Health and Human Services (HHS) announced that 25 states will be awarded nearly $300 million for a state innovation program that will help states design and test new multi-payer payment and delivery models for their Medicaid and CHIP programs.

The Center for Medicare and Medicaid Innovation program was created under the Affordable Care Act and will distribute two types of awards:

  • Model design awards: States selected for the design award will receive up to $50 million. Winning states will create and submit a statewide plan to transform its care delivery into a model that uses an integrated-care strategy led by the community.
  • Model testing awards: States selected for the testing award will receive up to $225 million over three to four years. Winning states will use the funds to test and evaluate multi-payer system transformation models that include employer-sponsored, commercial and public health plans.

CMS will use the program to learn whether new models outlined in the ACA, including accountable care organizations, are successful when implemented broadly and combined with state-initiated reforms.

California; Connecticut; Delaware; Hawaii; Idaho; Illinois; Iowa; Maryland; Michigan; New Hampshire; Ohio; Pennsylvania; Rhode Island; Tennessee; Texas; and Utah received the Model design fund. These 16 states will further develop proposals for comprehensive health care transformation.

Arkansas, Maine, Massachusetts, Minnesota, Oregon and Vermont received the testing fund. The objective will be to test programs which will curb heath care costs, “while maintaining or improving quality of care” in federal entitlement programs.