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Arkansas Bets Farm on Value-Based Care

By Christopher Cheney  
   September 01, 2016

Medicaid expansion has improved the lives of many economically disadvantaged residents, but Arkansas BCBS is grappling with a net negative financial impact from costs associated with serving Medicaid-eligible adults, he says.

"It started out as net positive. These people had never had coverage before, and they didn't really know how to use it; but as they got more comfortable and their providers helped them through the process, we've seen costs increase for us, particularly on prescription drugs. So right now, it's a financial challenge for us," Spaulding says.

"We have had to engage the delivery system in a different way to make sure we are collectively using our resources both from an insurer perspective and a provider perspective to get those people the right care, when they need it, where they need it from the people they need it from."

Medicaid expansion in Arkansas has transformed the roles of providers and payers, he says. "It's changed the whole relationship. Providers have less collectible debt. They have lower rates of uninsured patients. But now we have to battle with the way these people access the system—people who have never had insurance. For most of them, the only way they knew how to access the health system was through the emergency room."

Developing financially sustainable models to provide value-based care for Medicaid-eligible patients is daunting, Spaulding says. "It's resource intensive, and we have had to reassess our ratios of case management to population. We have had to engage the delivery system in a different way to make sure we are collectively using our resources, both from an insurer perspective and a provider perspective to get those people the right care, when they need it, where they need it, from the people they need it from; but going forward, it's going to require even more integration of both operations and culture, and there's going to have to be integration of financial incentives in all of this, so that we're all on the same end of the rope together.

"Part of that is the work that we are doing with the delivery systems across the state that are trying to organize themselves into clinically integrated networks to potentially share risk. The definition of the population under management begins with the alignment of the patient with a primary carephysician; so from that perspective,the role of the primary care physician is becoming more clearly defined," he says.

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


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