CMS State Innovation Models Initiative Announced: Applications due on Sept. 17, 2012 by 5pm ET

The Centers for Medicare and Medicaid Services (CMS) has announced a State Innovation Models Initiative that will provide a $275 million competitive funding opportunity for states to design and test multi-payer payment and delivery models that deliver high-quality health care and improve health system performance. The Innovation Center created the State Innovation Models Initiative for states that are prepared for or committed to planning, designing, testing, and supporting evaluation of new payment and service delivery models in the context of larger health system transformation.  The solicitation invites states interested in participating in the State Innovation Models Initiative to propose innovative approaches to improving care and lowering costs for their residents. States can apply for either Model Testing awards to assist in implementing already developed models, or Model Design awards that will provide funding and technical assistance as states determine what type of system improvements would work best.  Model Design Awards:States that would like to develop transformative payment and delivery reforms may apply for Model Design funding.Model Design awards will provide financial and technical support to states for their planning and design efforts and will award up to a total of $50 million for up to 25 states ($1 to $3 million per state).A state that receives model design funding must produce and submit a State Health Care Innovation Plan to CMS. Model Testing Awards:States that are ready to implement a multi-payer model in the context of a State’s Health Care Innovation Plan may apply for Model Testing funding.A total of $225 million over three to four years for up to five states to test and evaluate multi-payer health system transformation models including commercial, employer-sponsored and public health plans will be awarded ($20 to $60 million per state).Each state that applies for Model Testing funding but does not receive an award, may qualify for pre-testing assistance of up to $3 million (which will be counted toward the $50 million in funding for the Model Design Awards described above) to help improve model design proposals and/or State Health Care Innovation Plans. States may not apply for both a model design grant and a model testing grant.  All states, the District of Columbia, and U.S. Territories are eligible for funding; however, only governors’ offices in the states and territories and the mayor’s office in the District of Columbia may submit applications. Non-profit or other organizations are not eligible to apply.  In order to be selected for funding and successful in implementation, State Innovation Models will need broad stakeholder participation from patients, businesses, insurers, providers, and consumer advocates. The goal is for individuals and groups with an interest in promoting health care reform at the state level to participate in the process of model design and implementation. Applications are due by 5:00 p.m. ET on September 17, 2012 for both Model Design and Model Testing. The anticipated award date is mid-November, 2012.  Additional information, including a fact sheet and frequently asked questions can be found on the State Innovation Models Initiative website. Contact stateinnovations@cms.hhs.gov with questions.