December 23, 2014

RI Health Care Leaders Send Reform Recommendations to Raimondo and General Assembly Leaders

Broad Coalition Convened by Sen. Whitehouse and Rhode Island Foundation Agrees to List of Payment Reform Goals

Providence, RI – A broad coalition of Rhode Island health care leaders – from providers to insurers to academia – have developed recommendations on how the state can improve care and lower costs.  The group, which was convened by U.S. Senator Sheldon Whitehouse and Rhode Island Foundation President Neil Steinberg, today sent a letter to Governor-elect Gina Raimondo, House Speaker Nick Mattiello, and Senate President M. Teresa Paiva Weed laying out specific recommendations on payment reform, tracking metrics, and more.

The letter is notable for both the scope of the recommendations and of the individuals and organizations who signed it.  The co-signers of the letter include Lt. Governor and incoming Secretary of the Department of Health and Human Services Elizabeth Roberts, Lifespan President and CEO Timothy J. Babineau, Blue Cross & Blue Shield of RI President and CEO Peter Andruszkiewicz, Care New England Health System President and CEO Dennis Keefe, United Healthcare CEO Stephen Farrell, Rhode Island Business Group Health Executive Director Al Charbonneau, and Peter Marino of Neighborhood Health Plan.

“Better quality of care for Rhode Islanders at a lower cost is a vital and achievable goal for our state,” said Whitehouse, who founded the Rhode Island Quality Institute during his time as Attorney General and is a leading voice in Washington for health care delivery system reform.  “The reform goals we agreed to champion will help us move toward a system that rewards better care of patients and eliminates unnecessary and duplicative care.  These are goals that are best achieved when we all pull together, so it is important and striking that this agreement is so widespread.”

“These recommendations are both practical and significant. While everyone recognizes that payment reform is crucial to ensuring we have a healthcare system that can deliver quality care over the long-term for all Rhode Islanders, consensus on how to get there is rare. One of Rhode Island’s strengths is our ability to get decision-makers together face-to-face to find common ground,“ said the Foundation’s Steinberg.

“I believe Rhode Island is perfectly poised to bring the health care leaders together in order to agree to implement health care delivery improvements and provider payment reforms that will benefit Rhode Islanders,” said Speaker Mattiello.

“The Senate both supports and commends the leadership of Senator Sheldon Whitehouse and Neil Steinberg in confronting one of the greatest challenges facing our health care system,” said President of the Senate M. Teresa Paiva Weed.  “The recommended reforms build upon and are consistent with the findings of the 2011 hospital study commission led by Senator Joshua Miller and subsequent Senate legislative initiatives. We support the commitment of the stakeholders to work together to implement the payment reform goals while continuing to provide high quality health care.”

The letter’s recommendations fall into the following categories:

  1. Statewide Payment Reform Goals
  2. Statewide Progress Targets
  3. Statewide Tracking Metrics
  4. Action Steps for State Health Care Leaders and Policymakers

“Rhode Island is one of the states that is moving assertively to make Federal healthcare reform a reality,” said Lt. Governor Roberts.  “The payment reform and delivery system changes envisioned by our health care leaders and set forth in this Compact provide a critical roadmap to a stronger Rhode Island economy and healthier Rhode Islanders.”

“Nothing is more important to Rhode Island’s economy and its residents than finding a way to lower healthcare costs and maintain quality.  But this is an endeavor that cannot be conducted in isolation and requires sustained effort by all the players involved in healthcare delivery.  The compact is a critical step in continuing the important efforts already underway to assure the future of affordable healthcare in Rhode Island,” said BCBSRI’s Andrusckeiwiz.

“I am very pleased that Lifespan participated in and contributed to this very important compact.  The consensus and collaboration I witnessed was encouraging.  I believe this concise document will provide a useful framework to help guide our elected officials as we all work to create new models of care and new models of payment to better serve our citizens of the region,” said Lifespan’s Babineau.

