Sec. 7. Performance bonuses for significant achievement in Medicaid quality performance

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Section 1932(c)(1) of the Social Security Act ( 42 U.S.C. 1396u–2(c)(1) ) is amended by adding at the end the following new subparagraph: The Secretary shall establish a Medicaid Quality Performance Bonus fund for awarding performance bonuses to States for high attainment and improvement on a core set of quality measures related to the goals and purposes of the Medicaid program. Not later than three years after the date of enactment of this Act, the Secretary shall establish a methodology for awarding Medicaid Quality Performance bonuses to States not less than annually which will be based on the annual State reports required under section 1138B of title XI of the Social Security Act, in accordance with regulations promulgated by the Secretary.

Medicaid Quality Performance Bonus funds will be awarded to up to 10 States that meet thresholds established by the Secretary for— the top five States achieving the designation of superior quality performing State; or five States demonstrating the greatest relative level of annual improvement in quality performance. The total amount of payments under this subparagraph shall be equal to $500,000,000 for making payments under this subparagraph, to be available until expended. This subparagraph constitutes budget authority in advance of appropriations Acts and represents the obligation of the Secretary to provide for the payment of amounts provided under this subparagraph.

As a condition of receiving a bonus fund award under clause (iii), a State shall agree to designate at least 75 percent of the performance bonus funds for the development and operation of quality-related initiatives that will directly benefit providers, including— provider pay-for-performance programs; provider collaboration initiatives that have been demonstrated to improve performance on quality; provider quality improvement initiatives, including those aimed at improving care for special and hard-to-reach populations; and Secretary-approved activities and initiatives that a State may pursue to encourage quality improvement and patient-focused high value care.

Nothing in this subparagraph shall prohibit a State from establishing criteria for the State provider performance program that limits the award to a particular provider type(s), that limits application to a specific geographic area, or that directs incentive programs for quality-related activities for specific populations, including individuals eligible under this title and title XVIII of the Social Security Act, hard-to-reach populations. States may designate up to 25 percent of the quality performance bonus award for activities related to the goals and purposes of the program.

For purposes of allocation of Medicaid Quality Performance Bonuses the definition of provider shall have the meaning given to it in a State Plan. Nothing in this section shall prohibit a State from investing bonus funds into quality improvement activities for managed care entities. .

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42 USC 1396u–2(c)(1)

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Sec. 7

Performance bonuses for significant achievement in Medicaid quality performance

Cite42 USC 1396u–2(c)(1)

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