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6 States to Receive $250M in Innovation Model Funding

 |  By John Commins  
   February 22, 2013

The federal government this week detailed plans to award $250 million to six states poised to test multi-payer payment and service delivery models that reward positive health outcomes while reducing costs. 

The funding under the State Innovation Model awards is the first of nearly $300 million in innovation grants available under the Patient Protection and Affordable Care Act to entice states to build innovative delivery systems that lower Medicaid costs.

"Too many Americans receive care that is fragmented, unreliable, and generates poor health outcomes," Health and Human Services Secretary Kathleen Sebelius told reporters during a Thursday afternoon teleconference.

"The good news is we have numerous examples across the country of how improvements in care delivery can both lower costs and improve health. New strategies for coordinating care, for managing chronic diseases, to reducing errors, waste and duplication can keep patients healthier while lowering spending at the same time."

"States have long been innovators and leaders in promoting these kinds of improvements through their Medicaid programs. The awards we are announcing today will give these states the freedom they need to take these efforts to the next level by coordinating efforts with private payers."

Over the next three-and-a-half years, six states will receive grants ranging from $33 million to $45 million in grant money for their initiatives, including:

  • Arkansas, which will get $42 million to create an infrastructure that will place a majority of state residents into patient-centered medical homes by 2016, with a focus on team-based care, chronic disease management, and preventive services.
  • Maine, which will get $33 million to test its plan to align benefits from its MaineCare Medicaid program with benefits from Medicare and commercial payers. The model supports multi-payer ACOs that agree to deliver value-based care in return for performance-based payments.
  • Massachusetts, which will get $44 million to build on its groundbreaking work to support primary care practices as they transition into patient-centered medical homes.
  • Minnesota, which will get $45.2 million to develop its statewide Accountable Health Model, which is designed to allow every person in the state to receive team-based, coordinated, patient-centered care that improves access to medical care, long-term care, behavioral healthcare, and other services
  • Oregon, which will receive $45 million to continue development of a coordinated care model that will use the state’s purchasing power to realign healthcare incentives and payments. The Oregon Coordinated Care Model will reward value over volume and align incentives with improved population health.
  • Vermont, which will get $45 million to develop a health system that achieves full coordination and integration of care throughout the life of the patient. The Vermont model will increase care coordination and financial alignment between specialists and primary care practices using value-based reimbursements.  

CMS hopes the state models produce greater results when implemented broadly and combined with additional state-wide reforms.

"These are all groundbreaking models that bring together public and private payers to dramatically scale up the kind of coordinated patient centered care we know works best," Sebelius said. "Our hope is that the best ideas will be spread throughout the country."

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.

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