A case study in payment reform to support optimal pediatric asthma care

Executive Summary

This case study explores the role of emerging payment models in supporting care redesign for patients with poorly controlled pediatric asthma. It describes the Community Asthma Initiative (CAI), a successful initiative developed at Boston Children’s Hospital that has culturally sensitive education and environmental remediation services to improve outcomes for high risk patients. However, these services are rarely covered through fee-for-service (FFS) payment models. Asthma programs providing these services have often relied on short-term grant support and philanthropic funding, but these funding mechanisms are inefficient and unstable. Alternative payment models (APMs) offer a path to sustainable change that improves value for the patient and health care system.

This paper reviews payment reforms in several states to assess how new models can support services similar to those offered by the CAI. In addition to its own version of a patient centered medical home (PCMH), Massachusetts recently received approval to pilot a high-risk asthma bundled payment funded through its Medicaid demonstration waiver. Arkansas is implementing a statewide acute care bundle for asthma and patient-centered medical home models. New Jersey is reforming their Medicaid payments through the Delivery System Reform Incentive Payment (DSRIP) program, which provides asthma case management and home assessments through a pay-for-performance (P4P) mechanism. Oregon received a federal waiver to develop Coordinated Care Organizations (CCOs) to support and coordinate health resources and develop community partnerships. These reforms have used different payment models and care delivery approaches and are in various stages of implementation.

New payment models can support care redesign and improve value in health care delivery. They give more control over health care delivery to clinicians, who are well positioned to identify problems and develop pragmatic solutions for their individual patients. However, with the greater clinical autonomy that these new models provide, clinicians bear greater responsibility for costs and outcomes. This case study draws lessons learned from the pediatric asthma case study, makes policy recommendations, and identifies challenges to successful reform.