This report summarizes Minnesota’s efforts to transform its delivery system, focusing on landmark legislation passed in 2008, but also looking at the many public and private initiatives that preceded its passage. It describes Minnesota’s experience to date with developing and implementing these reforms. Minnesota’s 2008 legislation contained a number of specific elements with significant potential to achieve overall health care cost savings. In addition to establishing and funding a statewide health improvement program, and enhancements to coverage, the law included various provisions to collect and report data to achieve price and quality transparency, as well as provisions to support care redesign and payment reform; these latter provisions are the focus of this report.

From the report:

The 2008 legislation required Minnesota’s Commissioner of Health to establish uniform definitions for at least seven “baskets of care” by July 1, 2009, and to establish standard quality measurements for them by December 31, 2009. A basket of care is a collection of the services that are paid separately under a fee-for-service system, but which are usually combined by a provider in delivering a full diagnostic or treatment procedure to a patient—for example, all the services needed for knee surgery. (See Appendix C for additional information on and an example of the services comprising a basket of care.) Under this concept, plans will bundle payments for a set of health care services in ways that will create incentives for health care providers to cooperate and innovate on approaches to improving health care quality and reducing cost.25 Each basket then is the new “product” consumers can purchase, allowing providers, payers, and consumers to rethink the organization of health care service delivery.

Full report:  Minnesota’s Innovations Reforming Health Care Delivery Through Payment Change Transparency (PDF | 468.94 KB)

National Academy for State Health Policy. (2010). Reforming health care delivery through payment change transparency: Minnesota’s innovations. Gauthier, A. & Cullen, A.