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Some States Are Better Than Others at Implementing Value-Based Care


And these four states are lagging behind when it comes to value-based payment initiatives.

United States map

Over the past five years, there has been a seven-fold increase in the number of states implementing value-based care programs in the U.S., according to the “Value-Based Care in America: State-by-State” report from Change Healthcare.

Value-based care payment models are being designed across the U.S. to improve quality and reduce costs. This is changing the way that physicians practice medicine and how they are compensated for their services.

And some states are succeeding at integrating these payment models more than others.

The report revealed that 48 states have now implemented value-based care or payment programs and that 50% of the programs are multi-payer in scope. Just four states have little or no initiatives underway — Georgia, Indiana, Mississippi and West Virginia.


Despite Georgia having several Medicare and commercial value-based payment programs, the state does not have a coordinated strategy to increase the use of value-based payment.


Indiana also does not have a coordinated statewide strategy to adopt value-based payment models. The state has some participation in commercial value-based programs and those administered by the Centers for Medicare and Medicaid Services (CMS), including the Bundled Payments for Care Improvement initiative and the Next Generation Accountable Care Organization Model.

There are some targeted pay-for-outcome programs in Indiana, like the Indiana State Department of Health’s Maternal and Child Division infant mortality metrics.

Indiana also has a process to review performance standards for the application of the Quality Strategy Plan to managed care plans in Hoosier Healthwise, Healthy Indiana Plan and Hoosier Care Connect.


Like Indiana and Georgia, Mississippi does not have a coordinated statewide strategy to implement value-based payment programs into its healthcare system.

Still, the state has various value-based payment programs occurring through Medicare or commercial payers.

And Mississippi’s Coordinated Access Network, MississippiCAN, is a Medicare Coordinated Care Organization program that began in 2014. Magnolia Health, United Healthcare and Molina Healthcare were selected to act as coordinated care organizations for most Medicaid covered services.

MississippiCAN added psychiatric residential treatment facility services to the contracts through a Medicaid State Plan Amendment.

West Virginia

In 2014, West Virginia received a State Innovation Model Design grant from the Center for Medicare and Medicaid Innovation. The grant was used to develop the West Virginia Health System Innovation plan that recommended three strategies regarding value-based payment.

The plan suggested to set targets within the state Medicaid program to require the adoption of value-based payment by contracted plans, to encourage other payers to adopt value-based payment, and to establish regional accountable health communities.

Additionally, the plan sets goals of 10% value-based payment across all payers except for Medicare in 2017 and goes up to a goal of 80% in value-based payment by 2021.

But There's Still Hope

Three states stood out the most in the report for their breadth of initiatives, embrace of payment models that involve shared risk and willingness to test innovative strategies.

New York

In 2015, New York received a $100 million Round Two State Innovation Model Test grant and approval for its 115 Demonstration Waiver and Delivery System Reform Incentive Payments program from CMS. In the State Innovation Model, New York committed to 80% of all payments to be value-based payment by 2021, while in the waiver, it committed to achieving 90% value-based payment in Medicaid by 2021.

New York has tested a Medicaid pay-for-performance payment model and risk-sharing arrangements with managed care organizations. The state also has various value-based payment pilots that focus on maternity care, HIV/AIDS and integrated primary care.


Pennsylvania’s efforts began in 2013 and have included strategies for achieving reform, such as multi-payer episode of care payments for acute care. The state also required managed care organizations to shift 30% of their payments to alternative payment models by 2019. In Pennsylvania, there are global payments for enhanced primary care through patient-centered medical homes and a global budget for rural hospitals.


Vermont was one of the first states to transition to value-based care initiatives, when it came up with a patient-centered medical home strategy in 2011. The state has deployed many value -based payment strategies, including an all-payer accountable care organization model, episodes of care for the Medicaid population and Health Homes.

Vermont received a $45 million State Innovation Model Test grant from the Center for Medicare and Medicaid Innovation in 2013 and used the money to consider multiple alternative payment model options.

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