Medicaid in 2022: CMS eyes equity, value-based care

By Jim Hardy, specialist executive, State Health Transformation Services, Deloitte Consulting LLP

A decade has passed since the Centers for Medicare and Medicaid Services (CMS) launched the Center for Medicare and Medicaid Innovation (CMMI). What’s ahead for the next 10 years? There will likely be greater emphasis on using CMMI to drive meaningful change toward health equity and value-based care, according to a statement from CMS administrator Chiquita Brooks-LaSure. Based on a recent white paper (the Innovation Center Strategy Refresh) it appears that CMS will likely expand pilots that have shown promise and shelve smaller initiatives that haven’t met expectations.

The strategy refresh could be critical for rapidly expanding social programs. Between February 2020 and May 2021, enrollment in Medicaid and the Children’s Health Insurance Program (CHIP) grew by 11.5 million—nearly 83 million people are now covered by those two programs. The enrollment increase was likely fueled by the COVID-19 pandemic. The proposed $2.2 trillion budget-reconciliation bill could further expand enrollment by addressing coverage gaps for people who live in states that opted not to expand Medicaid eligibility.

I expect Medicaid programs will continue to emphasize ways to improve primary care and advance total-cost-of-care models. CMMI has indicated that it wants to work more closely with states to improve health equity and to move Medicaid toward value-based care. We also could see an increased focus on multi-payer alignment on alternative payment models (APMs), with more collaboration between Medicaid and Medicare. The ability to align and (at a minimum) harmonize on these initiatives will likely be a critical step in helping to reduce provider burden and hesitancy in transforming clinical and operational models to improve patient outcomes in a financially viable way.

Bringing a health equity focus to value-based care will likely be another major theme. CMMI and most states share a commitment to address equity in value-based design and goals. It will be interesting to see how this increased focus on equity will translate into specific initiatives and how health equity will be imbedded in broader initiatives.

I see three significant opportunities for state Medicaid programs coming out of CMMI’s “refreshed” strategy:

1. Drive accountable care and advanced primary care: Since 2010, CMMI has launched more than 50 APMs, most of which have been in Medicare. Some of those models can now be shifted to include Medicaid. However, several of them were relatively small in scale and are not necessarily promotable to broader applications. The administration wants to have a more significant impact and a clear path for promoting new payment models for Medicare and Medicaid populations. In 2022, I suspect we will see fewer new pilots emerge from CMMI. Existing pilots that show potential could be expanded to more states and new markets. A number of states are already working to build on CMMI-driven Medicare accountable care initiatives and imbed accountable care initiatives within their Medicaid managed care programs. I expect that work will continue as we come out of the COVID-19 pandemic. Massachusetts, for example, has a hybrid ACO/MCO model. Some states that don’t have a managed care program are also promoting accountable care programs. A key goal of these initiatives is to move programs from upside-risk models to up-side- and down-side-risk models. This is something Maine is planning to do over the next several years.
2. Advance health equity: A growing number of state Medicaid programs are developing equity-focused program initiatives. Some are adding health equity requirements to their managed care contracts. For example, some states now require equity-focused quality improvement projects. In addition, some states are pushing Medicaid managed care companies to report on quality measures at the sub-population level. This could help inform equity-based quality improvement strategies. Some states are also looking to align their drivers-of-health strategies (also known as social determinants of health) with their emerging equity-based strategies. Robust data collection and data analytics will likely be needed to identify opportunities for equity-based strategies and to track their progress.
3. Partner to achieve system transformation. Both CMMI and the states have recognized the value of encouraging multi-payer alignment on APMs to help stimulate the transformation of provider business and clinical models. Alignment is also seen as a way to address fatigue among hospitals and health systems that often have to engage in multiple payer initiatives that tend to be focused on similar goals but might have different quality and performance standards and metrics. Progress on alignment has been challenging, but with new initiatives—like the Health Care Payment and Learning Action Network’s new State Transformation Collaboratives—there is a renewed focus on driving stronger alignment between Medicare, Medicaid, and other payers.

To take advantage of CMMI’s refreshed strategy, many state Medicaid programs will likely need to:

1. Continue to build out data analytics capabilities to support the development, implementation, and evaluation of current and planned initiatives.
2. Continue to build out Medicaid Enterprise Systems to operationalize new APMs and to support multi-payer alignment.
3. Continue to push MCOs to develop their capacity to execute new equity-based strategies and multi-payer APMs.
4. Consider broadening the stakeholder groups (e.g., payers, health systems, clinicians, members, community representatives) that contribute to the design and evaluation processes of new and evolving initiatives.

CMMI and state Medicaid programs have come along way over the past 10 years to advance value and outcomes in the health care system. As we emerge from the profound effects of the COVID-19 pandemic, I am hopeful more progress can be made in improving health equity and that the partnership between CMMI and state Medicaid programs can grow stronger.

1. MaineCare Accountable Communities Overview, Maine Department of Health and Human Services, May 10, 2021

Return to the Health Forward home page to discover more insights from our leaders.