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As policymakers across the country look to balance their budgets, some are turning to Medicaid, recycling the same harmful policies they've used year-after-year: eliminating coverage for vulnerable Americans, restricting critical benefits like prescription drug coverage, imposing premiums on those who can't afford them, and slashing already-low provider reimbursement rates.

Community Catalyst and Georgetown University Health Policy Institute Center for Children and Families created the States of Innovation blog series to shine a spotlight on states that are trying to find a better way.  Our blog series highlights states that are pioneering new approaches to making Medicaid more sustainable without harming - and often by improving - care for the millions of vulnerable seniors, people with disabilities, children and low-income parents that rely on Medicaid.         ________________________________________________________________

Camden, New Jersey is one of the nation's poorest cities and has one of the highest crime rates in the nation. Homelessness, drug trafficking, high unemployment, and sky rocketing health care costs are a fact of life in this city of just 79,000. Between 2002 and 2008, 978 patients made 3,882 visits to emergency departments in the city - a majority of the visits were for preventable conditions that could be treated by a primary care doctor.

In this dire situation a family practice physician, Dr. Jeffrey Brenner, pioneered a successful approach to reducing hospital readmissions and health care costs of the sickest and most vulnerable populations. A recent episode of PBS's Frontline highlighted Dr. Brenner and his innovative work and praised his initiative as a new model of care. The work of the Camden Coalition of Healthcare Providers, the practice that Dr. Brenner set up, laid the groundwork for the "Garden State" to adopt this model, the Medicaid Accountable Care Organization (ACO) Demonstration Project, which was signed into law by Governor Christie last week.

Where it all began

An article by Atul Gwande in The New Yorker features a story about Frank Hendricks, who had multiple health issues, weighed 560 pounds, had a substance abuse problem and lived on welfare. Hendricks spent a majority of his time in the hospital because no one in the health care system was able to effectively manage his care. Dr. Brenner visited him regularly, arranged for a social worker and a nurse practitioner to coordinate his care, and advised him on how to best take care of his health -taking medication on time, healthy eating habits, etc. This team approach to care resulted in a significant improvement in Hendricks's health.

Hendricks is an example of a "super utilizer" in Camden's health care system. Through the collection of hospital data, Dr. Brenner found that a core area in the city, where a nursing home and a low-income housing tower are located, accounted for a majority of the hospital visits and millions of dollars in health care costs. Mr. Hendricks's case and the other super utilizers identified by Dr. Brenner's work showed that primary and preventive care with a team approach, which takes the whole person into consideration, significantly improves the overall health of the patient. According to Dr. Brenner this team approach has resulted in a 40-50 percent reduction in Camden's health care costs since he started this work in 2007. The cost saving strategies that Dr. Brenner and his team have used include:

* Nurse practitioner-led clinics in high cost buildings

* More super utilizer outreach teams

* Medical home-based nurse care coordination

* More same day appointments (open access scheduling)

What is New Jersey doing?

Despite the great success of Dr. Brenner's work to improve patient care and bring down overall health care costs, there are a few barriers to replicating this model elsewhere. Many state Medicaid programs do not have a payment system that provides incentives for providers to work together to improve care for patients, and hospitals in many states often lose money if the rate of preventable hospitalizations decreases.

New Jersey passed the Medicaid ACO Demonstration Project to try to remedy those misaligned incentives and help other communities replicate Dr. Brenner's success. This legislation enables community-based, non-profit coalitions of hospitals and primary care providers to apply for recognition by the state of New Jersey as Medicaid ACOs. Once approved as ACOs, these coalitions would qualify for "shared savings" if they reduce Medicaid costs by providing increased access to primary care and working together to better coordinate patients' care.

Under the legislation, the state is required to share any savings it accrues as a result of improved care coordination with the participating providers in the ACOs. To protect patients from any adverse incentives that might give ACOs a reason to skimp on care, ACOs must demonstrate improved care for their patients in order to qualify for these "shared savings".  The state will therefore be measuring - and requiring - quality improvement based on benchmarks which include: patient experience, access to primary and behavioral care, and reduction of unnecessary and inefficient medical costs.  

Key lessons for other states

Dr. Brenner's work shows that by providing more primary care and better coordinated care, we can drive down costs and create better outcomes for patients. The key is offering the right incentives to providers so they can work as team to coordinate care for the patient.

