PE R S PE C T IV E
of public approval of Congress to subfreezing lows.4 MACRA is a reminder of the virtues of compromise and quiet negotiation. A small group of An audio interview with Dr. Aaron is congressional leadavailable at NEJM.org ers and their staffs crafted a law that gives something to most members of both parties. Today’s appalling norm of poisonously polarized politics make this instance of political horse trading seem nothing short of miraculous.
Three Cheers for Logrolling Disclosure forms provided by the author are available with the full text of this article at NEJM.org. From the Brookings Institution, Washington, DC. This article was published on April 22, 2015, at NEJM.org. 1. House Committees on Energy & Commerce and Ways & Means. SGR Repeal and Medicare Provider Payment Modernization Act: section by section. March 19, 2015 (http:// energycommerce.house.gov/sites/republicans .energycommerce.house.gov/files/114/ Analysis/20150319SGRSectionbySection.pdf). 2. McClellan M, Berenson R, Chernew M, Kramer W, Lansky D, Milstein A. Medicare
physician payment reform: securing the connection between value and payment. Washington, DC: The Brookings Institution, January 27, 2015 (http://www.brookings .edu/research/papers/2015/01/27-medicare -physician-payment-reform-mcclellan). 3. Park E. Hatch-Upton CHIP proposal moves backwards on children’s health coverage. Washington, DC: Center on Budget and Policy Priorities, February 26, 2015 (http://www .cbpp.org/cms/index.cfm?fa=view&id=5276). 4. Riffkin R. 2014 U.S. approval of Congress remains near all-time low. Washington, DC: Gallup, December 15, 2014 (http://www .gallup.com/poll/180113/2014-approval -congress-remains-near-time-low.aspx). DOI: 10.1056/NEJMp1504076 Copyright © 2015 Massachusetts Medical Society.
The Children’s Cliff — Extending CHIP Jonathan Oberlander, Ph.D., and David K. Jones, Ph.D.
B
ipartisanship has been a rare commodity in U.S. health care policy in recent years. Since 2009, Democrats and Republicans have fought a protracted battle over the Affordable Care Act (ACA) in Congress, the courts, and state legislatures. It is striking, then, that the Medicare Access and CHIP Reauthorization Act (MACRA) passed Congress with overwhelming bipartisan majorities. MACRA, which President Barack Obama signed into law on April 16, 2015, sailed through the House of Representatives on a 392-to-37 vote and cleared the Senate 92 to 8. Most commentary has focused on MACRA’s repeal of Medicare’s sustainable growth rate formula (SGR) for reimbursing physicians, which has been replaced with a new “Merit-based Incentive Payment System.” The SGR’s demise, and an end to the annual drama of Congress canceling large scheduled cuts in Medicare payments to doctors, is welcome news to the medical profession. Yet MACRA contains another significant health policy development: a 2-year ex-
tension of the Children’s Health Insurance Program (CHIP). How did the CHIP extension happen, and what does it portend for the program’s future? Since 1997, CHIP has been a vital part of the U.S. health care safety net — a federal–state program that extends health coverage to children in working families who have modest incomes but do not qualify for Medicaid. More than 8 million children up to 18 years of age are currently insured through the program (see graph). States can also choose to cover pregnant women and “unborn children” through CHIP.1 Congress enacted CHIP with broad bipartisan support, and thanks to the lure of substantial federal funding, the political appeal of covering children, and flexibility in benefit and eligibility rules, all states implemented CHIP programs quickly. States can operate CHIP as a Medicaid expansion, a stand-alone program outside Medicaid, or as a combination of the two approaches, applying each to different popu-
lations and income levels.1 In states with stand-alone CHIP programs, there is no legal entitlement to coverage. States can charge premiums, require cost sharing by beneficiaries, and freeze enrollment in response to funding shortfalls. Unlike Medicaid, CHIP is a block grant: total federal payments to states for CHIP are capped, with each state receiving an annual funding allotment determined by formula. The federal government pays 70% of the costs of CHIP, with states picking up the rest (in contrast, the federal government funded 57%, on average, of the costs of state Medicaid programs before the ACA). In 2014, a congressionally mandated evaluation by Mathematica Policy Research and the Urban Institute concluded that CHIP had been “successful in nearly every area examined.”2 The program had helped to reduce the proportion of U.S. children who were uninsured from 15% in 1997 to 9% in 2012 (and from 25% to 13% among low-
n engl j med 372;21 nejm.org may 21, 2015
The New England Journal of Medicine Downloaded from nejm.org on November 4, 2015. For personal use only. No other uses without permission. Copyright © 2015 Massachusetts Medical Society. All rights reserved.
