“High-Needs” Users Drive Majority of Medicaid Spending

Nationally in 2007, 28 percent of all Medicaid enrollments accounted for 67 percent of the program’s expenditures. Despite this outlay, these patients — comprising the blind or disabled and aged — often do not receive the care they need in our fragmented fee-for-service health system.

With health care costs in this country at unsustainable levels and still rising, quality of care and cost reduction among the chronically ill and those with multiple health conditions is especially critical. To address this challenge, some health systems — including Medicaid and Medicare — are turning to “coordinated care.” Coordinated care programs work directly with health care providers to ensure that someone is looking after the patient’s health needs and managing care across specialists while helping to prevent unnecessary or duplicative care and treatment. The goal is to help patients get needed care before they experience a debilitating and costly health crisis.

Most of the research on coordinated care has focused on particular diseases (like asthma or depression), and very few studies have looked at Medicaid recipients, particularly those with multiple chronic conditions. In an effort to fill this knowledge gap, MDRC is evaluating a series of coordinated care programs for high-cost Medicaid recipients with disabilities. The goal of these evaluations is to generate evidence-based information about possible effective strategies for improving the health outcomes of low-income, high-needs patients, and curbing national health spending overall. To date, MDRC has begun to look at coordinated care programs in Colorado and New York.

In Colorado, MDRC is studying a pilot program funded by the Colorado Department of Health Care Policy and Financing, to determine whether it can help encourage the use of primary and preventive care in order to reduce expensive hospital admissions and emergency department visits. In New York State, MDRC is evaluating the state-funded Chronic Illness Demonstration Project, comprising seven programs designed to provide coordinated care to improve health outcomes and control expenses for Medicaid’s most complex and costly beneficiaries.

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