While New Jersey offers us one model to accomplish that, the Affordable Care Act (ACA) encourages many innovative approaches to improving care while reducing costs. For example, the ACA established the Center for Medicare and Medicaid Innovation (Innovation Center). The Innovation Center has the resources and flexibility to rapidly test innovative care and payment models and encourage widespread adoption of practices that promote better health and deliver better health care at lower cost.

The ACA also created an option for states to quality for enhanced federal funding to set up health homes to better coordinate the care of Medicaid beneficiaries with chronic physical or mental illness. If we can make this approach work for the sickest and most vulnerable population - then the health care system can work for everyone.

Editor's Note: This is the second blog in our series.  You may view the previous blog here.

As policymakers across the country look to balance their budgets, some are turning to Medicaid, recycling the same harmful policies they've used year-after-year: eliminating coverage for vulnerable Americans, restricting critical benefits like prescription drug coverage, imposing premiums on those who can't afford them, and slashing already-low provider reimbursement rates.

Community Catalyst and Georgetown University Health Policy Institute Center for Children and Families created the States of Innovation blog series to shine a spotlight on states that are trying to find a better way. We will highlight states that are pioneering new approaches to making Medicaid more sustainable without harming - and often by improving - care for the millions of vulnerable seniors, people with disabilities, children and low-income parents that rely on Medicaid. Our inaugural blog focuses on an initiative in Maryland to reduce the incidence of costly hospital-acquired infections and other medical errors.

By improving how Medicaid and other health insurers reimburse hospitals, Maryland dramatically lowered its rates of costly, potentially avoidable events (PAEs) such as hospital-acquired infections. Maryland's initiative is far more exciting than that sentence would lead you to believe, and we'll tell you why.

What's Really at Stake?

Wonky terms like "potentially avoidable events" - and even wonkier acronyms like "PAEs" - obscure what this is really about: the hundreds of thousands of people each year whose lives are shortened and who endure needless pain or lengthy hospital stays because of preventable medical errors.

Indeed, "PAE" takes on personal meaning to people like Ginny Harvey. In 1996, Ginny broke her ankle stepping off a curb and had surgery at a prominent hospital in Boston. That's where her story should have ended.

But during her hospital stay she acquired a staph infection, which quickly escalated into a fast-moving bone infection. After enduring 28 surgeries over the course of five years - including painful bone and muscle graphs - Ginny was forced to amputate her leg to save her life. "The staph infection did not ruin my life," she says, "but it has altered my life forever." For more on Ginny's story, click here.

Maryland vs. Medical Errors

Maryland is tackling this type of hospital-acquired infection and other medical errors head on. Before we talk about how the state is doing it, let's start with why we selected Maryland for our debut blog in the series. The state achieved tremendous results across the health care system (not just in Medicaid) in just the first year of their initiative:

• A nearly 20 percent reduction in hospital-acquired infections, like the type that Ginny suffered from.
• A 12 percent drop in overall hospital-acquired complication rates. This includes infections but also other harmful preventable events like accidental punctures during invasive procedures.
• More than $60 million in savings. Because the health care needed to treat these types of preventable complications is extremely costly, as Maryland's complication rates dropped so did its health care costs.

How Did Maryland Do It?

Maryland's reforms build on a common-sense concept: hospitals should get paid more for providing higher quality care, and less for providing harmful care. This may seem obvious, but many states' Medicaid payment methodologies fully reimburse hospitals for the costs associated with treating harmful conditions that could have been prevented. Those payment systems fail to reward hospitals for investing in preventing the types of infections Ginny endured.

The Affordable Care Act will soon require all states to take the first step: stop paying for the costs associated with a handful of medical errors that are virtually always preventable, such as operating on the wrong body-part. But these particularly egregious and extremely rare medical errors represent only a tiny sliver of the potentially preventable hospital-acquired complications that alter families' lives and drive up our nations' health care costs every day.

