Delivery System Transformation Initiatives (DSTI)

Program Location: 
Boston, MA
Payer Type: 

Reported Outcomes


The Delivery System Transformation Initiatives (DSTI) program is a performance-based incentive payment program to support and reward safety net hospitals for investing in delivery system transformation projects that advance the triple aims of better care, better population health, and lower costs. In addition, DSTI supports safety net providers’ investments in the infrastructure and capacities necessary to prepare for the transition away from fee-for-service payments toward alternative payment arrangements that hold providers accountable for the quality and cost of care. DSTI is jointly supported by the Commonwealth and the federal Center for Medicare and Medicaid Services (CMS).

The DSTI program was approved in December 2011 under Massachusetts’ 1115 Medicaid Demonstration Waiver. In early 2012, MassHealth worked closely with CMS and participating hospitals to develop a “Master DSTI Plan” outlining a comprehensive set of transformation projects and associated performance metrics within each of four categories:

  • Development of a fully integrated delivery system built on Patient-Centered Medical Home principles; 
  • Implementation of innovative care models to improve quality of care and health outcomes; 
  • Development of capabilities necessary to implement alternative payment models; 
  • Population-focused health outcome improvements.

Each participating hospital developed its own unique transformation plan, selecting up to seven projects from the Master DSTI Plan with proposed milestones and metrics by which hospital performance would be measured. MassHealth and CMS approved the hospital-specific plans in the spring of 2012, and hospitals received their first incentive payments in June. Hospitals will report on their progress and receive associated incentive payments on a semi-annual basis, and MassHealth will continue to work closely with the hospitals to track their progress and provide ongoing technical assistance as needed.  

Participating hospitals are undertaking a wide array of transformation projects, such as transforming primary care practices to patient-centered medical homes; piloting care management programs for patients with chronic or complex conditions; redesigning discharge processes to lower readmissions; strengthening communications and EHR linkages with providers across the spectrum of care; conducting readiness assessments to become an ACO; and building IT capacity and analytics infrastructure to better track and manage quality and cost of care. Hospitals eligible to participate in the DSTI program have a particularly high Medicaid payer mix and a low commercial payer mix; eligible hospitals include Boston Medical Center, Cambridge Health Alliance, Holyoke Medical Center, Lawrence General Hospital, Mercy Medical Center, Signature Healthcare Brockton Hospital, and Steward Carney Hospital. 

Payment Model: 

Up to $628 million in incentives is available to seven hospital systems over three years (2012-2014). In order to earn DSTI payments, each hospital must meet the performance goals outlined in its three-year transformation plan. 

The approved 2014 waiver renewal affords the authoridty to implement shared savings/shared risk payment arrangements that will support Primary Care Payment Reform and future contracts with ACOs. 

Improved Access: 

MassHealth Interim Report (September 2013)

Data from the PCMHI Medical Home Implementation Quotient (MHIQ) and patient experience surveys collected during the first 18 months of the PCMHI demonstrate overall progress toward the adoption of “medical homeness” by participating practices. Care management, access, and patientcenteredness showed the largest improvement.

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