetynetproviders.10Forinstance,Texasfacedtheprospectoflosingapproximately$3billioninUPLthatwaspaidtohospitalsin2011.DSRIPallowsstatestorepurposethatmoneyintoapoolofincentive-basedpaymentswhilesimultaneouslyexpandingMedicaidmanagedcare.
Indiscussionswithstates,itbecameclearthatmaintainingsupplementalfundingwasacriticaldriverinmoststates’decisionstoimplementaDSRIP.11Insomestates,safetynethospitals,whichoftenhave
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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limitedaccesstocapitalandrisklosingoutinpaymentmethodsthatrewardresultsdueinparttoacomplexpatientmix,arerecognizingthatDSRIPsareatooltofundtheclinicalandfinancialinvestmentsnecessarytoreorientcaretowardachievingpopulationhealthgoalsforlow-incomepatients.
design of dsRiP PRogRaMsAllstateDSRIPprogramsarebasedonthestrategicgoalsofbettercare,improvedhealth,andlowercosts.DSRIPprogramfundingisearnedbyqualifyingorganizationsthatdemonstrateimprovementsinhealthcarethroughreformsthattransitionawayfromtheepisodictreatmentofdiseasetopreventionandmanagementofhealthandwellnessamongthepopulationsofpatientsforwhichtheorganizationsaretakingincreasedresponsibility.DSRIPprogramsaredesignedtocatalyzedeliverysystemtransformationbyprovidingincentivepaymentsifandafterparticipatingprovidersachievemilestonesofimprovement.EachstateuniquelyadaptsthisframeworktoitsspecificMedicaidprogramneeds,asnegotiatedbetweenthestateandCMS.
DSRIPprogramssharecommondesigncharacteristics,butvaryinmanyways.Thissectionprovidesacross-stateanalysisofDSRIPprograms’participatingprovidersandprogramstructures.ItdescribestheDSRIPdevelopmentprocess,thetypesofstrategiesthatDSRIPenablesinstates,thebalanceofriskandpaymentforstatesandproviders,andalignmentofDSRIPprogramswithotherstatequalityimprovementanddeliveryreforminitiatives.
DSRIP Development and Approval ProcessDSRIPsareanelementofSection1115demonstrations.Section1115demonstrationwaiversgivestatesflexibilitytodemonstrateandevaluatepolicyapproacheswithintheirMedicaidandCHIPprogramstoexpandeligibility,provideservicesnottypicallycoveredbyMedicaid,anddevelopinnovativeservicedeliverysystems.ThesewaiversareapprovedbyCMSfornomorethanafive-yearperiod,althoughtheycanberenewed.Demonstrationsmustbe“budgetneutral”totheFederalgovernment,meaningthatFederalMedicaidexpenditureswillnotbemorethanFederalspendingwouldhavebeenwithoutthewaiver.12ThesedemonstrationsrequirestatestoworkcloselywithCMSthroughoutthedurationoftheprogramgiventhecomplexityofdesigningbroadsystemtransformationandtheneedforaccountabilityforinvestmentsofbillionsofdollarsthatarespecifictoeachstate.
Thespecialtermsandconditionsineachstate’swaiveroutlinekeydesignelementsforDSRIPprogramsandprovideaconceptualframework.Formoststates,oncethespecialtermsandconditionshavebeenapproved,statesarerequiredtodevelopstateprotocolsormasterplansthatprovidedetailsonprogramimplementationsuchasamethodologyfordistributingfunds,specificprojectmetrics,reportingrequirements,andanimplementationtimeline.AllstateprotocolsmustreceivefinalapprovalfromCMS;theyserveasanimportantguideforproviderstodevelopprovider-specificDSRIPprojectplans.DSRIPprojectplansarticulateascheduleofwhataprovidermustachieveandreporttobeeligiblefortheassociatedincentivepayments,andmustdemonstratehowselectedprojectsmeettheneedsofthecommunitiestheyserve.Importantly,thestateprotocolnegotiationprocesstypicallyoccursafterthedemonstrationhasbegun;negotiationswithCMStypicallylastforaboutninemonthstooveroneyear.Asaresult,theprotocolapprovalprocesshasbeenshowntotruncatetimelinesforDSRIPprojectimplementationandhaspresentedmultiplechallengestoproviderswhomustbeginprojectspriortofinalapprovalofstateprotocols.Forexample,asofMarch2015,Massachusettsisintheeighthmonthofitsthree-yearDSTIrenewal,yetitsDSTIprojectplanhasyettobeapprovedbyCMS.Thislagcontributes
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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toafeelingamongDSRIPprovidersthattheyare“buildingtheplanewhileflyingit,”althoughCMSnotesattemptstomitigatethisproblem,withNewYorkasanexampleofprotocolssignedatsametimeasSTCs.
Figure 1: DSRIP Waiver and Protocol Approval Process
Participating ProvidersMoststateDSRIPsfocusdeliverysystemtransformationandqualityimprovementeffortsonhospitals,particularlypublichospitalsandtheirhealthsystemsandothersafetynethospitals.13Duetoprogramscopeandprovidereligibilityrequirementsineachstate,thenumberofparticipatingprovidersvariesgreatlyacrossstateswithapprovedDSRIPs,fromtwoinKansasto309inTexas.14SixstateswithapprovedDSRIPsorDSRIP-likeprograms(California,Kansas,Massachusetts,NewJersey,NewMexico,andOregon)specifywhichprovidersinthestateareeligibletoparticipateintheprogramandreceiveincentivepayments.Inthesestates,DSRIPprogramslimitparticipationtohospitalproviders,andmostoftenhospitalsmustservehighvolumesofMedicaidanduninsuredpatients.
DSRIPprogramsinNewYorkandTexasrequireproviderstoformregionalcoalitions.Majorpublichospitalsorothereligiblesafetynetprovidersgenerallyleadtheseregionalcoalitions;additionalparticipatingproviderscanincludecommunity-basedorganizations,localhealthdepartments,communitymentalhealthcenters,andphysicianpracticesassociatedwithacademicmedicalcenters.NewYork’sPerformingProviderSystems(PPSs)mustcollectivelyimplementDSRIPprojectswhereasTexas’RegionalHealthcarePartnerships(RHPs)arecomprisedofperformingproviderswhoareindividuallyresponsibleforprojects.15IninterviewsinbothNewYorkandTexas,stateofficialsemphasizedtheneedforcollaborationamongmultipletypesofproviders,includingthosebasedoutsideofhospitalinpatientsettings,inordertoachievethelevelofsystemchangethestateshopetoaccomplish.InNewYorkspecifically,thestatewouldliketoconsiderbuildingontheregionalPPSstructureestablishedunderDSRIPtoestablishMedicaidaccountablecareorganizations(ACOs)inthefuture.
BeyondtheexplicitregionalpartnershipstructureinNewYorkandTexas,collaborationisstronglyencouragedinNewJersey’sDSRIP.FormanyCaliforniaandMassachusettsprojects,successfulprojectimplementationiscontingentuponsomesortofcollaboration.Ininterviews,hospital-basedprovidersinNewJerseystressedtheimportanceofparticipationbyabroadrangeofproviders,butacknowledgeddifficultiesinengagingprojectpartnersinDSRIPactivitiesduetoalackofappropriateresourcesora
“We wanted to create healthier communities and it wouldn’t work if hospitals, primary care
doctors, clinics, social services, etc. weren’t all focused in the same direction on the same
quality measures.” -NewYorkStateMedicaidOfficial
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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requirementfortheirparticipation.CMSnotesthattheemphasisonbuildingsystemcapacityiscriticaltobroaddeliverysystemreformbutstatesneedtofindthebestwaytobuildtheregionalandorganizationalframeworktomakespecificreformsworktoimprovecareforbeneficiaries.
Program StructureThestructureofDSRIPprogramsvariesbystateduetouniquestatehealthdeliverysystemgoals.DSRIPprograms(California,Kansas,Massachusetts,NewJersey,NewYork,andTexas)provideincentivepaymentsformeetingmilestonesonbothsystemreformprojectsandoutcomemeasures,whileDSRIP-likeprogramsinNewMexicoandOregondonotincludeprojectsandonlypayprovidersformeetingmilestonesonoutcomemeasures.Instatesthatincludeprojects,DSRIPprogramsaregenerallystructuredaroundfourcategoriesoffundingwhichparticipatingprovidersthenusetoproposeprovider-specificDSRIPplans.
Forthepurposesofcross-stateanalysis,thisreportcharacterizestheDSRIPprogramstructureasthefollowing:
1. Program Planning: Moststatesallowaninitialperiodforparticipatingproviderstoselecttheirdeliverysystemreformprojectsaspartofplanningeffortspriortothestartoftheprojects.Duringthistime,theprovidersdesign,submitandreceiveapprovalfortheirspecificDSRIPprojectplans.AcrucialelementofthisplanningperiodincludesconductingacommunityhealthneedsassessmentasthebasisfortheDSRIPplan.
2. Delivery System Reform Strategies: Asdescribedfurtherbelow,participatingprovidersselectprojectstotransformhowcareisdelivered;mostoftheseprojectsarefocusedonincreasingandimprovingcareinoutpatientsettings,reducinghospitalinpatientuse,andbuildingstronglinkagesbetweenprovidersbothwithinandamonghospitalsystems.TheseprojectsarethefocusoftheearlyyearsoftheDSRIPprogramandgenerallyfallintooneoftwocategories:
A. Infrastructure development:Generalareasofactivitiesincludeimprovingaccesstoprimaryandspecialtycareandincreasinghealthmanagementtechnologyfunctionalities.Examplesofspecificinfrastructuredevelopmentprojectsincludebuildingnewclinics,hiringnewstaff,trainingworkforce,implementingtelehealthstrategies,anddevelopingdiseaseregistries.
B. Redesign of care processes:Theseprojectstypicallyfocusmoreontransformingthedeliveryofcareandincludeactivitiessuchasimplementingtheprimarycaremedicalhomemodelandchronic
state sPotlightTexas: Increasing Access to Care through Strong
Community Partnerships
Texas’Section1115demonstrationacceleratedtheimplementationofanewpartnershipbetweentheTravisCountyHealthcareDistrictandtheSetonHealthcareFamily.Afterworkingtogetherformanyyearstoprovideaccesstocaretothecounty’sindigent,theorganizationslaunchedtheCommunityCareCollaborative(CCC)tocreateanintegrateddeliverysystem,knittingtogetherhospitalcareandthecounty’sclinicalsystemstoprovideaseamlesssystemofcareforthepatient.TheCCChasimplemented15DSRIPprojectstotransformthesafetynetcaresystemandprovideabettercareexperienceatlowercosttoimprovethehealthoftheuninsuredpatientpopulation.OneoftheseDSRIPsystemtransformationsistheprovisionofhealthscreeningsandprimarycarethroughMobileHealthTeams.Themobileunitprovidescareatchurchsitesandfoodpantries,andrecentlylaunchedaStreetMedicineteamtoreachhomelesspatients.16
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caremodel,integratingphysicalandbehavioralhealthcare,improvingcaretransitionsfrominpatienttoambulatorycaresettings,andusinghealthnavigationtoreducehospital/emergencydepartmentuse.
3. Reporting: DSRIPspushparticipatingproviderstobeabletoreportonpopulation-focusedmeasures.Reportingtendstobephasedinthroughouttheprogram.
4. Results:DSRIPsrequireparticipatingproviderstoachievequalityimprovementsinclinicaloutcomestiedtotheirDSRIPprojects.DSRIPsemphasizetheneedtoachievesuchresultsbytheendoftheprogram.MorerecentDSRIPprogramsemphasizetheimportanceofsustainabilityafterimprovementsareachieved.
figuRe 2: dsRiP PRogRaM stRuCtuRe
F unding C ategor ies
I mprovement A ctivities
I mprovement M easur es
Progr am Planning Deliver y System R efor m
R epor ting
R esults
• Design DSRIP Implementation Plan
• Outpatient capacity/ access
• “System-ness” • Population health
management • Clinical quality • Prevention • Chronic care
• Population health • Processes of care • Patient
experience • Potentially
preventable events
• Clinical outcomes
• Processes of care • Access • Patient
experience • Potentially
preventable events
• Clinic outcomes
Approved DSRIP Implementation Plan
Implementation milestones of progress
on projects
Pay-for-reporting of standard national
metrics
Pay-for-performance on standard national
metrics
Usingthisgeneralstructure,statescantailordomainsandtheactivitiesandmeasureswithinthemtobestmeettheiruniqueneedsandgoals.Forexample,CaliforniaallowsforHIVtransitionprojectsandMassachusettsincludesprojectsdesignedtohelpprovidersprepareforthestatewidetransitiontovalue-basedpurchasing.17
Delivery System Reform Strategies: DSRIP Projects
Asdiscussedabove,DSRIPprogramsallowforparticipatingproviderstoobtainMedicaidfundingforchanginghowcareisdeliveredthroughspecifieddeliverysystemreformstrategies.ThesestrategiesareimplementedthroughDSRIPprojectsthattendtoimproveinfrastructureandredesigncaredeliverysothatpatientscanstayhealthyandoutofthehospital.Someprojectshelptoimproveaccesstoprimarycareandotherambulatorycareservices,andtobetter
Common DSRIP Projects:• Expandaccesstoprimary
care• Integratephysicaland
behavioralhealth• Improvecaretransitionsfrom
hospitaltoambulatorycaresettings
• Enablechronicdiseasemanagement
• Usetelemedicine
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enabledeliveryofthoseservicesfromapopulationhealthmanagementperspective.Otherprojectsusemodelsintendedtodeliverpreventivecaretocohortsofpatients(suchaspatientswithdiabetes),usingtechniquessuchasself-managementtoempowerpatientstobettermanagetheirconditions.Examplesofthedeliverysystemreformstrategiestheseprojectsemployincludeincreasingaccesstoprimarycareandbehavioralhealthservices,coordinatingcareacrossservices,andtransformingthesystemtoenablemoretimelyandproactivepatientcareinthemostappropriatesetting.Inmanystates,DSRIPpresentsanopportunityforastatetoincreaseitsfocusoncertainissues.Forexample,inTexasover25percentofprojectsfocusonbehavioralhealthcare.18
Whilethemoretraditionalfee-for-serviceMedicaidreimbursementmodelmayrewardfillinghospitalbeds,DSRIPhelpsrewardthevalueofthecaredelivered.Becausemanyoftheseprojectsseektoprovidemorecareintheoutpatientsettingandthereforereducehospitaluse,providersparticipatinginDSRIPareabletoreceiveincentivepaymentsforreducingutilizationofotherwisereimbursableinpatientandemergencyservicesthatarecostlytotheMedicaidprogram.NearlyallDSRIPstatesincludereducingemergencyroomuseasaprogramgoalandmostprogramsusevariousemergencyroomvisitratesasameasureofprojectsuccess.NewYork’sDSRIPhastheexplicitstatewidegoalto“reduceavoidablehospitaluseby25percentoverfiveyearswithinthestate’sMedicaidprogram.”19Asaresult,theimplementationofthesedeliverysystemreformstrategiesdemandschangeamongmoretraditionallystructuredmedicalinstitutions,whichtendtooperateinsiloesandbepredominantlyhospitalbased.
Thegeneralstructureofdeliverysystemreformstrategieshasevolvedovertime.EarlierDSRIPprogramsinCaliforniaandMassachusettsprovidedhigh-levelguidanceforparticipatingprovidersaroundallowableprojectsandmetrics,butallowedprovidersgreaterflexibilitytodesignprojectstobemostrelevanttothepopulationsandregionsserved.MorerecentlyapprovedDSRIPprograms,suchasNewJersey’s,aremoreprescriptiveaboutprojectgoalsandwhichmeasuresarereported.Inotherwords,aproviderinCalifornia,MassachusettsandTexasmayselectthesamehigh-levelprojectareaasanotherproviderinitsstate,butimplementdifferentimprovementsandchoosevaryingmetricstomeasureprogress.Forexample,multipleprovidersinTexasmaychoosetoimplementtheprojectonexpandingprimarycarecapacity,butmaydosothroughcreatingmoreclinics,expandingclinichours,expandingmobileclinics,orotheroptionsandthereforeapplydifferentmetricstomeasuresuccess.Conversely,instateswithamorenarrowlydefinedprojectmenusuchasNewJerseyandNewYork,anyproviderthatselectsaprojectwillbeassessedbythesamesetofmeasuresasotherprovidersselectingthesameprojectinthestate.Forexample,anyproviderinNewJerseythatchoosestoimplementtheprojectonhospital-widescreeningforsubstanceusedisordermustreportonthesame
state sPotlight
New Jersey: Robert Wood Johnson University Hospital’s Cardiac Transitions Project
RobertWoodJohnsonUniversityHospital’sDSRIPprojectseekstoreducereadmissionsamongpatientswithcardiacdisease.Throughthisproject,patientnavigators,typicallyRegisteredNurses,reviewcases,discussmedicationissueswithphysicians,makehomevisitswithin48hoursofdischargetoperformasymptomandmedicationcheck,andensurethepatienthasafollow-upappointmentwithinsevendaysafterdischarge.Thenavigatorsmay,forinstance,findoutifaphysiciancanprescribeamoreaffordablemedication.Finally,asocialworkerfollowsupwiththreephonecallstoidentifyanyoutstandingissuesthatmayleadtoreadmission.
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pre-determinedsetofmetrics.Thatsaid,providersacrossdifferentstatesselectingthesameprojectswilllikelybeassessedbydistinctmeasures,sinceeachstate’sprogramisunique.
Duringsitevisitinterviews,DSRIPstakeholdersexpressedvaryingopinionsonthetrendtowardsmorestandardizedprojects.Forexample,whiletheTexasDSRIPprogramincludesmorethan1,400projectsthatmustundergoanarduousstateandfederalreviewprocess,providersexpressedanappreciationfortheflexibilitytodesignprojectsthatmettheneedsofthecommunitiestheyserve.Conversely,stakeholdersinNewJerseysharedtheirfrustrationwiththelimitedprojectmenuandpointedoutconfusionamongprovidersabouttheextenttowhichDSRIPactivitiescanbuildonexistingprojects.22
Balancing Risks and IncentivesAsdescribedabove,DSRIPincentivepaymentsareearnedif andafterparticipatingprovidersdemonstrateplanning,improvecaredeliverybyimplementingdeliverysystemreformstrategies,reportonmeasures,andimprovethequalityofcare.Assuch,DSRIPfundingisbothperformance-,aswellasrisk-based;providersruntheriskofinvestingincareimprovementsonthefrontendbutnotachievingtherequiredresultsandthereforenotearningthefullincentivepayment.Forprovidersaccustomedtofundinglevelsfrompriorsupplementalpaymentprograms,DSRIPmaybringincreasedbudgetunpredictabilityortensions.However,publichospitalsinCaliforniarelatedthatfromabudgetingperspective,DSRIPisamorepredictablesourceoffundingthansomeothersources,aslongasthehospitalsareabletoachievemostoralloftheirmilestones.Moreover,manystatesandproviderswhoarekeyparticipantsintheirstate’sDSRIPprogramanticipatealong-termreturn-on-investmentinDSRIPprogramsintheformofreducedcostlyservices(suchascostlyMedicaidreadmissions,meaningsavingsforstatesandcapitatedproviders)andimprovementsinthecaredeliverysystem(suchasincreasedvolumeintheoutpatient/communitysettings).Theflipside,ofcourse,isthatinstitutionsthatonlyofferacutecareservicesloserevenuewithreducedacutecareutilization(whichisrepresentativeoftheDSRIPprogramincentivestoshiftawayfromepisodictreatmenttohealthandwellness).
DSRIPprogramstendtosetahighbarforearningfunding.Initially,providersareabletoearnincentivepaymentsforplanningandimplementingdeliverysystemreformstrategies.Overtime,paymentsshift
“I think DSRIP is achieving its goals in terms of stabilizing the safety net hospital system. Hospitals aren’t closing. We have definitely seen quality changes such as integrating primary care and behavioral health through co-location, expanding access to specialty care through E-consults and expanding primary care.”
-CaliforniaMedicaidOfficial
state sPotlight
California: From Responsive to Proactive Care in a Clinic
TheHopeCenterClinic20inOaklandearnedDSRIPfundingbyprovidingcomplexcasemanagementforpatientsstrugglingtomanagetheirchronicconditions.Theprogramidentifiesthefivepercentmostcostlypatients,whohadhistoricallyreceivedepisodictreatmentinERsthroughoutthecity,andprovidesthemwithongoingcareintheoutpatientsetting.RonnieCrawford,apatient,sharedthathewas“goinghospitaltohospital,programtoprogram[untilthisprogram]…withyourguidanceandyourhelp,I’vechangedmedicationswhereI’mbreathingbetter.”Initialprogramresultsshowreductionsinhospitalizations:20percentinadmissionsperpatientperyearand23percentinbeddaysperpatientperyear.21
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awayfromtheseimplementationactivitiestowardsdemonstratingimprovedhealthoutcomes.Statesandprovidersreportedthisshiftmakesitincreasinglydifficulttoearnincentivepaymentsovertime.Thefinancingofimprovedcare—asopposedtocostorvolume-basedfunding—reflectstheprogram’sintenttotestamethodofshiftingMedicaidsupplementalpaymentsawayfromthefee-for-servicestructuretowardavalue-basedpayment.
