The 3rd Annual Tracking Report from the Arkansas Center for Health Improvement finds that the state is having success with a new health care business model that puts the focus on improved outcomes and cost savings.
Unlike fee-for-service, the model used by the vast majority of health care providers, the Health Care Payment Improvement Initiative offers no financial incentive for ordering unnecessary tests. Providers instead earn bonuses for improved outcomes for patients and for reducing costs.
It’s already saved the state some $54 million in Medicaid costs, according to Mike Motley, assistant policy director at ACHI. The tracking report found that total Medicaid costs predicted at $660.9 million came in at $606.5 million in 2015, due to cost avoidance. The savings were then shared between the state and the providers who helped avoid unnecessary costs.
Motley said the value-based model benefits patients as well by emphasizing outcomes and putting them in closer contact with their caregivers.