CMS on Tuesday released guidance to help states increase the adoption of value-based care strategies through their Medicaid programs.

The agency has committed to advancing value-based care in the Medicare program. It wants states to make a similar effort to reform their Medicaid programs because there is a significant overlap among Medicare, Medicaid and commercial providers. The guidance underscores the importance of multi-payer alignment in ensuring value-based care strategies lead to the healthcare delivery system’s transformation.

“Our healthcare providers need Medicare, Medicaid and private insurance payers to work in tandem with one another, and I am calling on our state partners to use this guidance to develop a plan to improve quality for their Medicaid beneficiaries by advancing value-based care in their own programs,” CMS Administrator Seema Verma said in a press release.

The guidance addresses a range of other considerations facing state Medicaid directors, including delivery system readiness, stakeholder engagement and providers’ financial risk. It also describes how states could use their existing power to adopt value-based payment in their Medicaid programs, including Medicaid fee-for-service and managed care.

“States are invited to choose the pathway that best meets their reform goals, and do not need to rely only on time-consuming, complex demonstrations or waivers to achieve better value in their programs,” CMS said in a statement.

Experts say multi-payer alignment in value-based care could accelerate its adoption and lower provider burden by reducing the complexity of reporting and payments.

CMS’ guidance builds on lessons learned from the agency’s experience working with states to develop and test value-based payments models. But the results of those experiments have been mixed, and the jury is still out on whether value-based payment can deliver on its promise to transform the healthcare delivery system.

Many policymakers and healthcare experts have long advocated for the broad adoption of value-based payments, which link providers’ financial rewards to the quality of care that they deliver to their patients. According to the Health Care Payment Learning and Action Network, only about a third of healthcare payments were value-based in 2018.

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New CMS guidance encourages value-based payment in Medicaid – Modern Healthcare