New Marketplace
Talk
The Only Answer Is Greater Stewardship (08:29)

“As a Medicaid medical director, your task is really about stewardship, and about health care variation and effectiveness,” says Arkansas Medicaid Medical Director William Golden. There is more demand for health care than there are resources, but we can’t resolve the payment side of that issue by continuing to raise taxes, private insurance premiums, or already high copays — or by cutting services and limiting access, notes Golden. “The only answer is to have greater stewardship. And that requires change. It requires change in four Ps: providers, payers, patients, policymakers. Everybody has to reorient to a greater stewardship. How do you change what you pay for and how do you get outcomes out of the system? So you have to create new incentives, financial rewards to shape the health care delivery system.”

In this vein, the Medicaid Medical Directors Network regularly compares notes on which innovations and incentives are working, and which are not. “We’re [almost] doing population health at scale. And we can actually get things done because we have the data, we have the financial incentives, we have the regulatory capacity to design, and we can work with multiple stakeholders in a community to do a variety of things,” says Golden. “We’re essentially boots on the ground as opposed to, say, Medicare, which is much more in Baltimore and has regional offices. We’re really in the community settings and have local connections.”

Golden shares examples of what he and his colleagues have worked on, one of the biggest of which is substance abuse, including substance abuse and pregnancy. In many states, 50% or more of baby deliveries are part of Medicaid, notes Golden, so how do you handle situations such as neonatal abstinence syndrome, Suboxone distribution, or perinatal care?

Arkansas also has a pay-for-performance program for hospitals, where they withhold payment raises to hospitals if they pass a basket of metrics. They first targeted early elective deliveries, and after a couple of cycles, nonspontaneous deliveries before 39 weeks dropped from about 60–70% to below 1% in the state, according to Golden.

As for payment reform, Arkansas Medicaid was charged by the governor to help create a sustainable health care system, and in 2012, they developed episodes of care that made doctors and hospitals accountable for the patient journey of a particular event. “We gave them data to show what the patients did during that journey, whether they went to the ER, whether they were readmitted — more than just their own billing, their own data. Somebody was accountable for what the entire health care system did during that period of time,” says Golden. “It got people thinking for the first time beyond just their service, and actually start talking about what it is about how you coordinate care.”

Golden’s team also wanted to increase the percentage of voluntary patient-centered medical homes in Arkansas, but they realized that the state’s primary care practices were capital poor — and had to provide up-front dollars to incent those voluntary homes. “We didn’t use a standardized accreditation program but actually went out and said, ‘We expect you to do certain things with these dollars; it’s an investment in your practice. And we expect you to have no more answering machines at night and on weekends. We expect you to have a care plan’ — we had to teach them what a care plan was. You had to have high-risk patients, you had to have same-day appointments. And to our surprise, they’ve done it.”

Medicaid is at the table convening multipayers in states all over the U.S. to implement alternative payment mechanisms, says Golden. “It’s an opportunity to get people to think about redesigning primary care into a much more chronic disease–oriented, preventive service approach,” he says. “We think we’re going to get there. We think that we’re going to be part of the solution to changing people’s attitudes to how to deliver care and to make ourselves a sustainable health care system.”

From the NEJM Catalyst event New Risk, New Business Models held in Boston, October 6, 2016.

More From New Marketplace

The Economics of Indication-Based Drug Pricing

What would indication-based drug pricing accomplish?

Turmoil in the Individual Insurance Market — Where It Came From and How to Fix It

The threat to individual market stability is real. We need to fix it before it's too late.

Navigating Pharmaceutical Price Increases: A Strategy to Protect Appropriate Use, Reduce Waste, and Identify Therapeutic Alternatives

In the face of major pharmaceutical price increases, Cleveland Clinic developed a strategy to ensure high-quality patient care while maintaining financial stability.

Controlling the Cost of Medicaid

Both political parties should support policies that focus on incentives as a mechanism for improving and sustaining their value.

Resetting the Nation’s Health Care Quality Agenda

Poor measures of care quality have consequences. The National Quality Forum is essential to creating measures that are valid and reliable.

Infographic: The Loss of Cost-Sharing Reduction Payments Would Destabilize Insurance Markets

The loss of CSR payments would create some short term chaos in the market, but it would not significantly impact the number of people covered.

Opportunities for Private-Sector Entrepreneurship in Health Care Transformation

Two veterans of public service say that government can do only so much — which creates attractive business opportunities for entrepreneurs.

Moving Past the EHR Interoperability Blame Game

Why can't EHRs talk to one another? We never created the right incentives, but we pretend that we did.

Emerging from EHR Purgatory — Moving from Process to Outcomes

What's the effect of the mode of physician payment when it comes to EHRs?

Reframing Analytics: Transforming Insights into Action

Centralizing clinical data for an integrated delivery system revealed a surprising lesson: sometimes predictive analytics are not enough.

Connect

A weekly email newsletter featuring the latest actionable ideas and practical innovations from NEJM Catalyst.

Learn More »

Topics

In Your Words: Support for Single-Payer…

If you could change one thing about health care payment, what would it be?

Four Ingredients for Engaging Physicians in…

A former physician network leader offers tips on building an environment conducive to change.

Bundled Payments

32 Articles

Opportunities for Private-Sector Entrepreneurship in Health…

Two veterans of public service say that government can do only so much — which…

Insights Council

Have a voice. Join other health care leaders effecting change, shaping tomorrow.

Apply Now