Maryland is the first state to tackle a broader list of 49 adverse events including ones that are usually - but not always - preventable, such as the type of infection that invaded Ginny's bones. Because these infections are not always preventable, and no hospital could be expected to lower its rate to zero, Maryland did not eliminate payment altogether for the costs associated with them. Instead, it adjusted a portion of hospital payments based on the rates of these complications; hospitals that do a good job at avoiding these events relative to their peers get a little extra money, and hospitals with a relatively high rate get a little less. This provides hospitals with the incentive to lower their overall rates of complications - saving money and saving lives.

The Real Question: Why Aren't Other States Doing It?

Remarkably few states are following Maryland's lead. And while they leave this cost-saving option on the table, Republican Governors are flocking to Capitol Hill and insisting that they need to cut vulnerable Americans off Medicaid to get their budgets under control. For example, Governor Christie is requesting that CMS allow New Jersey to freeze Medicaid enrollment for parents earning more than $439 a month. This proposal would result in 23,000 people being denied health coverage, and would save the state only nine million dollars.

Harmful eligibility cuts like these are unconscionable, particularly when New Jersey - and other states like it - could save even more money through payment reforms like Maryland's that improve health care quality and better families' lives.

To learn more about moving payment reform in your state's Medicaid program, please read Community Catalyst's policy brief. Over the summer, Community Catalyst will also be releasing model Medicaid payment reform legislation, as well as a state-by-state report card to help you track which states are following Maryland's lead.

This blog was based partly on an interview with Robert Murray, Executive Director of Maryland's Health Services Cost Review Commission.

Katherine Howitt, Policy Analyst at Community Catalyst

By Amanda Jezek, March of Dimes

Health reform has the potential to provide tremendous opportunities to expand health insurance coverage, but what many people do not realize is that the new law also makes significant investments designed to improve the quality of health care -- particularly in Medicaid.  These provisions are critical in making sure that care provided to Medicaid beneficiaries meets the highest standards of evidence and follows clinical care guidelines.  

Quality measurement and reporting can provide a comprehensive snapshot of how well Medicaid is serving the women, children, families and others who rely upon the program, and identify areas where improvements can be made.  These efforts hold great promise for the millions of people who will enter Medicaid in 2014, and also for the millions more who currently depend upon the program -- including a huge number of pregnant women.

HHS posted for comment in the Federal Register a proposed initial core set of adult quality measures for use in Medicaid.  The Affordable Care Act calling for this action mirrored language in the Children's Health Insurance Program Reauthorization (CHIPRA) which established the precedent by initiating the selection and dissemination of a core set of pediatric quality measures.  Health reform presents an important opportunity to build upon CHIPRA's efforts, particularly with regard to maternity care. 

Given that Medicaid finances more than 41 percent of births nationwide, maternity care is a common sense area of focus.  In fact, the proposed core set of adult measures includes the following four of great importance to pregnant women.  These measures are well established and have been recommended for use by  several national organizations that specialize in  measure development and use:

1.  Elective deliveries between 37 and 39 weeks gestation:  A January 2009 study published in the New England Journal of Medicine, found that elective Cesarean sections and inductions before 39 weeks pose significant risks to infants' health, including respiratory problems, feeding difficulties, infections, and higher rate of neonatal intensive care unit (NICU) admissions.i  These increased health problems led to higher rates of utilization of health care services and ultimately higher health care costs. The final weeks of pregnancy are a very important period of fetal lung development and brain growth and the health consequences for children born 37-39 weeks gestation with no medical indication can be significant and require costly care.
2. Pregnant women at risk of preterm delivery at 24-32 weeks gestation receiving antenatal corticosteroids prior to delivery:  Antenatal corticosteroids are typically recommended for women at risk, or experiencing preterm labor, to help the fetus's lungs mature so that he or she can breathe more easily after birth. Corticosteroids reduce breathing problems in newborns and help prevent a serious lung condition called respiratory distress syndrome. Corticosteroids also help prevent bleeding in the newborn's brain and a serious bowel disease called necrotizing enterocolitis. 
3. Medical assistance with smoking and tobacco use cessation:  This is critically important for pregnant women and particularly timely given that states are now required to cover tobacco cessation counseling for pregnant women in Medicaid.  Inclusion of this measure can help ensure that states are in compliance with the new federal law and help improve the quality of cessation services.  Women who smoke during pregnancy are more likely than nonsmokers to have a low birthweight or preterm baby.  According to the American College of Obstetricians and Gynecologists (ACOG), it is estimated that eliminating smoking during pregnancy would reduce infant deaths by 5 percent and reduce the incidence of singleton low birth weight infants by 10.4 percent.  Pregnant women enrolled in  Medicaid are 2.5-times more likely to smoke than other pregnant women according to data collected by the Centers for Disease Control and Prevention (CDC).
4. Postpartum care:  This measure captures the percentage of women who had a postpartum visit 21-56 days after delivery.  Postpartum care has been shown to help women improve appropriate spacing for subsequent pregnancies, reducing the risk of preterm birth which can be devastating for families as well as extremely costly.  In fact, a recent Institute of Medicine report estimates that the societal economic cost of preterm birth totaled at least $26.2 billion in 2005, the latest year for which data is available.  The medical component of that total was $18.8 billion - 85 percent of which was health services provided to infants.  The IOM Committee estimates that more than half of these medical costs are borne by Medicaid and other public programs. 

