HomeNewsThe Third Way: a path forward for managing Medicaid in Iowa

The Third Way: a path forward for managing Medicaid in Iowa

As a member of the Iowa Hospital Association (IHA) – and with our CEO Marty Guthmiller becoming the Chair of the IHA Board beginning October 10, 2018 – Orange City Area Health System would like to provide some background and context for a new IHA proposal for replacing the current Medicaid structure. The videos (linked at the right) depict some of the current facts and challenges under Iowa’s current Medicaid Managed Care environment. They should be viewed within the context of the information provided below from the IHA:

The Third Way: a path forward for managing Medicaid in Iowa Roadmap for Value-Based Payment

In April 2016, the State of Iowa implemented commercial managed care for nearly all Iowans receiving Medicaid. To move toward a sustainable financial model for Medicaid and ensure high quality, efficient, and accessible care for Iowas, the Iowa Hospital Association (IHA) has proposed pivoting the State’s Medicaid program to a value-driven delivery system that:

  1. Establishes data-informed care management at the site of care,
  2. Eliminates administrative redundancy,
  3. Promotes transparency and accountability, and
  4. Moves the State to payment arrangements that reward population health improvement and program efficiency.
This new model, “The Third Way,” would replace the current system of commercial managed care with a single statewide Administrative Services Organization (ASO) responsible for supporting a standardized suite of care management and administrative functions across the State, including: streamlined and centralized provider enrollment; centralized beneficiary enrollment and attribution; standardized quality measures, clinical guidelines and care improvement initiatives with flexibility for local variation and innovation; and tools and resources to support clinical practice transformation. A statewide data analytics infrastructure would be paired with the ASO, leveraging Medicaid claims, eligibility, and provider data to facilitate care coordination across care settings and support robust population health management. In addition to these administrative and care coordination responsibilities, the ASO would be charged with working with Medicaid providers to support movement across a continuum of value-based payment arrangements, designed to reward quality outcomes and cost efficiency. The ASO would offer a range of practice transformation technical assistance, including clinical guidelines and best practices, workflow redesign/management, risk assessment and stratification, root cause analysis and performance improvement plan development. A transitional payment model – providing a uniform payment schedule with routine updates, and considerations for sustaining community hospitals – would replace MCO payments as a foundation. The State would then work with stakeholders to develop a value-based payment (VBP) roadmap, including a menu of VBP options built upon a set of measures in support of the State’s quality, access and efficiency goals. Orange City Area Health System (OCAHS) supports a new model for Medicaid that, first and foremost, meets the health needs of those it is intended for. Second, OCAHS supports a sustainable financial model that ensures quality, efficiency, and accessibility with alignment to Medicare and other commercial carrier goals of data, transparency, and accountability. Finally, OCAHS supports a model that rewards providers for innovation in meeting the needs of those we serve, which ultimately is what is best for all of Iowa. We believe the IHA proposed “Third Way” is one such model with this potential. We are open to any other model that accomplishes similar goals and outcomes.