Using an estimated $8 billion as incentives, New York is overhauling Medicaid, pushing providers to establish more outpatient clinics, reduce hospital beds, use electronic records and enable low-income patients to see doctors and psychologists in the same visit.
Medicaid now covers almost one-third of all 19 million New Yorkers. Half this year's $62 billion budget is paid by the federal government.
The so-called $8 billion Medicaid waiver, approved last year, will apply projected federal savings over five years to improved outpatient care. The goal is to cut avoidable hospital admissions by 25 percent. In a letter last week, the federal Centers for Medicare and Medicaid Services extended approval of New York's plan for at least 13 more months.
"If you get upstream and start treating people sooner and more effectively, we'll have downstream savings," said Jason Helgerson, state Medicaid director. The state goal is to cut avoidable hospital admissions in half over the next decade, he said.
New York hospitals and thousands of doctors and other providers have organized into 25 groups that have since received approval for taking specific new approaches expected to improve care and cut long-term costs. Five-year financial awards are expected this month.
Failure to achieve goals will halt the federal money.
"It's going to be hard," said Dr. Ferdinand Venditti at Albany Medical Center. It will require changing provider and patient behavior, he said.
Albany Med is the leader in a five-county provider network with 170 organizations and more than 4,000 individual providers. It already has three urgent care clinics outside Albany, consistent with the new approach, and plans to open a fourth next month in suburban Colonie where doctors trained for the hospital emergency room can provide a higher level of care than typical walk-in clinics. They operate daily from 9 a.m. to 9 p.m. The average time for patients to get treated is 30 minutes.
All 25 plans, with nearly all New York's hospitals and reaching into every county, are due June 1. After initial checks go out next month, those newly formed provider systems will be required to meet various benchmarks, particularly reductions in avoidable hospital use. However, this first year will be focused on getting organized.
New York's Medicaid redesign since 2011 has imposed a spending cap and required transitions from fee-for-service to managed care patient coverage. It lowered spending by $1,000 per patient from 2009 to 2013, according to the state Health Department.
Some groups cover large upstate geographies, such as the Adirondack Health Institute for the eastern half of the Adirondacks, and another led by Samaritan Medical Center in Watertown for another large swath of northern New York. Within New York City, there are several separate groups.
Each was asked to first examine its existing services and capacity, and the actual need in its communities, to determine what's financially sustainable. Their assessments and proposals are posted online, and several project reductions in hospital beds.
All 25 groups have been approved for integrating physical and mental health where patients can get both evaluations in one visit.
Many Medicaid hospital readmissions involve a diagnosis of drug abuse, alcoholism or mental illness, Helgerson said. Earlier treatment, including medication, is expected to reduce repeat and expensive in-patient psychiatric treatment, detoxification and other hospitalizations.
All providers will be required within three years to use electronic patient records and connect to the regional and state data systems.
Another emphasis is better discharge planning, ensuring patients, a caregiver or nursing home staff understands and is accountable for what fragile discharged patients need to maintain health.