The proposed adult core measure set has been released for public comment, and its final composition may change as a result of those comments.  Stakeholders who care about the quality of maternity care in the Medicaid program should encourage HHS to include the above quality measures in the final version of the  initial core set. 

State reporting on quality measures in the core set is voluntary, so it is also important  that states be strongly encouraged to adopt and report on these measures.  Some states are already doing so, and  others can begin right away. 

The data obtained through quality measurement and reporting provides an enormously useful body of information for  to federal and state policy makers, consumers, health providers, payers and advocates that can be used to improve the care provided to pregnant women in Medicaid.  Improved care can ultimately result in better health outcomes for mothers and their children.  Healthier families -- for which health  coverage is only one factor --should ultimately be the true goal of health reform.

Finding the right health care professional to provide primary care can be a challenge--we're all looking for the right balance of expertise, compassion, communication skills, and availability.  So no one likes it when an insurance company steps in to limit our choice when it comes to picking an available primary care provider.  One of the new protections added by the Affordable Care Act, and going into effect for new plans this month, aims to ensure choice of providers--and it includes special safeguards for children.

Some health plans require enrollees to choose a primary care provider (PCP) who serves as a gatekeeper for other types of care; to see a specialist or get certain tests, enrollees need to get the approval of the PCP.  Under the new law, new plans (though not grandfathered plans) that have this requirement must allow enrollees to choose any PCP who participates in the plan and who is available to take new patients.  Under the Patients' Bill of Rights regulations, plans must notify enrollees of this right.  This prevents insurance companies from limiting the choice of PCP to a subset of their network providers. 

For children, all participating pediatricians (who are taking new patients) must be available as choices for a child's PCP.  This is an important provision for children as regular pediatric care has been proven to improve child health outcomes, avert preventable health care costs, and limit delays in care.  Moreover, parents want to be able to choose a pediatrician they trust.  A way to take this important advance one step further would be to include pediatric subspecialists in the definition of pediatricians that can be designated as a primary care provider. 

For some children with serious chronic conditions, pediatric subspecialists can provide children with their routine and ongoing care as well as needed specialty treatment. This improves continuity of care for the child and the ease of receiving treatment for the family.  A family with a child who is receiving cancer treatment, for example, could designate their pediatric oncologist as the PCP for their child.   Families should be afforded the ability to designate these kinds of clinicians as the primary care provider if they choose.

The choice of health care professionals helps to shift control over care to consumers and away from insurance companies.  Together with the other provisions that take effect September 23, it adds valuable protections that will benefit millions of Americans immediately and millions more as health care reform is fully phased in over the next four years.    

By Judith S. Palfrey, MD, FAAP

President, American Academy of Pediatrics

On Wednesday, I was honored to attend an event in DC unveiling the US Department of Health and Human Services' (HHS) Interim Final Rule on preventive services under health reform. To so many of us in the business of taking care of children, the achievement of passing the law last March was a time of historic celebration, and now, as one of the most significant pieces of the law takes shape, we realize just how much better off our children will be under health reform.

One of the earliest provisions of the Patient Protection and Affordable Care Act to take effect is Section 2713, which requires health plans to cover, at absolutely no out-of-pocket cost to families, preventive care services outlined in Bright Futures: Guidelines for Health Supervision of Infants, Children, and Adolescents. Supported by the Health Resources and Services Administration, Bright Futures is the definitive standard of pediatric well-child and preventive care developed by an evidence-informed, active collaboration led by the American Academy of Pediatrics (AAP).

