Medicaid savings visible in real time via website

New York state's Medicaid Visual Data Mining System allows state officials and policy makers to track the results of savings initiatives in real time, via a spending tracking website, according to Morris Peters, a spokesperson for the Division of Budget. (To view the site, go to http://www.health.state.ny.us/health_care/medicaid/regulations/global_cap/.)

The state's Medicaid Redesign Team (MRT) made recommendations expected to save $2.2 billion by the end of fiscal year 2011, and to date $600 million in savings have been achieved, according to an October 2011 progress report.

"New York has the highest per capita Medicaid spending in the nation, by far," says Mr. Peters. "In his effort to control unsustainable growth, Governor Cuomo created the MRT. This brought together stakeholders from every area of health care, to help design a Medicaid system that increased quality while controlling costs."

The public participation in this process has been "unprecedented," according to Mr. Peters, with more than 2,000 e-mails submitted by individuals, Medicaid consumers, providers, associations, and state and local employees.

Many of the suggestions were included in a package of reform proposals that achieved the governor's Medicaid budget target of nearly $2.3 billion in savings, says Mr. Peters. The MRT monthly reports allow the public and officials to see the progress in reshaping Medicaid based on their input, he adds, and distributing information publicly holds both policymakers and involved stakeholders accountable.

"It ensures that individuals, associations, and officials have the information necessary to promote efficiencies and protect vital health care services," he adds. "It encourages health care providers to partner with the state in realizing savings, in an effort to avoid benefit cuts."

While overall Medicaid spending was reported annually through the state's Division of Budget, the new website allows reporting on an ongoing basis to a level of detail that has not been seen in New York state, says Mr. Peters.

"This model is expected to provide an example for other states of how to implement innovative solutions to manage rising health care costs," he says. "We have already been contacted by other states for insights on setting up a similar system."

"Very challenging"

"I don't know of any other website where a program has tried to document savings on Medicaid," says Richard Kirsch, a senior fellow at The Rockefeller Institute of Government in Albany, NY, adding that although the site is unique, he's skeptical it will be effective.

The site, says Mr. Kirsch, reflects the governor's approach to affect savings by restructuring Medicaid so quality care is provided more efficiently, instead of cutting specific programs.

"That's the right goal, and they are going to hold themselves to that with the idea that they are going to have a website that reports on it," says Mr. Kirsch. "But translating that in a way that is fair to the system is going to be incredibly difficult."

This is because the savings are coming from making system changes in the way health care is delivered, says Mr. Kirsch. "This the kind of savings that we need to see, rather than artificial savings that cuts benefits but transfers the cost to other people, or cuts what providers get paid," he says.

However, attributing savings to specific system changes is going to be "very challenging," says Mr. Kirsch, adding that the kind of savings New York Medicaid is trying to achieve are difficult to achieve over the short term.

"The temptation is going to be to say, 'We did this, and it saved this much money,' to demonstrate savings that may not really have been achieved, or to oversimplify complex problems in order to demonstrate success," says Mr. Kirsch.

The approach is clearly targeting the general public, adds Mr. Kirsch, to demonstrate the state is going to be transparent and accountable with Medicaid. Whether other states follow suit, he says, "will depend on how well this is received, and whether it helps make the program transparent or leads to a lot of confusion and name calling."'

Contact Mr. Kirsch at (518) 443-5827 or rkirsch@rooseveltinstitute.org.