$8 Billion healthcare transformation in New York State

The New York State government has defined a goal to reduce avoidable hospital use by 25% over 5 years for the Medicaid population,nygov-logo which it will achieve through an innovative program called the Delivery System Reform Incentive Payment.

In 2012 New York State spent $53 billion on Medicaid beneficiaries, the most of any state in the country. In an effort to control costs, a Medicaid Redesign Team was struck in 2011 leading to greater enrolment of patients in Managed Care Organizations, reduced waste, and a global Medicaid spending cap that will result in an estimated $10 billion of savings in 2016 (based on original cost projections).

Better care, lower costs
Turning attention to sustainability and improved quality of care, the state entered into an agreement with the federal government in 2014 to reinvest $8 billion of savings through the Delivery System Reform Incentive Payments program. The primary goal is to reduce avoidable hospital use by 25% over 5 years.

Pay-for-Performance-PPCThis will be achieved by organizing hospitals and community care providers together in new integrated care organizations (called Performing Provider Systems), and by transitioning to performance-based funding system (focusing on pay-for-outcome, rather than fee-for-service).

The program is expected to improve care and reduce costs for the state’s 5.8 million Medicaid patients, and to encourage extending health insurance coverage to an estimated 1.5 million uninsured citizens.

KPMG will be supporting the New York State Department of Health during this program and providing assistance and guidance to care providers in Performing Partner Systems. Apix Performance is working as an expert advisor to KPMG, with a specific focus on design and development of the Medicaid Accelerated eXchange (MAX) Series during which care teams in all twenty-five Performing Providers Systems will undertake rapid-cycle process improvement projects.

More information is available here…