Staten Island Hospitals’ Experience in N.Y. Medicaid Program Could Provide Collaboration Model


The efforts of a group of providers on Staten Island to reach Medicaid-eligible patients could show a path toward greater collaboration for hospitals moving from traditional fee-for-service reimbursement to a quality-based payment program.

The Staten Island Performing Provider System (PPS) is a joint effort primarily between Staten Island University Hospital and the Richmond University Medical Center. It was formed under the New York Medicaid Delivery System Reform Incentive Payment (DSRIP) program, a Medicaid waiver program designed to deliver higher quality and lower cost care to Medicaid-eligible patients.

The primary goal of the DSRIP program was to reduce avoidable hospital use 25 percent over five years. It seeks to accomplish that goal by paying out about $7 billion dollars to the PPS organizations based on those groups achieving predefined results in system transformation, clinical management and population health improvement.

As New York’s DSRIP program entered its third year this month, Staten Island PPS has been able to meet most of its program goals to date. The CEO of the PPS, Joseph Conte, told me that his organization has taken a very proactive stance toward the community, trying to reach the approximately 180,000 Medicaid-eligible individuals on the island.

“Access is a function of trust, not bricks and mortar,” Conte said. “You have to get on the ground to develop those trusting relationships and then you will see people coming out of the shadows to get care.”

The program, which includes 25 similar organizations throughout the state, allows entities that might otherwise be competitors to work together to care for Medicaid patients. In another context, such integration could raise antitrust concerns, particularly in such a concentrated geographic market like Staten Island.

However, New York’s program contains a certificate of public advantage process through which the state department of health provides close oversight of the integrated entity to make sure any anti-competitive effects are outweighed by pro-competitive benefits and efficiencies.

Staten Island PPS is the only one of the 25 New York DSRIP organizations to have obtained that protection, and the two main hospitals that make up the organization account for about 85 percent of the Medicaid hospitalizations on the island.

But Conte confirmed that his organization only operates on behalf of its members within the confines of the Medicaid DSRIP program and that the individual members are free to contract with all other payers on their own.

Whatever the long-term prospects for this and similar collaborative enterprises, it appears that the Staten Island experiment is meeting expectations without frustrating competition in the surrounding markets.

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