Governor Charlie Baker’s administration said Thursday that it has chosen 18 networks of health care providers and insurers, from Boston to the Berkshires to launch the biggest redesign of the state Medicaid program in more than two decades.
They include the state’s largest hospital systems: Partners HealthCare, Steward Health Care System, Beth Israel Deaconess Medical Center, Lahey Health, and UMass Memorial Health Care and others.
Community health centers and community hospital systems, such as Signature Healthcare and Southcoast Health, also will participate. So will Boston Medical Center and Cambridge Health Alliance, organizations that already serve large populations of patients on Medicaid.
The networks, called accountable care organizations, or ACOs, will include about 900,000 people in the state Medicaid program, or MassHealth, which covers low-income families and individuals.
The goal of the ACOs is to contain costs and improve patients’ health outcomes by better coordinating their care. The thinking is that by making sure patients get adequate primary and preventive services, they can avoid costly procedures and hospital stays.
In this model of so-called accountable or value-based care, providers get paid more when they help patients stay healthy and meet a set of quality scores. Providers who score lower on quality measures are paid less.
This is a change from the traditional fee-for-service model of medicine, in which doctors and hospitals earn more for every service, test, and procedure, regardless of outcomes.
“We know the current fee-for-service system leads to gaps in care and inefficiencies,” MassHealth director Dan Tsai
Some of the medical providers will partner with insurers, such as Tufts Health Plan and Fallon Health, while others will contract directly with the state.
No other state is moving as aggressively as Massachusetts to shift its Medicaid program to accountable care, said Thomas Barker, a lawyer at Foley Hoag who formerly worked as general counsel of the national Medicaid program. “This is the state saying we’re progressing along, we’re not slowing down.”
The networks are scheduled to launch by January. State officials said they eventually want this care model to cover the majority of people on MassHealth.
In all, MassHealth covers 1.9 million people, including the elderly and people with disabilities. It accounts for about $16 billion in annual spending, which is split between the state and federal governments.
Governor Charlie Baker’s administration is restructuring the MassHealth program after striking a deal with former president Barack Obama’s administration last November. That agreement authorized $52.4 billion in spending over five years, including $29.2 billion from the federal government.
State officials said they’re confident that Massachusetts will get those funds, even though Republicans in Congress and President Trump have proposed huge cuts to the broader Medicaid program.
In a statement, Baker said the restructured MassHealth program will “promote integration and coordination to benefit patients, while holding providers accountable for their quality and cost.”
Dr. Eric Weil, an executive at Partners HealthCare’s Center for Population Health, said that to better manage patient care, Partners — the parent company of Massachusetts General and Brigham and Women’s hospitals — is increasingly sending health care workers to patients’ homes.
“We see this as a huge opportunity to improve the quality of care that we deliver to our most complicated patients,” Weil said.
A key to coordinating patients’ care is keeping them within set networks. So a patient in Boston Medical Center’s ACO, for example, probably would not go to a Partners hospital, except in rare circumstances.
“There’s no incentive for us to disrupt care,” said Dr. Alastair Bell, BMC’s chief operating officer. “We want to make sure people end up in systems of care that promote continuity, that promote coordination.”