Utilizing Pay for Success Financing: A Playbook for State Medicaid Managed Care Programs

Published Friday, June 16, 2017 | by Andrew E. Olson, Michael T. McKnight, Ruth Ann Norton, and Kevin Chan

This playbook provides useful tools for States and the Centers for Medicare and Medicaid Services to develop an ecosystem of managed care innovation using alternate payment mechanisms and Pay for Success financing.   

Value-based purchasing through shared-saving arrangements can secure federally matched funds to invest in population health, mitigate the financial risk to governments and health plans through outcomes-based payments, and bridge the funding gap with Pay for Success financing. 

The regulatory framework is for these projects is already in place and many states are already moving forward.  States can use their managed care contracts to advance innovative programs.  Managed care plans can start securing reimbursement for their investments in population health, and health-related social service providers can use the shared-saving their programs produce to address the social determinants of health. 

We provide the tools and resources to get started with an overview, assessment, and resources.  The appendices contain templates and draft materials for contracts and program proposals that should be easily adoptable.  

We welcome your thoughts and look forward to hearing your stories.