Effective Care Management for Children With Special Health Care Needs in the Era of Value-Based Payment

Objectives. To evaluate the impact of a pediatric-specific care coordination program for Medicaid children with special health care needs under a fully capitated payment model and assess whether sufficient savings can be achieved to offset the cost of the care coordination program. Methods. 442 children with special health care needs, receiving health care under a Medicaid capitation payment program, were enrolled in a care coordination program. ED and inpatient utilization were measured for 1-year pre and post intervention. Use rates and costs for ED and inpatient services were evaluated using a Poisson random effect regression model. Results. There was a statistically significant reduction in ED utilization (31% reduction, P < .0001), inpatient admissions (38% reduction, P = .0002), and inpatient length of stay (34% reduction, P = .0112) comparing the pre and post intervention periods. Medical cost savings attributed to the reduction in ED and inpatient utilization was approximately 3 times the program costs. Conclusions. Enrolling children with special health care needs in a care management program was associated with a significant reduction in ED utilization, inpatient admissions, and hospital length of stay when compared with baseline expenditures. Under a fully capitated Medicaid model, the cost savings greatly exceeded the costs of the interventions. These results serve to highlight the efficacy of pediatric-specific care management programs for children with special health care needs, both clinically and economically. Such models can inform other interventions and contracting strategies to assure children receive the care they deserve in a sustainable cost model.