“We were honored to be part of this highly collaborative process,” said Care New England’s Keefe, “which closely aligns with our strategic vision and the national agenda to improve quality, the patient experience, and reducing the overall cost of care.”

Other signatories on the letter are Al Kurose, President & CEO of Coastal Medical; Dr. Kathleen Hittner, Health Insurance Commissioner; Peter Karczmar, President of RI Medical Society; Christina Paxson, President of Brown University; Laura Adams, President & CEO of the Rhode Island Quality Institute; Michael Fine, MD, Director of the Rhode Island Department of Health; Dr. Al Puerini, RI Primary Care Physicians Corp.; Jack Elias, Dean of Medicine at Brown University; Lou Giancola, President & CEO of South County Hospital; Secretary of Health and Human Services Steven Constantino; Lou Rice, President of University Medicine Foundation; Leonard Schindel, CharterCare; Jane Hayward, RI Health Center Association; Mike Souza, Hospital Association of RI; John Keimig, Healthcentric Advisors; and Thomas Reardon, Prospect East Holdings.

The full text of the letter is below.


December 23, 2014


Dear Governor-elect Raimondo, Speaker Mattiello, and Senate President Paiva Weed:

Over the past few months, believing this is a unique and critical time for the state of health care in Rhode Island,  a group of key health care stakeholders, convened by Senator Sheldon Whitehouse and Rhode Island Foundation President & CEO Neil Steinberg, came together to discuss some of the biggest challenges facing our health care delivery system.

The discussions were frank and covered many aspects of Rhode Island’s current health care climate. There were areas of agreement and we acknowledged our differences. Most importantly, a consensus developed centered on a belief that for fundamental change to occur, we must work to alter the way we pay for health care. As Rhode Island currently spends nearly $9 billion yearly on health care expenditures, we all believe that our current trajectory of health care spending is unsustainable in the long term. To tackle this issue effectively, it will take cooperation and commitment from the health care industry, businesses, consumers and state government. 

We would like to serve as a resource for you as the state continues to encourage and stimulate this major paradigm shift in our current health care delivery system. We acknowledge that this will not be an easy task and will require thoughtful planning, implementation and execution. Our discussions around the need for health care payment reform have led to this compact of shared goals and commitment. We are aligned in our desire to work together and with you to establish statewide payment reform goals and progress targets. Below are some recommendations that have arisen from our discussions: 

Establish Statewide Payment Reform Goals in 2015:

To achieve payment reform in the next five years, we request that State leaders support our commitment to work together to implement payment reform and support the following statewide payment reform goals: 

  1. The expansion and development of alternative reimbursement models that reward value and patient-centric care delivery. 
  2. Expansion of incentives for systems of care that encourage collaboration and sharing of claims data and the sharing of health care information through CurrentCare, the statewide health information exchange, and other electronic health record systems.
  3. Elimination of waste in our health care system by reducing administrative overhead and encouraging the use of best practices to improve clinical outcomes while reducing costs. 

Establish Statewide Progress Targets in 2015:

As we transition to new payment models, it is important to set specific and bold targets for the State to meet. Establishing statewide targets sends the message that Rhode Island is committed to changing the traditional payment reform structure. Recommendations for progress targets include:

  1. Reduction in Fee for Service: State and health care sector leaders should set an aggressive target and timeline to reduce traditional fee for service in Rhode Island.
  2. Cost Control: The State and health care leaders should immediately collect the necessary data to establish a strategy to control costs and examine various options, such as linking health care inflation to Gross State Product.
  3. Reduce Waste and Redundancy:  Some estimates suggest that up to 30% of health care spending could be eliminated without impacting the quality of health care.  Specific targets should be established for the increased utilization of electronic medical records and reduced administrative costs. This effort will also require increased levels of consumer engagement and cooperation from patients.   

