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CMS Opens Second Round of Innovation Awards



This week in Washington—CMS announces round two of funding for innovation awards and opens applications for the Model 1 bundled payment initiative. You are tuning in to the National Association of Public Hospitals and Health Systems health policy update for the week of May 20, 2013.

On May 15, the Centers for Medicare & Medicaid Service (CMS) announced funding for round two of the Health Care Innovation Awards. CMS will award up to $1 billion for projects that test new payment and delivery system models that result in better care and lower costs for Medicare, Medicaid and the Children’s Health Insurance Program (CHIP) beneficiaries. For this round, CMS is specifically looking for proposals in the following 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, CMS is defining populations in this case by geography (health of a community), clinically (health of those with specific diseases), or by socioeconomic class. These models might involve activities focused on engaging beneficiaries, prevention, wellness and comprehensive care that extends beyond the clinical service delivery setting.

CMS will accept letters of intent from interested providers June 1 through June 28. Applications will be accepted beginning June 14 and are due Aug. 15. More information about this round of funding is available at

On May 17, CMS published a notice in the Federal Register announcing that the agency will accept additional applications for Model 1 of the Bundled Payments for Care Improvement initiative. The bundled payment initiative demonstration includes four models of care that bundle payments for multiple services received during an episode of inpatient and/or post-acute care.

Acute care hospitals that are paid under the inpatient prospective payment system can apply for Model 1, which defines the episode of care as an inpatient stay. Those hospitals who participate in Model 1 agree to provide a standard discount to Medicare from the usual Part A hospital inpatient payments. Interested hospitals must submit an information intake form by July 31.

Thanks for listening to another edition of This Week in Washington. I’m Zina Gontscharow; join us next week for another update.



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