1979
PERS PE C T IV E
The Children’s Cliff — Extending CHIP
70 63%
Percentage of Children
60 Medicaid or CHIP
50 40
41% 34%
Employer-sponsored insurance
30
25%
20 25% Uninsured
10
13%
12
11
20
10
20
09
20
08
20
07
20
06
20
05
20
04
20
03
20
02
20
01
20
00
20
99
20
98
19
19
19
97
0
Percentages of Low-Income U.S. Children Who Were Uninsured, Covered by Medicaid or CHIP, and Covered by Employer-Sponsored Insurance, 1997–2012. Shown are data for children 0 to 18 years of age whose family income was below 200% Oberlander of the federal povertyAUTHOR: level. Data are from Mathematica Policy Research and the Urban Institute.2 FIGURE: 1 of 1 ARTIST:
ts
income children).2 It provides a NOTE: contentious debate over CHIP AUTHOR,an PLEASE Figure of has been redrawn andreauthorization. type has been reset. President George important measure financial Please check carefully. security to low-income working W. Bush twice vetoed legislation Issue date: 05-21-15 OLF: 05-06-15 ? families and an essential source (which had drawn substantial of coverage for children who lack GOP support) before President access to private insurance. Some Obama signed a reauthorization 89% of CHIP enrollees live in bill in 2009 extending the profamilies with incomes of less gram to 2013. CHIP’s bipartisan than 200% of the federal poverty sheen had eroded: most Senate level (i.e., below $48,500 for a Republicans voted against the family of four in 2015).1 Children 2009 legislation, while nearly all insured by CHIP have good ac- Democrats voted for it. Then, in cess to medical services, and 2009 and 2010, Democrats were participation in the program is divided over whether to continue CHIP or phase it out in the face high among eligible children.2 Despite these achievements, of the ACA’s Medicaid expansion the future of CHIP was uncertain and establishment of subsidized heading into 2015. The pro- coverage through new health ingram’s funding was slated to run surance exchanges. Program out at the end of September. Ab- supporters, including Senator Jay sent congressional action to extend Rockefeller (D-WV), ensured its those funds, the health insurance survival, and the ACA ultimately of 5 million children in states with extended CHIP’s financing to stand-alone CHIP programs would 2015 while requiring states to be in jeopardy, a seemingly un- maintain current eligibility levels thinkable prospect.2 Nonetheless, for children until 2019. Since CHIP extension could have proven then, CHIP’s political environtumultuous — the program had, ment has become more treacherafter all, encountered political ous in the face of the ongoing difficulties in the past. In 2007, Obamacare fight and growing Democrats and Republicans had partisan polarization in Congress. 1980
A February 2015 draft GOP bill — cosponsored by Senator Orrin Hatch (R-UT), chair of the Senate Finance Committee, and Fred Upton (R-MI), chair of the House Energy and Commerce Committee — appeared to signal a partisan divide on CHIP. The Hatch–Upton draft called for a number of changes in CHIP that were opposed by Democrats and children’s advocacy groups, includ ing ending the ACA requirement that states maintain prior eligibility levels for children, enabling states to impose a 12-month waiting period before enrollees could join the program, and reversing the ACA mandate that states enroll in Medicaid any children with family incomes of up to 138% of the federal poverty level.3 But instead of entering a heated partisan debate, Congress quietly extended CHIP for 2 years through a “clean” bill that contained none of these controversial policies. CHIP benefited from timing: with steep cuts to Medicare payments to physicians looming, Congress had to move quickly — a need that set the stage for a deal linking SGR reform to CHIP extension. By attaching CHIP to a must-pass bill, congressional leaders limited potential conflict. Republicans and Democrats thereby avoided entangling CHIP in the volatile politics of Obamacare and the uncertainty surrounding the potential fallout from the upcoming Supreme Court decision in King v. Burwell (regarding subsidies for purchasing insurance on the federally facilitated exchange). CHIP enjoys political advantages that give it a strong bipartisan foundation: insuring children is a popular cause, the costs of doing so are modest, the program’s block-grant structure and
n engl j med 372;21 nejm.org may 21, 2015
The New England Journal of Medicine Downloaded from nejm.org on November 4, 2015. For personal use only. No other uses without permission. Copyright © 2015 Massachusetts Medical Society. All rights reserved.