Inadditiontoputtingprovidersatrisktoreceiveperformance-basedpayments,NewYork’sDSRIPprogramalsoholdsthestateaccountableifitfailstomeetcertainstatewideperformancemetrics.Thesespecificmetricsincludestatewideperformanceonavoidablehospitaluse,projectmetrics,meetingtargettrendratesforreducingthegrowthoftotalstateMedicaidspending,andimplementingvalue-basedpurchasingarrangementsinmanagedcare.Beginninginthethirdyearoftheproject,ifthestatefailstomeetanyofthesefourmetrics,thetotalamountofavailableDSRIPfundingwillbereducedandproviderswillnotbeeligibletoreceiveasmuchinincentivepayments.NewYorkistheonlystatetoincludethislevelofstatewideaccountabilityintheirprogram.Inaninterview,thestatediscussedthisasapositiveaspecttoitsprogramnotingthepowerofcollectiveaccountabilityonpublicdollarstodrivechange.
DSRIP in the Context of Other System Transformation InitiativesDSRIPscancomplementotherhealthsystemtransformationswithinthestate’sMedicaidsystemincludingmanagedcareexpansion,paymentreform,coverageexpansion,andotheraspectsofdeliverysystemreform.StateswithhigherlevelsofDSRIPfundingandgreaternumbersofparticipatingprovidersespeciallyreportedtheimportanceofDSRIPprogramstoaccomplishingbroaderwaiverandstateMedicaidpolicygoals,andsotheinterplayamongsuchprogramsisbothintentionalandmutuallybeneficial.Forthesestates,DSRIPisasubstantialcomponentoftheirhealthsystemtransformationeffortsanditslargescopepositionsitwelltocomplementotherhealthreforminitiatives.Forinstance,manyofCalifornia’spublichospitalsparticipatedinbothDSRIPandcoverageexpansion(LowIncomeHealthProgram(LIHP))aspartofthestate’scurrentwaiver,andhavefoundbotheffortsmakeeachmoresuccessful.Inoneexample,theLIHPrequiresenrolleestobeassignedtomedicalhomes,and17publichospitalsexpandedthemedicalhomemodelaspartofDSRIP.BothprogramsarealignedwithbroaderstatestrategiesrelatedtotheAffordableCareAct(ACA),managedcareexpansionandimprovingthequality,whileloweringthecost,ofMedicaidcare.InNewYork,DSRIPcomplementstheMedicaidRedesignTeam(MRT)waiverandseekstoaccomplishbroaderstatepaymentreformandcost-loweringgoals:bytheendoftheDSRIP,thegoalsareforMedicaidproviderstoacceptriskforpopulationsunderalternativepaymentmodels(suchascapitationandglobalpayments)andtoreducehospitaluseby25percent.Table2(nextpage)showsotherdeliverysystemreforminitiativesandhospitalsupplementalpaymentsavailableinDSRIPstates.
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table 2: deliveRy RefoRM PRogRaMs in dsRiP states
Delivery System Reform California Texas Massachusetts New
MexicoNew
Jersey Kansas New York Oregon
State Innovation Model (SIM) Round
1 Design Award23√ √
SIM Round 1 Testing Award √ √
SIM Round 2 Design Award √ √ √
SIM Round 2 Testing Award √
Medicaid Expansion State √ √ √ √ √ √
Medicaid Managed Care Expansion √ √ √ √ √ √ √ √
State Accountable Care Organization
Activity√ √ √ √ √ √
finanCing of state dsRiP PRogRaMsDSRIPfundingisavailableassupplementalincentivepaymentsforimprovementsincare,healthandcostwithinthesafetynet.Thissectionprovidesacross-stateanalysisofstates’DSRIPprogramfunding,thereportingandpaymentprocesses,andconsiderationsrelatedtodrawingdownfederalfunding.Perspectivesfromstates,providersandthefederalgovernment,theevolutionoftheprogram,andkeyissuesrelatedtothefinancingofDSRIPsarediscussedbelow.
Funding AmountsAsaSection1115demonstrationwaiverprogram,thelimitonthetotalDSRIPpoolfundingisestablishedinthenegotiatedwaiverspecialtermsandconditionsbasedonbudgetneutralityanalysis.24AsshowninTable3 anddiscussedinmoredetailbelow,theseamountsvaryconsiderablybystate,havedifferingrelationshipstothestates’priorandcurrentsupplementalpaymentprograms,andaredistributedamongdistinctnumbersandtypesofprovidersusinguniquecriteria.
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table 3: dsRiP aPPRoxiMate funding aMounts and distRibution
StateCurrent Federal Match
Approximate Maximum Federal
Funding
Approximate Maximum State and
Federal Funding
Number of Participating Providers
California 50% $3,336,000,000 $6,671,000,000 21
Texas 58.05% $6,646,000,000 $11,418,000,000 309providers(organizedinto20RHPs)
Massachusetts* 50% $659,000,000 $1,318,000,000 7New Mexico 69.65% $21,000,000 $29,000,000*** 29New Jersey 50% $292,000,000 $583,000,000 50
Kansas 56.63% $34,000,000 $60,000,000 2
New York 50% $6,419,000,000** $12,837,000,00064,099estimated
providers(organizedinto25PPSs)
Oregon 64.06% $191,000,000 $300,000,000 28TOTAL $17,598,000,000 $32,216,000,000
Notes: Thefundingamountsprovidedinthistableareestimatesbasedonananalysisofthefiguresprovidedineachstate’swaiver.Allamountsrepresentmaximumpotentialfunding;earningthefundingiscontingentuponachievingmilestones.Theapproximatefederalfundingfigureswerecalculatedbasedonayear-byyearanalysisoftotalcomputableDSRIPfundingandFMAPandmayvaryslightlyfromactualFFPpaid.
* TheMassachusettsDSTIwasrenewedforanadditionalthreeyearsinOctober2014.Thesefiguresrepresentfundingforallsixyearsoftheprogram.Thesefiguresdonotincludethe$330millioninfederalfundsincludedintherenewaldemonstrationforthePublicHospitalTransformationandIncentiveInitiativepool,whichwillallowoneDSTIhospitaltoimplementadditionaldeliverysystemreformprojects.
**ThisfiguredoesnotincludefundsfromtheNewYorkInterimAccessAssuranceFund.
***AdditionalfundingmaybeaddedfromunclaimedfundingintheUncompensatedCare(UC)Pool.
Relationships with Other Medicaid Supplemental PaymentsStates’DSRIPprogramshavevaryingrelationshipstopriorMedicaidwaiversupplementalpaymentprogramsforhospitals(e.g.UPL),whichfallwithinthefollowing:
• Equals prior supplemental funding: MaximumpotentialDSRIPpoolfundingmayequalpriorsupplementalpaymentaggregateamountsatthestatelevel.Inthesecases,DSRIPpoolsarecomprisedsolelyofrepurposedsupplementalfundingsourcesforhospitals(e.g.UPLpaymentsthestatewasnolongereligibletoreceiveduetomanagedcareexpansion).
• Exceeds prior supplemental funding: MaximumpotentialDSRIPpoolfundingmayexceedpriorsupplementalpaymentaggregateamountsatthestatelevel.Intheseinstances,DSRIPpoolsarecomprisedofrepurposedsupplementalfundingsources(e.g.,UPLpaymentsthestatewasnolongereligibletoreceiveduetomanagedcareexpansion)inadditiontomanagedcaresavings.
• No relation to prior supplemental funding: DSRIPdollarsmaynotbebasedonpriorsupplementalpayments.Instead,DSRIPpoolfundingmaybebasedsolelyonmanagedcaresavings.
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Table 4: DSRIP Relationship to Supplemental Payments
State
Delivery Reform and Supplemental Payment Programs
Uncompensated Care (UC) Pool
Designated State Hospital Program (DSHP)
Relation to Prior Supplemental Payments
California √ √ ExceedsTexas √ Exceeds
Massachusetts √ √ ExceedsNew Mexico √ EqualsNew Jersey Equals
Kansas √ EqualsNew York √ NorelationOregon √ Norelation
ThenatureofDSRIPfundingincomparisontopriorsupplementalpaymentsismorerisk-based,meaningthattheactualDSRIPincentivepaymentstosomeproviderswithinstatesmaybelessthanwhattheyhadreceivedaspriorsupplementalpayments(evenifstate-levelDSRIPfundingexceedspriorsupplementalpayments),duetofactorssuchas:(a)missingaprojectgoalorimprovementtargetandthereforenotbeingeligibletoclaimsomefunding;(b)aprojectthatrequiredadditionalspendingoffsetstheincentivepayment;and(c)forprovidersthatserveasthesourceofthenon-federalshare,theamountoffundsaprovidersuppliesoffsetstheamountoffundingearned.
Duetothefactthatfundingistiedtoimplementingdeliverysystemreformsandimprovinghealthoutcomes,DSRIPfundingdemandsmoreaccountabilityfromproviderstodeliverhighqualitycarecomparedtolump-sumsupplementalpayments.TheincreasedriskandinvestmentinherentinDSRIPfundingwasprominentininterviewswithprovidersinNewJersey,wherethesentimentwasthatthesameleveloffundingreceivedinthepriorprogramwouldnowneedtobeearnedatasubstantialcost,(intermsofeffortandfinancesrequiredtoimplementtheprojects),andathighrisk(duetoneedingtoachievechallengingmetrics).ManyprovidersacrossstatesreportedthatsupplementalpaymentstreamsaremakingupforMedicaidpaymentshortfalls(e.g.,California,NewJersey),sooptimizingthefundingiscriticaltotheirinstitutions.Inmanystates,thepublicprovidersreceivingthemostDSRIPfundingtendtoserveadisproportionateshareofMedicaidenrolleesandlow-incomeuninsuredindividuals,oftenwithcomplexhealthissues.SuchinstitutionstendtohavepayermixestypifiedbyahighpercentageofMedicaidpatients,highuncompensatedcarecosts,andalowpercentageofcommerciallyinsuredpatientsrelativetootherhospitals;narrowprofitmargins;aheavyrelianceonpublicfunding;andminimalfundsforongoingqualityimprovementandtransformation.
Thus,theshifttoDSRIPraisespolicyconsiderations,suchashowtheoriginalpurposeofsupplementalpaymentsshouldbereconciledtoDSRIPs,whetherDSRIPfundingiseffectiveinachievingitsqualityofcaregoals,andthegeneralrelationshipbetweenMedicaidpaymentoptionsandthevalueofhealthcare(e.g.,access,quality,efficiencyandutilization).
Inaddition,DSRIPscanbecomplementedby:
• Uncompensated Care (UC) Pools: FiveoftheeightapprovedDSRIPandDSRIP-likeprograms(California,Texas,Massachusetts,Kansas,andNewMexico)operateinparalleltoUCpools,whichreimburseprovidersforthecostsofprovidinguncompensatedcare.TherelationshipbetweentheDSRIPandtheUCpoolsvariesbystate.Forexample,Texas’UCpooliscloselytiedto
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DSRIPfunding;overthedurationofthewaiver,fundingforUCdecreaseswhilefundingforDSRIPincreases.Inotherstates,therelationshipislessdirect.Inourinterview,however,CMSrelatedthatitviewsDSRIPsandUCsasincreasinglyseparate.
• Designated State Health Programs (DSHP) Funds: FouroftheSection1115demonstrationsthatauthorizeDSRIPandDSRIP-likeprograms(California,Massachusetts,NewYork,andOregon)alsoauthorizeDSHPfunds.DSHPinSection1115demonstrationsprovidesfederalmatchforstateMedicaid-likeservicesthatarenotcurrentlyfederallymatched.AswithUCpools,therelationshipbetweenDSRIPandDSHPfundsvariesbystate.
How DSRIP Funding Is DistributedMedicaidwaivers’specialtermsandconditionsdeterminehowDSRIPfundingisdistributedbystatesandthefederalgovernment.Thishappensinthefollowingways:
• Bythetotallimitonpoolfundingperyear;
• Amongcategoriesoffunding;
• Amongparticipatingproviders;
• Withinparticipatingproviders’DSRIPimplementationplans;and
• ForanyunclaimedDSRIPfunding.
Total Pool FundingMaximumpoolfundingvariesfromstatetostate(seeTable3above);variationsinthenumberofparticipatingproviders,priorsupplementalfunds,andsizeofthestatemakelikecomparisonsoftotalpoolfundingacrossthestateschallenging.AmongstateswithapprovedDSRIPs,theaveragetotalstateandfederalfundingavailableperyearrangesfrom$7millioninNewMexicoto$2.3billioninNewYork.25SomestateshaveconsistentamountsofDSRIPfundingperyear(Massachusetts,NewJerseyandOregon).Othershaveascendingamountstoshiftprioritytoapay-for-performancefinancingmodelandemphasizetheincreasingimportanceofachievingprogramresultsinthelaterprogramyears(Kansas,NewMexicoandTexas),whileNewYork’sDSRIPfundingpeaksinthemiddleoftheprogram.ThisdesigninNewYorkisintendedtopromotesustainabilityofthereformspost-waiver.Themaximumpoolfundingrepresentsonlythetotalcaponpotentialfundingthatmaybedistributed.
Categories of FundingWaiversalsodictatehowDSRIPfundingisdistributedacrossfundingcategories(seeFigure2above).Asindividualagreements,thespecificsoffundingamountsandhowitisearneddifferacrossstates,makingitdifficulttoachievelikecomparisons.BelowisasummaryofthegeneraltypesofcategoriesinwhichDSRIPincentivepaymentscanbeearned,thoughnotallstatesincludeallofthesetypesoffundingcategories,andthedistributionofDSRIPfundingacrossthesetypesoffundingcategoriesvaries:
1. Program Planning: MoststateshavededicatedDSRIPfundingforplanninganddetailingspecificDSRIPprojectplans.26
2. Delivery System Reform Strategies: Thebulkofmoststates’DSRIPfundingisforpre-approveddeliverysystemreform“projects,”(orprograms/initiatives)andassociatedmetricsofimprovement(called“implementationmilestones”inthisreport).
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3. Reporting: DSRIPfundingcanbeearnedbyreportingonstandardmetrics(“pay-for-reporting”).
4. Results: Additionally,DSRIPfundingisfor“pay-for-performance,”27orimprovementonstandardqualitymetricsofoutcomes.
Asnotedabove,DSRIPstendtoincludemorefundingforplanninganddeliverysystemreforminearlierprogramyears,andmoreforpay-for-reportingandpay-for-performanceinlaterprogramyears.Atthesametime,thereismorefundingtowardplanninginmorerecentDSRIPs.ConsistentwiththetrendformorerecentlynegotiatedstateDSRIPprogramstobemorestandardizedandoutcomes-based,stateswithmorerecentDSRIPstendtohavelargerproportionsoftheirtotalDSRIPfundingdedicatedtowardreportingandresultstoholdthesystemaccountabletofundamentallyimprovecareforMedicaidbeneficiaries.
Allocating Pool FundsInmostDSRIPprograms,fundingisallocatedtoprovidersfirst,andparticipatingprovidersthensubmitDSRIPprojectplansthatmustreflecttheirallocatedamounts.Allowablefundingperprovideriscalculateddifferentlyandamountsvarysignificantlyamongstates.Theallocationstendtobedependentonaformulathatthestatehascreatedbasedonfactorssuchasvolume,cost,Medicaidshare,historiclevelsofsupplementalpayments,provisionofnon-federalshareandscoringoftheprojects/application.
Notably,NewYork(themostrecentDSRIPprogramapproved)insteadscoreseachaspectoftheproviders’DSRIPimplementationplanfirst,thesumofwhichthenproducestheamountthatwillgotoanetworkofproviders.ScoringinNewYorkrestsuponmultiplecriteriaintheDSRIPapplication,withamajorfactorbeingthenumberofMedicaidmembersattributedtothenetwork.
Valuation of DSRIP Implementation PlansProjectvaluation–howfundingisallocatedacrossprovidersforcompletionofprojectsorachievementofperformancegoals–variessignificantlybystate.EarlystateDSRIPprograms(e.g.,CaliforniaandTexas)tendedtoallowmoreflexibilityforparticipatingproviderstoproposevaluationforcertainproposedprojectswithintheprovider’sDSRIPplan(forexample,infrastructuredevelopmentandprocessredesignprojects),whilevaluationsforclinicalimprovementsandpopulationhealthtendedtobemoreformulaic.MorerecentstateDSRIPprograms(i.e.NewYork)baseprojectvaluationandtotalper-providerfundingallocationsonstandardizedformulas.StillothersbasevaluationuponhistoriclevelsofpreviousMedicaidsupplementalpaymentprograms(e.g.NewJersey)oronfactorsincludinghospitalsizeandpatientpopulation(e.g.Massachusetts).
DSRIPincentivepaymentamountsarenottiedtotheactualcostofachievingcareimprovements,noraretheyconsideredpatientcarerevenue.Becausepaymentsarevalueandperformancebased,mostDSRIPprogramsdonotrequireproviderstoreportonthecostofachievingcareimprovements,thoughlaterDSRIPs(i.e.NewJerseyandNewYork)dorequireparticipatingproviderstosubmitprojectbudgets.Additionally,mostDSRIPsdonotrequiretheincentivepaymentsbespentinanyparticularway(though,dependingonhowprogramrequirementsareinterpreted/implemented,morerecentlyapprovedDSRIPsmayrequireparticipatingproviderstoreportatahighlevelhowincentivepaymentsarespent).
Inotherwords,bothwithinandacrossstates,thereisnolike-comparisonofthe“price”beingpaidforaparticularimprovementorperformancelevel.InmorerecentDSRIPprograms,thefederalgovernmenthastriedtofocusonstandardizingpaymentwithinandacrossstatesbylinkingthecalculationtoanattributedpopulationandmakingimprovementgoalsbasedonaconsistentformula.CMSnotesthatstandardizationinvaluationmethodologycanenablecomparisonsthatarecriticaltoensurepaymentsarenotarbitrary.
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Statesandproviderscontendthatwhatisneededtodrivetransformationandsupportthesafetynetmayvarywithinandacrossstates.
Unclaimed FundingSinceitisaperformance-basedfundingprogram,someportionofeachstate’sDSRIPpoolmaygounclaimed.Eachstate’swaiveragreementhasdistinctmethodsfordealingwiththesefunds.Californiapurposefullylaidoutfinancingpoliciestoalignwiththepublichospitals’experiencesofqualityimprovement–itmaynotalwayshappenontime,orinalinearfashion,butratherinbitsandspurtswithplateaus.Assuch,California’sDSRIPallowsforpartialpaymentofpartialachievementofimplementationmilestonesandoutcomesmetrics,aswellasfortheabilityofanorganizationtocarryforwardthemilestone/metricandtheassociatedincentivepaymentforuptooneprogramyear.Forexample,onepublichospitalreportedthataclinicaloutcomegoalwas12percent,andbytheendoftheprogramyearandalotofhardwork,theorganizationachieved11.9percent,fallingshortoffullachievement.Thehospitalwaseligibleforpartialpaymenttoreflectitsprogressandrewardcontinuedimprovement.Furthermore,inCalifornia,90percentofunclaimedfundingaftertheadditionalprogramyearisavailabletothesamepublichospitalifthepublichospitaladdsmilestones/metricstoitsDSRIPimplementationplan.Ifthepublichospitalfailstodoso,otherpublichospitalscanaccessthefundingwithadditionalmilestones/metrics.AnyremainingDSRIPunclaimedfundingmayberolledintotheUCpool,withCMSapproval,butCaliforniahasnotmadethatrequest.
Overtime,CMShasmovedawayfrompartiallyconditionalpaymenttoall-or-nothingpaymentinordertosimplifyadministrationandclarifythegoaloftruesystemtransformation.Theabilitytohaveanadditionalyeartofullyachieveamilestoneormetric(“carry-forward”)hasbeenreplacedwithhighperformancefunds.Forexample,inNewYork’sDSRIPprogram,metricsnotmetinfullandontime(characterizedbyCMSasdemonstrationofmodestimprovementoverbaseline,generally10percent),willresultinforfeitedfunding.Themissedmetricwillbecarriedforwardintothefollowingyear(butnotthemissedfunding),requiringallmetricsinthefollowingyeartoberecalibrated(soeachmetricinthefollowingyearwillhavereducedincentivepaymentamounts,butinaggregaterepresentthesametotalfundingamountforthatyear).UnclaimedfundingisrolledintoaHighPerformanceFund,whichisawardedtotopperformerswhoexceedtheirmetricsforreducingavoidablehospitalizationsorformeetingcertainhigherperformancetargetsfortheirassignedbehavioralhealthpopulation.Thismodel,whichisalsousedinothermorerecentDSRIPs,ensuresthatallDSRIPfundingisdistributed,butencouragesproviderswhomeettheirmetricstoachieveadditionalimprovements.Howtheevolvedfinancingpoliciesinfluencesqualityimprovementremainstobeseen.
