In 2014, CMS launched the Delivery System Reform Incentive Payment Program, an optional federal Medicaid waiver program for states with high Medicaid expenses. The program provides states with significant funding that can be used to support hospitals and other provider organizations as they aim to improve how they provide care to Medicaid beneficiaries.
Through the program, states obtain a Medicaid Section 1115 waiver, and providers are rewarded for implementing successful delivery system and payment reform projects.
At the Becker's Hospital Review 6th Annual Meeting in Chicago, Healthcare Finance Group Senior Vice President of Hospital Business Development and Chief Marketing Officer Claudia Stone Gourdon discussed some of the drivers behind DSRIP — the main one being healthcare spending. "The U.S. spends more on healthcare than other first world countries but its outcomes are worse," said Ms. Gourdon. It appears the high spending is going to continue as well. In September 2014, CMS' Office of the Actuary projected healthcare spending will increase to 19.3 percent the GDP by 2023, up from 17.2 percent in 2014. Ms. Gourdon also discussed some of the other goals for DSRIP, including integrating healthcare systems in different regions, moving from fee-for-service to fee-for-quality, and increasing collaboration across providers to create care coordination.
Although the program is available in all states, "you're not going to see this program in states without many Medicaid eligible patients," said Ms. Gourdon. That is because the funding the states receive through DSRIP is partially based on the number of Medicaid members served.
Seven states have signed up for DSRIP so far: California, Kansas, Massachusetts, New Jersey, New Mexico, New York and Texas. In each of the states enrolled in the program, providers come together to form a DSRIP Entity and the entities select project and dollar goals and submit them to the state for approval. Under the state programs, CMS holds the state department of health accountable and the department of health holds each participating provider group accountable for meeting DSRIP program objectives. If the objectives aren't met, waiver payments are not made.
DSRIP includes four "domains" entities must keep in good standing, according to Ms. Gourdon.
- Domain 1: This is the overall progress domain. It is mandatory for all provider groups.
- Domain 2: This is the system transformation domain. Two projects are required of each DSRIP Entity in the second domain. An example of a project in this domain is the expanded use of telemedicine.
- Domain 3: This is the clinical improvement domain. Two projects are required of each DSRIP Entity in the third domain. Integration of primary care services and behavioral health services is an example of a project in this area.
- Domain 4: This is the population-wide impact domain. One project is required of each DSRIP Entity in the fourth domain. Increasing early access to HIV care is an example of a project in the fourth domain.
The size of the program in each state varies widely. For instance, in Texas — the state that has received the most federal funding under the program — there are 20 regional health partnerships established that are working on 1,491 projects, while in Kansas there are only two hospitals participating that are working on four projects.
The significant amounts of federal monies allocated to the DSRIP waiver program serves as a motivator for states to participate in the program. "The concept of the federal government is that this is seed money that is going to come back and pay them twice what they've invested," said Ms. Gourdon. However, there are obstacles, such as complex reporting requirements that rely on advanced IT systems, which are keeping some states and providers from participating.