PE R S PE C T IV E
state flexibility appeal to conservatives, and it has a strong constituency among state officials. Governors from both parties support CHIP — 39 wrote letters to the Senate Finance Committee endorsing its extension — and key congressional Republicans joined Democrats in working to renew it. CHIP, in other words, is not Obamacare, and the bipartisan coalition behind it remains largely intact. Meanwhile, limitations in the ACA’s coverage provisions for children, including those related to the accessibility of affordable coverage and the benefits of policies available in the insurance exchanges, have persuaded reformers that the program must continue for now.4 The bipartisanship that underlay CHIP’s extension and SGR reform does not, however, mark the emergence of new, less polarizing health care politics. That Congress can agree on the necessity of continuing insurance coverage for children and payments
The Children’s Cliff — Extending CHIP
to doctors seeing Medicare patients does not mean that Democrats and Republicans see eye to eye on other issues. The short 2-year extension of CHIP is itself a sign of problems. Democrats favored a 4-year extension but could not reach agreement with Republicans, partly because of a dispute over an ACA provision that provides states with enhanced federal CHIP payments. CHIP will go back up for a funding extension in 2017, and a new president and Congress will reconsider the program’s fate. As Bruce Lesley, president of First Focus Campaign for Children, notes, Congress eliminated the annual “SGR funding cliff” only to replace it with a “CHIP funding cliff.”5 CHIP’s 2015 journey through Congress was quick and relatively easy, but its long-term prospects remain uncertain. Disclosure forms provided by the authors are available with the full text of this article at NEJM.org.
From the University of North Carolina, Chapel Hill (J.O.); and Boston University, Boston (D.K.J.). This article was published on May 6, 2015, at NEJM.org. 1. Medicaid and CHIP Payment and Access Commission (MACPAC). Report to the Congress on Medicaid and CHIP, June 2014 (https://www.macpac.gov/publication/report -to-the-congress-on-medicaid-and-chip-614). 2. Mathematica Policy Research, Urban Institute. CHIPRA mandated evaluation of the Children’s Health Insurance Program: final findings. August 1, 2014 (http://medicaid .gov/chip/downloads/chip_report_congress -2014.pdf). 3. Alker J. Republicans introduce discussion draft of plan to extend (S)CHIP funding — and there is much to discuss. Washington, DC: Georgetown University Health Policy Institute Center for Children and Families, February 24, 2015 (http://ccf.georgetown.edu/ all/republicans-introduce-discussion-draft -plan-extend-schip-funding-much-discuss). 4. Rosenbaum S, Kenney GM. The search for a national child health coverage policy. Health Aff (Millwood) 2014;33:2125-35. 5. Ferris S. Advocates: don’t turn children’s insurance into Medicare bargaining chip. The Hill. March 19, 2015 (http://thehill.com/ policy/healthcare/236351-advocates-dont -turn-childrens-insurance-into-medicare -bargaining-chip). DOI: 10.1056/NEJMp1503576 Copyright © 2015 Massachusetts Medical Society.
The CMS Innovation Center — A Five-Year Self-Assessment Rahul Rajkumar, M.D., J.D., Matthew J. Press, M.D., and Patrick H. Conway, M.D. Related article, p. 1984
N
early 5 years ago, the Centers for Medicare and Medicaid Services (CMS) launched the Center for Medicare and Medicaid Innovation, with a mandate — outlined in the Affordable Care Act (ACA) — “to test innovative payment and service delivery models to reduce program expenditures . . . while preserving or enhancing the quality of care” for Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) beneficiaries.1 The Innovation Center received
an appropriation of $10 billion for fiscal years 2011 through 2019 to work on transforming the U.S. delivery system. CMS has a long history of conducting demonstration projects to test new payment and servicedelivery models. Many of these demonstrations have led to core elements of today’s Medicare and Medicaid programs, including the Inpatient Prospective Payment System and the Resource-Based Relative Value Scale for physician payment. The Innovation Center builds
on this tradition, aiming to identify models that will improve the quality and efficiency of health care services. In addition, the ACA grants the secretary of health and human services (HHS) the authority to expand these models nationally through rulemaking if they reduce spending without reducing the quality of care or improve the quality of care without increasing spending; models may not deny or limit the coverage or provision of any benefits. Each model is evaluated on these
n engl j med 372;21 nejm.org may 21, 2015
The New England Journal of Medicine Downloaded from nejm.org on November 4, 2015. For personal use only. No other uses without permission. Copyright © 2015 Massachusetts Medical Society. All rights reserved.
