Emerging Practices in Medicaid Primary Care Case Management Programs. Financial Incentives for Performance


As reported in other National Academy for State Health Policy work,32 states have begun to create financial incentives for good MCO performance. Two case-study states have extended this concept to their PCCM programs. Both use bonus payments to enhance the medical home concept by rewarding PCPs who provide the best access to key primary care services.

  • Maine established a $3 million per year fund for bonus payments to the Maine PrimeCare PCPs who show the best performance on a series of measures related to access, emergency room utilization, and prevention/quality. (See the Quality Improvement section of this report for more details on these measures).
  • Oklahoma offers a bonus payment to PCCM providers who exceed expected performance in provision of EPSDT screens to members. The bonus amount increases in proportion to performance.

Maine's system is the more extensive of the two, and has been in place since July 1998. For purposes of calculating this payment, PCPs are grouped by specialty and panel size so that physicians compete only with their closest peers. Those providers whose performance is in the top 20 percent of their group receive a bonus payment. Those who perform better receive larger bonuses. The specific amount of an individual provider's bonus payment depends on provider specialty and overall performance.

Maine Medicaid staff report satisfaction with this system. Based on calls from physicians regarding their performances, state staff also believe that this system does encourage physicians to improve their performances, although it is not always clear how much of the concern with improving performance results from simply knowing where they rank against other practices versus from the potential bonus payment. Some physicians in group practices may not realize that they receive a bonus payment, as it may go directly to the practice's business office. Maine Medicaid staff are working to develop a way to make the physicians aware of the payment without creating accounting problems within the billing office.

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