New Round of Health Care Innovation Awards Follows
Year of Slower Growth in Medicare Costs
Program by Center for Medicare and Medicaid Services
seeks more ideas
for better health care at lower cost
May 15, 2013 – On the heels of news that healthcare
spending by Medicare per beneficiary increased by just 0.4 percent last
year – far below historical averages – the Obama administration today
announced the second round of Health Care Innovation Awards as part of
the effort to deliver better healthcare at a lower cost.
This second round of Health Care Innovation Awards
by the Centers for Medicare & Medicaid Services
will fund applicants that have a high likelihood of driving health care
system transformation and delivering better outcomes.
Health and Human Services Secretary Kathleen
Sebelius in making the announcement said a nearly $1 billion initiative will fund
awards and evaluation to build on the Obama administration’s work to
transform the health care system by delivering better care and lowering
“These awards will continue our work to drive down
health care costs while providing high quality care to all Americans,
and I’m excited to see the innovative ideas these applicants will bring
to the table,” Secretary Sebelius said.
“Organizations from the public and private sectors
throughout the country are finding creative solutions to our health care
system challenges and these awards will continue to stimulate these
Made possible by the Affordable Care Act, the
Health Care Innovation Awards provides another opportunity to improve
the quality of health care and bring down costs for taxpayers and
patients, according to the announcement.
CMS will spend up to $1 billion for awards and
evaluation of projects from across the country that test new payment and
service delivery models that will deliver better care and lower costs
for Medicare, Medicaid, and Children’s Health Insurance Program (CHIP)
The health care law includes many tools to avoid
costly mistakes and readmissions, keep patients healthy, reward quality
instead of quantity, and create health information technology
infrastructure that enables new payment and delivery models to work. The
provisions in the Affordable Care Act are already working to reduce
Last year, CMS awarded 107 round one Health Care Innovation Awards out
of nearly 3,000 applications to organizations that are currently testing
innovative solutions to improve outcomes and reduce costs. Projects are
located in urban and rural areas, all 50 states, the District of
Columbia and Puerto Rico, and include:
The Courage Center
in Minnesota is helping to redefine primary care for adults with
disabilities. The Courage Center provides a medical home for people
with traumatic brain injury and those in wheel chairs. These patients
have significantly lower rates of depression and, as reported by Health Affairs,
have reduced rates of hospitalization by 71% - from 10.8 days per year
to only 3.1 days per year.
in Ohio is teaming with Anthem Blue Cross Blue Shield in Ohio to enable
Medicare beneficiaries make better informed treatment decisions about
surgery and their treatment options. Since September 2012, nearly 3,500
patients have participated, with 48 percent considering surgery
alternatives and 17 percent choosing less invasive options, resulting in
an average savings of $7,000 for each surgery avoided. 95 percent of
participants have reported very high levels of satisfaction with the
This second round of Health Care Innovation Awards
differs from the first round in that CMS is specifically seeking
innovations in four categories.
● Models that are designed
to rapidly reduce Medicare, Medicaid, and/or CHIP costs in outpatient
and/or post-acute settings.
● Models that improve care
for populations with specialized needs.
● Models that test
approaches for specific types of providers to transform their financial
and clinical models.
● Models that improve the
health of populations – defined geographically (health of a community),
clinically (health of those with specific diseases), or by socioeconomic
class – through activities focused on engaging beneficiaries, prevention
(for example, a diabetes prevention program or a hypertension prevention
program), wellness, and comprehensive care that extend beyond the
clinical service delivery setting.
In this round, CMS specifically seeks new payment
models to support the service delivery models funded by this initiative.
All applicants must submit, as part of their application, the design of
a payment model that is consistent with the new service delivery model
that they propose.
Like the first round, these awards will emphasize
results and ensure program integrity.
“We are pleased to be initiating round two of the
Health Care Innovation Awards today as we see innovative solutions in
delivering and improving care deployed all over the country,” said
Marilyn Tavenner, CMS acting administrator.
“Over the last three years, we have seen national
health care cost growth slow significantly and we want to continue that
trend by helping to improve the delivery of health care by testing new
models of paying for quality care, and these awards will help spur
private and public sector innovation in this endeavor.”
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