1981
of public approval of Congress to subfreezing lows.4 MACRA is a reminder of the virtues of compromise and quiet negotiation. A small group of An audio interview with Dr. Aaron is congressional leadavailable at NEJM.org ers and their staffs crafted a law that gives something to most members of both parties. Today’s appalling norm of poisonously polarized politics make this instance of political horse trading seem nothing short of miraculous.
Three Cheers for Logrolling Disclosure forms provided by the author are available with the full text of this article at NEJM.org. From the Brookings Institution, Washington, DC. This article was published on April 22, 2015, at NEJM.org. 1. House Committees on Energy & Commerce and Ways & Means. SGR Repeal and Medicare Provider Payment Modernization Act: section by section. March 19, 2015 (http:// energycommerce.house.gov/sites/republicans .energycommerce.house.gov/files/114/ Analysis/20150319SGRSectionbySection.pdf). 2. McClellan M, Berenson R, Chernew M, Kramer W, Lansky D, Milstein A. Medicare
physician payment reform: securing the connection between value and payment. Washington, DC: The Brookings Institution, January 27, 2015 (http://www.brookings .edu/research/papers/2015/01/27-medicare -physician-payment-reform-mcclellan). 3. Park E. Hatch-Upton CHIP proposal moves backwards on children’s health coverage. Washington, DC: Center on Budget and Policy Priorities, February 26, 2015 (http://www .cbpp.org/cms/index.cfm?fa=view&id=5276). 4. Riffkin R. 2014 U.S. approval of Congress remains near all-time low. Washington, DC: Gallup, December 15, 2014 (http://www .gallup.com/poll/180113/2014-approval -congress-remains-near-time-low.aspx). DOI: 10.1056/NEJMp1504076 Copyright © 2015 Massachusetts Medical Society.
The Children’s Cliff — Extending CHIP Jonathan Oberlander, Ph.D., and David K. Jones, Ph.D.
B
ipartisanship has been a rare commodity in U.S. health care policy in recent years. Since 2009, Democrats and Republicans have fought a protracted battle over the Affordable Care Act (ACA) in Congress, the courts, and state legislatures. It is striking, then, that the Medicare Access and CHIP Reauthorization Act (MACRA) passed Congress with overwhelming bipartisan majorities. MACRA, which President Barack Obama signed into law on April 16, 2015, sailed through the House of Representatives on a 392-to-37 vote and cleared the Senate 92 to 8. Most commentary has focused on MACRA’s repeal of Medicare’s sustainable growth rate formula (SGR) for reimbursing physicians, which has been replaced with a new “Merit-based Incentive Payment System.” The SGR’s demise, and an end to the annual drama of Congress canceling large scheduled cuts in Medicare payments to doctors, is welcome news to the medical profession. Yet MACRA contains another significant health policy development: a 2-year ex-
tension of the Children’s Health Insurance Program (CHIP). How did the CHIP extension happen, and what does it portend for the program’s future? Since 1997, CHIP has been a vital part of the U.S. health care safety net — a federal–state program that extends health coverage to children in working families who have modest incomes but do not qualify for Medicaid. More than 8 million children up to 18 years of age are currently insured through the program (see graph). States can also choose to cover pregnant women and “unborn children” through CHIP.1 Congress enacted CHIP with broad bipartisan support, and thanks to the lure of substantial federal funding, the political appeal of covering children, and flexibility in benefit and eligibility rules, all states implemented CHIP programs quickly. States can operate CHIP as a Medicaid expansion, a stand-alone program outside Medicaid, or as a combination of the two approaches, applying each to different popu-
lations and income levels.1 In states with stand-alone CHIP programs, there is no legal entitlement to coverage. States can charge premiums, require cost sharing by beneficiaries, and freeze enrollment in response to funding shortfalls. Unlike Medicaid, CHIP is a block grant: total federal payments to states for CHIP are capped, with each state receiving an annual funding allotment determined by formula. The federal government pays 70% of the costs of CHIP, with states picking up the rest (in contrast, the federal government funded 57%, on average, of the costs of state Medicaid programs before the ACA). In 2014, a congressionally mandated evaluation by Mathematica Policy Research and the Urban Institute concluded that CHIP had been “successful in nearly every area examined.”2 The program had helped to reduce the proportion of U.S. children who were uninsured from 15% in 1997 to 9% in 2012 (and from 25% to 13% among low-
n engl j med 372;21 nejm.org may 21, 2015
The New England Journal of Medicine Downloaded from nejm.org on November 4, 2015. For personal use only. No other uses without permission. Copyright © 2015 Massachusetts Medical Society. All rights reserved.
