Leveraging Medicaid in a Multi-Payer Medical Home Program: Spotlight on Rhode Island's Chronic Care Sustainability Initiative

This last of three case studies examining key operational aspects of coordinated care initiatives in Medicaid focuses on Rhode Island’s Chronic Care Sustainability Initiative (CSI). This multi-payer, patient-centered medical home (PCMH) initiative includes the one Medicaid health plan in the state and the commercial health plans, one of the largest of which has many Medicaid as well as commercial enrollees. These payers provide practices that participate in the CSI with financial incentives and practice transformation resources to develop a sustainable model of patient-centered chronic care for adults. The payers use a common contract with the practices that specifies uniform requirements and performance metrics, and they pay practices a uniform monthly per capita care management fee to support nurse care managers, who are integral to Rhode Island’s model. These fees and other investments in practice transformation also help finance data infrastructure at the practice level that is necessary to support a PCMH. CSI policy development and practices are guided by a multi-stakeholder group in a governance structure shaped by the consensus-oriented style and leadership of Rhode Island’s health insurance commissioner. The Office of the Health Insurance Commissioner (OHIC) and the Executive Office of Health and Human Services (EOHHS), where the Medicaid program resides, convene the project jointly.


The common contract is central to the multi-payer system. When multiple payers use a common contract, practices face uniform metrics, requirements, and incentives, and can invest in practice improvements that benefit all patients. In the CSI, common contract specifications were developed through a consensus process that included plans and providers. Because an OHIC representative was present at the meetings, antitrust restrictions that would otherwise have barred this process could be waived.

Medicaid participation in a multi-payer initiative presents opportunities and challenges. Because Medicaid is a large purchaser, leveraging its impact matters. Medicaid plan and provider experience in serving high-need populations has benefited the initiative. At the same time, plans and practices with sizeable Medicaid patient panels face challenges, as performance metrics are not risk-adjusted. However, the CSI rewards safety-net practices if they get “half-way to the goal.”

Combining a collaborative model with a mandate is useful. Multi-payer initiatives require buy-in. Even beginning as a voluntary pilot, the CSI might have been hard to launch without the health insurance commissioner’s leadership. Plans acknowledged that the subsequent mandate to participate probably helped move the PCMH effort forward statewide, but, importantly, consensus-style governance has lent acceptability to the mandate. Because the mandate operates through the OHIC, it covers commercial insurers, but it does not extend to self-insured employers or public purchasers. However, the Medicaid plan has always participated, and commercial plans must now pay practices care management fees for their Medicaid as well as their commercial members.

Collaboration requires time, effort, and leadership. The operation of a multi-payer initiative requires plans, practices, and purchasers to make significant commitments of time, focus, and effort on an ongoing basis. Active stakeholder leadership and engagement are necessary to build trust among parties and confidence that aligned action can advance shared goals for patient care and delivery system performance.

Multi-payer initiatives and practice transformation require infrastructure and entail new costs. Convening meetings, collecting data centrally to aggregate across payers, and other activities required to manage a multi-payer initiative all cost money. In addition to the overhead and infrastructure costs to manage the system are significant costs for developing infrastructure at the practice level for data collection and analytics, and for other changes, such as integration of nurse care managers. Care management payments to practices provide critical financing to support such transformation. With the expiration of federal grant funds to support health information technology, maintaining adequate funding is challenging.

Maintaining payer support may require evidence of savings. Health plans’ willingness to provide practices with additional support may ultimately depend on a demonstrated return on investment – evidence that investing in primary care is not only improving patient care, but also generating savings somewhere in the system. Some payers wondered whether payment to practices should be more strongly tied to their performance on clinical process and outcome metrics.

Practice transformation is the beginning, not the end, of system change. The CSI has focused mainly on what goes on in primary care practices, but, ultimately, performance should be measured not just at the practice level, but at the system level, using metrics like aggregate rates of hospitalization and emergency department use. At this writing, hospitals were not yet at the CSI table, but, more recently, the state has been engaging hospitals and has added performance measures on hospital use that are tied to payment.


Rhode Island has been successful in engaging plans, providers, and purchasers in a broad medical home initiative. A multi-payer system, including Medicaid in this case and several others nationwide, translates into important advantages for practices and providers, giving them a common, aligned set of goals, performance metrics, practice transformation resources, and incentives. Rhode Island’s ability to implement the CSI was enhanced by engaged leadership, a mixed regulatory-collaborative approach, the state’s small size, and the small number of major payers. Even under these conducive conditions, the organizational commitment, investment, and resources required to develop and implement a multi-payer PCMH initiative have been extensive, and mustering the necessary financing is a formidable, ongoing challenge. While the CSI model may not be feasible in other states, or may need adaptation, it illustrates the potential to leverage Medicaid’s role as a payer to transform health care delivery. Ultimately, to succeed most fully in improving care and reducing costs, multi-payer initiatives will need to extend beyond the sphere of primary care to engage specialists, hospitals, and others in the medical neighborhood. As the ACA expansion of coverage takes effect, and states and other entities seek to improve care delivery and orient payment toward performance, both the scale and momentum of multi-payer initiatives like the CSI can be expected to grow.


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