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Press Release

General Dynamics to Continue Supporting Arkansas Healthcare Transformation

Innovative state Medicaid program leverages analytic engine and managed services to improve care quality and reduce costs.

November 6, 2014


Doug Stone

(703) 995-3020

FAIRFAXVa. – General Dynamics Information Technology, a business unit of General Dynamics (NYSE: GD), announced today that it will continue to support and expand the analytic engine and reporting system for the Arkansas Health Care Payment Improvement Initiative (AHCPII). Arkansas was the first state to implement this type of statewide payment reform initiative that rewards service providers for providing high-quality, cost-effective care under the Medicaid program. Since its inception in 2012, the AHCPII has resulted in healthcare costs being reduced or stabilized in certain cases, along with improvements in appropriateness of antibiotic prescribing and perinatal screenings. 

The AHCPII was jointly developed by the state and private payers to contain costs which were increasing by about 8 percent annually and threatening to cause a potential budget shortfall of $140 million. It also rewards physicians, hospitals and specialists who provide patients with high-quality care at commendable costs. The AHCPII’s analytics engine uses historical claims data and physician-entered information, gathered through a HIPAA-compliant online Provider Portal, to determine a reasonable cost of care associated with each episode, as well as quality indicators. Providers then share in the savings or excess costs depending on their performance for each episode.

“The business intelligence platform General Dynamics developed has been essential in informing individual physicians about the costs resulting from their patient management decisions, and has resulted in significant savings,” said Dawn Stehle, director, Division of Medical Services, Arkansas Department of Human Services.

The AHCPII is the largest implementation of episode-based payment in the United States and creates financial accountability for more than 1,000 provider organizations. The program has been recognized by the Centers for Medicare and Medicaid Services (CMS) State Innovation Models Initiative Model Testing Awards and can be replicated by state health transformation programs nationwide.

The program is proving that rewarding providers for quality, cost-effective care can make an impact. In the past two years, AHCPII has resulted in decreases of average episode costs for some of the most prevalent and challenging issues covered by Medicaid. 

General Dynamics will continued to work with the Arkansas Department of Human Services (DHS) to rapidly scale the solution to address more than half of Arkansas’ medical spend over the next three to four years.  Going forward, General Dynamics will configure the analytics engine to implement additional episodes and functionality on an ongoing basis, as well as perform analysis, data reporting and extraction.  The company also will train and support Arkansas DHS users and provide DHS-facing customer support services to agents and provider relations representatives.

“General Dynamics has supported the Arkansas Medicaid program in various capacities since 2008,” said Marcus Collier, senior vice president of General Dynamics Information Technology’s Health and Civilian Solutions division. “We are proud to continue providing the analytics and data insights that will help the Arkansas Medicaid program improve population health, enhance care quality and reduce costs. Arkansas’ effort to move to value-based purchasing is unique in the U.S. because of its inclusiveness and scope, and we are honored to support this groundbreaking work.”  

General Dynamics supports a range of health quality and analytics initiatives including the CMS Health Care Quality Improvement System, Virtual Research Data Center, Chronic Condition Data Warehouse, Retiree Drug Subsidy program, Drug Data Processing System and Payment Reconciliation System. The company also launched the Calculating Quality Reporting Service (CQRS) in partnership with the Health & Social Care Information Centre (HSCIC) for the National Health Service (NHS) in England last year.

For more information about General Dynamics Information Technology, please visit