Statewide Tracking Metrics:

There are several key benchmarks that can be tracked at both the national and state level to ensure that we are improving care as we transform the delivery system. There are various datasets available that can help track quality performance. HealthCentric Advisors, the state’s Quality Improvement Organization, currently works with the State and stakeholders to generate quality reports. We will work with HealthCentric Advisors to identify six or seven important measures that can be tracked to ensure that care is being improved. Potential quality measures should include:

  • Healthcare Acquired Infections
  • 30 Day Readmission Rates by Hospital
  • Statewide Emergency Department Visits
  • Health Information Technology (HIT) Utilization

Recommended Action Steps for State Health Care Leaders and Policymakers:

Various state agencies and entities are independently working on this issue, but a coordinated statewide payment reform plan is needed now. Today we propose a public-private partnership to advise on the transformation of the delivery and payment system for health care in Rhode Island with the support of health care leaders, the business community, consumers, the Governor and the legislature. This partnership should:

  1. Immediately establish a stakeholder group (providers, payers, employers and consumers) to work collaboratively with the Administration to transform Rhode Island’s heath care payment system. 
  2. To the extent there are gaps, rapidly define and collect data to create a profile of health care in RI (includes quality metrics and spending statistics).
  3. Establish statewide baselines and goals for health care spending and quality for the next five years and report progress annually.
  4. Use existing health care spending programs to accelerate coordinated, risk based care.
  5. Encourage consumer engagement to increase the selection of high value care based on cost and quality data.
  6. Review and reform state healthcare regulations to promote efficiency.
  7. Promote better population health and personal responsibility in health care.

Building on a Track Record of Innovation

Over the last few years, Rhode Island has demonstrated a willingness to disrupt the system and develop new collaborations and partnerships. There are a number of exciting initiatives underway that are focused on reducing unnecessary care and improving the health of Rhode Islanders. Over the long term, these efforts will lower health care costs and spending. With this in mind, we need to continue, and further encourage, payment reforms we have begun to witness from many groups and organizations in our state.   

Here are a few examples:

  1. The Rhode Island Chronic Care Sustainability Initiative, a nationally recognized patient-centered medical program, has observed an overall decrease in hospital admissions and emergency visits by their patients. 
  2. Care New England, Blue Cross Blue Shield and the Rhode Island Primary Care Physicians Corporation have established a three-year accountable care payment contract agreement.
  3. Coastal Medical, a participant in the Medicare Shared Savings Program, recently announced first year’s savings of $7.2 million. 
  4. Several hospitals, including Rhode Island, Miriam, Newport and Kent, are participating in bundle payment demonstrations with the Centers for Medicare and Medicaid Services.
  5. Institutions and providers are making significant investments in health information technology, including the Rhode Island Quality Institute and the implementation of Epic at Care New England and Lifespan.   
  6. The Rhode Island Business Group on Health has initiated discussions about “Choosing Wisely,” an initiative to help patients, physicians and other health care providers address the overuse of health care resources in the United States.
  7. The State has secured $20 million from a grant from the Centers for Medicare and Medicaid Service to develop new models of care, including new payment initiatives.

Whenever possible, we should sustain, scale and build upon these models and efforts. Rhode Island has all of the necessary ingredients – a strong commitment from hospitals, payers, providers to improve patient outcomes, an engaged business community, a thriving research base, a robust statewide health information exchange and a strong medical school. 

As leaders of key institutions, organizations and constituencies, we are committed to bringing our institutional resources to bear on the goals outlined above, and we would value the partnership of state leaders going forward. If we do not affirm a strong commitment to payment reform, we jeopardize the many achievements that have been made. Similar to the Rhode Island banking industry, our health care industry faces the risk of losing local leadership and control as more efficient regional and national health care organizations develop formulas to deliver better care at lower costs.

As a new administration and General Assembly session begins, we strongly encourage you to continue to support the effort we have started to make health care payment reform a reality in Rhode Island.

Respectfully submitted,


Press Contact

Meaghan McCabe, (202) 224-2921