Our goal of building a value-based purchasing (VBP) model is to improve quality and health outcomes for our Medicaid members and reduce cost growth.
In a traditional fee-for-service system, the only financial incentive for providers is to provide more services; payment is not contingent on quality of care, efficiency, or patient outcomes. Consequently, there has been a national drive for health insurers to move away from fee-for-service reimbursement methodologies using alternative payment methodologies (change how you pay) and value-based purchasing (change what you pay for).
Program Strategy
Our program strategy consists of four components:
Quality Performance
Within the VBP Program, there are five priority health care domains included to improve population health. All measures selected align to these domain areas.
- Primary Care Access and Preventive Care
- Maternal Health Services
- Behavioral Health Services
- Care of Acute and Chronic Conditions
- Oral Health Services
The program will track both an initial measure set and expanded measure set in stages. The program will begin as a pay-for-reporting only program for the first 18 months (July 2023 - December 2024). PPS hospital systems can report their Quality Improvement Plan on measures from the initial measure set and/or the expanded measure set for the first 18-month period. The initial measure set will transition to pay-for-performance in subsequent years; beginning in January 2025. The expanded set of measures will be added to the set of pay-for-performance measures beginning January 2026.
Pay-for-Reporting Performance Payment
VBP Program participants put a portion of hospital payments at risk for performance on a suite of quality measures.
In the first stage of the program, July 2023 – December 2024, if a participant satisfies the pay-for-reporting reporting requirements (i.e., submission of the required VBP Reporting Tool, participation in the VBP Outcomes Meeting, and submission of supplemental data at least once per year), the provider retains 100% of the at-risk funding for that measure.
If a participant does not satisfy one or more of the reporting requirements, the provider must pay the state 100% of the at-risk funds. Funds collected from pay-for-reporting measures will not be used to support the Redistribution Pool.
Who can participate in the ND Medicaid VBP program?
Health systems with PPS hospitals in North Dakota are mandatory participants in the model. As of July 1, 2023, the six health systems are: Sanford Bismarck, Sanford Fargo, Altru Health System, CHI St. Alexius, Essentia Health and Trinity Health.
What is pay for reporting?
The program is being implemented with pay-for-reporting periods during which the definition of successful performance will comprise three major components.
- Achievement will include the completion of an annual VBP Reporting Tool with associated attestations. Submission will occur once per year by the last day in February.
- Achievement will include participation in an annual VBP Outcomes meeting that will be required and will occur once per year per PPS hospital system between October and November.
- Achievement will include submission of supplemental data for associated measures at least once per year. Data may be submitted as often as quarterly.
What is pay for performance?
Starting in 2025, Health system performance will be evaluated against the Statewide Target as well as their own historical performance. The Statewide Target is defined as the highest level of performance that the Department wishes to achieve across the state in order to provide high quality care to all North Dakotans. Statewide Targets will be selected for each measure except structural measures which will be rated as met/not met.
Statewide targets will be set based on availability and a reasonable, incremental rate of change according to the following hierarchy based:
- Utilize the National HEDIS 50th percentile, or other applicable increment.
- Utilize the National Adult or Child Core Median.
- Utilize Regional data, as available.
- Utilize State-selected Target or Improvement over self.
Contact Information
Medical Services Division
North Dakota Health and Human Services
600 E. Boulevard Ave., Dept. 325
Bismarck, ND 58505-0250
Email: dhsmedicaidquality@nd.gov