Report Presents Framework for a Value-Based Payment Strategy for Children's Health Care in New York

A new report issued jointly by United Hospital Fund and the Schuyler Center for Analysis and Advocacy presents potential value-based payment models for children's health services under New York Medicaid. Supported by a UHF grant to the Schuyler Center, and written by national payment experts at Bailit Health, the report describes two models that would foster and support screening for psychosocial risk factors such as trauma and maternal depression, integration of behavioral health services in primary care, and coordination between pediatric practices and community-based agencies addressing social determinants of health. One of the models is designed for use with a small portion of medically vulnerable children.

Both payment models—a primary care capitation model for general use and a total-cost-of-care model for children with complex medical conditions—would include care coordination payments, recognizing the expense associated with referrals, follow-up, and coordination of services, including connections with a robust network of community-based agencies addressing social determinants of health. Quality performance incentives would be a separate bonus payment in the primary care capitation model, and an inherent part of the shared savings calculation in the total-cost-of-care model.

As part of its efforts to improve its Medicaid program, New York is planning to have the great majority of its Medicaid managed care payment be value-based—rather than fee-for-service—by 2020. This shift is underway for adult Medicaid recipients; setting it up for children is crucial but involves a number of challenges, related to children's smaller average medical expense, the greater and longer-term impact on healthy development of social and environmental factors, and other issues unique to child health.

“Defining what constitutes ‘value' and how to measure that is very different for children's than for adult health care,” said Kate Breslin, President and CEO of the Schuyler Center for Analysis and Advocacy. “Effectively caring for children and putting them on a path toward life-long health requires payment models that promote screening and interventions to address social determinants of health—theirs and their caregivers'—that are not now a routine part of pediatric primary care.”

“For years, New York has led the nation in providing near-universal coverage for children, and Medicaid remains the primary payer, covering 43 percent of all children in the state,” noted Andrea G. Cohen, Senior Vice President for Program at UHF. “The State has a unique opportunity to lead the nation once again by developing pediatric value-based payment approaches that recognize the unique needs of children and invest in their long-term health and well-being.”

“Improving our approach to value-based care and payment for children may not generate short-term savings, but the long-term dividends are unquestionable,” said Jim Tallon, President of UHF. “Focusing on children's unique needs by incentivizing the health care and social services essential for them to thrive is itself a valuable investment.”

Value-Based Payment Models for Medicaid Child Health Services is available at It is the latest in a series of recent UHF reports, also available here.

About United Hospital Fund: United Hospital Fund works to build a more effective health care system for every New Yorker. An independent, nonprofit organization, we analyze public policy to inform decision-makers, find common ground among diverse stakeholders, and develop and support innovative programs that improve the quality, accessibility, affordability, and experience of patient care.