This payment structure is flawed in three primary ways: it does not adequately cover high-value services; it does not hold providers accountable for overall cost and outcomes; and it does not encourage coordination between providers for the health of the mom and baby.
Current State Of Outcomes-Driven Maternity Payment Models
The Health Care Transformation Task Force (HCTTF)—a coalition of payers and providers committed to embracing value-based payment models—today released a report, Expanding Access to Outcomes-Driven Maternity Care through Value-Based Payment, which examines how the maternal health crisis has been exacerbated by the predominant fee-for-service payment system. The report comprehensively details the current state of value-based payment adoption for maternity care in the US, showing that despite clear evidence about what works, efforts to transform maternity care payments have remained sluggish.
We reviewed promising “outcomes-driven maternity payment models” that address the shortcomings of the current fee structure and categorized them into three levels:
- Perinatal fee schedule changes that pay differently for high-value versus low-value care. Examples include nonpayment for early elective deliveries and improved reimbursement and coverage for certified nurse midwives, birth centers, and perinatal support services such as doulas and nurse home visits that have proven to be low-cost, effective interventions to improve maternal health outcomes.
- Value-based maternity payments that link reimbursement to maternal outcomes and total cost to address variability of high-risk interventions and outcomes. Examples include bundled payments and blended case rates, which mitigate the financial incentive to perform cesarean sections (c-sections) for low-risk births without medical indication. C-sections now account for almost one-third of all births, contributing to rising costs and associated risks of surgery; the Agency for Healthcare Research and Quality estimates that 35 percent of all c-sections were low-risk births.
- Comprehensive payments for mother and newborn that link reimbursement for both maternal and infant quality outcomes and total cost. Few payment policies have effectively implemented comprehensive payments for the mother/newborn dyad because most insurance plans cover and reimburse for their care separately, even though effective and appropriate perinatal care for the mother directly correlates to newborn outcomes and care needs. States (including Washington and New York) have designed or are in process of designing a dyad bundled payment inclusive of perinatal, postpartum, and pediatric care, but more pilots and additional research are needed.
Role For Policy Makers To Advance Outcomes-Driven Maternity Models
Much of the active payment reform efforts for maternity care have tweaked around the edges of the existing fee structure, but this crisis demands much more than a band-aid approach. We need more coordinated efforts across the public and private sector to upend misaligned financial incentives for maternity care. Childbirth is the most common reason for hospitalization, and cesarean section is the most common surgery in the US; refining the underlying financial model and rebalancing the care model and site of service will not come easily. As described in the Task Force report, there are several ways that private industry purchasers, payers, and providers can join forces and use aligned market power to advance outcomes-driven maternity care models. Yet, policy maker action is also needed to realize more widespread and transformational change away from the status quo.
The first step for policy makers, which has recently gained more widespread support in the medical community, is to ensure adequate access for all women to maternity care that includes coverage for postpartum care. Medicaid—which pays for half of the births in the US—is only required to cover low-income women for 60 days after the end of the pregnancy. The American Medical Association recently voted to adopt a policy encouraging Medicaid coverage up to one year postpartum. While many states have already set more inclusive Medicaid eligibility requirements for pregnant women, the Maximizing Outcomes for Moms through Medicaid Improvement and Enhancement of Services (MOMMIES bill) reintroduced in the House and Senate in May 2019 would expand the minimum postpartum coverage requirements for Medicaid beneficiaries to 365 days. The bill would also support increased access to primary health providers and the use of perinatal support services such as community health workers, doulas, and lactation consultants.
States should also address the shortage of certified nurse midwife-led care options and freestanding birth centers that face sustainability issues under current reimbursement policies and licensure requirements. Birth centers face a challenged financial model given low Medicaid reimbursement rates; on the flip side, commercial payers that we spoke to as part of our research are interested in building payment models that incentivize use of birth centers for low-risk births but find a shortage of birth centers to build an adequate network around. States can disrupt this “chicken-or-egg” scenario by mandating reimbursement in Medicaid fee-for-service, managed care organizations, and state employee plan contracts, and by reviewing licensure requirements to create a better business case for freestanding birth centers. In June, the Centers for Medicare and Medicaid Services (CMS) hosted a maternal health forum focused on unique challenges for women in rural communities; the speakers addressed recent trends of hospital-based obstetrics unit closures in rural counties, leaving more than half of all rural counties without a hospital offering maternity care. While not an alternate to hospital obstetrics care for high-risk pregnancies, freestanding birth centers could help to fill the maternity care gap for many women in rural communities.
States should also leverage the infrastructure supported by the Preventing Maternal Deaths Act of 2018. The legislation appropriated funds for all states to establish or support existing maternal mortality review committees that collect and analyze data on every maternal death, following the successful example of California’s Maternal Quality Care Collaborative. States could empower these committees to identify local and state policies contributing to poor outcomes and grant them authority to influence rapid quality improvement and policy change.
Finally, the CMS Innovation Center should test a comprehensive, multipayer maternity care model. Along with the report, today the HCTTF issued a call to action to CMS for this very purpose. The appropriate model would be designed to give providers flexibility to provide high-value services while holding participants accountable for outcomes including healthy birth weight and strong mother recovery in the postpartum period. Two such models have been presented to CMS: the Health Care Payment Learning and Action Network’s Maternity Action Collaborative recommended episode payment design elements for a maternity care bundled payment, and the Minnesota Birth Center proposed a comprehensive bundled payment for low-risk maternity and newborn care to the Department of Health and Human Services Physician-Focused Payment Model Technical Advisory Committee (PTAC). Surprisingly, PTAC determined that this model did not meet criteria to recommend to the Innovation Center for testing because of its limited relevance to Medicare. The authorizing statute for PTAC does not limit the committee to reviewing Medicare models nor should the Innovation Center limit its investments to innovative Medicare models.
Engaging Patients In Payment Reform And Reducing Disparities
Value-based payment models for maternity care will only be helpful in addressing the wide variation and negative trend in maternal health outcomes if they are designed with women, for the benefit of women and families. To be sure, the racial disparities in maternal health outcomes speak to broader structural inequities that will not be solved by changes in payment alone. But the health care system can and should be held accountable for reducing disparities in outcomes as a part of an outcomes-driven maternity payment model. Industry needs to use its political capital to advocate change, and policy makers need to step up now to make structural, lasting changes to reverse this crisis. The United States cannot continue to be the only developed nation in the world with rising maternal mortality amidst dramatic reduction globally. Our nation can and must do better for women and their children.