Payment MechanicsDSRIPincentivepaymentsaretriggeredby:(1)reportedachievement;and(2)provisionofthenon-federalshare.DSRIPreportsaretypicallyrequiredtwiceperyear,whileDSRIPachievementismeasuredannually;therefore,someachievementmaybeaccomplishedwithinthefirstsixmonthsoftheprogramyear,butmanymeasuresmaynotbeabletobereporteduntiltheendoftheprogramyear(forexample,measuresrequiring12monthsofdatafromtheprogramyear).
ReporttemplatesaredevelopedbyeachstateandapprovedbyCMS;aspublicprogramreportingtiedtosignificantsumsoffederalfunding,intervieweesrelatethereportstobeadministrativelycomplexandarduous,bothforproviderstocompleteandstatestoreview.Bothtypesofentitieshavereportedtheneedtotohireorredeploystaff/contractorstospecificallyattendtoDSRIPprogramreportingandadministration.
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DSRIPreportstendtobeduetothestateonemonthaftertheprogramperiodofreporting,thenthestatereviewsthereportsandmayapproveordenypayment,thenthenon-federalshareisdueandfederalmatchingpaymentismadetotheprovider.Asasimpleexample,aprovidermayspend$100inJanuarytomeetamilestone.ThatprovidermaythenreportachievementofthatmilestoneinJuly,withpaymentinAugustof$200.
ThepaymentmechanicsprocessissimilarinallDSRIPs,buteachwaiverdictatesauniquetimeframeforpaymentfollowingreporting.Forexample,California’sDepartmentofHealthCareServiceshasonemonthtoreviewreports;Texas’HealthandHumanServicesCommissionhasonemonthtoreviewreportswithpaymentsoccurringwithinthreemonths.MuchofthatreflectsthesignificantlyhighnumberofreportswithwhichtheStateofTexasmustcontend;however,thedelayedpaymenttimeframecanposebudgetchallengestotheproviders.
Role of Non-Federal ShareSinceMedicaidisajointstate-federalprogram,itsfundingissharedbythestateandfederalgovernments.AsaMedicaidwaiverprogram,DSRIPincentivepaymentshavebothafederalshare(FederalFinancialParticipation(FFP))andastateshare,or“non-federalshare,”thesumofwhichisthetotalcomputableincentivepayment.ThepercentageofthetotalcomputableincentivepaymentprovidedthroughFFPisbasedonthestate’sFederalMedicalAssistancePercentage(FMAP).28IntheMedicaidprogramgenerally,statespayprovidersforservicesrenderedorcostsincurred,andthenthefederalgovernmentreimbursesthestateforaportionofthosecosts,dependentupontheFMAPforthestateandhowthecostisclassified.Likewise,theFFPportionoftheDSRIPincentivepaymentistriggeredbythestateprovidingthenon-federalshareoftheincentivepayment.
Section1115demonstrationagreementsreflecthowthestateissourcingthenon-federalshare.DSRIPsallowthenon-federal/statesharetobesuppliedfromoneormoresources,includingstategeneralrevenuefunds,providertaxes,intergovernmentaltransfers(IGTs)frompublicentities(publicprovidersandlocalgovernmentalentities),andfederalizedstateprograms(DSHP).Certainsourcesofthenon-federalshare,suchasIGT,tendtodictatewhichprovidersareeligibletoparticipateinDSRIP.ProviderswhohavenosourceofmatchingfundstosupporttheirDSRIPprojectsmaynotbeabletoparticipate.Forexample,inthesecondyearofitsDSRIPprogram,Texasdidnotclaim$352millionofthepool’stotalcomputablefundingforthatyearduetoareasinthestatethatdidnothaveadequateIGTsources.
ManystatesstrugglewithhowtofinancetheircontributiontotheDSRIPprogram.Sincecontainingcostsisaprimarydriver,stateswithDSRIPsarenottakingonadditionalfundingshareresponsibilitiesthroughstategeneralrevenue/appropriationsbeyondwhatthestatehadbeenprovidingthroughpriorwaivers/supplementalpaymentprograms.TheexceptionisNewMexico,whichcurrentlypaysthenon-federalsharefromstategeneralrevenuebutisworkingwithitscountiesandotherstakeholderstoidentifyanotherfundingsource.
Oregonhasusedprovidertaxestogeneratepublicrevenuethatcanbeusedasthesourceofthenon-federalshare.Providertaxescanprovechallengingbecause,whiletheassessmentonproviderstendstobestandardized(e.g.a6%taxonproviders),providersmaybeeligibletoearnverydifferentlevelsofDSRIPfundingor,forsome,noDSRIPfundingatall.Inaddition,implementingneworexpandedprovidertaxesmaynotbepoliticallyfeasibleinsomestates.
Manystatesarelookingtopublicprovidersandlocalgovernmentstofundthenon-federalsharethroughIGTs.IGTsaretransfersofpublicfundsfromonelevelofgovernmenttoanother;entitiessupplyingtheIGTforDSRIPsincludepublichospitals,localgovernmentalentitiesandstateuniversityhospitalsand,in
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Texas,localmentalhealthauthorities.Thus,mostIGTsfundingthestate’sshareoftheDSRIPincentivepaymentsarederivedfromlocaltaxrevenues.IGTshavebecomethelargestnon-federalfundingsourceforDSRIPs(seeTable5).Federalpoliciesdictatethatstatescannotrequireincreasedfinancingofthenon-federalsharefromgovernmentalentities,soprovidingtheIGTisvoluntary.29,30
IGTsforDSRIPrequireahighleveloffundingthatmayposechallengestopublicprovidersandlocalgovernmentalentitiessupplyingIGT.ThesepublicprovidersoftenserveadisproportionatelyhighnumberofMedicaidpatientsandarelikelytoalreadyfacebudgetchallenges.ThelargeamountofIGTthatneedstobetransferredasthenon-federalsharepriortoreceivingtheincentivepaymentscanmakethecashflowchallengeofDSRIPmoreacuteforthoseproviderswhoareprovidingIGTs.Forexample,oneproviderinCaliforniadescribedtheneedtoworkcloselywithinitssystemandwiththecountytomakesurethereisenoughIGT.Inanotherexample,aproviderinNewYorkisborrowingtobeabletoprovideIGTforDSRIP.Moreover,publicproviderswhoalsoprovideIGTforprivateproviders(asinTexasandNewYork)mustputupadditionalIGT,whichreducestheamountofDSRIPfundingthattheycanretain.
table 5: souRCe of non-fedeRal shaRe
State State General Revenue
Provider Taxes
IGTs from Public Entities DSHP Entities Supplying Non-
Federal Share Dollars
California √ Designatedpublichospitals
Texas √ Publichospitals,localgovernment
Massachusetts √ √Stateforprivate
hospitals,publichospitalself-funded
New Mexico √ √Stateforprivate
hospitals,publichospitalself-funded
New Jersey √ StateKansas √ Publichospitals
New York √ √Mostlypublichospitals,supplementedbysome
state(DSHP)Oregon √ Hospitals
Privateprovidersareexcludedfromprovidingnon-federalshare,orfromexchangingcomparablefundswithagovernmentalentityprovidingtheIGTontheirbehalf,becauseitwouldviolateprovider-relateddonationsprohibitions.31InthecontextofIGTs,privateprovidersareoftendependentonpublicprovidersorgovernmentalentitiesforthenon-federalshareoftheirDSRIPincentivepayment.Thisarrangementposesrisksforprivateproviders.Forexample,aprivatehospitalinTexasachievedDSRIPmilestones,butthecountyservingastheIGTsourcehadlower-than-expectedtaxrevenues,andfailedtosupplytheIGT,sotheproviderdidnotreceivethefullincentivepaymentforwhichitwaseligible.
InTexasthisarrangementcanalsobeproblematicforthepublicproviderssupplyingtheIGT,sinceIGTisthesolesourceofthenon-federalshareandasignificantnumberofprivateprovidersareparticipatinginDSRIP.Essentially,onlypublicprovidersareputtingupthestatesharefortheentiresetofparticipatinghospitals.Providershaverelatedthatthematterofdeterminingnon-federalshareinTexashasbeenhighly
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complexandchallenging.Texasstakeholdersalsoacknowledgethatthestate’scounty-by-countyfundingapproachlimitstheabilityoftheRHPstructuretofostermeaningfulregionaltransformation;althoughtheRHPshaveledtoincreasedconversationandcollaborationbetweenproviders,countiesareprohibitedfromallocatingfundstowardspatientsinothercounties,eveniftheybelongtoasingleRHP.
Finally,NewYorkStatesupplementsIGTsbyusingtheDesignatedStateHealthProgram(DSHP))tofundasmallportionofitsDSRIPprogram.DSHPinsection1115demonstrationsprovidesfederalmatchforstateMedicaid-likeservicesthatarenotcurrentlyfederallymatched.CMShasgenerallylimitedDSHPasasourceofnon-federalshareinDSRIPstothispoint.
Duetotheseissuesaroundtheprovisionofthenon-federalshare,astatemaybelimitedinhowitdesignsitsDSRIPprogram,especiallyregardingprovidereligibility(ifprovidersdonothaveawaytofinancethenon-federalshare,theymaynotbeabletoparticipate)andproviderallocation/projectvaluation(statesgrapplewithcreatingformulaicandperformance-basedmethodstoallocatefundingamongprovidersandvalueprojectsthatreflectcomparableparityofnetincentivepaymentsbetweenprivateandpublicproviders).CMSrelatedthatIGTsespeciallytendtoinfluencehowlocalprovidersparticipateinDSRIP,whichneedstobeconsideredinensuringthatDSRIPfundingsupportsabeneficiary-centeredsystem.
dsRiP MeasuReMent and MonitoRingInadditiontothemonitoringrequiredforresearchanddemonstrationpurposesoftheoverallSection1115demonstration,DSRIPparticipatingprovidersmustmeasureprogresstowardthegoalsofbettercare,improvedhealth,andlowercoststotheMedicaidprogramforpaymentpurposes.Atanaggregatedlevel,CMSandstatesareexaminingDSRIPs’impactsontheseaims.AkeypolicyconsiderationforDSRIPsishowtomeaningfullyalignclinicalqualitywithpaymentinawaythatoptimizesrealimprovements;theexperiencesofstatesmayhelppolicymakersexplorequestionssuchas:
• HowcanmeasurementandpaymentbestbedesignedtoactivateactualimprovementonthegroundforMedicaidanduninsuredpopulations?
• Whatmeasuresmostappropriatelyreflectbettercare,improvedhealthstatus,andlowercosts?
• OnwhichmeasurescanaproviderreasonablymovetheneedlewithintheDSRIPlifespan?
• Whatistheappropriatenumberofmeasurestobalancereportingdatawiththeworkofperformanceimprovement?
• Whatareappropriatedatasources,i.e.,financial/administrativedata(e.g.claims)versusclinicaldata(e.g.charts)?
• Isthereawaytobalancestandardizedmeasureswithexperimentalones?
Thissectionsummarizesstates’experienceswithandtrendsinDSRIPsrelativetomeasuringimprovement,reportingachievement,andprogrammonitoring,assessmentandevaluation.
Measuring ImprovementEachDSRIPprogramincludesmeasurementofqualityandperformanceimprovement,butthespecificsofmeasurementvarybystate.Generally,theprogramhasevolvedfromallowingmorestate/localflexibilitytoselectandtailormetricstowardamorestandardizedandprescribedsetofmetrics.
Milestones and MetricsThisreportcategorizesDSRIPmetricsintothreetypes(thoughNewMexicoandOregonprogramsdonotincludethefirsttype);eachofwhichisdiscussedinfurtherdetailbelow.
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• Implementation Milestones and Metrics:ThesemetricsareintendedtomeasureprogresstowarddeliverysystemreformwithinDSRIPprojects.EarlierDSRIPprogramsallowedextensivelistsofpermissiblemilestonesandmetricsforeachproject,andproviderssimplyhadtoselectaminimum,andsometimesmaximum,numberofmilestones/metricstoreport(i.e.California,Massachusetts,andTexas).LaterDSRIPprogramsrequireanyproviderselectingacertainprojecttoimplementthesameprescribedsetofevidence-basedactivities(e.g.NewJersey).Suchactivitiescanbetailoredtotheneedsoftheorganizationandpopulation;forexample,allprovidersmayneedtotrainstaff,butthenumberofstafftrainedmayvary.LaterDSRIPsalsomandatethatimplementationmilestones/metricsaddresscommunityhealthneeds,asdemonstratedinanassessment.
• Pay-For-Reporting Metrics:ManyDSRIPprogramsinclude:(1)astandardsetofmeasuresthatallparticipatingprovidersmustreport;and(2)project-specificpay-for-reportingmetrics.Pay-for-reportingmetricsareeitherstandardnationalmeasures,oradaptedfromthem.
• Pay-For-Performance Metrics:EveryDSRIPprogramrequiresresultsinoutcomes.LaterDSRIPsmorecloselyalignpay-for-performancemetricswithdeliverysystemreformprojects;California’spay-for-performancecategoryfocusesonreducinghospital-acquiredconditions,whileitsprojectstendtoemphasizetheambulatorycaresetting.Otherstatesmustrelatepay-for-performancemetricstotheirprojects;forexample,aproviderwithacaretransitionsprojectmighthavetoreducereadmissions.
Table7providesexamplesofthethreetypesofmetrics.MoststateDSRIPprogramstendtogenerallycategorizemetricssimilarly.However,therearethousandsofmeasuresacrossstateDSRIPprogramswithlimitedoverlapandvarianceswherethereisoverlap,makingstate-to-statecomparisonsdifficult.Forexample,bloodpressurecontrolcanbecategorizedasapay-for-reportingmetricinNewJerseyandapay-for-performancemetricinNewYork.Likewise,TexasandMassachusettsmeasurethecongestiveheartfailureambulatorysensitiveconditionadmissionrateslightlydifferently.
table 7: exaMPles of tyPes of dsRiP MetRiCs
Implementation Milestones/Metrics
Pay-For-Reporting Metrics Pay-For Performance Metrics
• Redesigncareprocesses• Deployreformedworkforce
strategies,includinghiring/training
• Useprocessimprovementmethodologies
• Increasedaccesstoandcapacityforprevention,primarycare,chroniccareandbehavioralhealthservices
• Increasedvolumeinoutpatientsettings
• Clinicaloutcomes• Potentiallypreventableevents32
• Ambulatorysensitiveconditionadmissionrates
• Populationhealthmetrics33
• Processesofcaremetrics(e.g.NewJersey)
• Patientexperiencescores(i.e.California)
• Clinicaloutcomes• Potentiallypreventableevents• Ambulatorysensitivecondition
admissionrates(i.e.NewJerseyandNewYork)
• Processesofcaremetrics(i.e.NewYork34)
• Patientexperiencescores(i.e.Texas)
• Accessmeasures(i.e.Texas,suchasThirdNextAvailableAppointment35)
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Stakeholdersnotedcomplicationswithtyingpay-for-performancemetricsdirectlytoaDSRIPproject.Forexample,inTexas,providerswiththesameprojectscanselectdifferentoutcomemeasuresfromamenuofmorethan250pay-for-performancemeasures.Evenso,someprovidersremainconcernedthatthemenudidnotincludeameasurethatwouldpresentanaccuraterepresentationoftheprojectresult,andsoinadditiontotherequiredreporting,someprovidersarealsoreportingotherdataintheirDSRIPreports.Similarly,inNewJersey,onestakeholderexpressedconcernabouttheuseofadult-focusedasthmameasuresthatwerenotappropriateforthehospital’spediatricasthmaproject.36
StatesandCMSstruggletobalanceflexibilitytomeetlocalneedswithanabilitytocompareandaggregatedata.InearlierDSRIPprograms,deliverysystemreformprojectsareindividualizedandtheresultsamongprovidersarenotcomparable.Inlaterprograms,projectsrequirecommoncomponentsandworkstepsamonganyprovidersselectingthoseprojects,andallprovidersmustreportandimproveonthesamesetofprocessandoutcomemeasures.Instakeholderinterviews,providersnotedtheystronglypreferredhavingmoreflexibility,buttheyandstatesalsorecognizedthedrawbackofnotbeingabletodemonstrateaggregatestatewideimprovementsifthereistoomuchvariation.CMSnotesthatitsultimategoalisaparsimonioussetofmetricsthatensuresaccountabilityforfunding,whileatthesametimeprovidingflexibilitytoachieveimprovementsonthosemetricsbydemonstratingsystemtransformationthatfundamentallyimprovescareforbeneficiaries.
Inourinterviews,weheardconcernsthatstrongevidencemaynotyetbefullysubstantiatedtosupporttheeffectsofoutpatient-baseddeliverysystemreformsonnationalstandardizedoutcomemeasures.YetCMSnotesthisistheprecisereasonwhyithasbeennarrowingthetypesofmetricsetsinordertofocusonareaswherethereisastrongevidencebasefortruesystemtransformationandimprovedcare.ThoseinterviewedalsoexpressedaconcernthattheabilityofDSRIPproviderstoseeresultsintheambulatorycaresettingforpopulationsofpatientswithinthethree-tofive-yeartimeframeremainstobeseenincomingyears.Moreover,themeasurementofcosthasbeenthemostdifficultofthekeygoalstoincorporateintoDSRIPs.DSRIPmeasuresetstendtofocusonpotentiallypreventableeventstogetatcostavoidance,butmeasuringcost,percapitaspending,resourceuse,andefficiencyhasonlybeenintroducedselectivelyandcarefully.
Improvement PopulationOvertime,stateDSRIPprogramshavebeenrequiredtoincreasetheproportionofthepopulationrepresentedbythedenominatorinDSRIPmeasuresacrossstates,indicatingthatstatesmustachieveimprovementsforanincreasinglybroadersegmentofthetheirsafetynetpopulation.ThisevolutionisconsistentwithCMS’goalofprovidingcomprehensivecareforbeneficiaries,butdoesnotnecessarilymeanthestateisaffectingmorepatients.MorerecentDSRIPshaveusedattributionmodelstoassignalargeportionofthestate’slow-incomepatientstospecificparticipatingproviders.
• Implementationmetricsacrossstatestendtohavedenominatorsspecifictotheproject,orintervention,population(e.g.patientsenrolledinacaremanagementprogram).
• Pay-for-reportingmeasuresinCaliforniaarelimitedtothepatientsforwhomthehospitalisactivelymanagingcare37,butotherstatestendtoincludelargerpopulations–allpatientsmeetingmeasurementcriteria(i.e.Texas)orallattributedpatients(i.e.NewJerseyandNewYork).
• Pay-for-performancemeasures,similarly,haveevolvedfrompatientsreceivingtheintervention(i.e.California)toallpatientswithintheprovidersystemmeetingthemeasurementcriteria(i.e.Texas),toallattributedpatients(i.e.NewJersey),toallattributedMedicaidmemberswithinthe
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geographicregion(i.e.NewYork).Thus,thesamemeasureofimprovementintwostatesmayencompassdifferentsegmentsofthepopulationorcommunity.
NewJerseyprovidersnotedchallengeswithattribution.DSRIPprovidersoperatewithinanopenhealthsystemwherepatientscanchoosewheretoreceivetheircare(withinorbeyondtheprovidersystemtowhichtheyare“attributed”),andtheytendtoserveatransientpopulation.Forexample,oneprovideraskedhowitshouldreachouttoattributedindividualswhosecaretheproviderdoesnotcurrentlymanage–shouldtheprovidertrackthemdownandtrytogetthemintoitssystem,evenifthepatientseekscareelsewhere?ManyDSRIPprovidershaveamissionofservingalllow-incomepatients,andthisraisesquestionsaboutthepatientswhocometotheirdoorsthatarenotattributedtothem.Realizingtheimportanceofthisissue,CMShasaddressedattributionchallengesinlaterDSRIPs—suchastheNewYorkprogram—whereprovidersaremadeawareoftheirattributedpopulationatthebeginningandanydifferencesarereconciledattheendoftheyear.