1979
PERS PE C T IV E
The Children’s Cliff — Extending CHIP
70 63%
Percentage of Children
60 Medicaid or CHIP
50 40
41% 34%
Employer-sponsored insurance
30
25%
20 25% Uninsured
10
13%
12
11
20
10
20
09
20
08
20
07
20
06
20
05
20
04
20
03
20
02
20
01
20
00
20
99
20
98
19
19
19
97
0
Percentages of Low-Income U.S. Children Who Were Uninsured, Covered by Medicaid or CHIP, and Covered by Employer-Sponsored Insurance, 1997–2012. Shown are data for children 0 to 18 years of age whose family income was below 200% Oberlander of the federal povertyAUTHOR: level. Data are from Mathematica Policy Research and the Urban Institute.2 FIGURE: 1 of 1 ARTIST:
ts
income children).2 It provides a NOTE: contentious debate over CHIP AUTHOR,an PLEASE Figure of has been redrawn andreauthorization. type has been reset. President George important measure financial Please check carefully. security to low-income working W. Bush twice vetoed legislation Issue date: 05-21-15 OLF: 05-06-15 ? families and an essential source (which had drawn substantial of coverage for children who lack GOP support) before President access to private insurance. Some Obama signed a reauthorization 89% of CHIP enrollees live in bill in 2009 extending the profamilies with incomes of less gram to 2013. CHIP’s bipartisan than 200% of the federal poverty sheen had eroded: most Senate level (i.e., below $48,500 for a Republicans voted against the family of four in 2015).1 Children 2009 legislation, while nearly all insured by CHIP have good ac- Democrats voted for it. Then, in cess to medical services, and 2009 and 2010, Democrats were participation in the program is divided over whether to continue CHIP or phase it out in the face high among eligible children.2 Despite these achievements, of the ACA’s Medicaid expansion the future of CHIP was uncertain and establishment of subsidized heading into 2015. The pro- coverage through new health ingram’s funding was slated to run surance exchanges. Program out at the end of September. Ab- supporters, including Senator Jay sent congressional action to extend Rockefeller (D-WV), ensured its those funds, the health insurance survival, and the ACA ultimately of 5 million children in states with extended CHIP’s financing to stand-alone CHIP programs would 2015 while requiring states to be in jeopardy, a seemingly un- maintain current eligibility levels thinkable prospect.2 Nonetheless, for children until 2019. Since CHIP extension could have proven then, CHIP’s political environtumultuous — the program had, ment has become more treacherafter all, encountered political ous in the face of the ongoing difficulties in the past. In 2007, Obamacare fight and growing Democrats and Republicans had partisan polarization in Congress. 1980
A February 2015 draft GOP bill — cosponsored by Senator Orrin Hatch (R-UT), chair of the Senate Finance Committee, and Fred Upton (R-MI), chair of the House Energy and Commerce Committee — appeared to signal a partisan divide on CHIP. The Hatch–Upton draft called for a number of changes in CHIP that were opposed by Democrats and children’s advocacy groups, includ ing ending the ACA requirement that states maintain prior eligibility levels for children, enabling states to impose a 12-month waiting period before enrollees could join the program, and reversing the ACA mandate that states enroll in Medicaid any children with family incomes of up to 138% of the federal poverty level.3 But instead of entering a heated partisan debate, Congress quietly extended CHIP for 2 years through a “clean” bill that contained none of these controversial policies. CHIP benefited from timing: with steep cuts to Medicare payments to physicians looming, Congress had to move quickly — a need that set the stage for a deal linking SGR reform to CHIP extension. By attaching CHIP to a must-pass bill, congressional leaders limited potential conflict. Republicans and Democrats thereby avoided entangling CHIP in the volatile politics of Obamacare and the uncertainty surrounding the potential fallout from the upcoming Supreme Court decision in King v. Burwell (regarding subsidies for purchasing insurance on the federally facilitated exchange). CHIP enjoys political advantages that give it a strong bipartisan foundation: insuring children is a popular cause, the costs of doing so are modest, the program’s block-grant structure and
n engl j med 372;21 nejm.org may 21, 2015
The New England Journal of Medicine Downloaded from nejm.org on November 4, 2015. For personal use only. No other uses without permission. Copyright © 2015 Massachusetts Medical Society. All rights reserved.
