Cost Control Policy in Minnesota’s Healthcare

Table of Contents

Policy Summary

Hennepin Health policy was introduced for low-income Medicaid patients living in Hennepin County, Minnesota in 2012. In collaboration with Hennepin County’s Human Services and Public Health Department, NorthPoint Health, the Wellness Center, and the Metropolitan Health Plan, Hennepin County Medical Center created an accountable care organization (ACO). According to Kocot, Dang-Vu, White, and McClellan (2013), the central idea of ACOs is to reduce care costs and increase the quality of provided services. With this in mind, one may note that ACOs align costs with care quality. The identified policy was adopted system-wide in order to ensure that all services are closely related to cost control initiatives.

Hennepin Health policy is designed to link the compensation of providers to quality indicators that are tracked by patients. Namely, providers coordinate care for patients with the help of primary health care services, which is complemented by specialists, regionally-based contracts, and clinics that work in cooperation with each other (Kocot et al., 2013). The Affordable Care Act (ACA) contains the terms that allow Hennepin Health as an ACO to reward accumulating savings when providing care for Medicaid populations. Some business participants also support this concept by presenting similar incentives or buying suppliers to enhance the cost of patient care. Among the potential ramifications of the failure to follow this policy, it is possible to note the negative impact at organizational, unit, and individual levels. In particular, it is essential for the successful implementation of the mentioned system that all stakeholders contribute to it.

Policy Impacts

There are two models of payment and delivery, including virtual and integrated. The former implies the existence of several federally-qualified health centers (FQHCs), while the latter presents integrated care delivery. Both of these components enroll in a total cost of care (TCOC), thus contributing to shared-savings features (Blewett & Owen, 2015). In this regard, looking at the fiscal impact of this policy, one may argue that its comprehensiveness allows sufficient allocation of the existing resources. As a result, low-income and underserved populations receive the opportunity to afford necessary heath care services and gain access to aids that promote healthy lifestyles (Kocot et al., 2013). At the same time, the identified ACO remains effective and efficient in terms of providing services, keeping resources available, and controlling costs.

As for the impact of Hennepin Health policy on patient outcomes, the recent study of Blewett and Owen (2015) shows the increased use of outpatient care and less emergency care. Since this policy focuses on prevention of diseases and chronic conditions, as well as team-based care, which is targeted to ensuring patient-centeredness and sensitivity, the positive impact is evident. It is essential to point out the fact that the enhanced care management is one more beneficial impact of Hennepin Health policy that was achieved through greater collaboration of care providers from across the organization (Sandberg et al., 2014). The specified policy also takes into account such critical issues as social and economic statuses, physical and psychological concerns, as well as behavioral peculiarities of patients.

While determining advantages and disadvantages of policies implemented in the field of health care to control costs, it is essential to focus on unintended consequences. Since this policy is relatively new, there is little evidence about its secondary impacts. Nevertheless, such challenges as limited data-sharing capabilities and a lack of reconciling different payment methods may be noted (Kocot et al., 2013). In addition, the adaptation of various care quality measurements seems to be insufficient in terms of the given policy. Therefore, it is important to argue that the policy needs revision based on the improvement of certain specified areas. Even though the transition of several organizations into one can be complicated due to varying procedures, processes, evaluation, and documentation, it is still significant to standardize them in order to accomplish the stated goal.

Alternative Option to Policy

In my point of view, Hennepin Health policy is a good option to address the problem of high costs in healthcare and ensure more affordable services. However, the concerns identified above show that the policy needs some adjustments. Hennepin Health may be regarded as a relevant attempt to control costs, yet I consider that several ACO development and implementation processes should be more integrated. The consideration of the relevant evidence reveals that there is a feasible solution to the problem of reconciliation failure and data-sharing capabilities.

The modern environment sets new opportunities in the field of healthcare, one of the most important of which is integration initiatives. Consistent with the views of Kocot et al. (2013), I would suggest that medical accountability provided by this policy should be combined with social responsibility. In particular, the incorporation of non-medical services is likely to lead to greater effectiveness of the organization and better patient outcomes (Kocot et al., 2013). As an example, one may note such underserved population as Hispanics with a low income and their difficulties with receiving adequate care. Once both their health needs and social status are taken into account, they would be better understood by care providers. As a result, this specific population would receive comprehensive services, meeting their needs and expectations, and improving their lifestyles on a wider scale compared to more traditional approaches. Thus, some improvements to the existing policy should be considered with the aim of meeting its initial goals.


Blewett, L. A., & Owen, R. A. (2015). Accountable care for the poor and underserved: Minnesota’s Hennepin Health model. American Journal of Public Health, 105(4), 622-624.

Kocot, S. L., Dang-Vu, C., White, R., & McClellan, M. (2013). Early experiences with accountable care in Medicaid: Special challenges, big opportunities. Population Health Management, 16(1), 4-11.

Sandberg, S. F., Erikson, C., Owen, R., Vickery, K. D., Shimotsu, S. T., Linzer, M.,… DeCubellis, J. (2014). Hennepin health: A safety-net accountable care organization for the expanded Medicaid population. Health Affairs, 33(11), 1975-1984.

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