Sinceresultshaveyettobereportedinmoststatesforpay-for-performancemetrics,anticipatedissuessuchassmallnumbersofcasesrelativetolargerpopulationsandtheabilitytocapturedataforlargerpatientpopulationsconsistentlyandaccuratelyremainstobeseen.Furthermore,theabilityofvarioustypesofproviderstoeffectivelycollaboratetomakeadentinthehealthofsafetynetpopulations,whichcanbeparticularlydisenfranchised,transientanddifficulttofollow,inanopenhealthcaresystemwithinafive-yeartimeframeisyettobefullyexplored.
Improvement MethodologyInordertodrawdownfundingformilestoneachievement,DSRIPprovidersmustmeetprescribedimprovementtargetsforoutcomemeasuresinthelatteryearsoftheprogram.AsthefirstDSRIP,Californiaoriginallysetimprovementtargetsbasedon:(a)improvementovertheindividualprovider’sbaselinebyasetpercentage(suchas10percent);(b)setbracketsofimprovementtowardbenchmarks(suchasahospitalmovingfrommiddleperformancetotopperformancebasedonbenchmarks);and(c)absoluteimprovementtargetsregardlessofbaseline(e.g.zerofallswithinjuryper1,000patientdays).However,CMSintroducedastandardizedimprovementmethodologyfromMedicareandMedicaidmanagedcarethathasbeenusedinallDSRIPssince,andwasincorporatedintoCalifornia’sprogramduringitsmid-pointassessment.
TheQualityImprovementSystemforManagedCare(QISMC)38setsimprovementtargetsbasedonclosingthegapbetweenbaselineandbenchmark.TheQISMCmethodologyestablishesbenchmarksofhighperformancelevels(HPLs;i.e.85thor90thpercentile),towardwhicheveryprogrammustmove,andminimumperformancelevels(MPLs;i.e.25thpercentile),whicheveryprogrammustachieve.39
Eachstate’sDSRIPprogramestablishesuniquebenchmarksforitspay-for-performancemeasuresbasedonstateornationaldata.Programsalsomandatedifferentlevelsofimprovementtargetsetting;forexample,TexasprovidersmustclosethegapbetweenbaselineandHPLby20percentbytheendoftheprogram,whereasNewYorkprovidersmustclosethegapbetweentheprioryear’sbaselineandtheHPLby10percenteachofthelastcoupleofyears.
Sofar,Californiaistheonlystatewithresultsusingthismethodology,anduniquelyhastheexperienceofcomparingtheuseofQISMC(programYear4)withthepriormethodologiesusedtodetermineimprovementtargets(Year3).40Inourinterview,theclinicalpanelofCaliforniapublichospitalsdescribedhowtheQISMCmethodologycanbeproblematicwhendealingwithmeasuresdependentonasmallnumberofcases,becauseonepatientcandramaticallyswingresults.However,otherstatesusingthe
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QISMCmethodologyforpopulation-basedmeasuresmaynotexperiencethesamechallengesduetolargersamplesizes.Californiaalsoexpressedreservationsabouttheabilityofreportstocapturewhatitmeanstomiss,meet,orexceedatargetfromaclinicalstandpoint.
Reporting AchievementAllDSRIPsrequiresubstantial,regular,andprescribedreportingfromproviderstothestate,andfromthestatetoCMS.StateDSRIPreportingrequirementsareshapedbyeachstate’sbroaderSection1115demonstrationreportingrequirementsasnegotiatedbythestateandCMSanddescribedinthewaiver’sspecialtermsandconditions.Thegoalsofreportingaretwo-fold:(1)todemonstrateimprovementandtriggerpayment;and(2)toderivemeaningfromthedatainordertodrivecontinuedperformanceimprovementanddeterminewhatworksandwhatdoesnot.
DSRIP Reporting RequirementsThenumberofmeasuresreportedthroughDSRIPprogramsishigh;someprovidersarereportingonhundredsofmeasurestoparticipateintheprogram.Providerreportstriggerincentivepaymentsandalloweachstatetoevaluateprogressandinitialoutcomes.ProvidersaretypicallyrequiredtoreportonprogresstwiceayearthroughareportingprocessdescribedinstateDSRIPprotocols.ProviderreportsmustbeapprovedbythestateandsenttoCMS.SomeDSRIPs—particularlythosewithlargenumbersofparticipatingproviders—requireongoingmonitoringofreportingcompliance(furtherdiscussedbelow).
StatesarerequiredtoreportonaggregateprogressandearlyfindingsfromDSRIPsandbroaderwaiveractivitiestoCMSquarterly,semi-annually,and/orannually,dependingonthetermsofeachstate’sSection1115demonstration.
Data InfrastructureWhileDSRIPinvestmentinelectronicdatamustnotduplicateotherfederalfunding,41theavailabilityofelectronicdatawasconveyedtobeofhighimportancetosuccessinDSRIPs,dueto:(1)thevolumeandtypeofreportinginvolved;and(2)theneedtohaveaccesstodatarapidlyandbeabletouseittodriveimprovement.Forexample,CaliforniareportedinYear3“…siteshavedemonstratedthecapacitytousedatatopinpointareasofnoncompliance[withtheintervention]andtodirectresourcestothehighestpriorityareas.”42OneofthelargestpublichospitalsystemsinthecountryexplainedinaninterviewthatitneededacompleteoverhaulofitsdatainfrastructureinordertobesuccessfulinDSRIP.AmajorNewJerseysafetynetprovidercommentedthatwhileithasacomprehensiveinpatientelectronicmedicalrecordssystem,outpatientsystemsarestillinearlyadoptionwithinthehospitalanditsprovidernetwork,andthetwomustbeconnectedforatrulysuccessfulDSRIPprogram.Moreover,thesharingofdataamongprovidersisimperative;eveninDSRIPsthatdonotmandateit,collaborationamongprovidersisoftennecessarytoachievethedeliverysystemreformseffectivelyand/orreportonmeasures.
Atthesametime,theexpansionofelectronicsystemswascommunicatedtobehighlydisruptivetoDSRIPreportingandprojects.WhileDSRIPrequiresproviderstoimprovedatacollection,reporting,andthesophisticationofinformationtechnology(IT)andqualitymanagementpractices,theimplementationofITsolutionsmid-programcanresultinfluctuatingratesasnewworkflows,datacollection,anddocumentationstandardsare
“One big challenge has been reporting. We don’t have the infrastructure or technology
for some of it. We had to select some projects based on reporting
capacity.”
-TexasDSRIPProvider
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deployed.Significanttimeandresourcesareneededtomakeelectronichealthrecords(EHRs)functional,whichstatesreportedcanbeaniterative,onerous,andmulti-yearprocess.Thereisalsoatensionbetweenelectronicsystemsdesignedtocapturedataforadministrativeandbillingpurposesandtheneedtodemonstratequalityanddriveclinicalresults.
Astate’sdatainfrastructurealsoimpactsDSRIPreporting.CalifornianotesthatthelagtimeinstatewidedatalimitsitsuseforfilteringintoDSRIPreports;publichospitalsrelyontheirowndatasourcesanddefinitions.However,lackofstatewidedatacanresultininabilitytoestablishabenchmarkrequiredfortheQSMICmethodology.Conversely,NewMexicoexpectstogenerateinformationforperformancemeasurementthroughexistingstatewidedatabasesratherthancollectadditionaldatafromtheparticipatinghospitals.Evaluatorsreportedwarinessinusinghospital-generateddata,butalsowereconcernedaboutaccuracyinstatedatasources.Statesandevaluatorsrelatedthatanall-payerclaimsdatabasecouldbebeneficial.
Data Collection and ValidationAccuracyofdatasourceswascitedasacommonconcern,especiallywhendataisgenerallyreportedforonepurpose,butunderDSRIPisneededforclinical/analyticalpurposes.Comparabilityalsoremainsproblematic;evenwithstandardmeasures,thedetailsofcollectingandvalidatingthemeasuresmayvaryamongproviders.Furthermore,standardizedmeasuresareunderconstantflux,asexemplifiedinCalifornia’sYear3aggregateannualreport:
“Not until mid-[program Year 3], in January 2013, did national consensus form around the National Quality Forum’s standardized methodology for reporting sepsis bundle compliance. However, understanding the need for comparable data year to year and among [public hospital systems (PHSs)], in April 2012, PHSs, along with [the State] and CMS, agreed on using two ICD-9 codes (severe sepsis and septic shock) as a standardized measure. Thus, [Year 3] data is more comparable than [Year 2]. Yet, sepsis has more complexity than those codes, and the fact that PHSs are using various data definitions for reporting other components allows for the learning laboratory for performance measurement initially envisioned in the DSRIP program. Changes … as a result of the Mid Point Assessment, will be implemented in [Year 4] and will further improve comparability.”43
Evenattemptstocorrectmeasurementmid-programmaynotnecessarilyreconcileanoutdateddesignofprojectinterventionsanddatacollectionandvalidationpracticeswithnewmeasuresofsuccess.
Using Data to Drive ImprovementDSRIPsnecessitatetheuseofdatatodrivecontinuousqualityimprovement,andmanyDSRIPprovidersutilizeprocessimprovementmethodologies.Additionally,DSRIPprogramparticipantssharesuccessesandsetbacksthroughimprovementcollaboratives.44Somestatesrequireproviderstoparticipateandmaytiefundingtoparticipatingincollaboratives(i.e.Kansas,Massachusetts,NewJersey,NewYork,andTexas).Inotherstates,itisnotrequired(i.e.CaliforniaandOregon),butmaybeusedasaneffectivetoolforsuccessfulDSRIPimplementation.InCalifornia,forexample,DSRIPparticipatingprovidersestablishedandself-fundedlearningcollaborativesdirectlyasaresultoftheprogram.
Duringtheprojectinterview,Californiaunderscoredtheimportanceofbalancingthequantityandqualityofreporting;toomuchdatacollectioncandiffusetheabilitytofocusandpotentiallyleadstoadata-rich,information-poorscenario.Thestaterelatedaneedtofocusonmeasuresthatareactionableandprovidemeaningfuldata,andthatareaccompaniedbyanarrativetodescribewhatisbehindthenumbers.
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Monitoring and AssessmentAsapublicprogram,DSRIPreportingissubjecttomonitoringforprogramcomplianceandpotentialaudits.LaterandlargerDSRIPsmandatesubstantialmonitoringandassessmentactivities(e.g.annualandquarterlyreportsinNewYorkandOregon).Keyaspectsincludethefollowing:
• Mid-Point Assessment:ManystateswithapprovedDSRIPsusemid-pointassessmentsasanopportunitytoreviewprogress,evaluateproviderandstateperformancesofar,andrenegotiatewaiverterms.Todate,onlyCaliforniahascompletedamid-pointassessment,withchangesmadetotheimprovementtargetsettingmethodologyforpay-for-performancemetrics.
• Independent Assessor:Manystatescontractwithanindependentassessorforavarietyofpurposes,includingreviewingproviderDSRIPplans,compilingandsubmittingregularreportstoCMS,andservingasexternalcomplianceauditandreviewentities.
Evaluation of DSRIP ProgramsAllstatesareevaluatingtheirDSRIPprogramsaspartofevaluationsrequiredforSection1115demonstrationwaivers.StatessubmitevaluationplanstoCMSforapprovalandappointindependent—typicallyacademic—entitiestocompleteinterimandfinalevaluations.Interimevaluationstendtocoincidewithstateapplicationstorenewthewaiver/DSRIPprogram.FinalevaluationsaregenerallyexpectedwithinayearaftertheDSRIPends,whichinsomecasesmaybepriororclosetowhenfinalDSRIPprogramresultswillbereported.
DSRIPevaluationswillassesstheefficacyofprojects,proportionofmilestones/metricsmet,andwhetherimprovementsweremadeonmeasuresquantitatively.Evaluationsmayalsoqualitativelyaimtoassesstheprogram’simpactonthegoalsofbettercare,improvedhealthandlowercosts,butgenerallyfinddifficultyindevisinganappropriatemethodology,duetofactorssuchasnotbeingabletocontrolforcorrespondingcatalystssuchasACAimplementation,compareDSRIPparticipatingproviderstoapeergroup,45accesscomparabledatasetswithinthesametimeline,oraccesspre-/post-DSRIPdatafortheparticipatingproviders.EvaluationsarerelyingondatareportedthroughtheDSRIPprogram,state-leveldata,keystakeholderinterviewsand/orproviderfinancialdata.
Theonlyinterimevaluationsare:
(1)Massachusettsreportsametricachievementrateof95percentinthefirstyearbutlittleotherdata.46
(2)California’sinterimevaluationhasrecentlybeencompleted47andthusfar,reportsthefollowingfindings:
• Aprojectmilestoneachievementrateof99percentforYears2-3;
state snaPshot
Mid-PRogRaM Results in CalifoRniaOverthecourseofDSRIP,California’sdesignatedpublichospitalshave:
• Experiencedanaverage35.9%decreaseintheCentralLine-AssociatedBloodstreamInfection(CLABSI)ratepersiteinAcuteCareUnitsandanaveragedecreaseof59.7%intheICU.
• Assignedmorethan500,000patientstoamedicalhomeand/orprimarycareprovider
• Enteredoveronemillionpatientsintodiseaseregistriesforcaremanagementpurposes*
*CaliforniaHealthCareSafetyNetInstitute,Aggregate Public Hospital System Annual Report on California’s 1115 Medicaid Waiver’s Delivery System Reform Incentive Program, Demonstration Year 7(CaliforniaHealthCareSafetyNetInstitute,2013).Availableat:http://www.dhcs.ca.gov/Documents/DSRIP%20DY%207%20Aggregate%20Pub%20Hosp%20System%20Annual%20Report.pdf
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• RelatedtothethreeCMSstrategicgoals,designatedpublichospitalsreportedhigherimpactonqualityoutcomes,butperceivedalowerimpactoncost;
• HospitalsreportedthatDSRIPledtosystematicandmajorchange;
• DSRIPispushingthepublichospitalstoacceleratetheirbuildingofEHRssystematicallythroughouttheentirehospitalsystem(inpatientandoutpatient);
• Theinfusionoffundsintothepublichospitalsservedasanimpetustoputmeasuresinplaceandmobilizetheorganizationtoimplementtheprojects;and
• Theprojectsselectedweregenerallyconsistentwithhospitalstrategies,butDSRIPallowedtheseprojectstobeexpandedacrossthesystem.
Finally,thoughTexashasnotyetcompletedanevaluation,thestatereleasedsomepreliminaryfindingsthatreflecttheongoingdevelopmentoftheRHPstructure.EvaluatorshavefoundincreasedcollaborationamongprovidersparticipatinginRHPsonactivitiesthatimprovedaccesstocareandservicesprovidedtodisadvantagedpopulations.48
Ultimately,CMSwillevaluateDSRIPasatooltosupporttheabilityofSection1115demonstrationstotransformcaredeliveryprocesses.AlthoughthespecificDSRIPgoalsdifferacrossstates,thereisaconsistentthemeofcreatingincentivestoimprovecareforbeneficiariesacrosssystems.
“DSRIP really brought everyone out of day-to-day survival mode and how to make costs work to an open table about healthy communities about helping everyone in the community.”
-TexasDSRIPProvider
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
Key taKeaWayS
G iventhepurposeandgenesisofDSRIPprograms,itiscriticaltoconsiderthekeytakeawaysofthisanalysiswithbroaderdeliverysystemreformstrategiesandtheroleofsupplementalpayments.WiththeoldestDSRIPprogramnowonlyinitsfifthyear,itischallengingtocreate
adefinitivelistof“lessonslearned.”Howeverthefollowingkeythemesemergedfrominterviewsandsitevisits:
1. While states view DSRIP programs as a way to preserve supplemental payments, CMS describes the primary purpose of DSRIPs as catalyzing delivery system transformation.
AlthoughCMSdescribesDSRIPasatoolprimarilyintendedtoassiststatesintransformingtheirdeliverysystemstofundamentallyimprovecareforbeneficiaries,stateshavebeencandidthatDSRIPprogramshavebeenpursuedasameanstopreservehospitalsupplementalfunding;withtheintroductionofDSRIP,statesshiftfromasystemwheresupplementalfundingwasdesignedtomakeupforMedicaidpaymentshortfallstowardasystemwherefundingisearnedwhenqualityandimprovementgoalsdesignedtosupportsystemtransformationaremet.Theshifthasbeensignificantandcontinuestoevolve.
TherelationshipbetweenDSRIPandsupplementalpaymentsiscomplicatedandevolving,andextendstoUCpools,whichreimburseprovidersforuninsuredcareandMedicaidpaymentshortfallsandareviewedasanothermechanismtosustainsafetynetsystems.ThelinkagebetweenUCpoolsandDSRIPsvary,withsomeoperatingasasubsetofthesepools,whileothersoperateseparatelybuttieincreasedDSRIPfundingtodecreaseduncompensatedcarepoolfunding.Massachusetts,forinstance,isrequiredtoassesstheinterplaybetweenrecentcoverageexpansionsandfutureproviderfinancinggivenuninsuredcareandMedicaidshortfallscenarios.Subsequently,thestatemustsubmitareportonhowitsprogramwilllookinthefuture.CMSviewsthefutureofDSRIPanduncompensatedcarepoolsastwodistinctissuesandplanstoincreasinglytreatthemseparately.CMSnotedthattheexpansionofhealthcarecoveragewillinfluencethefutureofuncompensatedcarepools,andalthoughDSRIPsdoimpactuncompensatedcarepools,theyarenotintendedtobeavehicletofinancethesafetynet.
2. DSRIP is not “one size fits all;” programs share common traits but vary based on state goals and needs for system transformation to improve outcomes for Medicaid beneficiaries, as well as federal and state negotiations.
Overall,DSRIPswerelaunchedtoimprovecaredeliveryforlow-incomeuninsuredandMedicaidbeneficiariesandtransformhealthsystems.TheDSRIPframeworkisexplicitlybasedontheCMSstrategicgoalsofbettercare,improvedhealth,andlowercosts.Thebasisforsystemtransformationistomoveawayfromepisodictreatmenttopopulationhealthmanagement—inotherwords,keepingpeoplehealthyandoutofthehospital.
AsDSRIPsmultiplyandevolve,statestypicallylooktothemostrecentlyapprovedstateprogramforguidanceonfavoredCMSpolicies;repeatedly,DSRIPstatesandprovidersnotethattheyare“flyingtheplane,whilebuildingit.”SignificantnegotiationoccursbetweenstatesandCMSonSection1115demonstrationwaiversgenerally,butalsospecifictoDSRIPs,withcorenegotiationareasincludingfunding,timeframe,typesandnumberofeligibleproviders,andmetrics.ThesearethekeyareaswhereDSRIPsdifferfromstatetostate.Forexample:(1)certainstatesattractfundingabovepriorsupplementalpayments,whileothersreceivelevelfunding;(2)moststatesreceiveafive-yearDSRIP
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approval,whileOregon’sprogramistwoyears;(3)eligibleprovidersrangefromallhospitalsinthestatetoonlysafetynethospitalstocoalitionsofproviders;and(4)certainstatesworkwithhospitalstolocalizeDSRIPprojectandmetrics,whileothersusestandardizedprojectsandmetricsstatewide.StatesandCMSagreethatDSRIPsshouldbeindividualizedinordertopropelandacceleratestateeffortstoimprovecaretoMedicaidbeneficiaries,rewardvalueovervolume,andmovetowardamorepreventive,accountablemodelofcare.Withthisunderstandinginmind,CMSplanstomaintaintheflexibilityneededtocontinuetoaddressstateproposalsindividuallyanddoesnotplantoissueformalguidanceonDSRIP.
3. While DSRIP policy is not one-size-fits all, as DSRIPs evolve, there is an increasing emphasis on standardizing metrics to demonstrate real improvements.
AsDSRIPsshiftovertime,measuringperformanceisincreasinglyprescriptive,withDSRIPsseekingpre-definedoutcometargetsratherthanprovidersdefiningimprovementgoalsbasedontheirfacilitiesandpatients.Withthesechanges,DSRIPsgaintheabilitytocompareandcontrastresultsacrossprovidersand,potentially,acrossstates.WhilerecognizingtheconcernthatthedesignofDSRIPsrespectlocalnuance,flexibility,andinnovationforprojectstoachieveimprovements,DSRIPsmustbeabletodemonstrateoutcomesandensureaccountabilityforallocatedfunding,thusCMS’emphasisonensuringaccountabilitybasedonaparsimonioussetsofmetrics.Thisisparticularlychallenginginattemptingtosupportinnovationinareaswheremetricsmaynotyetbeavailable.TheoutcomesDSRIPsmeasuremaynotbethebestindicatorsofprogramsuccessduetoalackofstatewide,standardizedmetricsthataccuratelyreflectprogressinallfacetsofdeliverysystemtransformation.Forexample,aclinicalpanelacrossCalifornia’spublichospitalsreportedthatDSRIPhasbeeninstrumentalinculturaltransformationandmakingarealimpactthatisnotcompletelycapturedinDSRIPmetrics;infact,oneUniversityofCaliforniahealthsystemofficialsaidthatDSRIPhasbeenthemostimportantchangeagentintheorganization.
