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Transitioning Community Hospitals to Value-Based Care: Lessons From Massachusetts
Christopher J. Louis, PhD, MHA, Sara S. Bachman, PhD, MS; Dylan H. Roby, PhD; Lauren Melby, MBA, MPP; and David L. Rosenbloom, PhD
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Transitioning Community Hospitals to Value-Based Care: Lessons From Massachusetts

Christopher J. Louis, PhD, MHA, Sara S. Bachman, PhD, MS; Dylan H. Roby, PhD; Lauren Melby, MBA, MPP; and David L. Rosenbloom, PhD
This article examines the evolution of the Community Hospital Acceleration, Revitalization and Transformation investment program in Massachusetts and informs other states seeking to transform care delivery in community hospitals toward value-based care.
CHART Phase 2 incorporated more emphasis on reporting and TA compared with Phase 1. In Phase 2, approximately 30 metrics were collected from each hospital awardee each month. Metrics reflect utilization (eg, readmission rates) and operational efficiency (eg, ED length of stay for behavioral health patients). TA was enhanced in Phase 2 to include at least monthly conversations between HPC program officers and hospital staff. These conversations were used as an ongoing vehicle for providing project updates (eg, staffing changes), identifying project risks, and helping awardees form strategies to overcome barriers. At the beginning of Phase 2, TA was focused on start-up implementation issues (eg, data collection and design, reporting, project organization, etc), but over time became more focused on the dissemination of best practices and learning across sites. Quarterly regional and biannual statewide meetings of hospital awardees led by HPC consultants and staff were held to share best practices and help address similar issues occurring at multiple hospitals. Clinically-trained expert consultants and HPC staff regularly visited each hospital site to discuss progress toward CHART Phase 2 aims and facilitate goal achievement. 

Learning From the Design of CHART Phases 1 and 2

The HPC’s CHART investment program is designed to transform care delivery at Massachusetts community hospitals (and in their surrounding communities), thereby preparing these organizations for VBP. In doing so, Massachusetts has created the largest state-driven combined all-payer (payer-blind) inpatient readmission and ED utilization reduction program in the country. Further, CHART is implemented “at-scale.” Care is delivered to entire target populations, rather than subsets of those populations, through pilot programs. Given the CHART program’s design and scale, thriving partnerships between state health policy makers, the HPC, hospital staff, and community partners are critical to program success. 

Although the CHART investment program is not a one-size-fits-all program, other states can learn from Massachusetts and deploy elements of CHART. Drawing on lessons from CHART Phases 1 and 2, we offer recommendations for states considering how to transform care delivery in their community hospitals to promote VBP:

Use legislation to drive change. Massachusetts policy makers committed to changing the trajectory of healthcare spending through Chapter 224. Through action-oriented statutory language, Massachusetts instituted an annual maximum healthcare spending target, created the HPC to monitor progress against this benchmark and develop associated policies and programs, and levied an assessment on certain providers and insurers to support CHART. 

Ensure appropriate funding levels. Funding levels for specific community hospital grants must be substantial enough to enable innovation. CHART Phase 1 increased capacity and capability through smaller investments; Phase 2 built on that momentum with larger, more broad-ranging transformational investments in specific hospital projects. 

Engage in a collaborative implementation planning process. CHART Phase 2 awardees engaged with the HPC in a robust, iterative, yearlong implementation planning process to develop innovative and transformative projects. Thus, projects were more closely tailored to the local hospital context and specific population needs. This enhanced project quality and adaptability and aligned hospital and state goals.

Develop an ongoing measurement plan that informs program design, implementation, and adaptation. Funders and awardees should collaborate to develop a measurement plan that captures only measures that are salient to understanding program effectiveness and areas for process improvement. In CHART Phase 2, locally-derived data were used to drive program design. Throughout implementation, hospital awardees and HPC staff used key utilization, process, and outcomes data to drive real-time improvement and program adaptation. 

Deploy ongoing flexible technical assistance to awardees throughout planning and implementation stages. In CHART Phase 2, TA occurred through regular meetings with HPC program officers, regional and statewide learning collaboratives, and special sessions with expert consultants. The HPC retained flexibility in the provision of TA, adapting based on cohort-wide and individual awardee needs and performance. 

Involve clinical and nonclinical community partners from the beginning. Through their CHART programs, several hospitals have engaged in coalition building and created multistakeholder collaborative meetings that include community partners in regular hospital team meetings. Engaging key community partners (eg, police departments, skilled nursing facilities, detox centers) in implementation planning may improve the ability of awardees to more rapidly implement and integrate their projects. 

