6 States to Receive $250M in Innovation Model Funding

John Commins, for HealthLeaders Media , February 22, 2013

The federal government this week detailed plans to award $250 million to six states poised to test multi-payer payment and service delivery models that reward positive health outcomes while reducing costs. 

The funding under the State Innovation Model awards is the first of nearly $300 million in innovation grants available under the Patient Protection and Affordable Care Act to entice states to build innovative delivery systems that lower Medicaid costs.

"Too many Americans receive care that is fragmented, unreliable, and generates poor health outcomes," Health and Human Services Secretary Kathleen Sebelius told reporters during a Thursday afternoon teleconference.

"The good news is we have numerous examples across the country of how improvements in care delivery can both lower costs and improve health. New strategies for coordinating care, for managing chronic diseases, to reducing errors, waste and duplication can keep patients healthier while lowering spending at the same time."

"States have long been innovators and leaders in promoting these kinds of improvements through their Medicaid programs. The awards we are announcing today will give these states the freedom they need to take these efforts to the next level by coordinating efforts with private payers."

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