April 22nd, 2014
Medicare beneficiaries with multiple chronic conditions, certain types of serious conditions (e.g. heart disease, pulmonary disorders, mental disorders, cancer), and functional limitations have higher health and long-term care costs and more adverse outcomes than other beneficiaries.
One of the biggest opportunities for savings for Medicare, Medicaid, and beneficiaries themselves, is through reducing hospitalizations, readmissions, and institutional care, especially for these high-risk beneficiaries. Achieving these savings and serving this population will require innovative delivery models and a clear business case to convince organizations to implement those new models.
The Affordable Care Act set aside $10 billion for experiments in innovative care delivery and payment systems. With these funds, the Centers for Medicare and Medicaid Innovation (CMMI) is launching and evaluating several initiatives, primarily Accountable Care Organizations (ACOs), bundled payment for care innovation, and primary care transformation. These initiatives change financial incentives for health care providers so that while they bear some financial risk for the costs of providing care, they also stand to benefit from any savings produced.
Historically, it has taken additional legislative action to apply successful delivery models more broadly across the Medicare program. Now, the health care law has removed this barrier, giving the Secretary of Health and Human Services the ability to expand successful innovations that improve quality or lower costs. While early results show improvements in quality and modest savings, most CMMI pilots and demonstrations to date are not specifically targeted on high-risk beneficiaries, where the biggest gains can be expected.Read the rest of this entry »