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Research Topic(s): Health Care Management & Finance / Health Economics & Policy / Population Health / Systems Engineering
Personnel: William Riley, PhD, Mac McCullough, PhD
Arizona State University has been awarded a grant for nearly $1.4 million to create the National Safety Net Payment and Service Delivery Reform Center to help implement health care payments and service delivery reform. The two-year grant was awarded by the Robert Wood Johnson Foundation to the university's College of Health Solutions’ School for the Science of Health Care Delivery. The center will be located in the Health North building on the university’s Downtown Phoenix campus.
Within the United States, there are over 6,500 safety net organizations in the safety net system that provide health care to more than 106 million people. While some of these safety net organizations are proactively participating in payment and service delivery reform, many do not have the capacity to participate in delivery and payment reform efforts.
The National Safety Net Payment and Service Delivery Reform Center will comprise three interacting levels of support:
“Dr. William Riley and his team of technical, operational, and health care service and delivery reform experts understand the operational challenges of current payment reform programs,” said Victor Trastek, M.D., director of ASU’s School for the Science of Health Care Delivery and professor of practice. “They are well-equipped to develop this integrated national resource center to give health care safety net organizations the long-needed ability to participate in payment and service delivery reform efforts.”
Numerous payment reform efforts by both governmental and commercial payers are underway that have significant technical and operational challenges for health care safety net organizations. A safety net health system is one that provides a significant level of care to low income, uninsured, and vulnerable populations. Safety net providers have two distinguishing characteristics: a legal mandate to serve patients regardless of their ability to pay, and a substantial share of uninsured, Medicaid, and other vulnerable patients.
Alternative health care payment models (other than fee-for-service payment) include capitation, sub-specialty carve outs, episode-based and bundled payment, shared savings, pay for performance (PFP), and retainer-based practice. These models have been applied to inpatient, outpatient, long term care, and mental health care settings; pharmacies; and various sub-specialty services.
Although this shift towards fee-for-value payment represents improved financing, health care payment reform efforts have a disruptive impact on clinicians and health care organizations. While there are significant opportunities to improve the value equation, safety net organizations are poorly positioned to succeed with new payment models and may lack the resilience to overcome setbacks.
Three types of operational problems in payment reform programs have been identified that limit their effectiveness and jeopardize the chances of successful implementation: 1) errors in data integrity and timeliness, performance measure specification, and patient attribution (the process by which patients are assigned to a specific physician or practice); 2) the implementation of performance and risk-adjustment measures underlying most prepayment programs; and 3) the influence of uncontrollable events in shared savings and capitation programs (such as the introduction of very high-cost specialty drugs).