s e d and i m d s r i p (dsrip) pools - macpac · 2015. 8. 31. · s tate e xperiences d esigning...

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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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


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standardizingmetricsinareaswherethereisstrongevidence.

• Providers,states,andthefederalgovernmentmustspendsignificanttimetolaunchDSRIPprograms;asaresult,afive-yeartransformationprojectmayinrealitybeonlythreetofouryears.Additionally,mostDSRIPsrequiresignificantresourcesforadministrationandimplementation.

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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


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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.


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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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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


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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


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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


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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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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


32

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


33

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.

34


conclUSion

D SRIPprogramscanonlybeconsideredintheirinfancy;theoldestDSRIPprogramisjustinitsfifthyear.Thereiswidevariabilityacrosstheeightstatesintheirdesign,financing,andmeasurement.Nonetheless,theysharetwocommongoalsoftransformingthedeliverysystem

tomeetthegoalsofbettercare,improvedhealth,andlowercosts;andincentivizingsystemtransformationandqualityimprovementsinhospitalsandotherprovidersthatservehighvolumesoflow-incomepatients.Inmanystates,theyarealsoseenasamechanismtopreservesupplementalpaymentsforsafetynethospitals.ThespecificsofDSRIPfinancingpolicies,andthemilestonesandmetricsfordeterminingimpact,arecomplexandevolving.AsDSRIPprogramscontinuetomatureandevolve,itwillbecriticaltoevaluatetheirimpactonstateMedicaidandbroaderdeliverysystemreforms,andonsafetynetproviders.

35


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


36

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


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/


38

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

40


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.

41


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.


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.


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


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)


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.


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.


45Co

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pond

ing

Pool

s Corresponding Uncompensated Care (UC) Pool

Yes,maximumUCpoolfundingis$17,582,000,000over5years


No

Prov

ider

s

Participating Providers

Atotalof309providerswereparticipatinginDSRIPasofOctober2014.Performingprovidersarehospitalsandothereligibleproviders,includingcommunitymentalhealthcenters,localhealthdepartments,physicianpracticeplansaffiliatedwithanacademichealthsciencecenter,andotherprovidersspecificallyapprovedbythestateandCMS.

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1. Infrastructuredevelopment2. ProgramInnovationandRedesign3. QualityImprovement4. Populationfocusedimprovements

Project Funding Per Year Averageprojectfundingperyearis$150,000.


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.


RHPsmustselectaminimumnumberofprojectsfromCategories1and2(whichallRHPshaveexceeded).TheminimumnumberofrequiredprojectsvariesforeachRHPbasedonthevolumeoflow-incomepatientstheyserve.RHPsservingthehighestvolumeoflow-incomepatientsmustselectaminimumof20projectsfromCategories1and2whileRHPsservingthelowestvolumesoflow-incomepatientsmustselectaminimumof4projectsfromcategories1and2.AminimumlevelofparticipationbysafetynethospitalsandprivatehospitalswasalsorequiredinordertobeeligibletoearntheRHP’sfullinitialallocation.


RHPsmustparticipateinannualstatewidelearningcollaborativesinYears3-5.ThefirststatewidelearningcollaborativewasheldinSeptember2014.Inadditiontostatewidelearningcollaboratives,performingprovidersarealsostronglyencouragedtoformregionallearningcollaboratives.AlmostallRHPsarerequiredtoprovidelearningcollaboratives.


46O

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QualityImprovementoutcomesarelargelypay-for-performance.Additionally,Category3outcomesaredividedinto“standalone”clinicaloutcomesand“non-standalone”processoutcomes.Projectsmustincludeatleastonestandalonemeasure(i.e.clinicaloutcome-focusedmeasure)oratleastthreenon-standalonemeasures(i.e.processmeasure).


TheimprovementmethodologyisacombinationofimprovementoverselfandtheQualityImprovementSystemforManagedCare(QISMC)methodologyofclosingthegapbetweenbaselineandbenchmark.