4. DSRIPs increase accountability for outcomes over the course of implementation.
Whereaspriorsupplementalpaymentswerebyandlargedistributedtoprovidersbasedontheirpayermix,DSRIPpaymentsaremadeonlyafterimprovementsareplanned,executed,andachieved.DSRIPprogramsgenerallyprovidemorefundingforprocessandinfrastructureimprovementsinearlieryears,astheyarenecessarytoachieveclinicalimprovementsinlateryears.DistributionoffundingformulasreflectthisshiftandincreasinglyallocatefundingtowardsachievingimprovedclinicaloutcomesasDSRIPprogramsprogress,whilemaintainingmaximumvaluationdirectlyproportionaltothenumberofMedicaidbeneficiariesserved.Thismakesincentivepaymentsmorechallengingtoattain;inallstates,thebarrisesovertime.
5. DSRIPs provide continued support for public and safety net hospitals via an incentive-based program; however, certain states have expanded DSRIP participants beyond hospitals.
Manystates,andproviders,haveconsideredDSRIPstobeprimarilytargetedforpublichospitalsbecauseDSRIPreplacessupplementalpaymentsthatpreviouslyprimarilysupportedhospitalsthatencounteredalargeshareofMedicaidpaymentshortfallsgiventheirpayermix.Asaresult,certainstatesexclusivelyfocusDSRIPonsafetynethospitals;however,othersfocusmorebroadlyonsafetynetproviders(e.g.,outpatientclinics),andstillothersmakeDSRIPavailabletoahostofhealthcareorganizations(e.g.mentalhealthorganizations).ThisreinforcesconflictingperceptionsamongstakeholdersregardingthegoalsofDSRIP;specificallywhethertheintentofDSRIPistostimulatedeliverysystemreformforallprovidersortostabilizethesafetynet.Itremainstobeseenwhat
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impactthisapproachhasonsafetynetprovidersandhowitcontinuestoevolve,butitisnecessarytomonitorinordertoevaluatesafetynetstability.
6. DSRIP enables states to redesign hospital payment strategies to align with broader delivery system reform goals, thus supporting transition costs for the design of new systems.
DSRIPscancomplementotherhealthsystemtransformationswithinthestate’sMedicaidsystem,includingmanagedcareexpansion,paymentreform,coverageexpansion,andotheraspectsofdeliverysystemreform.DSRIPprogramscanhelptocatalyzecommunity-basedcollaborationandincreaseproviders’abilitytotakeresponsibilityforthehealthofthepopulationsserved.InMassachusetts,theprogramworkedtoestablishaprovider-basedACOandproposedanaccountablecareframeworkaspartofitsrenewedSection1115demonstrationwaiver.InNewYork,DSRIPestablishedaccountable-care-likenetworks,andinTexas,participantsreportthatDSRIPhasbrokendownbarriersbetweenprovidersthatwerepreviouslycompetitors.Goingforward,severalparticipantsraisedDSRIPcollaborationwithMedicaidmanagedcareplansasonepotentialreformstrategy.Additionally,populationhealthhasbecomeagreaterfocuswithpay-for-performancemetricsexaminingbroaderpopulationhealthoutsideofhospitalwalls.
7. DSRIP implementation is resource intensive for states, providers, and the federal government.
States,providers,andfederalofficialssuggestthatDSRIPaccountabilityhasproducedresults,butalsocreatedsignificantadministrativeburden.Moststateshaveincreasedstaff/consultingcapacityandexpertiseinclinicalqualityandperformanceimprovement;afterDSRIP,California’sDepartmentofHealthCareServicesappointedthefirst-evermedicaldirectortooverseequalityinMedicaid,includingDSRIP.TexasHealth&HumanServicesCommissiondedicatedanadditional13FTEstosupporttheadministrationofDSRIPalone.Providers,too,reportaddingstaff/contractortimetosuccessfullyimplementprojects,complywithDSRIPreporting,andaddressdataandtechnologylimitations.CMSnotesthattheadministrationischallengingandrequirestheagencytothinkcarefullyaboutthedesirednumberofDSRIPs,buttheuniquelevelofdetailedreportingisimportantconsideringtheinvestment.WhileparticipantsunderstandthevalueofDSRIPreporting,theyquestionwhethertheremaybeanequallyvaluable,butlessresourceintensiveapproach.
8. States are challenged to produce a source for the non-federal share of DSRIP funding.
DSRIPpaymentsrequireanon-federal/statesharethatcanbefundedbysourcessuchasstategeneralrevenuefunds,providertaxes,orIGTs.Stakeholdersnotedthatfindingasourceofnon-federalshareisdifficultforstates,andpresentsahostofcomplications(political,technical,andfinancial).StatesreportfederalinconsistencyonpoliciessuchasDSHPandIGTs,whichhavebeenvehiclesforthestatenon-federalshare.Inmanystates,theprovisionofthenon-federalshareisintricatelyconnectedtowhichparticipantsqualifyforDSRIPandcancreatescenarioswherenon-publicprovidersgo“shoppingforIGTs”inordertoparticipate.Furthermore,theentityprovidingthenon-federalshareisfinancially
“We realized very early on that our DSRIP project is a population health project. We realized we needed to do everything we can to keep low-income
patients healthy and that’s the focus.”-NewJerseyDSRIPProvider
“[It’s a] very labor intensive process. It’s far more labor intensive than we were able to fathom when it
first rolled out.”
-CaliforniaMedicaidOfficial
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andpoliticallyimpactedand,insomecases,maynetfewerDSRIPincentivepaymentsthanaprivately-ownedhealthcareproviderforcomparablework.
9. While lacking comprehensive DSRIP evaluation data, there are multiple examples of quality improvement and care delivery redesign.
SinceDSRIPprogramsarerelativelynewandvarysignificantlyindetails,itisnotyetpossibletodeterminetheefficacyofspecificfinancingpolicies.Broadly,however,stateswithmorematureDSRIPsreportthatsignificantimprovementsincarehavebeenachievedforlow-income(Medicaidanduninsured)patients,andthatmostlikelytheseimprovementswouldnothavebeenachievedatcomparablescale,speed,andsuccesswithouttheimpetusofearningtheaccompanyingDSRIPfunding.Forexample,TexasMedicaidprovidersreporttheability,viaDSRIP,toprovideservicesunreimbursedbytheirstate’sMedicaidprogramandnotethecareimprovementsmadeasaresultoftheseinvestments.
10. States and providers are concerned about the timeframe for DSRIP implementation and evaluation, demonstration of results for Medicaid beneficiaries, and the impact on waiver renewal requests.
AllDSRIPimplementationtimeframes(postplanning)arefiveyearsorlessand,justrecently,CMSapprovedthefirstDSRIPrenewal(inOctober2014,CMSapprovedMassachusetts’sDSTIprogramforanadditionalthreeyears).ProvidersexpressedconcernaboutupcomingrenewalrequestsandthecontinuationandevolutionofDSRIP.Whiletheserenewalsshouldbeinformedbytheprogramresultsandevaluation,bothhaveshortcomings.
First,DSRIPimplementationonlycommencesafterasignificantamountoftimehasbeenspentonprogramdevelopment,projectplanning,andstartup.Forexample,MassachusettsprovidersreceivedCMSapprovalofDSRIPprojectsnearlyafullyearintoathree-yearwaiver,allowingonlythelattertwoyearsforactualtransformationwork;thisexperienceissharedamongstates.
Second,stateandproviderintervieweesnotedthatrealtransformationrequiresadditionaltime,andthatDSRIPprogramsarerelativelyshortcomparedtothetimeneededtotransformasystem.Incontrast,CMSnotedthatfiveyearsshouldbesufficienttimeforDSRIPimplementation;officialsdonotviewDSRIPasalong-termsustainablesolutionwithoutaddressingunderlyingcaredeliveryissuesinstates.TheagencyisactivelyprocessinginformationfromDSRIPstoidentifytheirvalueandreturnoninvestment.
Last,onlyNewYork’sDSRIPwasexplicitlydesignedtobeaone-timeinvestment.WhilestatesandprovidersreportedthatsomereformsaresustainableafteraninitialDSRIP(i.e.certainone-timeinvestmentsininfrastructure),othersarenot(e.g.payingforaspectsofbettercarenotreimbursedunderMedicaid).Somestatesseeacontinuedneedforsuchinvestmentintransformation,asaDSRIPrenewaloralternativearrangement,andareconcernedthatrenewalrequestsprecedetheconclusionoftheprogram,whichmeansthatfinalprogramresultsandevaluationdataarenotavailable.CMSpointsoutthatDSRIPisademonstration.Assuch,itisnotintendedtoserveasthemechanismforMedicaiddeliveryreformslongterm,butrathertoidentifywaystobetteroperatetheMedicaidprogramgoingforward.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
conclUSion
D SRIPprogramscanonlybeconsideredintheirinfancy;theoldestDSRIPprogramisjustinitsfifthyear.Thereiswidevariabilityacrosstheeightstatesintheirdesign,financing,andmeasurement.Nonetheless,theysharetwocommongoalsoftransformingthedeliverysystem
tomeetthegoalsofbettercare,improvedhealth,andlowercosts;andincentivizingsystemtransformationandqualityimprovementsinhospitalsandotherprovidersthatservehighvolumesoflow-incomepatients.Inmanystates,theyarealsoseenasamechanismtopreservesupplementalpaymentsforsafetynethospitals.ThespecificsofDSRIPfinancingpolicies,andthemilestonesandmetricsfordeterminingimpact,arecomplexandevolving.AsDSRIPprogramscontinuetomatureandevolve,itwillbecriticaltoevaluatetheirimpactonstateMedicaidandbroaderdeliverysystemreforms,andonsafetynetproviders.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
enDnoteS
1Asfurtherdescribedbelow,theframeworkputforthbyCMSfortheDSRIPisbasedontheInstituteforHealthcareImprovement’s(IHI’s)“TripleAim”goalsofbettercare,lowercosts,andbetterhealth.AtthetimeofthecreationofthefirstDSRIP,CMSwasledbyDr.DonaldBerwick,formerheadofIHI.
2ManyDSRIPprogramsrepurposepriorsupplementalpaymentstohospitals;TexasalsoincludedpriorsupplementalpaymentstootherprovidersinitsDSRIPpool.
3WhileFloridaincludesaprogramsimilartothesestatesinitsSection1115demonstration,Florida’sprogramdidnotmeetthecriteriaforthisprojectduetoitspaymentmechanism.
4NASHPdidnotdevelopafactsheetforKansas,giventheearlystageofimplementationandlackofavailableinformation.
5Massachusetts’DSTIistheonlyprogramcompleted.ThefirstroundofDSTIwasforthreeyearsandthenextroundhasrecentlybeenrenewedforanadditionalthreeyears.
6InCalifornia,designatedpublichospitalsare21governmentownedhospitalsystems,includingUniversityofCaliforniahospitalsandcountyownedandoperatedhospitals.OnlythedesignatedpublichospitalsparticipateinCalifornia’sDSRIP.
7Apriorwaiverlimiteduncompensatedcaretocostsandwassetatalevelthatwasbelowwhatthepublichospitalsfeltwassustainable.
8JuliaParadise,Medicaid Moving Forward (TheHenryJ.KaiserFamilyFoundation,2015).Availableat:http://kff.org/medicaid/fact-sheet/the-medicaid-program-at-a-glance-update/
942CFR438.60
10AaronMcKethanandJoelMenges,Medicaid Upper Payment Limit Policies: Overcoming a Barrier to Managed Care Expansion (TheLewinGroup,2006).Availableat:http://www.lewin.com/~/media/lewin/site_sections/publications/upl.pdf
11Underacapitatedmanagedcaredeliverysystem,supplementalproviderpaymentsdirectedataparticularproviderarenotpermittedbecauseoffederalregulationsthatrequiremanagedcareratestoaccountforthefullcostofservicesunderamanagedcarecontract(42CFR438.60).WhilecapitatedMedicaidmanagedcareorganizationscanspendupto5percentoftheircapitationrateonperformance-basedincentivepaymentstoproviders(42CFR438.6(c)(5)(iii)),statescannotdirectthesepaymentsinthesamemannerthattheycandirectUPLpayments.
12TheCentersforMedicare&MedicaidServices.“Section1115Demonstrations.”RetrievedMarch17,2015.Availableat:http://www.medicaid.gov/medicaid-chip-program-information/by-topics/waivers/1115/section-1115-demonstrations.html
13PrivateprovidersplayanimportantroleintheTexasDSRIPprogram.Asignificantnumberofprivatehospitalsareparticipatingduetothestate’ssystemtransformationgoalsandinclusionofprivateprovidersinthestate’spreviousUPLprogram.
14Twostates,NewYorkandOregon,havenotyetapprovedparticipatingproviders.
15InNewYork,aPPScanbecomprisedofhundredsorthousandsofhealthcareorganizationsthatarecollectivelyresponsibleforanattributedpopulationandforimplementingprojectstoimprovecareforthatpopulation.InTexas,anRHPformsadministrativelyinageographicregionofMedicaidproviderswhoareindividuallyresponsiblefortheir
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ownpatientsandtheirownDSRIPprojects.
16Towatchavideooverviewofthisprogram,pleasevisit:http://texasregion7rhp.net.FormoreinformationontheCommunityCareCollaborative,pleasesee:http://communitycarecollaborative.net.
17DSRIPsareprohibitedfrompayingforcapitalimprovements,EHRs,housing,otherservicesdirectedatsocialdeterminantsofhealth.
18LisaKirschandArdasKhalsa.“TexasHealthcareTransformationandQualityImprovementProgramWaiver.”PresentedattheTexasDSRIPLearningCollaborativeSummitonSeptember9,2014.RetrievedMarch17,2015.Availableat:http://www.hhsc.state.tx.us/1115-docs/DSRIP-summit/DSRIPSuccess.pdf
19NewYorkStateDepartmentofHealth.“RedesigningNewYork’sMedicaidProgram.”RetreivedMarch17,2015.Availableat:https://www.health.ny.gov/health_care/medicaid/redesign/
20Formoreinformation,see:http://www.alamedahealthsystem.org/about-us/news-press/news/hope-center-clinic-serves-super-users
21CaliforniaAssociationofPublicHospitalsandHealthSystems,LeadingtheWay:California’sDeliverySystemReformIncentiveProgram(DSRIP)(TheCaliforniaAssociationofPublicHospitalsandHealthSystems,2014).Availableat:http://caph.org/wp-content/uploads/2014/09/Leading-the-Way-CA-DSRIP-Brief-September-2014-FINAL.pdfForthefullvideo,see:https://www.youtube.com/watch?v=zHyJ4DC8zdk.
22ProvidersinNewJerseyhadtheoptionofformulatingtheirownprojectwithinexistingclinicalareasorinanewclinicalareathatwasuniquetotheirpopulation.
23TheCenterforMedicare&MedicaidInnovationwithinCMShasprovidedtworoundsofStateInnovationModelawardstosupportstatesastheydevelopandtestnewmulti-payerdeliverymodelsthatsupportMedicaidandCHIPbeneficiaries.StatesreceivingaSIMDesignawardaresupportedthroughtheprocessofdevelopingadeliverysystemtransformationplanwhilestatesthatreceiveaSIMTestingawardaresupportedastheyimplementanewdeliverysystemmodel.Moreinformationisavailableat:http://innovation.cms.gov/initiatives/state-innovations/
24ASection1115demonstrationmustbebudgetneutral,meaningitcannotcostthefederalgovernmentmorethanwhatwouldhaveotherwisebeenspentabsentthewaiver.
25InNewYork,unlikeinotherDSRIPs,thereisemergencyrelieffundingfordistressedhospitalstoenablethemtoparticipateinDSRIP(upto$1billiontotal,withamaximumof$500millioninfederalfunds)aswellasDSRIPDesignGrantfunding(upto$200milliontotal,withamaximumof$100millioninfederalfunds)tosupportparticipatingprovidersinformingprovidernetworksanddevelopingDSRIPplans.
26California’sDSRIPprogram,asthefirstofitskind,didnotincludefundingforplanning,nordotheDSRIP-likeprogramsinNewMexicoandOregon.
27Thisreportuseseachstate’sDSRIPprogram’sindividualdefinitionofpay-for-performance,butthatthesedefinitionsarenotnecessarilythesameacrossstates.Certainstatesmaydefinepay-for-performanceaspaymentforimprovementinclinicaloutcomesandpotentiallypreventableevents;whileotherstatesmayalsoprovideperformancepaymentsforprocessimprovementsaswell.Thismakeslike-comparisonsdifficult.
28Forfurtherdetails,pleaseseehttp://aspe.hhs.gov/health/fmap.cfm.
29Under§1905(cc)oftheSocialSecurityAct,amendedundertheACA,statesarenotallowedtorequireincreasedparticipationfrompoliticalsubdivisions.
30EntitiessupplyingIGTforDSRIPandparticipatinginDSRIPprojectimplementationonlybenefitfromFFP
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37
andnotthefullincentivepayment.However,theseproviderstypicallyfindtheabilitytodrawdownFFPonlyisstilladvantageous.
31Provider-relateddonationsaddresscertaintypesofpublic-privatefinancingarrangements,andCMShasprovidedguidancetostatesonallowableandunallowableuseofprovider-relateddonations.Federalregulationsat42CodeofFederalRegulations(CFR)433.52,whichimplementsection1903(w)oftheSocialSecurityAct,defineaprovider-relateddonationas“adonationorothervoluntarypayment(incashorinkind)madedirectlyorindirectlytoastateorunitoflocalgovernmentbyoronbehalfofahealthcareprovider,anentityrelatedtosuchahealthcareprovider,oranentityprovidinggoodsorservicestothestateforadministrationofthestate’sMedicaidplan.”AspartofaprogramYear2financialandmanagementreviewofTexas’fundingpools,CMShasraisedconcernsaboutpossibleprovider-relateddonations,whichmayaffectDSRIPpaymentsmadetocertainprivateproviders.TheStateofTexas,theaffectedprovidersandCMSareworkingonthoseissuescurrently.
32InDSRIPs,potentiallypreventableeventsencompassavoidablehospitaluse(admissions,readmissionsandEmergencyDepartmentvisits)aswellashospital-acquiredcomplications/conditionsandadverseevents.
33Thedefinitionofwhichrangesacrossstatesfromprevention(e.g.,California)topublichealthmeasures(e.g.,NewYork).
34SuchasNCQA’sAntidepressantMedicationManagementmeasure
35TheTexasDSRIPprogramrequiresatleasteitherthreeprocess/accesspay-for-performancemeasuresoroneclinicaloutcome/potentiallypreventableevent/patientexperiencemeasureperdeliverysystemreformproject.
36NewJerseyandCMShavesubsequentlyupdatedthelistofapprovedDSRIPmetricsforpediatricasthmaprojectsinNewJersey.
37Definedaspatientswhohavevisitedthesystem’sprimarycareclinic(s)atleasttwiceinthepastyear.
38Historically,CMS–atthetimeknownastheHealthCareFinancingAdministration(HCFA)–usedtoreviewmanagedcareplansonstructuralstandardsthatlookedataplan’sinfrastructureandcapacitytoimprovecare,asopposedtolookingatwhethertheplanactuallyimprovedcare.TodemandmoreaccountabilitywithinMedicareandMedicaid,HCFAworkingthoughNASHPinconsultationwithStateMedicaidagenciesandregulators,qualitymeasurementexperts,managedcareplansandbeneficiarygroupstodevelopQISMCinthelate1990s.
39Asasimpleexample,iftheprovider’sbaselinerateforhemoglobin(Hb)A1ccontrolis50percentandthebenchmark(90thpercentile)is80percent,thenthegapis30percent(80%-50%).Theprovider’simprovementtargetistoclosethegapby10percent,inotherwordsimproveHbA1ccontrolby3percent(30%*10%)overthebaseline,orachieve53percent(50%+3%)forHbA1ccontrol.
40 Texas has only reported baseline rates, and other states have not yet reported baselines. DYs 4-5 in Texas will utilize QISMC methodology; the first report in DY4 for TX is April 2015.
41DSRIPsmayprovidefundingforHITinfrastructurebutmaynotduplicatefederalfundingprovidedbytheMedicaidEHRIncentiveProgramestablishedthroughtheRecoveryAct/HITECHActof2009.
42CaliforniaHealthCareSafetyNetInstitute,Aggregate Public Hospital System Annual Report on California’s 1115 Medicaid Waiver’s Delivery System Reform Incentive Program, Demonstration Year 8(CaliforniaHealthCareSafetyNetInstitute,2013).Availableat:http://www.dhcs.ca.gov/Documents/DSRIP%20DY%207%20Aggregate%20Pub%20Hosp%20System%20Annual%20Report.pdf
43Ibid.p.12.
