Medicare, Medicaid initiatives unveiled by new innovation center

CMS plans to consult with stakeholders in the health care industry while working to improve primary care and lower costs.

By Chris Silva — Posted Dec. 6, 2010

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The American Medical Association joined with federal officials Nov. 16 to reveal how a new center will examine ways of delivering health services and paying physicians while improving care.

The Center for Medicare and Medicaid Innovation, created by the Patient Protection and Affordable Care Act, will consult with stakeholders across the health care sector as it works on initiatives geared toward improving primary care and better care coordination for patients.

"For too long, health care in the United States has been fragmented -- failing to meet patients' basic needs and leaving both patients and providers frustrated," Donald M. Berwick, MD, Centers for Medicare & Medicaid Services administrator said during a Nov. 16 conference call that included the AMA president. "Payment systems often fail to reward providers for coordinating care and keeping their patients healthy, reinforcing this fragmentation."

He said the innovation center will help change this trend by identifying, supporting and evaluating models of care that both improve the quality of care patients receive and lower costs.

AMA President Cecil B. Wilson, MD, said the center "holds promise as a testing ground for emerging models of patient care." He said he hopes it will provide physicians with the resources necessary to move ahead with improvements in health delivery.

"There is much hard work ahead, and AMA will remain involved to ensure that the focus is on helping provide high-quality care to America's patients," he said.

The center has $5 million in fiscal 2010 to help start-up operations and a $10 billion budget from 2011 to 2019 to test models that could help Medicare and Medicaid.

Dr. Berwick outlined some of these concepts during the conference call:

  • Eight states -- Maine, Michigan, Minnesota, New York, North Carolina, Pennsylvania, Rhode Island and Vermont -- will participate in a multipayer, advanced primary care demonstration that will include up to 1,200 medical homes serving 1 million Medicare beneficiaries. The project will evaluate the effectiveness of doctors working in a more integrated fashion and receiving more coordinated payments.
  • The Federally Qualified Health Center Advanced Primary Care Practice Demonstration will test the effectiveness of doctors and other health professionals working in teams to treat low-income patients at community health centers, helping 195,000 beneficiaries.
  • A new state option will let Medicaid patients pick a physician to function as their "health home," coordinating treatments with other professionals. States that implement this program will receive enhanced federal financial resources.
  • 15 state programs will get up to $1 million each to develop programs that showcase improved benefits and savings for dual eligibles, those eligible for both Medicare and Medicaid.

Through these programs, CMS and CMMI will be core partners in more than 1,500 patient-centered primary care practices that will provide coordinated-care services to millions of Medicare and Medicaid beneficiaries, officials said. "The center will identify and test care models that provide beneficiaries with a seamless care experience, better health and lower costs," said Richard Gilfillan, MD, CMMI's acting director.

In addition to advancing existing models to new stages of development, a main goal of CMMI is to identify, validate and "scale up" payment and delivery methods that may be relatively unknown, Dr. Gilfillan said.

"We will be evaluating different types of care and payment models. Some may be well-known; others may be novel approaches developed by individual providers of care or small, innovative companies."

Dr. Wilson noted that for any new model of care to succeed, Congress first must fix the sustainable growth formula model that helps calculate Medicare physician pay.

"As we work to optimize the way health care is provided to patients, it's important to note that the current Medicare physician payment system that now threatens seniors' health care is the payment system for all the new models of care," he said. "For these models to succeed in optimizing patient care and curbing health care costs, it is critical that Congress fix the broken Medicare physician payment system."

Dr. Wilson said he is optimistic about the potential CMMI offers in developing new payment and delivery models. "We're very encouraged by this change in culture," he said.

This change is evident in programs like the Vermont Blueprint for Health, an advanced model of primary care and prevention that includes health teams that provide coordinated services through multiple primary care practices in a community, as well as fees based on performance and outcomes.

"This demonstration project ... strengthens reforms already in place here as part of our Vermont Blueprint for Health and provides another example of how states can contain health care costs and improve quality," said Vermont Gov. Jim Douglas.

The program is funded by state general fund tax revenue, the state's Medicaid program and major commercial insurers. Under the project, Medicare funding will be used to advance the Blueprint program.

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Paths to improvement

The Center for Medicare and Medicaid Innovation aims to explore payment and delivery innovations while improving the U.S. population's health and lowering health care costs. CMMI officials describe their mission as:

Better care for individuals: Improving services in formal care settings such as hospitals, nursing homes and doctors' offices, and developing innovations that make care safer, more patient-centered, efficient, timely and equitable. The center will promote bundling payments, an approach where doctors collaborate to manage multiple procedures as part of one episode with a single payment, rather than the current fee-for-service method of submitting bills for each procedure.

Coordinated care to improve patient outcomes: Identifying and widely deploying the best advanced primary care and health home models, and supporting innovations in accountable care organizations.

Community care models: Exploring ways to improve public health and make communities healthier and stronger. The center will focus on health crises associated with obesity, smoking and heart disease.

Source: The Center for Medicare and Medicaid Innovation (link)

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