Chapter 1290, item 313YY of the 2020 Appropriations Act (the Act) outlines a Workgroup on Medicaid Payment Policies and Care Coordination (see Appendix I for language), which consists of health care stakeholders and is convened by the Department of Medical Assistance Services (DMAS). The Act directed the workgroup to evaluate and develop strategies to encourage effective and efficient provision of care for Medicaid members. The Act specifies that the workgroup should:

1) examine the role of hospital discharge planning and Managed Care Organization (MCO) care coordination and factors that may contribute to hospital readmissions,

2) assess the effectiveness of past and current activities to improve hospital readmissions,

3) assess how to prevent inappropriate emergency department utilization,

4) examine the role of MCO care coordinators in assisting Medicaid members in accessing appropriate sites of care,

5) evaluate the impact of freestanding emergency departments on utilization,

6) consider other state and federal efforts to address inappropriate emergency department utilization, and

7) consider strategies to engage in value-base purchasing arrangements to encourage the effective and efficient provision of care. The content required of the workgroup spans complex and interconnected issues within health care delivery and financing. The workgroup focused on areas with trusted data and the greatest opportunity or need by the Medicaid population.

The Act outlines six required stakeholders—the Virginia Hospital and Healthcare Association (VHHA), Hospitals, Virginia Association of Health Plans (VAHP), Managed Care Organizations (MCO), Emergency Department (ED) Physicians, and Primary Care Physicians (PCP)—and gives DMAS the authority to include other stakeholders, as necessary. DMAS included Virginia Health Information (VHI) and the Virginia Center for Health Innovation (VCHI) as additional workgroup members (See Appendix II for full list of Workgroup Participants). DMAS assembled the workgroup members for seven meetings in October, November, and December of 2020 and March, May, June, and July of 2021.

The report below seeks to summarize a large amount of data and information developed, presented, and discussed by the workgroup. While the content of this report does not necessarily reflect the views of DMAS or of any individual workgroup participant, this report does reflect and summarize key themes, policy options, and considerations discussed by the group. The report presents potential policy options for the Administration and General Assembly to consider which address the issues discussed by the group. This report outlines policy options that received consensus support from workgroup members, including options that received both support and abstention among the workgroup members. Policy options that did not receive consensus support are discussed with relevant context and listed in the appendix. As the convener of the workgroup, DMAS did not vote on the policy options. To review materials presented to the workgroup, please visit the Value-Based Purchasing section of the DMAS website at https://www.dmas.virginia.gov/about-us/value-based-purchasing/.