A healthy partnership: Medicaid managed care organizations and federally qualified health centers

Natalie_Ellerston“Triple Aim” has become recognized as the methods designed to put our health care system on the path to long-term sustainability.

Stakeholders recognize the triple aim as simultaneously lowering population health costs, increasing quality and improving the health care experience for patients. Critical to improving the patient experience is measuring the performance of health providers, and paying them for the outcomes they delivered.

Providers most able to jump into value-based arrangements are Integrated Delivery Systems (IDS) — networks of practices under a parent holding company that provides a continuum of health care services. IDS organizations are typically anchored by large hospitals, and have the resources needed to conquer entry barriers into value-based arrangements.

However, many providers transforming to value-based arrangements find that it may take several years to break completely from fee-for-service. This need to exist in both systems can post challenges even for the best-run facilities.

Over the past few years, as many hospital systems have consolidated, they have purchased professional services capabilities, invested in health information technology (HIT) and enhanced clinical management capabilities an effort to reduce costs and improve quality. All of which are critical components of value-based contracts. In addition, providing one-stop shopping for patients also improved their patients’ health care experience.

But for Medicaid Managed Care Organizations (MCO) to be successful, they must do more than partner with a narrow IDS-based network to spread investment costs and delegate financial risk. Meeting the needs of the under served Medicaid recipients requires a more comprehensive look at value-based payment arrangements with a wider variety of providers.

This is because:

  • Many Medicaid recipients have several chronic physical and behavioral health issues, requiring care from providers and community-based organizations.
  • Inpatient and emergency department utilization is higher within Medicaid populations due to higher rates of common chronic conditions, and lack of access to preventive care.

MCOs should look toward FQHCs

Unlike IDS organizations, Federally Qualified Health Centers (FQHCs) recognize that Medicaid sustainability rests on achieving the Triple Aim. FQHCs offer many of the assets Medicaid MCOs need for long-term success:

  • They operate in under served areas.
  • They are intensely focused on high-quality, broadly defined accessible primary and preventive care services, often including mental health and dental services.
  • Their collaborations with community-based organizations, including public health agencies, provide expansive programming resources that can help counteract social determinants of poor health like food insecurity and unstable housing.

For more insight into this topic, please download our complete white paper, “A Healthy Partnership: Medicaid Managed Care Organizations and Federally Qualified Health Centers.

–Natalie Ellerston

About the author

Ellertson has worked with government funded programs at the state, local and federal levels for almost 25 years. She conducted policy research and development for a Washington, DC based think tank and worked as a policy aide for elected officials in both the U.S. and the UK.  She has 15 years of strategic planning and performance management consulting experience.

Past clients include the Centers for Medicare and Medicaid Services (CMS), several state and local departments of health and human services, and military health care entities.  She currently builds  clinical improvement programs for Medicaid recipients serviced in both MCOs and ACOs.

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