MIPCD: Background

The following is an excerpt from the Funding Opportunity Announcement (PDF) released in February 2011. Grant awards for 10 States were made in September 2011. Sources for statements made below are found in the FOA.

Interventions that address the behavioral or social circumstances that influence participation in preventive health services and/or otherwise have a positive impact on outcomes of preventive health services may contribute to improving health and decrease growth in health care expenditures.

Examples of the contribution of tobacco use; uncontrolled weight, cholesterol and blood pressure; and onset of, and uncontrolled, diabetes to the level and growth in health care spending are the following:

• Tobacco use is responsible for more than 430,000 deaths each year, and is the largest cause of preventable morbidity and mortality in the U.S. Although rates have declined over the past decades, roughly one in five high school students and adults smoke cigarettes. Cigarette smoking is the leading cause of preventable death, and, for every person who dies from a smoking-related disease, about 20 more people have at least one serious illness related to smoking.
• Overweight and obesity have been shown to increase the likelihood of certain diseases and other health problems, and are important concerns for adults, children, and adolescents in the U.S. An estimated 26.7 percent of adults in the U.S. reported being obese in 2009, up 1.1 percentage points since 2007, and approximately 300,000 deaths per year may be attributable to obesity.
• In 2008, the annual healthcare cost of obesity in the U.S. was estimated to be as high as $147 billion a year.
• More than one-third of adults have two or more of the major risk factors for heart disease, a leading cause of morbidity, mortality, and health care utilization and spending.
• Diabetes is the seventh leading cause of death in the U.S. and accounted for $116 billion in total U.S. healthcare system costs in 2007, and almost 24 million Americans have diabetes, including 5.7 million who don't know they have the disease. Also about 186,300 people younger than 20 years have Type 1 or Type 2 diabetes.

Attitudes and behaviors of individuals affect their participation in, completion of, and retention of preventive health interventions. Health promotion programs show promise for employers and employees in work-site health promotion programs.

Improving participation in preventive activities will require finding methods to encourage Medicaid consumers to engage in and remain in such efforts. A significant review of the effects of economic incentives on consumers' preventive health behaviors, primarily in commercial insurance program was published in 2004 in the American Journal of Preventive Medicine. A systematic literature review identified 111 randomized controlled trials, of which 47 (published between 1966 and 2002) were reviewed. These studies showed that financial incentives worked about 73 percent of the time. Incentives that increased the ability to purchase a preventive service worked better than more diffuse incentives, but the type matters less than the nature of the incentive. Economic incentives were assessed to be effective in the short run for simple preventive care and distinct, well-defined behavioral goals.

Experience in operating and evaluating the planned MIPCD Program could contribute to our understanding of the effectiveness of these incentive programs for general populations and for Medicaid populations:

• Since many of the studies have been targeted in scope, population specific and limited duration;
• There is little evidence for Medicaid populations;
• Small incentives can produce finite changes, but it is not clear what size of incentive is needed to yield a major sustained effect;
• The longer-term use of incentives should be evaluated; and
• Further testing could be useful to determine effectiveness and extension of lessons learned to other conditions and populations.

State Medicaid programs have experimented with Medicaid physician pay-for-performance (P4P) programs and Medicaid beneficiary incentive programs. States designing Section 4108 beneficiary incentive programs may benefit from materials contained in articles that report on lessons learned from commercial sector physician P4P, experiences of State physician P4P programs and early experiences in West Virginia, Florida and Idaho beneficiary incentive programs.

Some promising practices include but are not limited to the following:

• strong communication;
• placing enough incentive dollars at stake;
• taking into consideration starting points;
• avoiding  penalty approaches to incentives, which have been counterproductive;
• including physicians and other providers in the process;
• incorporating boards or panels (similar to one Florida has in place called the Enhanced Benefits Panel) that function as an independent reviewer and auditor can help with ethical, legal, and practical constraints; and
• incentives for outcomes likely yield the best results, these are difficult to administer and introduce several legal, ethical, and practical issues.

As an approach to including outcome driven incentives, States could consider rewarding or incentivizing beneficiaries on a tiered basis for participation in programs (e.g., engaging in counseling aimed at teaching individuals how to quit smoking), attempts at behavior change (e.g., completing a smoking cessation program), actual behavior change (e.g., not smoking one week after completing the program), and finally achievement of health goals (e.g., remaining "quit" after 6 months). Other examples of a tiered incentive structure include rewarding appointments with providers to discuss health improvement goals, making attempts to improve behavior (e.g., becoming more physically active, eating a more nutritious diet), and finally attaining a behavior change goal (e.g., losing weight, lowering cholesterol levels). A tiered incentive approach to participation is important to sustaining behavior change over the long term, especially in the areas of physical activity, nutrition, and smoking cessation.