Arkansas has identified nine priority illnesses and services for which to bundle Medicaid pay, according to a letter Gov. Mike Beebe sent to federal Health and Human Services Secretary Kathleen Sebelius on Aug. 10. They are: pregnancy and neonatal care; attention-deficit/hyperactivity disorder; type 2 diabetes; back pain; cardiovascular disease; upper respiratory infections; developmental disabilities; long-term care; and prevention.

State Medicaid officials are working on a plan — the Arkansas Health Care Payment Improvement Initiative — to pay teams of physicians and other health professionals based on episodes of care and to allow doctors to keep any savings they generate. These partnerships would be similar to the health system reform law’s accountable care organizations but would not be defined as specifically as ACOs. Payment levels would be based on a study of both public and private health care spending in the state.

The priority list represents a more modest goal than the complete transformation of Medicaid payment initially outlined by Arkansas Medicaid Director Eugene Gessow. The state, however, still is aiming for a July 2012 implementation for the revised program.

The Arkansas Medical Society is pleased that the state recognized its full reform plan was impractical given the short time frame, said David Wroten, the society’s executive vice president. “However, we still have concerns over the practicality of utilizing a bundled payment approach in a state that is primarily rural,” he said. “We also remain concerned that there are no current plans to pilot the bundled payment methodology prior to statewide implementation.”

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