44InstituteforHealthcareImprovement,The Breakthrough Series: IHI’s Collaborative Model for Achieving Breakthrough Improvement (TheInstituteforHealthcareImprovement,2003).Availableat:http://www.ihi.org/resources/Pages/
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IHIWhitePapers/TheBreakthroughSeriesIHIsCollaborativeModelforAchievingBreakthroughImprovement.aspx
45TheevaluatorsofOregon’sDSRIP-likeHospitalTransformationPerformanceProgram(HTPP)programareplanningtoincludecomparisonsbetweenparticipatinghospitalsandnon-participatinghospitalsonCoordinatedCareOrganization(CCO)metricstoseehowHTPPisaffectingCCOperformance.Nootherstatehasyettoidentifyacomparablepeergroup.
46TeresaAndersonetal.,MassHealth Section 1115(a) Demonstration Waiver 2011-2014 Interim Evaluation Report(TheUniversityofMassachusettsMedicalSchool(UMMS)CenterforHealthPolicyandResearch,2013).Availableat:http://www.mass.gov/eohhs/docs/eohhs/cms-waiver/appendix-b-interim-evaluation-of-the-demonstration-09-2013.pdf
47NaderehPouratetal.,Interim Evaluation Report on California’s Delivery System Reform Incentive Payments (DSRIP) Program (UCLACenterforHealthPolicyResearch,2014).Availableat:http://www.dhcs.ca.gov/provgovpart/Documents/Waiver%20Renewal/AppendixCDSRIP.PDF
48MonicaL.WendelandLizaM.Creel.“EvaluationoftheTexasHealthcareTransformationandQualityImprovementProgram:1115(a)MedicaidDemonstrationWaiver.”PresentedattheTexasStatewideLearningCollaborativeSummitonSeptember10,2014.RetrievedMarch17,2014.Availableat:https://www.hhsc.state.tx.us/1115-docs/DSRIP-summit/WaiverEvaluation.pdf
Appendix
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
State fact SheetS
T heinformationpresentedinthefollowingfactsheetssummarizesNASHP’sunderstandingoftheDSRIPandDSRIP-likeprogramsinCalifornia,Texas,Massachusetts,NewMexico,NewJersey,NewYork,andOregonasofMarch2015.Theyappearinchronologicalorderofwaiverapproval.NASHPcompiled
thisinformationfromavarietyofsources,includingtheSpecialTermsandConditionsandattachmentsofeachstate’sSection1115demonstrationwaiver;availableaggregatereports,evaluationplans,resourcesavailableonstatewebsites,andinformationcollectedduringinterviews.Forpurposesofstate-to-statecomparison,eachDSRIPprogramyearbeginswith“Year1,”thoughstatesmayrefertoDSRIPyearsintermsofwaiverdemonstrationyears.Furthermore,theamountsprovidedinthefollowingfactsheetsareestimatesbasedonananalysisoffiguresprovidedineachstate’s1115demonstrationwaiver.AswithallDSRIPprograms,fundingiscontingentupon:(1)theachievementofmilestones,metrics,reportingandoutcomes(inmostcases,thoughsomefundingisforplanningandadministration);and(2)theprovisionofthenon-federalshare.Unlessotherwisenoted,allfundingestimates(e.g.averageprojectfundingperyear)arebasedontheSTCsandtotaldollarsallocated(grosstotalcomputableallocation,notnetincentivepaymentsreceived).Finally,thecurrentFMAPisprovidedineachstatealthoughthisnumbermayhavefluctuatedinpastyears.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
california
geneRal PRogRaM infoRMation and ContextCalifornia’s2010Section1115demonstrationrenewal,knownastheBridgetoReform,createdaLowIncomeHealthProgram(LIHP)toprovidecoveragethroughtheendof2013foradultsincertaincountieswhowouldbeeligibleunderACAcoverageoptionscome2014;expandedthestate’sSafetyNetCarePool(includingcreationofthefirstDSRIPprogram);expandedtheMedicaid(“Medi-Cal”)managedcareprogramtonewpopulations;andprovidedstatebudgetrelief.TheDSRIPinparticularseekstodrivesystemtransformationbyprovidingsupportforinfrastructureandqualityimprovementswhilebolsteringthesafetynetfordesignatedpublichospitals(DPH)servinglargenumbersofMedi-CalenrolleesanduninsuredCalifornians.
UnderDSRIP,eachofCalifornia’sDPHsisundertakingseveralsystemtransformationprojectsaimedatbecominganintegrateddeliverysystem.Eachhospitalsystemisrequiredtoundertakeprojectsineachof4Categories(withanoptional5thCategory-HIVTransition-addedasamodificationtothewaiver),withsignificantflexibilityforparticipantstotailorprojectstomeetlocalneedsandgoals.
Gen
eral
In
form
atio
n
Program Length 5yearsStage of Implementation Year5Date Submitted to CMS 6/3/2010Date Approved by CMS 11/1/2010
Date Expires 10/31/2015
Fund
ing
Maximum Potential Pool Funding (federal)
$3,336,000,000
Maximum Potential Pool Funding (all funds)
$6,671,000,000
Current FMAP 50.00%Source Of Matching Funds (Non-Federal)
IGT(providedbythedesignatedpublichospitals)
Average Funding Available Per Year
$1.3billion
Relation of Total Funding to Prior Supplemental Payments
Exceedspriorsupplementalpayments
Total Distribution of Payments
Californiadoesnotincludefundingforplanning.Morefundingisallottedtoimplementationmilestonesinearlieryears,whichdecreasesovertimeasfundingisincreasinglyallottedtopay-for-reportingofpopulationhealthmeasuresandpay-for-performanceofreducedhospital-acquiredinfections.
Corr
espo
ndin
g Po
ols
Corresponding Uncompensated Care (UC) Pool
Yes,totalamountofUCpoolis$8,050,508,827
Corresponding Designated State Health Program (DSHP)
Yes,totallimitofDSHPis$4,000,000,000;DSHPallocationisapercentoftheUCpool.Thestatedoesn’tnecessarilyspendallofthismoneyeachyear.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
42Pr
ovid
ers
Participating Providers All21designatedpublichospitals(DPHs)areparticipating(including17healthsystems).
Proj
ects
Bei
ng F
unde
d
DSRIP Project Domains
Projectsareidentifiedwithineachoffivecategories(Categories1-4arerequired):• Category1:InfrastructureDevelopment• Category2:InnovationandRedesign• Category3:Population-focusedImprovement• Category4:UrgentImprovementinCare• Category5:HIVTransitionProjects
Project Funding Per Year Averageprojectfundingperyearis$3.4million.Approved Projects 388
Minimum Number of Projects Required
Aminimumof12projectsarerequiredperDSRIPplan(15ifparticipatinginCategory5):
• Category1:minimumof2projects• Category2:minimumof2projects• Category3:4“projects”:allmustreportallmeasures(70)across4domains1
• Category4:4projects:allmustimproveon2requiredprojectsandselect2additionalprojects2
• Category5:participationinCategory5optional;ifparticipating,mustselect3projects
Nomaximumrequirements(exceptforCategory5,nomorethan3projects)
Process for Reallocating Unused Funds
ForCategories1,2,4and5,DPHsarepermittedpartialpaymentforpartialachievementofamilestonein25%increments(i.e.,ifamilestoneis30%achieved,theDPHcanreceive25%ofthepayment).
ForCategories1,2,4and5,DPHsarepermittedtocarryforwardamilestoneandtheassociatedpaymentforuptooneDY.IfaDPHisunabletomeetamilestoneincategories1or2,theyareabletosubmitadditionalprojectproposalstoclaimupto90%ofanyremainingunclaimedfundsforthosemilestonesaspartofa90-dayprocess.Categories4and5arenotsubjecttothispenalty.IftheDPHisunabletoproposesufficientadditionalmilestones,theunclaimedfundingbecomesavailabletotheotherDPHsforadditionalmilestones.ForCategory3,DPHsmayclaimpartialpaymentwithinthereportingyear;however,theyareunabletocarryforwardunclaimedfundsforpartialachievement.AllremainingunclaimedfundingwilleitherremainunclaimedorberolledintotheSafetyNetCarePool,withCMSapproval.
Additional Funded Program Elements
AdditionaldesignelementsarenotrequiredinCA,unlesstheDPHisparticipatinginCategory5,whichrequireseachplantoincludeactivitiesrelatedtosharedlearning.DSRIPrequiresthestatetoreporteachyearonsharedlearningactivitiesthatoccur.Additionally,theCAHealthCareSafetyNetInstitute(SNI)providedlearningcollaborativesspecificallyfortheDSRIPinwhichDPHsparticipatedandpartiallyfundedattheiroption.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
43O
utco
mes
Types of Outcomes Being Used for Pay-for-Performance
Hospitalsafetymeasuresareusedforpay-for-performanceexceptformeasureswhereevidenceislackinginlinkingtheprocessimprovementtooutcomeimprovement.
Metrics and Benchmarked Improvement Targets
TheimprovementmethodologyisacombinationofimprovementoverselfandtheQualityImprovementSystemforManagedCare(QISMC)methodologyofclosingthegapbetweenbaselineandbenchmark.
Denominator for Improvement
Denominatorsarespecifictoeachparticipatinghealthsystem.
Thereisnoattributionmethodologyutilized,sincealldenominatorsdonotexceedtheDPH’spatientpopulationandtheDPHstendtocoverdistinctgeographicareas.
Statewide Accountability Test
N/AforDSRIP
Repo
rtin
g &
Mon
itorin
g
Provider Reporting
DPHsarerequiredtosubmitthreereportstothestateforrevieweachyear(twosemi-annualreportsandoneannualreport).DPHsarerequiredtosubmitdataoneachmilestoneinadditiontoanarrativedescriptionofoverallprojectimplementation.Reportsalsomustincludeanarrativeonhowprojectscontributedtosystemreformforthepopulationsservedaswellasanysharedlearningthattookplace.
State Reporting
ThestatemustsubmitanannualaggregatereportonDSRIPtoCMS,whichmustincludeelementssuchasadescriptionofprogressmade,metricreporting,outcomedata,andsharedlearningactivitiesthatoccurred.ThestateengagedSNItoconductthisreportannually.
Mid-Point Assessment Process
Amid-pointassessmentofDSRIPoccurredinYear3thatreviewedprogressineachcategory.Thisprocesshasoccurredandwasfinalized,resultinginchangestotheDSRIPprotocolsthatapplytoYears4-5ofCategory4.
Program Evaluation
UCLACenterforHealthPolicyResearchisevaluatingCalifornia’sDSRIP.ThegoalsoftheevaluationaretoassessDSRIPprojectsbasedonprogramrequirementsandmilestones.IntheinterimevaluationhospitalsreportedthatDSRIPhashadahighimpactonqualityandoutcomesbutalowerimpactoncosts.HospitalsalsoreportedthatDSRIPledtosystematicchangesandnewcollaborations.
External Audit/Review Notrequired.
44
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
texaS
geneRal PRogRaM infoRMation and ContextTheTexasDeliverySystemReformIncentivePayment(DSRIP)programispartofthestate’sHealthcareTransformationandQualityImprovementProgramSection1115demonstration.ThemajorcomponentsofthewaiverincludethestatewideexpansionofMedicaidmanagedcareandthedevelopmentoftwofundingpoolsthatsupportprovidersfordeliveringuncompensatedcareandforimplementingdeliverysystemreforms:theUncompensatedCare(UC)PoolandtheDSRIPPool.Savingsgeneratedfromthemanagedcareexpansion,inadditiontopreservingpriorsupplementalpaymentstohospitals(UpperPaymentLimitfunding)underanewmethodology,allowthestatetomaintainbudgetneutralityandestablishtheUCandDSRIPpools.
DSRIPincentivizesbothhospitalandnon-hospitalproviderstoimplementmulti-yearprojectsthatenhanceaccesstohealthcare,qualityofcare,experienceofcare,andthehealth-caresystem,withtargetpopulationsincludingMedicaidandlow-incomeuninsuredindividualsacrossthestate.TexashasadoptedalocalizedapproachtoDSRIPimplementationbyorganizingprovidersinto20geographicallydefinedRegionalHealthcarePartnerships(RHPs),whichconductlocalcommunityneedsassessmentsandarecoordinatedbyapublichospitalorotherlocalgovernmentalentity.Intergovernmentaltransfers(IGTs)frompublicentitiessuchashospitaldistricts,counties,state-fundedmedicalschoolsandcommunitymentalhealthcentersfinancethenon-federalshareofDSRIP.
Gen
eral
Info
rmat
ion Program Length 5years
Stage of Implementation Year4Date Submitted to CMS 7/12/2011Date Approved by CMS 12/12/2011Date DSRIP protocols approved 10/1/2012(initialapproval);5/21/2014(latestprotocolmodifications)
Date Expires 9/30/2016
Fund
ing
Maximum Potential Pool Funding (federal) $6,646,000,000
Maximum Potential Pool Funding (all funds) $11,418,000,000
Current FMAP 58.05%
Source Of Matching Funds (Non-Federal)
Intergovernmentaltransfers(IGTs)frommajorpublichospitals,orotherunitsoflocalgovernmentsuchascounties,cities,communitymentalhealthcenters,state-fundedacademicmedicalschools,andhospitaldistricts.
Average Funding Available Per Year AvailableDSRIPfundingfluctuatesperyearbutaveragesabout$2.28billionperyear.
Relation of Total Funding to Prior Supplemental Payments
The$29billiontotalDSRIPandUCpoolfundingexceedspriorsupplementalpayments(UPLfunding).InFFY2010,Texasmadeabout$2.86billioninUPLsupplementalpayments,accordingtoCMS-64data.
Total Estimated Distribution of Payments
FundingwasinitiallydistributedtoRegionalHealthPartnerships(RHP)basedontheintensityoftheirMedicaidandlow-incomepatientcare.InYear1only,fundingwasavailableforsubmissionofRHPPlans.Year1fundingwasbasedonthevalueoftheDSRIPCategory1-4projects(DY2–DY5).Overthecourseoftheremainingfouryears,fundingforcategories1and2decreasesfromnomorethan85%,tonomorethan75%.Category3fundingincreasesfromatleast10%toatleast15%andcategory4fundingincreasesfromatleast5%toatleast10%.Fundingpercentagerequirementswereappliedtoeachprovideratthetimeofplansubmission.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
45Co
rres
pond
ing
Pool
s Corresponding Uncompensated Care (UC) Pool
Yes,maximumUCpoolfundingis$17,582,000,000over5years
Corresponding Designated State Health Program (DSHP)
No
Prov
ider
s
Participating Providers
Atotalof309providerswereparticipatinginDSRIPasofOctober2014.Performingprovidersarehospitalsandothereligibleproviders,includingcommunitymentalhealthcenters,localhealthdepartments,physicianpracticeplansaffiliatedwithanacademichealthsciencecenter,andotherprovidersspecificallyapprovedbythestateandCMS.
Proj
ects
Bei
ng F
unde
d
DSRIP Project Domains
1. Infrastructuredevelopment2. ProgramInnovationandRedesign3. QualityImprovement4. Populationfocusedimprovements
Project Funding Per Year Averageprojectfundingperyearis$150,000.
Process for Reallocating Unused Funds
PartialpaymentisonlyavailableforP4PCategory3outcomesin25%increments.Category1and2metricsmustbefullyachievedforpaymentandallmeasureswithineachCategory4domainmustbereportedforpayment.
Thereisacarry-forwardpolicyforcategories1-3.Iftheperformingprovidersdonotfullyachieveamilestone,theycancarryforwardavailableincentivefundingforthatmilestoneforuptooneadditionalDY.Afterthat,ifthemetricisstillnotachieved,theassociatedincentivepaymentisforfeited.
UnallocatedfundingfromYears3-5intheamountof$1,169,205,548wasredistributedamongtheRHPsforadditionalthree-yearprojectsforthoseyears.
Furtherunclaimedfundingcannotberedistributed.
UnclaimedDY2fundingwasforfeited.Number of Approved Projects 1,491projectshavebeenapprovedandareactiveasofOctober2014.
Minimum Number of Projects Required
RHPsmustselectaminimumnumberofprojectsfromCategories1and2(whichallRHPshaveexceeded).TheminimumnumberofrequiredprojectsvariesforeachRHPbasedonthevolumeoflow-incomepatientstheyserve.RHPsservingthehighestvolumeoflow-incomepatientsmustselectaminimumof20projectsfromCategories1and2whileRHPsservingthelowestvolumesoflow-incomepatientsmustselectaminimumof4projectsfromcategories1and2.AminimumlevelofparticipationbysafetynethospitalsandprivatehospitalswasalsorequiredinordertobeeligibletoearntheRHP’sfullinitialallocation.
Additional Funded Program Elements
RHPsmustparticipateinannualstatewidelearningcollaborativesinYears3-5.ThefirststatewidelearningcollaborativewasheldinSeptember2014.Inadditiontostatewidelearningcollaboratives,performingprovidersarealsostronglyencouragedtoformregionallearningcollaboratives.AlmostallRHPsarerequiredtoprovidelearningcollaboratives.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
46O
utco
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Types of Outcomes Being Used for Pay-for-Performance
QualityImprovementoutcomesarelargelypay-for-performance.Additionally,Category3outcomesaredividedinto“standalone”clinicaloutcomesand“non-standalone”processoutcomes.Projectsmustincludeatleastonestandalonemeasure(i.e.clinicaloutcome-focusedmeasure)oratleastthreenon-standalonemeasures(i.e.processmeasure).
Metrics and Benchmarked Improvement Targets
TheimprovementmethodologyisacombinationofimprovementoverselfandtheQualityImprovementSystemforManagedCare(QISMC)methodologyofclosingthegapbetweenbaselineandbenchmark.
MinimumCategory3Requirements:Providerscaneitherselectastandalonemeasure,anon-standalonemeasurewithastandalonemeasure,oratleast3non-standalonemeasures.
Denominator for Improvement
Category3outcomemeasuresarebasedonevidence-basedand/orendorsedqualitymeasuresandmustbereportedbasedonapprovedmeasurespecificationsasoutlinedintheprojectmenu;thesedenominatorsaregenerallybroaderthantheprojectinterventionpopulation.WithapprovalfromHHSC,performingprovidersmaynarrowthedenominatorbasedononeormoreofthefollowingfactors:payer(Medicaid,Uninsuredorboth),gender,age,co-morbidcondition,facilitywhereservicesaredeliveredandrace/ethnicity.
Statewide Accountability Test Thereisnostatewideaccountabilitytest.
Repo
rtin
g &
Mon
itorin
g
Provider Reporting
InYear1,RHPsmustsubmitastate-approvedRHPplantoCMSfortheperformingproviderswithinthatRHPtoreceivepayment.InYears2-5,providersreportonprojectprogresstwiceayearforpayment.Inadditiontoreportingforpayment,eachRHPanchormustsubmitanannualreportinYears2-5.
State Reporting ThestatemustreportquarterlyandannuallyonDSRIPtoCMS.DSRIPreportingisacomponentofthestate’squarterlyandannualwaiverreportingrequirements.
Mid-Point Assessment Process
Byearly2015,anindependentassessorwillworkwithHHSCtocompleteamid-pointassessmentofRHPs.Themid-pointassessmentresultscouldleadtomodificationofcertainDSRIPprojectsandor/metricstosupportsuccessfulimplementationinlateryearsofthecurrentwaiverperiod.
Program Evaluation
TheevaluationoftheTexasSection1115demonstrationisdividedbythetwodistinctinterventions:expansionofMedicaidmanagedcareandRHPformation.TheStrategicDecisionSupportunitofHHSCoverseestheentireevaluationandspecificallyconductstheevaluationofintervention1,managedcareexpansion.TexasA&MleadstheevaluationofDSRIP.
External Audit/Review Texasiscontractingwithanindependentassessor,Myers&StaufferLC,toconductthemid-pointassessmentandforongoingcompliancemonitoring.
47
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
maSSachUSettS
geneRal PRogRaM infoRMation and ContextIn2006,MassachusettsdramaticallyshifteduseofitsUncompensatedCarePooltocombineitwithfundingpreviouslyusedtosupportsupplementalpayments,creatingtheSafetyNetCarePool(SNCP).TheSNCPcontinuedtosupportuncompensatedcarepaymentstoprovidersbutalsoredirectedasignificantportionoffundingtopurchasinginsurancecoverageforlowincomeindividualsaspartofMassachusetts’landmarkstatehealthcarereformlawthatexpandedaccesstoaffordablehealthcare,whichultimatelyachievednear-universalcoverageinthestate.Inits2011-2014Section1115demonstrationwaiver,changestoMassachusetts’SNCPcontinued,asthenewDSTIprogramwascreatedundertheSNCP.