MinimumCategory3Requirements:Providerscaneitherselectastandalonemeasure,anon-standalonemeasurewithastandalonemeasure,oratleast3non-standalonemeasures.


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.


Byearly2015,anindependentassessorwillworkwithHHSCtocompleteamid-pointassessmentofRHPs.Themid-pointassessmentresultscouldleadtomodificationofcertainDSRIPprojectsandor/metricstosupportsuccessfulimplementationinlateryearsofthecurrentwaiverperiod.

Program Evaluation

TheevaluationoftheTexasSection1115demonstrationisdividedbythetwodistinctinterventions:expansionofMedicaidmanagedcareandRHPformation.TheStrategicDecisionSupportunitofHHSCoverseestheentireevaluationandspecificallyconductstheevaluationofintervention1,managedcareexpansion.TexasA&MleadstheevaluationofDSRIP.

External Audit/Review Texasiscontractingwithanindependentassessor,Myers&StaufferLC,toconductthemid-pointassessmentandforongoingcompliancemonitoring.

47


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)


48


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


Exceededprevioussupplementalpayments. 10%increaseoverinitialDSTI


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


Yes;MassachusettsUncompensatedCarePoolwasrestructuredandincorporatedintotheSafetyNetCarePoolwhenstateconductedits2006healthreform.AportionoftheSNCPauthorizedexpenditurelimitscontinuestobeallocatedtotheHealthSafetyNet,whichpaysforuncompensatedcare.DSTIfallsunderSNCP.

SNCPapprovedfora3-yearperiodunderwaiver.DSTIfallsunderSNCP.


ThroughDecember31,2013.Expenditureauthoritywas$360millioninSFY2012,$310millioninSFY2013and$130millioninSFY2014.

ThroughJune30,2017.Expenditureauthorityof$385millioninSFY2015;$257millioninSFY2016;and$127millioninSFY2017forvariousstate-fundedprograms.DSHPauthorityalsousedtosupportConnectorsubsidies(throughJune30,2019),CommonwealthCaretransition,temporarycoverageduringConnectorwebsitechallenges,outsideoftheexpenditureauthoritycapslistedabove.


49


Prov

ider

s


SevenhospitalseligibleforDSTIdefinedaspublicorprivateacutehospitalswithahighMedicaidpayermixandalowcommercialpayermix:BostonMedicalCenter,CambridgeHealthAlliance,StewardCarneyHospital,LawrenceGeneralHospital,SignatureHealthcareBrocktonHospital,MercyMedicalCenter,andHolyokeMedicalCenter.

SevenhospitalseligibleforDSTIdefinedaspublicorprivateacutehospitalswithahighMedicaidpayermixandalowcommercialpayermix:BostonMedicalCenter,CambridgeHealthAlliance,StewardCarneyHospital,LawrenceGeneralHospital,SignatureHealthcareBrocktonHospital,MercyMedicalCenter,andHolyokeMedicalCenter.

Proj

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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


HospitalsarerequiredtoselectaminimumoffiveprojectsacrossCategories1-3.Eachhospitalmusthaveatleastoneprojectineachofthethreecategoriesandatleasttwoprojectsintwoofthethreecategories.HospitalsarepermittedtosubmitmorethanfivetotalprojectsacrossCategories1-3.ForCategory4,hospitalsarerequiredtoreportonaspecifiednumberofpopulationhealthmetrics.Hospitalsmustalsoreportonaminimumofsixbutnomorethan15hospital-specificmetricsthatlinktoprojectsinCategories1-3.

Notyetfinalized


HospitalsmaycarryforwardunclaimedincentivepaymentsinDY15andDY16forupto12monthsfromtheendoftheDemonstrationyearandbeeligibletoclaimreimbursementfortheincentivepaymentunderconditionsspecifiedinthemasterplan.Nocarry-forwardisavailableforDY17.

Notyetfinalized


Participationinalearningcollaborativerequired;treatedasaprojectinCategory3withapprovedmetrics.

Notyetfinalized


50


Out

com

es


Metricsarepay-for-performanceotherthanpopulation-focusedimprovementmetrics,whicharepayforreporting.

Notyetfinalized


ForCategories1-3,providersmustreportonbetweentwoandsevenmetricsperprojectperyear.Metricsfallintotwocategories:1)processandinfrastructuremetricsthatarecriticaltoprojectplanning,design,andimplementation;and2)outcomemetricsthatdemonstratetheresultsoftheprogram.Category4metricsarecomprisedoftwocategories:populationhealthmetricsthatallhospitalsmustreportonandhospitalspecificmetricsthatlinktoprojects.

Notyetfinalized


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.

51


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


Fund

ing

Maximum Potential Pool Funding (federal) $21,000,000

Maximum Potential Pool Funding (all funds) $29,000,000(plusanyunclaimedfundsfromUCpool)


Intergovernmentaltransfers(IGTs)fromlocalcountiesandfromtheUniversityofNewMexicohospitalplusstategeneralfundstofillgap.

Average Funding Available Per Year $7million;graduallyincreasesfrom$2.8millionto$12millioninDY2-5


Sameaspriorsupplementalpayments,no“new”money;somepriorsupplementalpaymentfundingwasincorporatedintoarateincreaseforhospitals,asdescribedinSTC105.


HospitalsqualifyforHQIIfundsbyachievingoutcomemetricsintwodomains:UrgentImprovementsinCare;andPopulation-FocusedImprovements.AllHQIIfundingisdirectedtowardsachievementonoutcomemeasures(i.e.,nofundingforDSRIPprojectsorprojectplandevelopment)so100%oftotalfundingisconsideredpay-for-performance(meetingimprovementtargets).


52Co

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Pool

s


Yes,UCandHQIIpoolscombinetomakeuptheSNCP,valuedat$373,873,201total.ThemaximumpotentialfundingfortheUCPoolis$344,446,615;unclaimedUCfundsgointoHQIIpool.ThestatehaslimitationsontheFFPitcanclaimfortheSNCPthatfluctuateeachyearsuchthatthestateincreasinglyclaimsfundsfromtheHQIIpool(however,thelimitsonUCpoolfundingremainconsistentthroughoutthewaiverat$68,889,323/year).OverthecourseofthefiveyearstheUCpoolshrinksfrom100%to85%whiletheDSRIPpoolincreasesfrom4%to15%.


No

Prov

ider

s


Thereare29eligiblehospitals;theseincludesolecommunityproviders(SCPs)andthestateteachinghospital.HospitalshadtobeeligibletoreceiveSCPandUPLsupplementalhospitalpaymentsatthetimeofthedemonstrationapproval.All29hospitalshavesubmittedtheirintenttoparticipate.

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UnlikeotherDSRIPprograms,HQIIdoesnotincludefundingfor“projects”orinterventions;onlyforoutcomemeasures.Outcomemeasuresaredividedintotwodomains:

1. UrgentImprovementsinCare(Required)2. Population-FocusedImprovements(Optional)

Participatinghospitalsarerequiredtoreportandimproveon(andbepaidbasedon)asetoftenmeasuresfromDomain1;theymayalsochoosetoreportonmeasuresrelatedtoPopulation-FocusedImprovement(Domain2).


Theprogramdoesnotappeartoincludefundingforadditionalelements,suchassharedlearning(althoughsharedlearningisencouragedthroughSTC83.d.v)

Out

com

es


Domain1includes10measuresofsafercarethatalignwiththeCMSPartnershipforPatientsinitiative(hospital-acquiredconditionsandreadmissions).Domain2includespopulation-focusedimprovementsthatalignwiththeAHRQpreventionindicators.


ThestateusesstandardizedmetricsandtheQualityImprovementSystemforManagedCare(QISMC)methodologyofclosingthegapbetweenbaselineandbenchmark.

Thestateestablisheshighperformancelevels(HPL)andminimumperformancelevels(MPL)basedonstateornationalbenchmarksforeachoutcomemeasure;thiswassubmittedinMarch2014.HospitalsthenusethestateMPLsandHPLstosettheirownimprovementtargetsforeachoutcomemeasure.HPLsshouldbegenerallysettothe90thpercentileofthestateornationalperformanceandMPLsshouldbesettothe25thpercentileofstateornationalaggregateperformance.

Theprovider-setimprovementtargetsmustcontinuouslyclosethegapbetweentheprovider’scurrentperformance/baselineandthestateHPLinDYs3,4,and5.Specifically,forDYs4and5,theproviderimprovementtargetcannotbelowerthanthestateMPL.


DenominatorsarenotspecificallyidentifiedintheSTCs,butwilllikelybeprovidedinthestate’sallocationandpaymentmethodology(APM)documentdueJuly1.STC83.d.iirequiresthestatetoconsidersmalldenominatorissuesforsmallerhospitals.

Statewide Accountability Test None


53Re

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ing

& M

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Provider Reporting

Participatinghospitalsmustsubmitannualreports,althoughthestateislookingtouseexistingdata(e.g.,hospitalinpatientdischargedata)forthemajorityofmeasures.Forthosemeasuresthatcannotbecapturedwithexistingdata,thestatewilldevelopastandardhospital-reportingtemplateforallparticipatinghospitalsthatincludessectionsonhospitalinterventions,challenges,andmid-coursecorrectionsandsuccesses.ThestatemustalsobeabletoaggregatehospitalreportsforCMSandsharedlearningamongallhospitals.

State Reporting ThestatemustshareHQIIreportingresultsonitswebsite


Amid-coursereviewwillbeconductedpriortoDY4.ItwillbeajointeffortbetweenthestateandCMSdesignedtoexaminehospitals’progressinmeetingtheirspecifiedimprovementtargetsandtoassessthesuccessoftheprojectinachievingitsgoals.IfahospitalperformsabovetheHPLonanoutcomemeasureinDY3,thehospitalmayberequiredtoreportonanadditionalmeasureinDY4anddemonstrateimprovementsonthatmeasureinDY5.ThestateorCMSmayproposeadjustmentstohospitalinterventionsorotheraspectsofthedemonstrationbasedonthemid-yearreviewfindings.

Program Evaluation/External Audit and Review

TheAPMdocumentwassubmittedonJuly1andincludesoperationalrequirementsonmonitoringandevaluation.

54


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


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)


InYear1,100percentofDSRIPfundingisprovidedasatransitionpayment.InYear2,50percentofDSRIPfundingisprovidedasatransitionpayment;25percentispaidtohospitalsthatdevelopahospitalspecificplan;theremaining25percentispaidforprogressontheirprojectasmeasuredbystage-specificactivities/milestonesandmetricsachievedduringthereportingperiod.Overtime,fundinggraduallyshiftsfromprojectimprovementstoqualityimprovements(firstaspay-for-reportingandthentopay-for-performance).

Corr

espo

ndin

g Po

ols


No.Thewaiverdoes,however,authorizetransitionpaymentsinDY1-DY2.

Corresponding Designated State Health Program (DSHP) No.


55Pr

ovid

ers

Participating Providers AllacutecarehospitalsareeligibletoparticipateinDSRIP.Totalof63eligiblehospitals;50haveapprovedDSRIPprojects;13arenotparticipating.

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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.


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.


Incentivepaymentduringthepay-for-performancedemonstrationyearsisbasedonhospitalsmakingameasurableimprovementinacoresetofthehospital’squalityimprovementperformancemeasures.Formeasureswithanationalorpubliclyavailablebenchmark,ameasurableimprovementisaminimumofa10percentreductioninthedifferencebetweenthehospitalsbaselineperformanceandimprovementtargetgoal.Forhospitalsworkingwithprojectpartners,thisgapisreducedfrom10percentto8eightpercent.Formeasureswithoutanationalorpublicallyavailablebenchmark,ameasureableimprovementisa10percentrateofimprovementoverthehospital’sbaselineperformance(peryear).


PerformancemeasurementforbothStage3and4metricswillmeasureimprovementforspecifiedpopulationgroups,includingthecharitycare,MedicaidandCHIPpopulations,collectivelyreferredtoasthelowincomepopulation.Anattributionmodeltolinkthelow-incomepopulationwithDSRIPhospitalsandprojectpartnersforStage3and4performancemeasurementhasbeendevelopedbytheDepartmentwiththeinputandsupportbythehospitalindustry.

Statewide Accountability Test N/A


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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.


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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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


Intergovernmentaltransfers(IGTs)frommajorpublichospitals,supplementedbysomestategeneralrevenuefundedbyDSHP.

Average Funding Available Per Year AvailableDSRIPfundingfluctuatesperyear.


Norelationtopriorsupplementalfunding;NYDSRIPfundingcomesfromMedicaidRedesignTeam(MRT)savingsandnopriorsupplementalpaymentswererolledintoDSRIP.


NewYorkincludes$140millioninfundingforplanninginYear1/DY0andthenhas5yearsofDSRIPimplementationactivities.FundingforDomain1,ProjectProgrammilestones,ishighest(80%and60%oftotalDSRIPfunding,)inDY1and2,respectively,andsteadilydeclinesto0%inDY5.FundingforDomains2and3steadilyincreasesthroughouttheprogramandreaches55%and40%,respectively,inDY5.Domains2and3areacombinationofP4PandP4Randineachcase;morefundingisbasedreportinginearlieryearsandonperformanceinlateryears.NewYorkalsohasapopulationhealthdomain,whichremainsconsistentlyat5%oftotalDSRIPfundingeveryyear.


58Co

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Pool

s


No(althoughtheF-SHRP1115demonstrationdoesincludeanindigentcarepoolforclinicsthatisnotrelatedtotheDSRIP)


Yes;$4billionrelatedtoDSRIP(total,allfunds);AdditionalDSHPhadpreviouslybeenapprovedaspartofotherinitiatives

Prov

ider

s


EligibleprovidersformregionalcoalitionsknownasPerformingProviderSystems(PPSs)ledbymajorpublichospitalsorothereligiblesafetynetproviders;PPSscanincludehealthcareproviders,healthservices,community-basedorganizations,andothers.Twenty-fivePPSshavebeenidentifiedasofMarch2015.

Eligiblehospitalsarepublichospitals,CriticalAccessHospitalsorSoleCommunityHospitals,orhospitalsthatservedaminimumnumberofMedicaidoruninsuredpatients.Eligiblenon-hospitalbasedprovidersmustalsomeetrequirementsforvolumeofMedicaid/uninsuredpatients.ThestateandCMSmayalsoapprovecertainnon-qualifyingorganizationsforparticipationinaPPS.

Proj

ects

Bei

ng F

unde

d


1. OverallProjectProgress2. SystemTransformationandFinancialStability3. ClinicalImprovement4. PopulationHealth

Project Funding Per Year Averageprojectfundingperyearis$900,000.Number of Approved Projects 258


PPSsmustincludeaminimumoffiveprojectsandamaximumof11projectsperDSRIPplanwithspecificcriteriaforeachprojectcategory.


$1billiontotalcomputableintemporary,timelimited,fundingisavailablefromanInterimAccessAssuranceFund(IAAF)forpaymentstoproviderstoprotectagainstdegradationofcurrentaccesstokeyhealthcareservicesinthenearterm.

DSRIPDesignGrantsareavailableinCY2014tosupportprovidersindevelopingDSRIPprojectplans.Theyamounttoupto$200milliontotalcomputable.

AhighperformancepoolisavailableforPPSsthatclosethegapbetweenbaselineandbenchmarkby20%and/orexceedthe90thperformancepercentileonasubsetofmetricsrelatedtoavoidablehospitalization,behavioralhealthandcardiovasculardisease.Fundingiscomposedofupto10%ofannualDSRIPprojectfundsandanyunclaimedprojectfunding.

