Milliman has experience working with state Medicaid agencies on alternative payment strategies, including the creation and evaluation of shared savings arrangements. We also have experience advising ACOs, health plans, and other provider entities on alternative payment strategies for the Medicaid population. For both the payer and provider perspective, we advise on the potential savings that could come from implementing alternative payment strategies relative to the systems currently in place.

Milliman has a complete understanding of the Medicaid population and Medicaid data, which enables us to distinguish between well managed and poorly managed delivery systems. We can set up benchmarks for a population’s utilization and cost to evaluate performance under alternative payment arrangements. We understand how to set up these arrangements, using very specific information—including benchmarking data—and adjusting for outliers and certain conditions that can’t be managed by providers. The contractual provisions of these arrangements can make a significant difference between artificial and real cost savings and quality improvement.

It can sometimes be difficult to structure arrangements in a way that is beneficial for both the provider and payer. Milliman has the insight to structure agreements in a manner that will produce the greatest likelihood of improved delivery system performances. We are also aware that states often need ways to stretch their funding, and we can evaluate how these arrangements will affect the Medicaid budget and spending.

Our extensive work with health plans, providers, and states has provided us with the familiarity and knowledge to guide each of these entities on their paths to shared saving arrangements.