MEDICAID PAY-FOR-PERFORMANCE SPREADS ACROSS THE NATION

Volume 28, Issue 490 April 30, 2007

Christina Kent

Medicaid pay-for-performance (P4P) programs are now almost the norm. As of July 2006, more than half of all Medicaid programs were operating one or more P4P program, according to a new report from the Commonwealth Fund. And within the next five years, nearly 85 percent of states plan to incorporate P4P into their Medicaid programs.

P4P programs reward improvements in health care and outcomes with higher levels of payment and other types of incentives. Most (70 percent) state Medicaid P4P programs have been established within managed care or primary care case management programs. A growing number of states are beginning to use P4P to enhance the management of chronic disease.

Other trends include:

An emphasis on standardized performance measures. Nine states are joining with other payers, employers, consumers and providers to develop statewide and regional P4P efforts.

A focus on health information technology. Several Medicaid programs are paying for “participation” rather than “performance” by rewarding providers who adopt technologies such as electronic health records.

A focus on the delivery of specific kinds of care. Maine ties 30 percent of a performance bonus to emergency department utilization measures.

For the full report, go to: www.cmwf.org/usr_doc/Kuhmerker_P4PstateMedicaidprogs_1018.pdf

Also available is a Fund-supported guide for states on strategies for implementing physician-focused Medicaid pay-for-performance programs.