Engage an external evaluator to assess program efficacy. The HPC has engaged an independent evaluator to perform a full-scale, mixed-methods evaluation of CHART Phase 2. Examining the perspectives of key stakeholders as well as broader trends in hospital and state data promotes a comprehensive view about whether specific hospital investments advance community hospitals’ participation in VBP.

DISCUSSION

States seeking to transform low-cost community hospitals toward value-based care must find ways to incentivize participation in activities that reflect these new delivery models. One of the most notable efforts to transform care in states is the State Innovation Models initiative funded by the Center for Medicare and Medicaid Innovation. However, these federally funded projects are not specifically focused on community hospitals and are interested primarily in Medicare and Medicaid patients.17 Other state-driven programs focus on specific issues, such as reducing avoidable healthcare utilization (eg, readmissions). For example, the Texas Medical Center Grant Program in Collaborative Health Policy Research awards $750,000 annually to hospital-based projects aiming to benefit the health of Texans through improving care for at-risk populations and reducing hospital readmissions.18 New York implemented the Value-Based Payment Quality Incentive Program in conjunction with its Delivery System Reform Incentive Payment (DSRIP) program to “transition financially distressed facilities [community hospitals] to VBP, improve their quality of care and as a result, achieve financial sustainability.”19 The design of the New York DSRIP program also includes some components similar to those of CHART Phases 1 and 2, such as project-based initiatives and community partner engagement.20 However, no state-based investment program using nonfederal funds has used such a robust and collaborative design as CHART. Thus, the innovative roadmap created by Massachusetts should be considered by policy makers when determining how best to design the specific path forward given their own state’s context.

Although CHART targets community-based populations, it is also aligned with publicly sponsored reforms, such as Medicaid Section 1115 waivers. Massachusetts’ new 1115 waiver, effective July 2017, authorizes $52.4 billion to be spent over 5 years and includes $1.8 billion in DSRIP investments to support providers in transitioning to ACOs and enhancing behavioral health care and long-term services and support.21 The waiver also enables Massachusetts to implement its MassHealth (Medicaid) ACO program. In order to ensure programs are complementary to each other, the HPC actively works with other state agencies to be supportive of, but not duplicative of, these initiatives.

A broader question that looms for federal and state health policy makers is whether APMs and value-based care delivery models can be sustained at community hospitals in the long term. With challenges like narrower financial margins, reliance on public payers, fewer employed physicians, and older facilities compared with their AMC counterparts, community hospitals face substantial barriers to shifting to and sustaining APMs and accountable care models. These are relevant issues ripe for future research and inquiry. Nonetheless, Massachusetts seems to have acknowledged these challenges and continues to move forward despite the fact that a broader state and federal payment system shift to value-based care has not occurred as quickly as initially anticipated. Moreover, with federal health policy in flux, state-based efforts to innovate within their community hospital systems and transform care delivery for their most vulnerable and highest-need patients may be more important than ever.

Acknowledgments 

The authors would like to acknowledge all the CHART awardees for their commitment to preserving access to healthcare services in their communities.

Author Affiliations: Department of Health Law, Policy and Management (CJL, SSB, DLR), and School of Social Work (SSB), Boston University, Boston, MA; School of Public Health, University of Maryland (DHR), College Park, MA; Massachusetts Health Policy Commission (LM), Boston, MA.

Source of Funding: This research was supported through a contract with the Massachusetts Health Policy Commission to evaluate the CHART Phase 2 Investment Program (HPC-RFR-2016-009).

Author Disclosures: Mrs Melby is an employee of the Massachusetts Health Policy Commission. The remaining authors report no relationship or financial interest with any entity that would pose a conflict of interest with the subject matter of this article. 

Authorship Information: Concept and design (CJL, SSB, DHR, LM, DLR); acquisition of data (CJL, SSB, DLR); analysis and interpretation of data (CJL, DHR, DLR); drafting of the manuscript (CJL, SSB, DHR, LM, DLR); critical revision of the manuscript for important intellectual content (CJL, SSB, DHR, LM, DLR); obtaining funding (CJL); administrative, technical, or logistic support (CJL); and supervision (CJL). 

Send Correspondence to: Christopher J. Louis, PhD, Boston University School of Public Health, 261W Talbot, Boston, MA 02118. E-mail: louisc@bu.edu.
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