InMassachusetts,DSTIsupportsinvestmentstopromotedeliverysystemandpaymenttransformationwithinsevensafetynethospitalsystems.DSTIinitiativesweredesignedtoprovideincentivepaymentstosupportinvestmentsineligiblesafetynethealthcaredeliverysystemsforprojectsthatadvancetheCMSstrategicgoalsofimprovingthequalityofcare,improvingthehealthofpopulationsandenhancingaccesstohealthcare,andreducingtheper-capitacostsofhealthcare.Inaddition,DSTIpaymentssupportinitiativesthatpromotepaymentreformandthemovementawayfromfee-for-servicepaymentsandtowardalternativepaymentarrangementsthatrewardhigh-quality,efficient,andintegratedsystemsofcare.
MassachusettsrecentlyreachedagreementwithCMSonrenewalofitsSection1115demonstrationwaiver;thisagreementincludescontinuationofDSTIforthefirstthreeyearsofthefive-yearwaiver.Generally,itisexpectedthattherenewedDSTIwillfollowasimilarformattotheinitialDSTI,withincreasedrequirementsforparticipatinghospitalsystemstodemonstrateimprovementonhealthoutcomeandqualitymeasures;however,therenewalDSTIprotocolanddesignhavenotyetbeenapprovedbyCMS.
Initial DSTI Renewed DSTI
Gen
eral
Info
rmat
ion
Program Length 3years(7/1/11–6/30/14) 3years(7/1/14–6/30/17)Stage of Implementation Completed6/30/14 CurrentlyinYear1ofa3-yearrenewalperiod
Date Submitted to CMS Waiversubmittedon6/30/2010 Waiverextensionsubmittedon9/30/2013
Date Approved by CMS
Waiverapproved12/20/2011.DSTIMasterplanapprovedMay2012;HospitalprojectsapprovedJune2012.
Waiverapproved10/30/2014Masterplanapprovalpending;Hospitalplanapprovalspending.
Date Expires
InitialDSTIcompletedon6/30/2014;MASection1115demonstrationextendedthroughOctober30,2014duringMassachusetts’negotiationwithCMS.
6/30/2019(currentauthorizationforDSTIexpires6/30/17)
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
48
Initial DSTI Renewed DSTI
Fund
ing
Maximum Potential Pool Funding (Federal Funds)
$314,000,000$345,000,000
Maximum Potential Pool Funding (all funds)
$627,000,000 $690,800,0003
Current FMAP 50% 50%
Source Of Matching Funds (Non-Federal)
Thelargestsourceofnon-federalshareisstateappropriations.However,thesourceofnon-federalsharefortheonlypublichospital(CambridgeHealthAlliance)isanintergovernmentalfundstransfer.
Thelargestsourceofnon-federalshareisstateappropriations.However,thesourceofnon-federalsharefortheonlypublichospital(CambridgeHealthAlliance)isanintergovernmentalfundstransfer.
Average Funding Available Per Year $209,333,333 $230,266,666
Relation of Total Funding to Prior Supplemental Payments
Exceededprevioussupplementalpayments. 10%increaseoverinitialDSTI
Total Distribution of Payments
InYear1,MassachusettsproviderswereeligibletoreceivehalfofDSTIfundsbasedonCMSapprovalofahospital-specificDSTIplan.TheremaininghalfofYear1DSTIfundswereawardedforhospitalsthatachievedmetricsdetailedinthosehospitalspecificDSTIplans;inYears2and3,75%ofDSTIfundswereavailabletohospitalsforachievedmetricsinhospital-specificprojectsand25%oftheDSTIfundswereavailableforreportingonCategory4outcomePopulationHealthmetrics.
Notyetdefinedonaprojectspecificbasis.However,CMSretainedtheexisting“pass/fail”fundingaccountabilityformetricsassociatedwithprojectactivities.Additionally,thepercentageofDSTIfundingatriskforimprovedperformanceonvalidatedoutcomeorqualitymeasureswillgraduallyincreasefrom0%inSFY2015to10%inSFY2016to20percentinSFY2017(averagingto10%totaloverthethreeyearperiod).Thisaccountabilitystructureisonaprovider-specificbasis.
Corr
espo
ndin
g Po
ols
Corresponding Uncompensated Care (UC) Pool
Yes;MassachusettsUncompensatedCarePoolwasrestructuredandincorporatedintotheSafetyNetCarePoolwhenstateconductedits2006healthreform.AportionoftheSNCPauthorizedexpenditurelimitscontinuestobeallocatedtotheHealthSafetyNet,whichpaysforuncompensatedcare.DSTIfallsunderSNCP.
SNCPapprovedfora3-yearperiodunderwaiver.DSTIfallsunderSNCP.
Corresponding Designated State Health Program (DSHP)
ThroughDecember31,2013.Expenditureauthoritywas$360millioninSFY2012,$310millioninSFY2013and$130millioninSFY2014.
ThroughJune30,2017.Expenditureauthorityof$385millioninSFY2015;$257millioninSFY2016;and$127millioninSFY2017forvariousstate-fundedprograms.DSHPauthorityalsousedtosupportConnectorsubsidies(throughJune30,2019),CommonwealthCaretransition,temporarycoverageduringConnectorwebsitechallenges,outsideoftheexpenditureauthoritycapslistedabove.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
49
Initial DSTI Renewed DSTI
Prov
ider
s
Participating Providers
SevenhospitalseligibleforDSTIdefinedaspublicorprivateacutehospitalswithahighMedicaidpayermixandalowcommercialpayermix:BostonMedicalCenter,CambridgeHealthAlliance,StewardCarneyHospital,LawrenceGeneralHospital,SignatureHealthcareBrocktonHospital,MercyMedicalCenter,andHolyokeMedicalCenter.
SevenhospitalseligibleforDSTIdefinedaspublicorprivateacutehospitalswithahighMedicaidpayermixandalowcommercialpayermix:BostonMedicalCenter,CambridgeHealthAlliance,StewardCarneyHospital,LawrenceGeneralHospital,SignatureHealthcareBrocktonHospital,MercyMedicalCenter,andHolyokeMedicalCenter.
Proj
ects
Bei
ng F
unde
d
DSRIP Project Domains
Projectsfallwithineachoffourrequiredcategories
Category 1:DevelopmentofafullyintegrateddeliverysystemCategory 2:ImprovedhealthoutcomesandqualityCategory 3:Abilitytorespondtostatewidetransformationtovalue-basedpurchasingandtoacceptalternativestofee-for-servicepaymentsthatpromotesystemsustainability.Category 4:Population-focusedimprovements
Projectsfallwithineachoffourcategories:
Category 1:DevelopmentofafullyintegrateddeliverysystemCategory 2:ImprovedhealthoutcomesandqualityCategory 3:Abilitytorespondtostatewidetransformationtovalue-basedpurchasingandtoacceptalternativestofee-for-servicepaymentsthatpromotesystemsustainability.Category 4:Population-focusedimprovements
Eligible Project Funding Per Year
Averageeligiblefundingperhospital,peryearis$29million.
Averageeligiblefundingperyearis$33million.
Number of Approved Projects 49 Notyetfinalized
Minimum Number of Projects Required
HospitalsarerequiredtoselectaminimumoffiveprojectsacrossCategories1-3.Eachhospitalmusthaveatleastoneprojectineachofthethreecategoriesandatleasttwoprojectsintwoofthethreecategories.HospitalsarepermittedtosubmitmorethanfivetotalprojectsacrossCategories1-3.ForCategory4,hospitalsarerequiredtoreportonaspecifiednumberofpopulationhealthmetrics.Hospitalsmustalsoreportonaminimumofsixbutnomorethan15hospital-specificmetricsthatlinktoprojectsinCategories1-3.
Notyetfinalized
Process for Reallocating Unused Funds
HospitalsmaycarryforwardunclaimedincentivepaymentsinDY15andDY16forupto12monthsfromtheendoftheDemonstrationyearandbeeligibletoclaimreimbursementfortheincentivepaymentunderconditionsspecifiedinthemasterplan.Nocarry-forwardisavailableforDY17.
Notyetfinalized
Additional Funded Program Elements
Participationinalearningcollaborativerequired;treatedasaprojectinCategory3withapprovedmetrics.
Notyetfinalized
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
50
Initial DSTI Renewed DSTI
Out
com
es
Types of Outcomes Being Used for Pay-for-Performance
Metricsarepay-for-performanceotherthanpopulation-focusedimprovementmetrics,whicharepayforreporting.
Notyetfinalized
Metrics and Benchmarked Improvement Targets
ForCategories1-3,providersmustreportonbetweentwoandsevenmetricsperprojectperyear.Metricsfallintotwocategories:1)processandinfrastructuremetricsthatarecriticaltoprojectplanning,design,andimplementation;and2)outcomemetricsthatdemonstratetheresultsoftheprogram.Category4metricsarecomprisedoftwocategories:populationhealthmetricsthatallhospitalsmustreportonandhospitalspecificmetricsthatlinktoprojects.
Notyetfinalized
Denominator for Improvement
Totheextentthatdenominatorsareincluded,theyarespecifictotheprojectanduniquemetricsforeachhospital.
Notyetestablished
Statewide Accountability Test N/A Specificsof5%aggregatepotentialpenaltyin
SFY2017notyetestablished.
Repo
rtin
g &
Mon
itorin
g
Provider ReportingHospitalsmustreporttwiceayearforpaymentandarealsorequiredtosubmitanannualreportthatdetailsprogress,challenges,andlessons.
Hospitalsmustreporttwiceayearforpaymentandarealsorequiredtosubmitanannualreportthatdetailsprogress,challenges,andlessons.
State Reporting
MassachusettsreportstoCMSon1115demonstrationwaiverquarterlyandannually.DSTIisacomponentoftheMassachusettsquarterlyoperationalreportsandannualreportsforthe1115demonstration.
MassachusettsreportstoCMSon1115demonstrationwaiverquarterlyandannually.DSTIisacomponentoftheMassachusettsquarterlyoperationalreportsandannualreportsforthe1115demonstration.
Mid-Point Assessment Process Thereisnostatemid-pointassessmentprocess.
Thereisnomid-pointassessmentofDSTI.However,becauseDSTIisapprovedforthreeyearsinafive-yearwaiver,MassachusettsmustreachagreementwithCMSontherestructuringoftheSNCPandDSTI.
Program Evaluation
TheUMassMedicalSchoolCenterforHealthPolicyandResearchcompletedadraftinterimevaluationreportofthe1115demonstrationonSeptember26,2013.
Thestatehasacommitteecomprisedofmembersacrossagenciestoexamineeachsemi-annualreporttoensurehospitalshaveachievedtheirmilestonesandtoprovidefeedbackonprogress.
AnindependentevaluatormustberetainedtoassesshospitalperformanceforDSTIpayments.Inaddition,anindependentevaluatormustberetainedforoverallwaiverevaluation.Inthecontextofthisevaluation,evaluatormustaddressthefollowingquestion:“WhatistheimpactofDSTIonmanagingshortandlongtermper-capitacostsofhealthcare?”
External Audit/Review
Noexternalauditorreview;howevertheUMassMedicalSchoolCenterforHealthPolicyandResearchissuedinterimevaluationdescribedabove.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
neW mexico
geneRal PRogRaM infoRMation and ContextNewMexico’sHospitalQualityImprovementIncentive(HQII)programispartofthestate’sCentennialCare1115demonstrationwaiver.TheCentennialCarewaiverestablishesacomprehensivemanagedcaresystem,consolidatinganumberofprevious1915(b)and1915(c)waiversandexpandingaccesstocarecoordinationforMedicaidenrollees.ThewaiveralsoestablishesaSafetyNetCarePool(SNCP)thatiscomprisedofanUncompensatedCare(UC)PoolandaHospitalQualityImprovementIncentive(HQII)pool.HQIIisavailableinyearstwothoughfiveofthewaiver.ConsistentwithCMS’strategicgoals,NewMexico’sHQIIprogramwasdesignedtoincentivizehospitalstoimprovethequalityofcareforandhealthofMedicaidanduninsuredpopulationswhileloweringcosts.
NewMexicohasdesignated29hospitals(solecommunityprovider(SCP)hospitalsandthestateteachinghospital)thatareeligibletoparticipateintheprogrambyimprovingonmeasuresofclinicaleventsorhealthstatusthatreflecthighneedfortheMedicaidanduninsuredpopulationstheyserve.
Gen
eral
Info
rmat
ion Program Length 5years
Stage of Implementation Year1(planningonly)
Date Submitted to CMS 4/25/2012
Date Approved by CMS 9/4/2012,effective1/1/2014
Date Expires 12/31/2018
Fund
ing
Maximum Potential Pool Funding (federal) $21,000,000
Maximum Potential Pool Funding (all funds) $29,000,000(plusanyunclaimedfundsfromUCpool)
Current FMAP 69.65%Source Of Matching Funds (Non-Federal)
Intergovernmentaltransfers(IGTs)fromlocalcountiesandfromtheUniversityofNewMexicohospitalplusstategeneralfundstofillgap.
Average Funding Available Per Year $7million;graduallyincreasesfrom$2.8millionto$12millioninDY2-5
Relation of Total Funding to Prior Supplemental Payments
Sameaspriorsupplementalpayments,no“new”money;somepriorsupplementalpaymentfundingwasincorporatedintoarateincreaseforhospitals,asdescribedinSTC105.
Total Distribution of Payments
HospitalsqualifyforHQIIfundsbyachievingoutcomemetricsintwodomains:UrgentImprovementsinCare;andPopulation-FocusedImprovements.AllHQIIfundingisdirectedtowardsachievementonoutcomemeasures(i.e.,nofundingforDSRIPprojectsorprojectplandevelopment)so100%oftotalfundingisconsideredpay-for-performance(meetingimprovementtargets).
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
52Co
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pond
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Pool
s
Corresponding Uncompensated Care (UC) Pool
Yes,UCandHQIIpoolscombinetomakeuptheSNCP,valuedat$373,873,201total.ThemaximumpotentialfundingfortheUCPoolis$344,446,615;unclaimedUCfundsgointoHQIIpool.ThestatehaslimitationsontheFFPitcanclaimfortheSNCPthatfluctuateeachyearsuchthatthestateincreasinglyclaimsfundsfromtheHQIIpool(however,thelimitsonUCpoolfundingremainconsistentthroughoutthewaiverat$68,889,323/year).OverthecourseofthefiveyearstheUCpoolshrinksfrom100%to85%whiletheDSRIPpoolincreasesfrom4%to15%.
Corresponding Designated State Health Program (DSHP)
No
Prov
ider
s
Participating Providers
Thereare29eligiblehospitals;theseincludesolecommunityproviders(SCPs)andthestateteachinghospital.HospitalshadtobeeligibletoreceiveSCPandUPLsupplementalhospitalpaymentsatthetimeofthedemonstrationapproval.All29hospitalshavesubmittedtheirintenttoparticipate.
Proj
ects
Bei
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DSRIP Project Domains
UnlikeotherDSRIPprograms,HQIIdoesnotincludefundingfor“projects”orinterventions;onlyforoutcomemeasures.Outcomemeasuresaredividedintotwodomains:
1. UrgentImprovementsinCare(Required)2. Population-FocusedImprovements(Optional)
Participatinghospitalsarerequiredtoreportandimproveon(andbepaidbasedon)asetoftenmeasuresfromDomain1;theymayalsochoosetoreportonmeasuresrelatedtoPopulation-FocusedImprovement(Domain2).
Additional Funded Program Elements
Theprogramdoesnotappeartoincludefundingforadditionalelements,suchassharedlearning(althoughsharedlearningisencouragedthroughSTC83.d.v)
Out
com
es
Types of Outcomes Being Used for Pay-for-Performance
Domain1includes10measuresofsafercarethatalignwiththeCMSPartnershipforPatientsinitiative(hospital-acquiredconditionsandreadmissions).Domain2includespopulation-focusedimprovementsthatalignwiththeAHRQpreventionindicators.
Metrics and Benchmarked Improvement Targets
ThestateusesstandardizedmetricsandtheQualityImprovementSystemforManagedCare(QISMC)methodologyofclosingthegapbetweenbaselineandbenchmark.
Thestateestablisheshighperformancelevels(HPL)andminimumperformancelevels(MPL)basedonstateornationalbenchmarksforeachoutcomemeasure;thiswassubmittedinMarch2014.HospitalsthenusethestateMPLsandHPLstosettheirownimprovementtargetsforeachoutcomemeasure.HPLsshouldbegenerallysettothe90thpercentileofthestateornationalperformanceandMPLsshouldbesettothe25thpercentileofstateornationalaggregateperformance.
Theprovider-setimprovementtargetsmustcontinuouslyclosethegapbetweentheprovider’scurrentperformance/baselineandthestateHPLinDYs3,4,and5.Specifically,forDYs4and5,theproviderimprovementtargetcannotbelowerthanthestateMPL.
Denominator for Improvement
DenominatorsarenotspecificallyidentifiedintheSTCs,butwilllikelybeprovidedinthestate’sallocationandpaymentmethodology(APM)documentdueJuly1.STC83.d.iirequiresthestatetoconsidersmalldenominatorissuesforsmallerhospitals.
Statewide Accountability Test None
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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Provider Reporting
Participatinghospitalsmustsubmitannualreports,althoughthestateislookingtouseexistingdata(e.g.,hospitalinpatientdischargedata)forthemajorityofmeasures.Forthosemeasuresthatcannotbecapturedwithexistingdata,thestatewilldevelopastandardhospital-reportingtemplateforallparticipatinghospitalsthatincludessectionsonhospitalinterventions,challenges,andmid-coursecorrectionsandsuccesses.ThestatemustalsobeabletoaggregatehospitalreportsforCMSandsharedlearningamongallhospitals.
State Reporting ThestatemustshareHQIIreportingresultsonitswebsite
Mid-Point Assessment Process
Amid-coursereviewwillbeconductedpriortoDY4.ItwillbeajointeffortbetweenthestateandCMSdesignedtoexaminehospitals’progressinmeetingtheirspecifiedimprovementtargetsandtoassessthesuccessoftheprojectinachievingitsgoals.IfahospitalperformsabovetheHPLonanoutcomemeasureinDY3,thehospitalmayberequiredtoreportonanadditionalmeasureinDY4anddemonstrateimprovementsonthatmeasureinDY5.ThestateorCMSmayproposeadjustmentstohospitalinterventionsorotheraspectsofthedemonstrationbasedonthemid-yearreviewfindings.
Program Evaluation/External Audit and Review
TheAPMdocumentwassubmittedonJuly1andincludesoperationalrequirementsonmonitoringandevaluation.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
neW JerSey
geneRal PRogRaM infoRMation and Context• DSRIPispartoftheNewJerseyComprehensiveWaiver,thatseekstoprovidecomprehensivehealthcarebenefits
to1.3millionNewJerseycitizens,includingMedicaidbeneficiariesandotherspecifiedpopulations.ThroughDSRIP,NewJerseyaimstotransitionsafetynethospitalpaymentsfromtheprevioussupplementalpaymentsystem(HospitalReliefSubsidyFund)toanincentive-basedmodelforallNewJerseyhospitalswherepaymentiscontingentonachievingqualityimprovementgoals.
• EachparticipatinghospitalsubmitsaHospitalDSRIPPlan,whichdescribeshowitwillcarryoutoneprojectthatisdesignedtoimprovequalityofcare,efficiency,orpopulationhealth.Hospitalprojectsareselectedfromamenuoffocusareasthatinclude:asthma,behavioralhealth,cardiaccare,substanceabuse,diabetes,HIV/AIDS,obesity,andpneumonia.Eachprojectconsistsofaseriesofactivitiesdrawnfromapredeterminedmenuofactivitiesgroupedaccordingtofourprojectstages.HospitalsmayqualifytoreceiveDSRIPpaymentsforfullymeetingperformancemetrics(asspecifiedintheHospitalDSRIPPlan),whichrepresentmeasurable,incrementalstepstowardthecompletionofprojectactivities,ordemonstrationoftheirimpactonhealthsystemperformanceorqualityofcare.AllacutecaregeneralhospitalsinNewJerseyareeligibletoparticipate.
Gen
eral
In
form
atio
n
Program Length 5yearsStage of Implementation Year3Date Submitted to CMS 9/14/2011Date Approved by CMS 10/1/2012
Date Expires 6/30/2017
Fund
ing
Maximum Potential Pool Funding (federal) $292,000,000
Maximum Potential Pool Funding (all funds) $583,000,000
Current FMAP 50.00%Source Of Matching Funds (Non-Federal) Providertax
Average Funding Available Per Year
AvailableDSRIPfundingfluctuatesperyearbutaveragestoabout$146millionperyear.4
Relation of Total Funding to Prior Supplemental Payments Sameaspriorsupplementalpayments(HospitalReliefSubsidyFund)
Total Distribution of Payments
InYear1,100percentofDSRIPfundingisprovidedasatransitionpayment.InYear2,50percentofDSRIPfundingisprovidedasatransitionpayment;25percentispaidtohospitalsthatdevelopahospitalspecificplan;theremaining25percentispaidforprogressontheirprojectasmeasuredbystage-specificactivities/milestonesandmetricsachievedduringthereportingperiod.Overtime,fundinggraduallyshiftsfromprojectimprovementstoqualityimprovements(firstaspay-for-reportingandthentopay-for-performance).
