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Quality Update - Health care quality issues for Minnesota's health care leaders

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Minnesota's State Innovation Model

Transforming the health care system through experimentation

Minnesota's Innovation Aims

1. Every patient should receive coordinated, patient-centered primary care. Services are integrated for the whole person, with particular attention to individuals with complex health issues and who need multiple types of care.
2. For Medicare, Medicaid, and other populations, providers participate in accountable care and payment models. Payment is based on quality, patient experience, and cost performance measures.
3. Providers are rewarded for keeping patients healthy and improving quality of care. Financial incentives will be aligned. The state will move away from the current payment system which is riddled with perverse incentives where we reward the volume of treatment rather than best care and healthy outcomes.
4. Population health becomes a focus with providers partnering with community organizations and engaging consumers to integrate medical care, mental/chemical health, community health, public health, social services, schools, and long term supports and services.

Minnesota is one of six states selected by the Centers for Medicare & Medicaid Services (CMS) Innovation Center to receive funding to act a laboratory of innovation to support comprehensive approaches to transform the state's health system through new payment and service delivery models.

The Innovation Center is fostering the testing of new payment and service delivery models that have the potential to lower costs for Medicare, Medicaid, and the Children's Health Insurance Program (CHIP), while maintaining or improving quality of care for program beneficiaries. The goal is to create multi-payer models with a broad mission to raise community health status and reduce long term health risks for beneficiaries of these programs.

The Minnesota Department of Human Services (DHS) and Department of Health (MDH) are jointly leading Minnesota's $45.2 million project—called the Minnesota Accountable Health Model—over the next three years. This is the largest award for any of the six testing states, which also include Arkansas, Maine, Massachusetts, Oregon, and Vermont. A total of over $250 million was awarded.

CMS is awarding an additional $50 million to 19 other states to start or support further development and planning of state-based models for multi-payer payment and health care delivery system transformation with the aim of improving health system performance for residents of the participating states.

Expanding Experimentation

The Innovation Center created the State Innovation Models initiative for states that are prepared for or committed to planning, designing, testing, and supporting new payment and service delivery models in the context of larger health system transformation.

"Minnesota is seen as innovative. We've done an extensive amount of work in electronic health records, quality reporting, quality management, and improvement. And, we also have progressive reform legislation," said Diane Rydrych, director of the Division of Health Policy, Minnesota Department of Health, and one of the leads for Minnesota's innovation model. The state innovation model will allow Minnesota to take the next steps in testing and spread.

Each participating state developed a State Health Care Innovation Plan with a strategy to use all of the levers available to transform its health care delivery system through multi-payer payment reform and other state-led initiatives.

The work aims to close gaps in the areas of health information technology, secure exchange of health information, quality improvement infrastructure, and workforce capacity for team-based coordinated care.

Minnesota was well positioned to receive the testing award because of all the innovative work being led by the state. The Minnesota Accountable Health Model builds on state reforms already underway, including:

  • Medicaid ACO demonstration (Health Care Delivery System): DHS has non-fee-for-service payment arrangements with provider groups caring for non-dually eligible populations.
  • Multipayer health care home initiative: in addition to the regular fee-for-service reimbursement for traditional covered services, Medicare, Medicaid, and some commercial payers are paying participating primary care practices a monthly per-beneficiary fee to cover the cost of providing improved care coordination, enhanced access, patient education, community based support, and other services. The state now has 244 certified health care home clinics.
  • Community care teams: multidisciplinary teams that partner with primary care offices (certified health care homes), the hospital, and existing health and social service organizations to provide individuals with support for well-coordinated preventive health services and coordinated links to social and economic support services.
  • Statewide Health Improvement Program (SHIP): a community grant program to create good health for parents, kids, and the whole community by making environmental changes that support decreasing obesity and reducing the number of people who use tobacco or who are exposed to tobacco smoke.
  • E-health initiative: a public-private collaborative working to accelerate the adoption and use of health information technology.
  • Statewide Quality Reporting and Measurement System (SQRMS): a standardized set of quality measures for health care providers across the state, with a uniform approach to quality measurement in Minnesota to enhance market transparency and improve health care quality.

Approximately 150 representatives from across the continuum of care, including mental health and long term support and services, attended three stakeholder meetings to contribute ideas to develop the state's plan.

A six-month planning period started in April 2013, with implementation and testing to run October 2013 and through September 2016.

Core Work

Key components of the three year implementation phase of the project include secure exchange of health information and data analytics including building data warehouse capability for data from DHS, managed care organizations, and Medicaid ACO participating providers. The work will strengthen quality and performance measurement by expanding the current measurement infrastructure to support shared savings models. Workforce development will include integrating new professions into care delivery, such as community health workers, community, paramedics, and doulas. The model will support development of 15 Accountable Communities for Health that build on the Community Care Teams to better integrate health care with behavioral health, long term care supports and services, and social services.

Risks and Challenges

This experimentation is not without risks. We're already seeing more consolidation within the large integrated systems. Smaller providers are folding into these systems or are being controlled within them.

As ACOs are being embedded in hospitals and health systems, many are building their own social services supports instead of linking with social services agencies and programs already working in the community.

The state is examining payor coordination to see if health plans and the state can continue moving toward
aligned payment approaches and data sharing methodologies. "We need to use various policy levers and incentives to move toward broader data sharing and greater accountability for a community-wide perspective on care coordination and health," said Rydrych.

Patients often lack a real voice in their care. They frequently are missing from the conversation on how to reform care systems, and the state is looking for opportunities to bring forward patients' ideas.

Providers are wary about expanded health care home accountability, such as for behavioral health. It is still talked about in general terms and planning is occurring to determine what this really means.

Lastly, the state has three years to complete this transformational work. That's a short time for the difficult, groundbreaking work planned.


Savings from the model are projected at $111.1 million over three years, with $90.3 million in Medicaid savings, $13.3 million in savings to private payers, and $7.5 million in Medicare savings.