Diana Crumley, JD, MPAff

March 18, 2021

In many state Medicaid programs, primary care is the keystone that supports other state health care priorities, like value-based care and health equity. Better primary care is associated with improved health outcomes, lower health care costs, and reductions in health disparities — especially for communities of color. By promoting advanced primary care within Medicaid initiatives, states can work toward broader state health care goals and have a big impact.

Through Medicaid managed care contract cycles, states have regular opportunities to catalyze activities relating to advanced primary care and health equity. Managed care contracts and requests for proposals (RFPs) serve — not as boilerplate, legalistic documents — but as dynamic expressions of states’ priorities. Contracts are tools that can drive better, more equitable outcomes. Contract requirements and incentives are levers that can elevate innovation and encourage accountability. For example, with increased state focus on acknowledging and addressing racism in health care institutions, Medicaid managed care contracts can advance policies and programs that explicitly reduce health disparities, embed cultural humility in care, and promote health equity.

Over the past two years, the Center for Health Care Strategies (CHCS) has helped states explore how to use managed care tools and levers to strengthen primary care models that better serve the needs of Medicaid enrollees. Through the Advancing Primary Care Innovation in Medicaid Managed Care learning collaborative, supported by The Commonwealth Fund, CHCS assisted 10 states in designing Medicaid managed care programs that hold managed care organizations (MCOs) accountable for progress toward concrete primary care goals. Inspired by these states, CHCS compiled design considerations and state examples in a toolkit for states that features design options related to identifying and addressing social needs, integrating behavioral health, and moving to value-based payment in primary care, among other topics.

Guiding Principles to Support Advanced Primary Care and Health Equity

To build Medicaid managed care programs centered on strengthening primary care and promoting health equity, states can consider four guiding principles outlined below (see CHCS’ toolkit for more detail):

1. Don’t just reprocure — reimagine.

States can craft RFP questions and an evaluation process that rewards not only stability and sophistication, but also innovation and collaboration. MCOs can work with local communities and other MCOs to strengthen the capacity of providers to address the needs of Medicaid members.

An RFP offers an opportunity to rethink a state’s Medicaid managed care program and introduce new goals and partners. States should take full advantage of this window to ensure proposed goals and activities align with member needs and promote equity. During the planning process, a Medicaid agency can: (a) outline its vision and associated goals; (b) listen to members, providers, and MCOs; and (c) refine their approach in response to feedback.

For example, to share goals for the next phase of its Medicaid managed care program, Louisiana developed a white paper outlining its vision, with primary care and health equity as central pillars. North Carolina published a series of policy papers, including an advanced data strategy to support the state’s advanced medical home program. Ohio developed animated videos that explain, in straightforward terms, initiatives to reduce administrative burden on providers and deliver more personalized care.

To refine program details, states often seek feedback from Medicaid providers, MCOs, community organizations, and, importantly, Medicaid members themselves. For example, Ohio held listening sessions with Medicaid members and community partner organizations to refine a person-centered vision for the state’s new managed care program. Oregon held public forums and listening sessions in partnership with local community advisory councils and regional health equity councils. Hawaii published a request for information asking the public to comment on the role of primary care in behavioral health integration. Other states have used multi-stakeholder advisory groups to define primary care investment and transformation goals. As it refines its ideas, the state Medicaid agency can build trust with members and other stakeholders by summarizing what the state heard and how it will respond.

In drafting an RFP, a state can craft questions and an evaluation process that rewards not only stability and sophistication, but also innovation and collaboration. MCOs can work with local communities and other MCOs to strengthen the capacity of network providers to address the needs of Medicaid members. For example, Oklahoma asks plans to describe reimbursement mechanisms or incentives to co-locate behavioral health services in a primary care setting, as well as innovative approaches to addressing health disparities. Minnesota asks prospective MCOs to reflect on disparities in maternal health and well-child visits, strategies for connecting families to social supports, and efforts to address structural racism and develop antiracist systems and processes.

2. Consider the complementary roles of the state Medicaid agency, MCOs, and primary care teams.

A state may want to reflect on how it, MCOs, and primary care teams can each craft and support innovative approaches to care, care coordination, and health equity. Mapping out these functions can help the state design a cohesive strategy and integrate primary care and health equity priorities throughout a managed care contract, while avoiding duplication.

MCOs can implement performance improvement projects that advance health equity through partnerships with primary care practices, or eliminate utilization management practices that unnecessarily inhibit innovative telehealth approaches or behavioral health integration.

