Pay for performance extends to Medicaid experiment in New York

March 29, 2015

Doctors in New York's economically depressed neighborhoods are in an experiment to transform New York's healthcare services into coordinated networks of doctors, hospitals and other practitioners. Medicaid officials hope to inspire these providers to work together on a coordinated care approach. New York, which has the country's largest Medicaid budget, is committing more than $1 billion a year for five years to the experiment. If it works, more could follow. At the start, doctors will still be paid through FFS, they will be eligible for bonuses if their teams improve the health of the patients assigned to them, who generally have used them in the past, if the experiment works providers may be paid solely based on outcomes, with better-performing groups earning more than those whose patients are in worse shape. The New York State project, which goes by the Delivery System Reform Incentive Payment program, has created unlikely alliances, mainly between competing hospitals. In many cases, doctors and hospitals from different groups have served the same patients, and the jockeying over who would get to claim them - and the government money they would bring - was so fierce that the Medicaid inspector general had to step in to resolve territorial disputes.