Rhode Island’s Updated Affordability Standards Support Behavioral Health and Alternative Payment Models

By Rachel Block

Ten years ago, Rhode Island instituted health care “affordability standards” for commercial health insurers to encourage them to improve the affordability of their health plans, as well as enhance health care quality and consumer protections. Insurers were first directed to increase investment in the state’s primary care health system, and then cap spending growth for hospitals and encourage the adoption of new provider payment models. A comprehensive study concluded that the standards were effective, resulting in lower rates of increase in all commercial insurance rates in Rhode Island than in a comparable population, with no diminishment of health care quality.

The Rhode Island Office of the Health Insurance Commissioner (OHIC) recently updated these standards. The new regulations continue the primary care funding requirement and add important new provisions designed to facilitate behavioral health integration and accelerate the adoption of payment reforms.

Under the new regulations, insurers are still required to:

• Spend at least 10.7% of their total health care spending on primary care. At least 9.7% must go toward direct primary care spending (reimbursement to providers), with the balance paying for administration of primary care medical homes and the state health information exchange.
• Make practice support payments to encourage and sustain patient-centered medical homes (PCMH). Practices seeking PCMH designation shall receive both infrastructure and care management payments, while those meeting the PCMH standards receive the care management payments. The actual amounts are negotiated between the insurers and practices.

New policies that have been adopted to support behavioral health care and promote its integration into primary care practices include:

• Forthcoming OHIC guidelines and a process for the state to recognize “qualifying integrated behavioral health (QIBH) primary care practices”
• The elimination of copays for behavioral health services delivered in conjunction with a primary care visit in a QIBH primary care practice
• Out-of-pocket costs for behavioral health screening services that are comparable to other health screenings
• Insurer reports to OHIC regarding their strategies to support behavioral health integration in primary care

The regulations also address physician payment reforms and health insurer/provider contracting practices that support efficiency and improved population health. Rhode Island has now set aggressive targets and requirements for the use of alternative payment models:

• By January 21, insurers are required to increase their use of alternative payment methods, including approaches that place more financial risk on providers. The regulation spells out specific requirements for risk-sharing under these arrangements, such as the establishment of a budget and ascertaining the financial and clinical capacity of the integrated system to deliver care under this arrangement.
• Insurers are required to adopt a prospective alternative payment model that supports primary care transformation and behavioral health integration. The primary care payments made through these models should increase from 10% of the insurer’s covered lives by January 2021 to 60% of covered lives by January 2024.

Additional provisions address specialty physician and hospital alternative payment models, as well as the alignment of quality measures across different payment initiatives.

Finally, insurers will be required to report to OHIC on a quarterly basis about their primary care spend, care transformation, and payment reform activities. This will help inform ongoing state regulation and set a high standard for public transparency about payment and contracting arrangements.

The affordability standards reflect consensus among the key stakeholders across the state on key delivery system reform priorities and assure consistency and fair play for insurers in the market. By aligning payer efforts, they increase chances of success and address the need to support services that improve the collective good like primary care. These efforts, and their effects on the costs and quality of health care for Rhode Island residents with commercial insurance, merit continued attention from policymakers and the health care industry.