Aligning Incentives in Medicaid: How Colorado, Minnesota, and Vermont Are Reforming Care Delivery and Payment to Improve Health and Lower Costs

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Colorado, Minnesota, and Vermont are pioneering innovative health care payment and delivery system reforms. While the states are pursuing different models, all three are working to align incentives between health care payers and providers to better coordinate care, enhance prevention and disease management, reduce avoidable utilization and total costs, and improve health outcomes. Colorado and Minnesota are implementing accountable care models for Medicaid beneficiaries, while Vermont is pursuing multipayer approaches and moving toward a unified health care budget. This synthesis describes the common drivers of reform across the states, lessons learned, and opportunities for federal administrators to help shape, support, and promote expansion of promising state initiatives. It also synthesizes strategies and lessons for other states considering payment and delivery reforms. The accompanying case studies describe the states’ efforts in greater detail.


Note: These case studies were based on publicly available information and self-reported data provided by the case study institutions. The Commonwealth Fund is not an accreditor of health care organizations or systems, and the inclusion of an institution in the Fund's case study series is not an endorsement by the Fund for receipt of health care from the institution.