HHS Earmarks $1B for Healthcare Jobs, Innovation

The healthcare industry got a $1 billion shot in the arm Monday when the Department of Health and Human Services announced a competition to spark "innovative healthcare delivery models." Preference will be given "to projects that rapidly hire, train and deploy healthcare workers."

Most of the department heavyweights were on hand for the afternoon press conference: Secretary Kathleen Sebelius, Don Berwick, MD, administrator of the Centers for Medicare & Medicaid Services, and Richard Gilfillan, MD, acting director of the Center for Medicare & Medicaid Innovation.

Sebelius said preference will be given to projects that provide for "rapid workforce deployment" and help "spark the economy" although HHS has not targeted the number of jobs it hopes to see created. She needled Congress for its failure to pass a comprehensive jobs bill, saying "This program will help us create the healthcare jobs we will need in the future to promote care coordination and improve health."

Healthcare remains a leading source of job creation in the overall economy. According to the Bureau of Labor Statistics, new healthcare jobs represent 22% of the more than 1.2 million non-farm jobs created in 2011.

The billion-dollar Health Care Innovation Challenge is a response to the many successful local healthcare projects that are helping to improve care and reduce healthcare costs, Sebelius said. "Public and private community organizations, including hospital, physicians, churches, and other groups, are developing innovative solutions to help improve our healthcare system. This competition will help them build on their success."

The program will focus on beneficiaries enrolled in Medicare, Medicaid, and CHIP, particularly those with the most urgent healthcare needs. The announcement comes on the heels of a critical report released last week by the National Association of Medicaid Directors that points to a lack of attention the Medicaid program has received in the area of innovation and implementation of healthcare reform.

The innovation challenge is open to providers, payers, local government, community-based organizations, and public-private partnerships. Awards will range from $1 million to $30 million. Potential applicants must submit a letter of intent by Dec. 19. Final applications are due Jan. 27 and grant recipients will be announced March 30. Projects must be up and running within six months. Berwick added that the projects must be sustainable and "capable of being rapidly delegated to other areas of the country."

Projects, which will be funded over three years, will be evaluated and monitored to make sure they produce measurable improvements in care quality and cost savings.

The CMS Center for Innovation will oversee the program. In his comments, Berwick praised the Center's work citing its bundled payments program, primary care initiative and the Pioneer ACO program as helping achieve the triple aim: better care, better health and lower costs. The comments came as some members of Congress called on the Government Accountability Office to look into Innovation Center's activities. The center is funded with $10 billion as part of the Affordable Care Act.

The Health Care Innovation Challenge announcement came just hours after the U.S. Supreme Court announced that it will hear a challenge to the individual mandate section of the ACA. When asked for her reaction, Sebelius said the administration has confidence that the legislation will prevail and welcomes the opportunity "to put to bed once and for all the possibility that healthcare reform will disappear."