New Funding for CA HHS system reforms

New funding gives states and innovators tools and flexibility to implement delivery system reform in California

Health and Human Services Secretary Kathleen Sebelius today announced new delivery system reform efforts made possible by the Affordable Care Act that offer states and innovators tools and flexibility to transform health care.

CA HHS announced twelve prospective recipients receiving as much as $110 million in combined funding, ranging from an expected $2 million to $18 million over a three-year period, under the Health Innovation Awards program to test innovative models designed to deliver better care outcomes and lower costs.  Examples include projects to provide better care for dementia patients, improve coordination between specialists and primary care physicians, and to improve cardiac care.  Round two of the Health Care Innovation Awards program focuses on four priority areas: rapidly reducing costs for patients with Medicare and Medicaid; improving care for populations with specialized needs; testing improved financial and clinical models for specific types of providers, including specialists; and linking clinical care delivery to preventive and population health.  The twelve prospective recipients will test models in all four categories and spanning 13 states.  Additional prospective recipients will be announced in the coming months.

Also today, HHS made up to $730 million available as part of the State Innovation Model initiative to help states design and test improvements to their public and private health care payment and delivery systems.  Project goals are to improve health, improve care, and decrease costs for consumers, including Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) beneficiaries.

“As a former governor, I understand the real sense and urgency states and local communities feel to improve the health of their populations while also reducing health care costs, and it’s critical that the many elements of health care in each state – including Medicaid, public health, and workforce training – work together,” Secretary Sebelius said.  “To help, HHS will continue to encourage and assist them in their efforts to transform health care.

“These efforts will strengthen federal, state, and local partnerships, encourage broad stakeholder engagement, and capitalize on federal resources to ensure greater transformation of delivery of health care services,” said Centers for Medicare & Medicaid Services (CMS) Administrator Marilyn Tavenner.

Round two Health Care Innovation Awards prospective projects in California include:

Association of American Medical Colleges:  This project will test the scalability of an eConsult/eReferral model for implementation in five partner academic medical centers.  Developed by the University of California San Francisco, the eConsult/eReferral model is an electronic consultation and referral platform for access to specialty input to address several well-documented gaps in primary care-specialty care communication and coordination and provide a foundation for non-face-to-face, asynchronous electronic consultation. The proposed project has two components: (1) implementation of a standardized set of condition-specific referral templates across 12 medical specialties, with additional surgical specialties nearing completion and (2) eConsult, an asynchronous exchange initiated by the primary care provider to seek guidance from the specialist, who is expected to respond in less than 72 hours. The project is estimated to receive $7,125,770.

 Regents of The University of California San Francisco:  This project will implement the Care Ecosystem. The Care Ecosystem is an innovative clinical program that builds on the university’s history of offering high-quality dementia care, while incorporating the University of Nebraska Medical Center’s specialized expertise in functional monitoring and rural dementia care. The system, which targets Medicare beneficiaries and persons dually eligible for Medicare and Medicaid, will emphasize continuous and personalized care. Care Ecosystem includes the are: (1) caregiver module, which includes educational forums and connect families with community resources; (2) decision-making module, which facilitates proactive medical, financial, and safety decisions; (1) medication module, which tracks and reduces inappropriate medications or doses and trigger a pharmacist review when indicated; and (4) functional monitoring module, which uses smartphones and sensors to rapidly detect and respond to changes in functional status, which is particularly important for patients living remotely, alone, or who are at-risk for acute declines. The project aims to improve satisfaction with care, prevent emergency-related health care costs, and keep patients in the home longer. The project is estimated to receive $9,990,848.

The twelve innovative projects announced today represent the first batch of prospective recipients for round two of Health Care Innovation Awards program funding.  In 2012, 107 organizations located in urban and rural areas, all 50 states, the District of Columbia and Puerto Rico received awards through round one of the initiative.

As part of the State Innovation Model Initiative, states, territories and the District of Columbia can apply for either a Model Test award to assist in implementation or a Model Design award to develop or enhance a comprehensive State Health Care Innovation Plan.   Up to 12 states will be chosen for state-sponsored Model Testing awards ($700 million available) and up to 15 states will be chosen for state-sponsored Model Design work ($30 million available).

For more information about the Health Care Innovation Awards program prospective recipients announced today, go to:

Currently, there 25 states are participating in the State Innovation Models initiative.  For more information on the initiative, please visit:

To learn more about other innovative models being tested by the CMS Innovation Center, please visit: