Faced with rising health care costs, states are designing and implementing payment reforms that fundamentally transform how the health care market provides and pays for services. Two states in particular, Ohio and Oregon, have developed an overarching vision to guide their multi-payer payment and delivery system transformations.
Along the way, these states have placed an emphasis on leadership, multidisciplinary engagement, availability of federal resources, and investment in infrastructure to realize their goals. As a result, both Ohio and Oregon are implementing initiatives based on the framework of the Triple Aim and are on a path to achieving its objectives.
Promoting A Common Vision Of Transformed Health Care Delivery
When Ohio’s Governor Kasich took office in 2011, the state’s Medicaid budget was growing by 9 percent each year. The Governor knew that tackling this unsustainable program growth would require system-wide transformation. On his third day in office, he signed an executive order to form Ohio’s Office of Health Transformation (OHT), an executive level office tasked with developing a vision and plan for system-wide change.
In 2012, OHT convened a diverse group of employers, health plans, health care providers, and consumer and family advocates to begin discussing how to reset the basic rules of health care competition to reward better care instead of more care. Also in 2012, with federal support, the Cincinnati-Dayton region launched a Comprehensive Primary Care Initiative (CPCI), a collaboration between Medicare, Medicaid, and seven commercial payers to advance primary care by establishing patient-centered medical homes (PCMH).
In February 2013, the Centers for Medicare and Medicaid Innovation (CMMI) awarded Ohio a State Innovation Model (SIM) Model Design grant to develop a Healthcare Innovation Plan, in which Medicaid partnered with the same seven commercial payers to plan for expanding PCMHs statewide as well as launch episode-based payments. Ohio then received a $75 million four-year SIM Model Test grant in December 2014 to implement its plan.
Since 2009, Oregon has been developing and advancing its Coordinated Care Model (CCM), which uses Accountable Care-like entities called Coordinated Care Organizations (CCOs) to provide value-based care. That same year, Oregon’s federal State Health Access Program grant and the Robert Wood Johnson Foundation (RWJF) State Network technical resources assisted the state as it developed infrastructure and milestones for the CCOs, and, in February 2013, Oregon received a Round 1 SIM Model Test grant to expand the CCM’s reach and impact.
The SIM project compliments other initiatives including Oregon’s federally supported CPCI, and Medicaid 1115 Waiver. Oregon is using this waiver authority for a Delivery System Reform Incentive Payment (DSRIP)-like initiative, a program similar to DSRIP but not as comprehensive and without federal funding for projects. Oregon’s initiative promotes collaboration across the delivery systems in the state by sharing hospital emergency department information.
Transforming Vision Into Reality
1. Leadership Entity To Foster And Fuel The Vision
The OHT in Ohio serves as a strike team responsible for strategic planning and budgeting across all state health agencies. OHT staff focus on long-term thinking, rather than day-to-day operations. They develop and maintain the state’s overall priorities to modernize Medicaid, streamline health and human services programs, and improve health system performance. System transformation is never linear, and OHT plays a key role in adapting policy in response to the dynamic health care environment. OHT designed the SIM initiative in response to the federal funding announcement, strategically building upon the state’s CPCI primary care work.
The Oregon Health Policy Board (OHPB) serves as the policy-making and oversight body for the Oregon Health Authority (OHA), the state’s central health agency that operates Medicaid, Children’s Health Insurance Program (CHIP), Addictions and Mental health Division, Public Health Division, and Public Employees’ benefit Board. With the vision and guidance of the OHPB, OHA works across divisions towards its shared vision of aligning CCM principles and implementation among payers and providers. As the lead health agency, OHA has purposefully designed and implemented all the state’s payment initiatives to grow the CCM in Oregon, leveraging available resources along the way.
2. Multi-Disciplinary Engagement
Engaging a diverse group of stakeholders is critical to the design and implementation of system transformation. The state leadership entity often serves as the convener and catalyst for such engagement.
For example, Ohio’s OHT leads a number of state implementation teams comprised of providers, private payers, and state agencies that work through implementation of key payment reform tenets. In addition, OHT leads ad-hoc inter-agency workgroups, which each focus on a specific issue within the larger vision, i.e. coordinating workforce training. The workgroups, of which there have been over 50 in the past four years, are disbanded once the specific issue is resolved.
OHA’s Transformation Center helps CCOs build relationships across stakeholders and supports the adoption of the coordinated care model through technical assistance and learning collaboratives. The center also fosters sharing of best practices among CCOs, health plans, and plans’ provider networks.
3. Leveraging Available Resources
States need to identify and efficiently use resources to implement their payment and delivery system reform visions. Oregon leveraged the power and support of its legislature to approve initial funding for activities to build the vision. Oregon also used technical assistance and support from the Robert Wood Johnson Foundation’s State Network, and resources from the Catalyst for Payment Reform organization support Ohio’s efforts.
The Affordable Care Act created numerous federal funding opportunities that both Ohio and Oregon leveraged. The SIM Model Design award, of which Ohio was a Round 1 recipient, is a unique opportunity for states, as it provides funds specifically for planning and design; it allows states to carefully foster their vision. CMS also provided two rounds of SIM Model Test awards to assist states with implementing those visions. Despite the federal funds currently available, this money will not last forever, and states must carefully plan for the future.
4. Investment In Infrastructure To Promote Sustainability
Investing in infrastructure and planning processes is one mechanism to promote sustainability. It can take years to see results from infrastructure work, but it is critical for system-wide, long-lasting transformation.
Ohio’s OHT focuses its federal investments on infrastructure and systemic change, such as improving health information exchange, creating practice-level care coordination teams, and integrating services. This emphasis on improving the population’s health and creating efficiencies rather than focusing on improvement of a handful of disease-specific metrics is key to developing a sustainable model.
Oregon has an explicit focus on infrastructure investment and sustainability planning as well. For example, through its SIM grant, the state is working to integrate clinical services with social services and low-income housing. However, rather than use SIM funds to directly finance this program, Oregon has designated funding for stakeholder engagement, which resulted in a sustainability funding plan for this integration of services.
Looking Forward
Leaders in Ohio and Oregon developed innovative visions and are taking policy and planning steps to move towards a health care system that improves population health, enhances the quality of care, and lowers costs.
Developing a health transformation agenda with common goals and interagency collaboration allowed policymakers in Ohio and Oregon to obtain buy-in from multiple payers, leverage federal resources, align ongoing initiatives, and generate collaboration among providers. Each state’s health care market and political atmosphere is unique. Yet, Oregon and Ohio, two distinct states, on their own path to implementing multi-payer payment reform, can provide common lessons that are relevant and applicable to policymakers across the country.
Author’s Note
This blog is supported by the Kaiser Permanente. Thanks to Greg Moody, of Ohio, and Jeanene Smith, of Oregon, for their interviews and review.
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