CMS offering physicians grants for health care innovations

Washington -- The latest federal effort to support local health system reform initiatives will award up to $1 billion in grants for efforts to improve care and lower costs for patients with public coverage.

The Health Care Innovation Challenge program was announced on Nov. 14 by the Center for Medicare and Medicaid Innovation. The center will provide grants of $1 million to $30 million to physicians and other health professionals, payers, local governments, community-based organizations. Priority will be given to public-private partnerships and multi-payer groups, as well as for proposals targeting patients with complex health care needs.

"Both public and private community organizations around the country are finding innovative solutions to improve our health care system," said Health and Human Services Secretary Kathleen Sebelius. These grants will help such projects accelerate and expand.

The grants will come from the $10 billion the center is receiving from the health system reform law. CMMI is managing several similar programs designed to improve health care and lower costs for people in Medicare, Medicaid and the Children's Health Insurance Program.

The grant applications must detail how the proposed reforms can be implemented within six months, expanded to other regions and sustained, according to CMMI. Proposals also should focus on using health professionals in innovative ways.

CMMI -- part of the Centers for Medicare & Medicaid Services -- is functioning like a foundation, said Richard J. Baron, MD, MACP, group director of CMMI Seamless Care Models. "If your idea works, come to us. We'll support that idea." The center also is managing payment bundling projects and a number of other care improvement initiatives.

It is not yet clear whether the best way to achieve CMMI's goals is to change health care payment or to change the delivery system, said Dr. Baron, speaking at a Nov. 16 event on clinician leadership in health reform at the Brookings Institution in Washington. Dr. Baron, who joined the center in March, is overseeing efforts to implement Medicare accountable care organizations, among other duties. His six-physician practice in Philadelphia -- Greenhouse Internists -- is known for being a pioneer in adopting electronic medical records.

Dr. Baron said physician practices and other organizations adjusting to health reform should focus on providing the best care to patients in the most efficient way. "I'm stunned at the number of physician practices I'm learning about who measure productivity by cash collections," he said, adding that practices that put patient care first will fare better in the long run.

Dr. Baron noted that many practices rely on fee-for-service payment today. "I wouldn't consider it prudent to predict five years from now that's going to be a viable business model," he said.

Other physician leaders at the Brookings event discussed issues affecting the adoption of new payment models and the adjustment to a changing health care landscape.

Barbara McAneny, MD, a private practice oncologist in Albuquerque, N.M., said she's concerned that accountable care organizations will allow hospitals to reduce competition from physician practices and other smaller health care entities. Dr. McAneny, who was speaking for herself, also is a member of the American Medical Association Board of Trustees.

"That's clearly one of the many nightmare scenarios to which we could be heading," Dr. Baron said in response. "We're very worried about anti-competitive behavior."

However, Dr. Baron said small practices should look at the leadership opportunities provided by the innovation grants and the advance payment opportunity in the federal ACO regulation. Medicare will provide upfront funding for some ACO implementation costs faced by physician practices, such as implementing new information technology. The funds would be repaid from any savings achieved by the practice's ACO.

Letters of intent for the innovation challenge grants are due by Dec. 19. Applications are due on Jan. 27, 2012. The innovation center expects to notify awardees by March 30, 2012.