TheDSRIPbudgetincludes$600milliontotalcomputableforstateadministrationoftheprogramover6years.Aspartoftheseduties,thestatewillleadlearningcollaborativesattheregionalandstatelevelsthatarerequiredforallPPSs.


59O

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Astandardsetofmetricsisrequiredforeachdomainandproject.Manyofthesemeasuresarepay-for-reportinginearlierprogramyears,andtransitiontobeingpay-for-performanceinlateryears.


AllqualityimprovementtargetsareclosingthegapbetweenthePPS’baselineandthestateornationalbenchmarkofthe90thpercentileby10%year-over-year.


PopulationofattributedMedicaidbeneficiaries(minimumof5,000Medicaidmembersinoutpatientsettings)formostprojects.OneprojectisfortheuninsuredandMedicaidnon/lowutilizingpopulation,andusesthatattributedpopulationforthedenominatorforthatproject’smetrics.


Ifthestatefailstomeetspecifiedperformancemetrics,DSRIPfundswillbereducedinYears4-6(DYs3-5)by5%,10%,and20%respectively.Ifpenaltiesareapplied,CMSrequiresthestatetoreducefundsinanequaldistribution,acrossallDSRIPprojects.

Repo

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g &

Mon

itorin

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Provider ReportingPPSsmustreporttwiceayearforpaymentpurposesthoughtheymayonlybeeligibleforpaymentattheendoftheyearreport.PPSswillalsoreportquarterlytosupportNewYork’squarterlyassessments.

State Reporting Thestatewillpublishproject-by-projectupdatesonaquarterlybasis.


Allplansinitiallyapprovedbythestatemustbere-approvedbythestateinordertocontinuetoreceivefundinginYears5-6(DYs4and5).Thestatewillsubmitdraftmid-pointassessmentcriteriaandchecklisttoreviewplanstoCMS,whichwillbemodifiedinconsiderationoflearningandnewevidence.

Program EvaluationThestateiscurrentlydevelopingitsevaluationplan:itsubmittedanevaluationproposalandreceivedpublicinput.Willhaveaninterimandfinalindependentevaluation.

External Audit/Review NewYorkiscontractingwithanindependentassessor,PublicConsultingGroup(PCG),toserveasanexternalauditorandreviewer.

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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


Fund

ing

Maximum Potential Pool Funding (federal funds) $191,000,000

Maximum Potential Pool Funding (all funds) $300,000,000


Providertax;thestate’sportionofHTPPmoneyisfundedthroughanincreaseofonepercentagepointtothestate’shospitalassessmentrate.

Average Funding Available Per Year $150million


Exceedspriorsupplementalpayments(i.e.,nosupplementalpaymentdiversiontofundHTTP)


Hospitalswereawarded$150,000,000forsubmittingbaselinedatainYear1.InYear2,hospitalsareeligibleforanadditional$150,000,000contingentuponachievementofincentivemeasures.

Corr

espo

ndin

g Po

ols


No;OregonhasatribalhealthprogramforuncompensatedcarethatisnotdirectlytiedtotheHTPP.


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


All11measuresarepay-for-performanceinYear2.Allmeasureshaveeitherahospitalonlyorhospital-CCOcollaborationfocus.Measuresthenfallintodomainsincludingreadmissions,medicationsafety,patientexperience,healthcare-associatedinfections,sharingEDvisitinformation,andbehavioralhealth.


OHAwilluseitsCCOmethodologytocalculatehospitalimprovementtargets,whichrequireatenpercentreductioninthegapbetweenbaselineandbenchmarktoearnincentivepayments.

Denominator for Improvement Thedenominatorforimprovementisspecifictoeachmeasureandparticipatinghospital.


HTPPpaymentswillbeincludedinOregon’scalculationsoftotalexpendituresunderthewaiver.IfOregonfailstomeettrendreductiontargets,thestatefacesreducedfederalfundingforDSHP

Repo

rtin

g &

Mon

itorin

g

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.