PE R S PE C T IV E
state flexibility appeal to conservatives, and it has a strong constituency among state officials. Governors from both parties support CHIP — 39 wrote letters to the Senate Finance Committee endorsing its extension — and key congressional Republicans joined Democrats in working to renew it. CHIP, in other words, is not Obamacare, and the bipartisan coalition behind it remains largely intact. Meanwhile, limitations in the ACA’s coverage provisions for children, including those related to the accessibility of affordable coverage and the benefits of policies available in the insurance exchanges, have persuaded reformers that the program must continue for now.4 The bipartisanship that underlay CHIP’s extension and SGR reform does not, however, mark the emergence of new, less polarizing health care politics. That Congress can agree on the necessity of continuing insurance coverage for children and payments
The Children’s Cliff — Extending CHIP
to doctors seeing Medicare patients does not mean that Democrats and Republicans see eye to eye on other issues. The short 2-year extension of CHIP is itself a sign of problems. Democrats favored a 4-year extension but could not reach agreement with Republicans, partly because of a dispute over an ACA provision that provides states with enhanced federal CHIP payments. CHIP will go back up for a funding extension in 2017, and a new president and Congress will reconsider the program’s fate. As Bruce Lesley, president of First Focus Campaign for Children, notes, Congress eliminated the annual “SGR funding cliff” only to replace it with a “CHIP funding cliff.”5 CHIP’s 2015 journey through Congress was quick and relatively easy, but its long-term prospects remain uncertain. Disclosure forms provided by the authors are available with the full text of this article at NEJM.org.
From the University of North Carolina, Chapel Hill (J.O.); and Boston University, Boston (D.K.J.). This article was published on May 6, 2015, at NEJM.org. 1. Medicaid and CHIP Payment and Access Commission (MACPAC). Report to the Congress on Medicaid and CHIP, June 2014 (https://www.macpac.gov/publication/report -to-the-congress-on-medicaid-and-chip-614). 2. Mathematica Policy Research, Urban Institute. CHIPRA mandated evaluation of the Children’s Health Insurance Program: final findings. August 1, 2014 (http://medicaid .gov/chip/downloads/chip_report_congress -2014.pdf). 3. Alker J. Republicans introduce discussion draft of plan to extend (S)CHIP funding — and there is much to discuss. Washington, DC: Georgetown University Health Policy Institute Center for Children and Families, February 24, 2015 (http://ccf.georgetown.edu/ all/republicans-introduce-discussion-draft -plan-extend-schip-funding-much-discuss). 4. Rosenbaum S, Kenney GM. The search for a national child health coverage policy. Health Aff (Millwood) 2014;33:2125-35. 5. Ferris S. Advocates: don’t turn children’s insurance into Medicare bargaining chip. The Hill. March 19, 2015 (http://thehill.com/ policy/healthcare/236351-advocates-dont -turn-childrens-insurance-into-medicare -bargaining-chip). DOI: 10.1056/NEJMp1503576 Copyright © 2015 Massachusetts Medical Society.
The CMS Innovation Center — A Five-Year Self-Assessment Rahul Rajkumar, M.D., J.D., Matthew J. Press, M.D., and Patrick H. Conway, M.D. Related article, p. 1984
N
early 5 years ago, the Centers for Medicare and Medicaid Services (CMS) launched the Center for Medicare and Medicaid Innovation, with a mandate — outlined in the Affordable Care Act (ACA) — “to test innovative payment and service delivery models to reduce program expenditures . . . while preserving or enhancing the quality of care” for Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) beneficiaries.1 The Innovation Center received
an appropriation of $10 billion for fiscal years 2011 through 2019 to work on transforming the U.S. delivery system. CMS has a long history of conducting demonstration projects to test new payment and servicedelivery models. Many of these demonstrations have led to core elements of today’s Medicare and Medicaid programs, including the Inpatient Prospective Payment System and the Resource-Based Relative Value Scale for physician payment. The Innovation Center builds
on this tradition, aiming to identify models that will improve the quality and efficiency of health care services. In addition, the ACA grants the secretary of health and human services (HHS) the authority to expand these models nationally through rulemaking if they reduce spending without reducing the quality of care or improve the quality of care without increasing spending; models may not deny or limit the coverage or provision of any benefits. Each model is evaluated on these
n engl j med 372;21 nejm.org may 21, 2015
The New England Journal of Medicine Downloaded from nejm.org on November 4, 2015. For personal use only. No other uses without permission. Copyright © 2015 Massachusetts Medical Society. All rights reserved.
1981
