The Centers for Medicare & Medicaid Services (CMS) released a new State Medicaid Director’s Letter to states encouraging states to advance value-based care (VBC) across healthcare systems in their states by implementing value-based payment (VBP) for care for Medicaid populations. CMS encouraged alignment of value-based care and provider incentives across payers. The guidance covers allowable regulatory mechanisms to implement VBP, considerations for states exploring VBP, and examples of innovative payment models for VBP from other states. The guidance highlighted South Dakota Medicaid’s Health Home program as a successful example of a successful program implemented in a fee-for-service payment structure operating in rural and frontier areas.
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