Issue Briefs | Sep 1, 2014

Considerations for State Development of Performance Measure Sets

Beth Waldman and Michael Bailit, Bailit Health Purchasing, LLC

As states play a more active role in health care delivery system and payment reform, Medicaid programs have joined other public and private sector purchasers in measuring performance as part of value-based purchasing initiatives. While essential to value-based purchasing, performance measurement can create a significant administrative burden for providers. This burden can grow significantly when individual payers (e.g., insurers, managed care plans, and third-party administrators) utilize different measures. There is a growing interest by Medicaid programs and other payers in developing common measure sets to reduce administrative burden on providers and send a common message to them about performance accountability. This guide provides an overview of the steps states should take in developing a performance measure set—either on their own or in partnership with others—identifies critical considerations, and offers guidance in selecting measures.