Corr
espo
ndin
g Po
ols
Corresponding Uncompensated Care (UC) Pool
No.Thewaiverdoes,however,authorizetransitionpaymentsinDY1-DY2.
Corresponding Designated State Health Program (DSHP) No.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
55Pr
ovid
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Participating Providers AllacutecarehospitalsareeligibletoparticipateinDSRIP.Totalof63eligiblehospitals;50haveapprovedDSRIPprojects;13arenotparticipating.
Proj
ects
Bei
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DSRIP Project Domains
Eachhospitalmustselectoneprojectfromamenuoffocusareasthatinclude:behavioralhealth,HIV/AIDS,chemicaladdiction/substanceabuse,cardiaccare,asthma,diabetes,obesity,pneumonia,oranothermedicalconditionthatisuniquetoaspecifichospital,ifapprovedbyCMS.Therearethenfourstagesofactivities:Stage1:InfrastructureDevelopment:Stage2:ChronicMedicalConditionRedesignandManagementStage3:QualityImprovementsStage4:PopulationFocusedImprovements
Project Funding Per Year Averageprojectfundingperyearis$3.26million.Number of Approved Projects 50Minimum Number of Projects Required Eachparticipatinghospitalhasselectedoneprojectfromamenuoffocusareas.
Additional Funded Program Elements
NewJerseyhasaUniversalPerformancePool(UPP)whichismadeupofthefollowingfunds:
• ForDY2,HospitalDSRIPTargetFundsfromhospitalsthatelectednottoparticipateorwhereCMSdidnotapprovethehospital’ssubmittedplan.TherewillbenocarveoutallocationamountforDY2.
• ForDY3-5,HospitalDSRIPTargetFundsfromhospitalsthatelectedtonotparticipate,thepercentageofthetotalDSRIPfundssetasidefortheUPP,knownasthecarveoutallocationamount,andTargetFundsthatareforfeitedfromhospitalsthatdonotachieveprojectmilestones/metrics,lessanyprioryearappealedforfeitedfundswheretheappealwassettledinthecurrentdemonstrationyearinfavorofthehospital.
Hospitalsarealsorequiredtoparticipateinlearningcollaborativesaspartofthestage2metrics.
Out
com
es
Types of Outcomes Being Used for Pay-for-Performance ForDY4andDY5,overhalfofqualityimprovementmetricswillbepay-for-performance.
Metrics and Benchmarked Improvement Targets
Incentivepaymentduringthepay-for-performancedemonstrationyearsisbasedonhospitalsmakingameasurableimprovementinacoresetofthehospital’squalityimprovementperformancemeasures.Formeasureswithanationalorpubliclyavailablebenchmark,ameasurableimprovementisaminimumofa10percentreductioninthedifferencebetweenthehospitalsbaselineperformanceandimprovementtargetgoal.Forhospitalsworkingwithprojectpartners,thisgapisreducedfrom10percentto8eightpercent.Formeasureswithoutanationalorpublicallyavailablebenchmark,ameasureableimprovementisa10percentrateofimprovementoverthehospital’sbaselineperformance(peryear).
Denominator for Improvement
PerformancemeasurementforbothStage3and4metricswillmeasureimprovementforspecifiedpopulationgroups,includingthecharitycare,MedicaidandCHIPpopulations,collectivelyreferredtoasthelowincomepopulation.Anattributionmodeltolinkthelow-incomepopulationwithDSRIPhospitalsandprojectpartnersforStage3and4performancemeasurementhasbeendevelopedbytheDepartmentwiththeinputandsupportbythehospitalindustry.
Statewide Accountability Test N/A
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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Provider Reporting
DY2:HospitalsarerequiredtosubmittheDSRIPplan(covers50%ofDY2TargetFundingamount),andsubmittheDY2ProgressReport(coverstheother50%ofDY2TargetFunding)DY3-DY5:HospitalsarerequiredtosubmitanannualDSRIPapplicationrenewalforDY3-5andquarterlyDSRIPProgressReportsforDY3-5thatarebasedonstage-specificactivities/milestonesandmetricsachievedduringthereportingperiod.
State Reporting
TheDepartmentandCMSwilluseaportionoftheMonthlyMonitoringCallsforMarch,June,September,andDecemberofeachyearforanupdateanddiscussionofprogressinmeetingDSRIPgoals,performance,challenges,mid-coursecorrections,successes,andevaluation.
Mid-Point Assessment Process
Amid-pointassessmentofDSRIPwillbecompletedbyJune2015bytheindependentDSRIPevaluatortoprovidebroaderlearningbothwithinthestateandwithinthenationallandscape.Partofthemidpointassessmentwillexamineissuesoverlappingwiththeformativeevaluations,andpartofthiseffortwillexaminequestionsoverlappingwiththefinalsummativeevaluation.
Program Evaluation
• TheRutgersCenterforStateHealthPolicyisconductingtheevaluationofNewJersey’swaiver.ThequantitativeportionoftheevaluationconsistsofanalysisofMedicaidclaimsdataandpayerdatainadditiontohospitalreportedmeasures.Thequalitativeportionconsistsofasurveyandkeyinformantinterviewswithhospitals.
• InterimEvaluationReport:ThestatemustsubmitadraftinterimevaluationreportbyJuly1,2016,orinconjunctionwiththestate’sapplicationforrenewalofthedemonstration,whicheverisearlier.ThepurposeoftheInterimEvaluationReportistopresentpreliminaryevaluationfindings,andplansforcompletingtheevaluationdesignandsubmittingaFinalEvaluationReport.
• FinalEvaluationReport:ThestateshallsubmittoCMSadraftofthefinalevaluationreportbyJuly1,2017.
External Audit/Review • TheCenterforStateHealthPolicyatRutgersUniversityisconductingboththemid-pointassessmentandfinalevaluation.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
neW yorK
geneRal PRogRaM infoRMation and ContextNewYork’sDeliverySystemReformIncentivePayment(DSRIP)programispartofthestate’sPartnershipPlan1115demonstrationwaiver.AsdescribedindemonstrationAmendment13,thestateplanstoinvestsavingsgeneratedfromreformunderNewYork’sMedicaidRedesignTeam(MRT)intostatehealthcarereformefforts,includingtheDSRIPpool.UnderDSRIP,Medicaidprovidersandcommunity-basedorganizationsareorganizedintoACO-likestructurescalledPerformingProviderSystems(PPSs)thatcollectivelyimplement5-11qualityimprovementprojectsdesignedtocreateregionalintegrateddeliverysystemsabletoacceptvalue-basedpaymentsforattributedpopulations.
NewYork’sDSRIPprogramwascreatedtoincentivizeprovidercollaborationatthecommunityleveltoimprovethecareforMedicaidbeneficiarieswhileloweringcostsandimprovinghealth.ParticipatingPPSsreceiveDSRIPfundingforachievingspecificprojectmilestones,metricsandoutcomes.
AspecificgoalofDSRIPistoreduceavoidablehospitaluseby25percentoverfiveyearswithinthestate’sMedicaidprogram.Inaddition,DSRIPfocuseson:“(1)safetynetsystemtransformationatboththesystemandstatelevel;(2)accountabilityforreducingavoidablehospitaluseandimprovementsinotherhealthandpublichealthmeasuresatboththesystemandstatelevel;and(3)effortstoensuresustainabilityofdeliverysystemtransformationthroughleveragingmanagedcarepaymentreform.”
Gen
eral
In
form
atio
n
Program Length 6yearsStage of Implementation Year1(planningonly)Date Submitted to CMS 8/6/2012Date Approved by CMS 4/14/2014
Date Expires 12/31/2019(assumingrenewalofthePartnership1115demonstration12/31/2014)
Fund
ing
Maximum Potential Pool Funding (federal) $6,919,000,000
Maximum Potential Pool Funding (all funds) $13,837,000,000
Current FMAP 50.00%Source Of Matching Funds (Non-Federal)
Intergovernmentaltransfers(IGTs)frommajorpublichospitals,supplementedbysomestategeneralrevenuefundedbyDSHP.
Average Funding Available Per Year AvailableDSRIPfundingfluctuatesperyear.
Relation of Total Funding to Prior Supplemental Payments
Norelationtopriorsupplementalfunding;NYDSRIPfundingcomesfromMedicaidRedesignTeam(MRT)savingsandnopriorsupplementalpaymentswererolledintoDSRIP.
Total Distribution of Payments
NewYorkincludes$140millioninfundingforplanninginYear1/DY0andthenhas5yearsofDSRIPimplementationactivities.FundingforDomain1,ProjectProgrammilestones,ishighest(80%and60%oftotalDSRIPfunding,)inDY1and2,respectively,andsteadilydeclinesto0%inDY5.FundingforDomains2and3steadilyincreasesthroughouttheprogramandreaches55%and40%,respectively,inDY5.Domains2and3areacombinationofP4PandP4Randineachcase;morefundingisbasedreportinginearlieryearsandonperformanceinlateryears.NewYorkalsohasapopulationhealthdomain,whichremainsconsistentlyat5%oftotalDSRIPfundingeveryyear.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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rres
pond
ing
Pool
s
Corresponding Uncompensated Care (UC) Pool
No(althoughtheF-SHRP1115demonstrationdoesincludeanindigentcarepoolforclinicsthatisnotrelatedtotheDSRIP)
Corresponding Designated State Health Program (DSHP)
Yes;$4billionrelatedtoDSRIP(total,allfunds);AdditionalDSHPhadpreviouslybeenapprovedaspartofotherinitiatives
Prov
ider
s
Participating Providers
EligibleprovidersformregionalcoalitionsknownasPerformingProviderSystems(PPSs)ledbymajorpublichospitalsorothereligiblesafetynetproviders;PPSscanincludehealthcareproviders,healthservices,community-basedorganizations,andothers.Twenty-fivePPSshavebeenidentifiedasofMarch2015.
Eligiblehospitalsarepublichospitals,CriticalAccessHospitalsorSoleCommunityHospitals,orhospitalsthatservedaminimumnumberofMedicaidoruninsuredpatients.Eligiblenon-hospitalbasedprovidersmustalsomeetrequirementsforvolumeofMedicaid/uninsuredpatients.ThestateandCMSmayalsoapprovecertainnon-qualifyingorganizationsforparticipationinaPPS.
Proj
ects
Bei
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DSRIP Project Domains
1. OverallProjectProgress2. SystemTransformationandFinancialStability3. ClinicalImprovement4. PopulationHealth
Project Funding Per Year Averageprojectfundingperyearis$900,000.Number of Approved Projects 258
Minimum Number of Projects Required
PPSsmustincludeaminimumoffiveprojectsandamaximumof11projectsperDSRIPplanwithspecificcriteriaforeachprojectcategory.
Additional Funded Program Elements
$1billiontotalcomputableintemporary,timelimited,fundingisavailablefromanInterimAccessAssuranceFund(IAAF)forpaymentstoproviderstoprotectagainstdegradationofcurrentaccesstokeyhealthcareservicesinthenearterm.
DSRIPDesignGrantsareavailableinCY2014tosupportprovidersindevelopingDSRIPprojectplans.Theyamounttoupto$200milliontotalcomputable.
AhighperformancepoolisavailableforPPSsthatclosethegapbetweenbaselineandbenchmarkby20%and/orexceedthe90thperformancepercentileonasubsetofmetricsrelatedtoavoidablehospitalization,behavioralhealthandcardiovasculardisease.Fundingiscomposedofupto10%ofannualDSRIPprojectfundsandanyunclaimedprojectfunding.
TheDSRIPbudgetincludes$600milliontotalcomputableforstateadministrationoftheprogramover6years.Aspartoftheseduties,thestatewillleadlearningcollaborativesattheregionalandstatelevelsthatarerequiredforallPPSs.
State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
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utco
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Types of Outcomes Being Used for Pay-for-Performance
Astandardsetofmetricsisrequiredforeachdomainandproject.Manyofthesemeasuresarepay-for-reportinginearlierprogramyears,andtransitiontobeingpay-for-performanceinlateryears.
Metrics and Benchmarked Improvement Targets
AllqualityimprovementtargetsareclosingthegapbetweenthePPS’baselineandthestateornationalbenchmarkofthe90thpercentileby10%year-over-year.
Denominator for Improvement
PopulationofattributedMedicaidbeneficiaries(minimumof5,000Medicaidmembersinoutpatientsettings)formostprojects.OneprojectisfortheuninsuredandMedicaidnon/lowutilizingpopulation,andusesthatattributedpopulationforthedenominatorforthatproject’smetrics.
Statewide Accountability Test
Ifthestatefailstomeetspecifiedperformancemetrics,DSRIPfundswillbereducedinYears4-6(DYs3-5)by5%,10%,and20%respectively.Ifpenaltiesareapplied,CMSrequiresthestatetoreducefundsinanequaldistribution,acrossallDSRIPprojects.
Repo
rtin
g &
Mon
itorin
g
Provider ReportingPPSsmustreporttwiceayearforpaymentpurposesthoughtheymayonlybeeligibleforpaymentattheendoftheyearreport.PPSswillalsoreportquarterlytosupportNewYork’squarterlyassessments.
State Reporting Thestatewillpublishproject-by-projectupdatesonaquarterlybasis.
Mid-Point Assessment Process
Allplansinitiallyapprovedbythestatemustbere-approvedbythestateinordertocontinuetoreceivefundinginYears5-6(DYs4and5).Thestatewillsubmitdraftmid-pointassessmentcriteriaandchecklisttoreviewplanstoCMS,whichwillbemodifiedinconsiderationoflearningandnewevidence.
Program EvaluationThestateiscurrentlydevelopingitsevaluationplan:itsubmittedanevaluationproposalandreceivedpublicinput.Willhaveaninterimandfinalindependentevaluation.
External Audit/Review NewYorkiscontractingwithanindependentassessor,PublicConsultingGroup(PCG),toserveasanexternalauditorandreviewer.
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State Experiences Designing and Implementing Medicaid Delivery System Reform Incentive Payment (DSRIP) Pools
oregon
geneRal PRogRaM infoRMation and ContextThroughtheHospitalTransformationPerformanceProgram(HTPP)diagnosis-relatedgroup(DRG)hospitals,definedas“urbanhospitalswithabedcapacityofgreaterthan50,”willearnincentivepaymentsbymeetingspecificperformanceobjectivesdesignedtoadvancehealthsystemtransformation,reducehospitalcosts,andimprovepatientsafety.Theprogramlastsfortwoyearsandpaymentsaremadeforreportingbaselinedatainthefirstyearandformeetingbenchmarksorimprovementtargetsinthesecondyear.
ThemajorgoaloftheprogramistoaccelerateOregon’shealthsystemtransformationactivitiesamongatargetedgroupofproviders.OregoncurrentlyoperatesastatewideaccountablecaremodelthatconsistsofanetworkofCoordinatedCareOrganizations(CCOs).Thesecommunity-levelentitiesprovidecoordinatedandintegratedcaretoOregonMedicaidbeneficiariesandareheldaccountableforthepopulationstheyservebyoperatingunderaglobalbudget.TheHTPPseeksto“createamutuallybeneficialsystemforbothhospitalsandCoordinatedCareOrganizations(CCOs)byreducingcostsandimprovingquality.”ThestatespecificallyhopestouseHTPP,inpart,asavehicletoacceleratetransformationandqualityimprovementsinCCOs.
Gen
eral
In
form
atio
n
Program Length 2yearsStage of Implementation Year1Date Submitted to CMS 6/26/2013Date Approved by CMS 6/27/2014;HTPPeffective7/1/2014
Date Expires 6/30/2016
Fund
ing
Maximum Potential Pool Funding (federal funds) $191,000,000
Maximum Potential Pool Funding (all funds) $300,000,000
Current FMAP 64.06%Source Of Matching Funds (Non-Federal)
Providertax;thestate’sportionofHTPPmoneyisfundedthroughanincreaseofonepercentagepointtothestate’shospitalassessmentrate.
Average Funding Available Per Year $150million
Relation of Total Funding to Prior Supplemental Payments
Exceedspriorsupplementalpayments(i.e.,nosupplementalpaymentdiversiontofundHTTP)
Total Distribution of Payments
Hospitalswereawarded$150,000,000forsubmittingbaselinedatainYear1.InYear2,hospitalsareeligibleforanadditional$150,000,000contingentuponachievementofincentivemeasures.
Corr
espo
ndin
g Po
ols
Corresponding Uncompensated Care (UC) Pool
No;OregonhasatribalhealthprogramforuncompensatedcarethatisnotdirectlytiedtotheHTPP.
Corresponding Designated State Health Program (DSHP)
Yes.SpecifiedstateprogramsareeligibletoreceivedDSHPpaymentstosupporthealthsystemtransformationgoalsinDY11-DY15ofwaiver.Maximumpotentialpoolfundingis$704,000,000,FFPonly,over5yearsandthetotalamountavailableperyeargraduallydecreasesfrom$230millioninDY11to$68millioninDY15.CMSmayreduceavailableDSHPfundingifthestatefailstomeetgoalsforreductionsinpercapitagrowthrates.
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Prov
ider
s
Participating Providers All28diagnosis-relatedgroup(DRG)hospitals(urbanhospitalswithabedcapacityofgreaterthan50)areparticipating.
Proj
ects
Be
ing
Fund
ed DSRIP Project DomainsUnlikeotherDSRIPprograms,HTPPdoesnotincludefundingforprojectsorinterventions;onlyformeetingreportingandbenchmarkrequirementsonhospital-specificmetrics.
Additional Funded Program Elements N/A
Out
com
es
Types of Outcomes Being Used for Pay-for-Performance
All11measuresarepay-for-performanceinYear2.Allmeasureshaveeitherahospitalonlyorhospital-CCOcollaborationfocus.Measuresthenfallintodomainsincludingreadmissions,medicationsafety,patientexperience,healthcare-associatedinfections,sharingEDvisitinformation,andbehavioralhealth.
Metrics and Benchmarked Improvement Targets
OHAwilluseitsCCOmethodologytocalculatehospitalimprovementtargets,whichrequireatenpercentreductioninthegapbetweenbaselineandbenchmarktoearnincentivepayments.
Denominator for Improvement Thedenominatorforimprovementisspecifictoeachmeasureandparticipatinghospital.
Statewide Accountability Test
HTPPpaymentswillbeincludedinOregon’scalculationsoftotalexpendituresunderthewaiver.IfOregonfailstomeettrendreductiontargets,thestatefacesreducedfederalfundingforDSHP
Repo
rtin
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Mon
itorin
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Provider Reporting AllHTPPmeasureswillbereportedontheOHAwebsiteatleastonceayearandwillbeavailableatthehospitallevel.
State Reporting ThestatemustprovidequarterlyreportstoCMSthatdetailpaymentsandprogress.
Program Evaluation
ThestatewillconductaninterimindependentevaluationofHTPP,dueMarch31,2016,toassesshowthegoalsoftheprogramarebeingmet.Evaluationquestionswillfocusonhowparticipatingprovidersareperformingonmetricsandincludecomparisonsbetweenparticipatinghospitalsandnon-participatinghospitalsonCCOmetricstoseehowHTPPisaffectingCCOperformance.
External Audit/Review TheHospitalMetricsandIncentivePaymentProtocolmayincludemoreonthis.
(Footnotes)
1Forpurposesofthisfactsheet,eachCategory3domainsetofmeasurescountsasa“project.”
2IfaDPHbaselinevalueonameasuremeetsorexceedsthehighperformancegoal,theproviderisconsideredtohaveachieved“topperformance”onthemeasureandmustselectadifferentstretchmeasure(inthesameintervention)toimproveuponforDY9and10.
3TherenewalDSTItransitions$660,000,000inhistoricalfundingtothestate’sonlypublichospitaltotheCambridgeHealthAlliancePublicHospitalTransformationandIncentiveInitiative.Upto30%ofthisincentivepoolwillbeatriskbasedonperformanceonoutcomemeasures.
4InNewJersey,DSRIPtransitionpaymentsweremadeinDY1(7/1/2012to6/30/2013)andforhalfofDY2(7/1/2013to12/31/2013).FundingtiedtotheDSRIPprogram(approvalofapplicationandprogressreports)didnotbeginuntilthesecondhalfofDY2(1/1/14).Accountingforthetransitionpayments,thetotal5-yearprogramfundingis$833M,or$166.6Mperyear.