Issue Brief | Jan 26, 2016

Safety-Net Provider ACOs: Considerations for State Medicaid Purchasers

Michael Bailit and Beth Waldman, Bailit Health Purchasing LLC

With states increasingly moving to develop population-based payment arrangements with provider organizations, the critical role of safety-net providers has become a challenging consideration for states.  While safety-net providers typically lack the capital, experience, and/or scale to operate as an Accountable Care Organization (ACO), their role in state Medicaid programs underscores their integral role in the implementation of a population-based payment strategy with ACOs.  This issue brief, prepared by Bailit Health Purchasing, examines seven safety-net ACOs across five states to understand their origins, organization, characteristics and functions and to identify federal and state policy questions associated with their emergence.  The issue brief identifies both challenges facing safety-net provider ACO aspirants and state strategies to support safety-net provider development of ACOs.