For example, states may develop shared infrastructure and models to guide MCO activities. Examples include Tennessee’s centralized care coordination tool for its patient-centered medical home program, Washington State’s multi-payer primary care payment model, and equal access to all major physician groups and federally qualified health centers in the District of Columbia. MCOs can implement performance improvement projects that advance health equity through partnerships with primary care practices that serve communities of color, or eliminate utilization management practices that unnecessarily inhibit innovative telehealth approaches or behavioral health integration. For example, Michigan requires MCOs to coordinate with its high-volume primary care practices to develop, promote, and implement targeted evidence-based interventions that reduce health disparities.

Primary care teams can offer more face-to-face, culturally appropriate care, and be important partners for innovative care coordination strategies. For example, Medicaid members may be more receptive to questions about social needs at their primary care office, rather than on the telephone with an MCO care manager. Relatedly, Pennsylvania requires patient-centered medical homes to screen for health-related social needs and document those needs using Z codes. Oregon proposed holding coordinated care organizations accountable for social needs screening using any qualified data source, including from provider-reported data and community information exchanges, and evaluated the policy using an equity lens.

3. Choose an approach that is tailored to a state’s needs.

Each state is unique and should design a strategy that makes the most sense for that state’s primary care landscape and priorities, including meeting the needs of communities experiencing disparities. States interested in advanced primary care may choose to target certain care delivery goals, including those that advance health equity, such as identifying and addressing social needs, enhancing team-based care, integrating behavioral health, and using technology to improve access.

There are many ways to achieve these care delivery goals. In a more flexible approach, the state may define general expectations and outcomes surrounding advanced primary care, allowing MCOs to customize their approach while holding them accountable for outcomes. Alternately, in a more prescriptive or centralized approach, the state may require a specific model or framework, requiring the MCO to implement or advance uptake of a program using state specifications. A state interested in behavioral health integration might explore a range of options, such as: (a) centralized — adopting related standards in a patient-centered medical home program; (b) prescriptive — advancing a particular approach, such as Screening, Brief Intervention and Referral to Treatment or the Collaborative Care Model; or (c) flexible — allowing MCOs to explore a range of behavioral integration models, but holding MCOs accountable for targeted goals.

For states looking for inspiration, additional examples are available in CHCS’ Advancing Primary Care Innovation in Medicaid Managed Care: A Toolkit for States, and in a contract database developed by George Washington University.

 4. Measure and reward progress.

In working toward these goals, states can embed related performance standards in managed care contracts and advance value-based payment models that make it easier for primary care providers to deliver better, more equitable care.

States can hold MCOs accountable for progress toward goals, including those that explicitly target health disparities, through the use of payment incentives and auto-assignment methodologies, among other mechanisms. For example, states can measure specific indicators of innovation, like: (a) the number of community health workers relative to members; (b) investment indicators, like primary care spending; or (c) quality and outcome measures, which can be stratified using race, ethnicity, and language data (e.g., Michigan’s health equity HEDIS measures). In working toward these goals, states can embed related performance standards in managed care contracts and advance value-based payment models that make it easier for primary care providers to deliver better, more equitable care.

As an example, in the next phase of its managed care program, Hawaii will measure — and periodically expect increases in — primary care spending in three concentric definitions. The definitions include services provided in the office setting, and will be progressively expanded to include behavioral health supports and services to address health-related social needs. As noted in its most recent RFP, the state may tie these targets to withhold and incentive arrangements for MCOs.

States can also adjust incentive and withhold arrangements to encourage more investment in safety-net providers and community-based organizations, and help remedy systematic underinvestment in communities of color. For example, Oregon requires its coordinated care organizations to describe how quality pool earnings will be distributed to partners that assist with health-related social needs and health equity efforts, and to reinvest a portion of net income and reserves as part of the Supporting Health for All through REinvestment initiative. New Mexico allows performance-related penalties to be redirected to system improvement activities for provider network development and enhancement activities that directly benefit members.

Strengthening Primary Care through Medicaid Managed Care

Over the next 15 months, CHCS will dive deeper into these and other approaches for using Medicaid managed care to strengthen primary care through a series of resources, webinars, and blog posts. The new series, Strengthening Primary Care through Medicaid Managed Care, will examine the tools and levers that states can use to advance comprehensive primary care strategies and equitably improve the health of Medicaid enrollees. CHCS will also introduce a new module to its primary care innovation toolkit on advancing health equity in primary care, and synthesize learnings from the recently launched Promoting Health Equity through Primary Care Innovation in Medicaid Managed Care initiative, which will support up to four states that are looking to promote health equity, with a specific focus on addressing racial and ethnic disparities.

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