Perhaps the best-known aspect of Bright Futures is the schedule of "well-baby and well-child visits" it establishes--31 visits between birth and age 21 years (to pediatricians and other clinicians, it is also known as the "periodicity schedule"). The interim rule clearly states that all components of pediatric well-child visits--including physical exams, immunizations, hearing and vision screening, developmental and behavioral screening, and anticipatory guidance--in accordance with the Bright Futures periodicity schedule must be free of financial barriers, including co-pays and deductibles. Insurers may not exclude any of these services from coverage, and cost-sharing cannot be imposed on families.

This landmark investment in preventive services will eventually allow all families, regardless of income, the opportunity to visit their pediatrician regularly during their children's most critical years of development. Having coverage for the clinically appropriate well-child visits will allow pediatricians to identify and treat health problems in children before they start. This, in turn, should help bring down the prevalence of chronic conditions that place significant financial and physical strain on children and families.

The Academy will continue to work with HHS on the development of a Final Rule, and in the process, will continue to advocate for the following: all plans--including those retaining "grandfather status"--to cover Bright Futures services; Bright Futures to be appropriately integrated into other initiatives and standards, such as meaningful use and quality measures; and for insurance companies to eliminate cost-sharing while making up those dollars for pediatricians and other health care providers.

The views expressed by Guest Bloggers do not necessarily reflect the views of the Center for Children and Families.

Editor's Note:  CCF's Dawn Horner also blogged about the preventive health services rule. 

The National Academy of State Health Policy (NASHP) is an independent academy of state health policymakers working together to identify emerging issues, develop policy solutions, and improve state health policy and practice. Recently, its executive committee identified ten aspects of health reform that states must get right in order to successfully implement federal health reform. Like the health reform law, the top ten list covers a broad range of objectives and responsibilities:

1) Be Strategic with Insurance Exchanges

2) Regulate the Commercial Health Insurance Market Effectively

3) Simplify and Integrate Eligibility Systems

4) Expand Provider and Health System Capacity

5) Attend to Benefit Design

6) Focus on the Dually Eligible

7) Use Your Data

8) Pursue Population Health Goals

9) Engage the Public in Policy Development and Implementation

10) Demand Quality and Efficiency from the Health Care System

With the dust settling on the passage of health reform, attention is shifting from the early provisions of the law such as coverage for young adults under their parent's plan and consumer-friendly insurance reforms including eliminating pre-existing exclusions for children, lifetime caps and rescissions of policies. Many states have launched formal or informal groups to begin the planning and decision-making process. According to the National Governors Association (NGA), at least a quarter of the states have formally launched commissions, task forces or advisory groups. The lack of consumer representation on these state structures is a bit disappointing given that engaging the public has been flagged as one of the top ten critical areas.

Two of my favorites among the top ten are simplifying and integrating eligibility systems and using data to analyze and improve your programs. Those of us working on children's coverage know how important these aspects of program administration are to the ultimate success of enrolling all eligible children and families. Both rely on well-designed, high-functioning technology based on simplified processes and streamlined procedures.

The NASHP brief puts it bluntly: "36 million Americans cannot be enrolled in Medicaid or the new exchanges by relying upon what, in most states, is a county-based eligibility platform designed around the cumbersome and intrusive processes of the welfare eligibility system." Touche`!

Effective systems are expensive and time-consuming to build and implement. There is an important role here for the federal government to assist states in system procurement, to standardize data reporting requirements and to require that systems meet data reporting standards as a condition of federal funding. We cannot hope to meet our coverage goals without data to analyze how well our programs are working and identify where improvements are needed. Public reporting of data on enrollment, retention, access to care, health outcomes and much more will be the best way for Americans to know when states are truly getting it right!!

Charlie Homer
President and CEO, National Initiative for Children's Healthcare Quality

In this time of agonizing about broad health care reform, I take solace in celebrating the passage of CHIPRA (the Child Health Insurance Program Reauthorization Act) just over a year ago, and focusing on its productive implementation. CHIPRA not only expanded access to health insurance for children, but--as the regular readers of this blog know--included groundbreaking activities to strengthen the QUALITY of care that children who are insured through CHIP or Medicaid receive.  These activities included substantial grants to states for demonstration projects (announced just yesterday) funding for an electronic health record that meets the specific needs of children, and two sequential activities around the measurement of quality of children's health care.

The first measurement activity mandated by the CHIPRA legislation was the creation of a "core" measurement set. The legislation called for a tight deadline, mandated the scope of the measures, and specified an inclusive process for selecting the measures. Last summer, the Agency for Healthcare Research and Quality (AHRQ) conducted a thoughtful, broadly inclusive process to create that core measurement set.

The process that AHRQ used is well described on their website. The panel included leaders of state Medicaid and CHIP programs, consumers, pediatricians and family physicians, dentists, and public health professionals. AHRQ contracted with experts to produce background information, too. The committee used a formal consensus process, voting on the validity, feasibility and importance of the measures. It then prioritized measures to make sure the set was balanced (e.g., acute, preventive and chronic care, inpatient and outpatient, and oral health). They recommended 25 measures that were subsequently reviewed by AHRQ's National Advisory Committee and ultimately the Secretary of Health and Human Services. This recommended measurement set is now out for public comment, with responses due by March 1st.

This set includes 13 measures of preventive care, 5 for management of children with acute conditions, 9 of care for children with chronic conditions, 1 of patient experience and 1 of availability. 

• Most of the preventive measures are relatively simple, emphasizing counting encounters (e.g., number of well child visits, frequency of prenatal care, and number receiving preventive dental care) rather than focusing on the content of the preventive care itself. Preventive content is addressed in assuring documentation of BMI (happily consistent with the current emphasis by the White House on obesity prevention), using standard tools for developmental screening, immunizations, and Chlamydia screening. 

• Acute care measures address appropriate use of antibiotics, catheter associated blood stream infections in intensive care inpatient settings (the only inpatient measure), counts of those EPSDT eligible children who receive dental treatment and counts of emergency departments visits in a population (presumably an outcome measure assessing prevention and integration of care more than quality of acute care itself). 

• The most common chronic conditions in childhood are addressed through a simple outcome measure for asthma (number of children over one year old with one or more asthma related emergency room visits), follow up for children on a medication for ADHD, follow up after mental illness hospitalization, and assessment of hemoglobin A1C for children with diabetes. 

• Rounding out the set, the list includes the CAHPS Health Plan survey including supplemental items for Medicaid and Children with Chronic Conditions and an indicator of access to primary care practitioners.

One can quibble with some of the measures (e.g., the inclusion of children under two in the asthma measure given the difficulty of diagnosis, the accuracy of coding, and effectiveness of treatment in that age group) and lament the generally low bar the measures establish (e.g., counts of visits receiving more emphasis than content). I also believe the committee could have recommended the measurement of the "medical home" through the use of the CAHPS survey rather than defer this measurement to the future.  

Congress recognized that any initial measurement set would be inadequate and specified that CMS create a program to develop new measures to address gaps in the core measurement set. Indeed, this week, AHRQ is convening a panel to recommend criteria for the measures under this new program. The committee highlighted gaps in their measurement set, specifically highlighting the need for better measures of mental health and substance abuse service, inpatient and specialty care, duration of enrollment and coverage, medical home, and other means of care integration, and availability of services. We at the National Initiative for Children's Healthcare Quality--working with the National Quality Forum--recently convened an expert group that identified additional gap areas such as care coordination, broader indicators of population health, and special topics such as pediatric palliative care. We anticipate the Secretary will be seeking public comment on which topics the new program should address.

But, overall, for now, rather than critique the current set, it is far more important to commend the committee, AHRQ, CMS, and the Secretary for moving quickly, transparently and yet rigorously to assemble a thoughtful and credible measurement set. We should also urge HHS to move on to establishing effective mechanisms for collecting and reporting these data across all types of care provided in Medicaid and CHIP programs (e.g., fee-for-service and primary care case management as well as managed care), for encouraging universal, standardized reporting (not required under CHIPRA), and for assisting states and delivery organizations in using these data to improve care.

The views expressed by Guest Bloggers do not necessarily reflect the views of the Center for Children and Families.