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Health Share of Oregon is a nonprofit founded in 2012 to coordinate the provision of medical, dental, and behavioral health care for Medicaid beneficiaries in a tricounty region encompassing Portland. As one of 16 coordinated care organizations designated by the state to oversee and improve the delivery of these services for a geographically defined population, it receives a global budget. It distributes per-capita payments to health plans— some of which are integrated delivery systems—and county-run mental health agencies that have agreed to accept risk for providing or ensuring access to defined services. These risk-bearing entities—all founders of Health Share—serve on its governing board, along with representatives of community-based organizations and social service agencies committed to this population. Health Share brings these stakeholders together to improve care for high-need, high-cost patients; achieve efficiencies by centralizing certain administrative and enrollment functions; and create accountability for performance. A Note on This Series This case study series, which follows up on previous Commonwealth Fund research examining the attributes of high-performing organized delivery systems,1 describes how three diverse organizations are creating accountable care systems. It focuses on how each organization is building on experience to develop a system for population health management. IMPETUS FOR ACO FORMATION AND DEVELOPMENT In 2012, the Centers for Medicare and Medicaid Services (CMS) agreed to provide Oregon $1.9 billion over five years to avert a budget shortfall in its Medicaid program, with the stipulation that the state reduce the rate of growth in per-capita Medicaid spending by 2 percent by the second year.2 To achieve this goal, Oregon implemented a Medicaid reform plan envisioned by its governor, John Kitzhaber,3 that required any health plan or provider participating in the Medicaid program to join or form a regional coordinated care organization (CCO) that would be responsible for meeting state-designated quality improvement and cost containment goals. To learn more about new publications when they become available, visit the Fund’s website and register to receive email alerts. Commonwealth Fund pub. 1769 Vol. 22 The mission of The Commonwealth Fund is to promote a high performance health care system. The Fund carries out this mandate by supporting independent research on health care issues and making grants to improve health care practice and policy. Support for this research was provided by The Commonwealth Fund. The views presented here are those of the authors and not necessarily those of The Commonwealth Fund or its directors, officers, or staff. For more information about this brief, please contact: Douglas McCarthy, M.B.A. Senior Research Director The Commonwealth Fund DM@cmwf.org 2 The Commonwealth Fund Health Share of Oregon, the largest of 16 CCOs that formed across the state, was founded by four competing health plans, three county-run mental health agencies, and several health care provider organizations in the greater Portland area (Exhibit 1). The participating health plans and mental health agencies are designated risk-accepting entities (RAEs), which take financial responsibility for providing defined benefits to Medicaid beneficiaries. The health plan CareOregon, the subject of a previous Commonwealth Fund case study,4 is one of these RAEs. The Portland area also is served by a competing CCO known as FamilyCare. To meet the strict financial and quality targets set by the state, Health Share has instituted a wide range of initiatives to help member organizations improve the quality and coordination of care for high-need, high-cost patients. These efforts focus on improving care transitions, increasing care management, and addressing the socioeconomic barriers to health, including homelessness. This work is supported by a $3.4 million state transformation grant to redesign care in accordance with local priorities and a $17.3 million Health Commons grant from the Center for Medicare and Medicaid Innovation.5 Exhibit 1. At-A-Glance: Health Share of Oregon Coordinated Care Organization Entity type Nonprofit coordinated care organization that brings community partners together to improve health outcomes and reduce costs for a geographically defined population of Medicaid beneficiaries Service area Three counties (Clackamas, Multnomah, and Washington) encompassing greater Portland, the state’s largest metropolitan area ACO program Medicaid accountable care organization ACO partners Seven risk-accepting entities (RAEs) that take financial responsibility for providing defined medical or behavioral health services, nine dental health plans, and several communitybased organizations and social service agencies. Four RAEs focus on physical health care; three of these—Kaiser Permanente, Providence Health and Services, and Tuality Healthcare— are integrated delivery systems with affiliated health plans. The fourth, CareOregon, is a network model health plan founded by safety-net providers, which include federally qualified health centers, urban hospital systems, and an academic medical center. Three RAEs are county mental health agencies that focus on behavioral health care. Patients served Approximately 227,000 Medicaid beneficiaries were enrolled in Health Share as of June 2014. For physical health care, approximately two-thirds are served by the CareOregon RAE, while the remaining third are served by the other three RAEs. Providers Health Share’s combined network includes 17,000 providers of all types, including nearly all hospitals in the tricounty region (excluding the VA and Shriner Hospital for Children) EHR systems Health Share is promoting links between providers’ electronic health record (EHR) systems and has created a care coordination registry to aid those working with its members who have exceptional needs Financial arrangement Health Share receives a global per-capita budget from the Oregon Health Authority (the state’s Medicaid agency), which it apportions to its RAEs. These, in turn, pay contracted providers on a capitated or fee-for-service basis. The state withholds 2 percent of the CCO’s overall capitation budget, contingent on the CCO and its RAEs meeting cost and quality targets. Health Share retains 2 percent of its global budget to cover administrative expenses and reserves. Future increases in per-capita payments to the CCO (and its RAEs) will be reduced by 1 percentage point in the first year and a cumulative 2 percentage points the second year. Governance The CCO’s governing board includes representatives of the entities bearing financial risk, which have authority to make decisions about payment. By state mandate, the board also includes representatives of safety-net hospitals, dental clinics, and substance abuse treatment centers, as well as other stakeholders with expertise treating Medicaid beneficiaries. Health Share of Oregon: Community-Oriented Accountable Care 3 BUILDING A SYSTEM FOR POPULATION HEALTH MANAGEMENT Care redesign. Because many of Health Share’s provider organizations and payers had previously invested in the infrastructure needed to establish patient-centered medical homes (PCMHs), more than 90 percent of Health Share members are cared for in a state-certified PCMH. Health Share is now working to develop an advanced primary care model for patients with complex medical, behavioral, and social needs, using an approach similar to one used by Legacy Medical Group, part of an urban health system that contracts with CareOregon. This approach relies on nurse case managers, pharmacists, and social workers to support primary care physicians in medical homes that care for a large number of high-needs patients. Early data from Legacy show that this intensification of care reduced use of the hospital: admissions declined from 6.5 percent to 5.7 percent of patients in one year, while emergency department (ED) visits declined from 12.6 percent to 11.6 percent of patients. Because mental health problems are common among Health Share members, the CCO is also working to identify and spread best practices for addressing these needs. Part of this involves helping the three county-based mental health agencies integrate their efforts through colocation of services and improved care transitions between inpatient psychiatric units and community mental health programs. For the latter, Health Share established an intensive transition team, funded by the Health Commons grant, which provides short-term intensive case management and mental health services to individuals who have had a psychiatric hospital admission. The team deploys mobile crisis support specialists who can meet patients at the hospital and then follow them throughout their transition to outpatient care. Local mental health crisis programs in each county help connect these patients to communitybased services and supports. The three county mental health agencies also are working to increase efficiency by standardizing administrative processes, which has the added benefit of improving Health Share’s ability to monitor performance across its network as all three providers define and measure services in the same way. The administrative simplification has led to a reduction in the number of ways that services are authorized from several hundred to a few dozen, as well as agreement on standards for the length and intensity of services and the creation of a single contracting mechanism for residential treatment services. Discussions are under way to create and fund specialized high-cost substance abuse treatment services on a regional basis, which would be difficult for individual RAEs to sustain alone given the small numbers of patients who will benefit. Care management of patients with complex, costly needs. Health Share is using funds from the Health Commons grant to wrap additional care management se

Health Share of Oregon: A Community-Oriented Approach to Accountable Care for Medicaid Beneficiaries