New Ways to Deliver Care: The Center for Medicare and Medicaid Innovation promises cost-cutting ideas

One of the most common criticisms of the 2010 health care reform law is that it doesn’t do enough to reduce health care costs. Richard Gilfillan, MD, however, begs to differ.

Dr. Gilfillan is acting director of the new Center for Medicare and Medicaid Innovation, which was created under the Patient Protection and Affordable Care Act to test and disseminate new models of health care delivery and payment that reduce costs while improving quality. “The Center for Innovation is a giant ball of potential energy for change in the health care system,” Dr. Gilfillan said at a December 2010 conference held by the journal Health Affairs.

Waste accounts for about 30 percent of health care spending, Dr. Gilfillan said. The center’s goal is to find ways to take those dollars and redistribute them into new models that meet the twin goals of lower costs and higher quality. The current health care system is “unsustainable,” he said. “We all know it.”

Three Main Projects

Health care delivery needs to shift from today’s system, which is marked by fragmented care delivered by providers in various silos, such as inpatient, outpatient, home health and nursing home care, to a seamless system of coordinated care, he said. To make that happen, the federal government will have to transform how it pays for care. Some of the care delivery and payment ideas the center expects to explore are patient-centered medical homes, accountable care organizations (ACOs) and bundled payment, Dr. Gilfillan said.

The center has announced three initial projects, which are focused on primary care. One effort will test the patient-centered medical home model, which is led by a personal physician who provides continuous, coordinated care throughout a patient’s lifetime, in Maine, Michigan, Minnesota, New York, North Carolina, Pennsylvania, Rhode Island and Vermont. The Multi-Payer Advanced Primary Care Practice Demonstration is expected to include more than 1,200 medical homes serving almost one million Medicare beneficiaries. The project aims to evaluate the effectiveness of doctors and other health professionals across the care system working in a more integrated fashion and receiving more coordinated payment from Medicare, Medicaid and private health plans.

A second initiative, the Federally Qualified Health Center Advanced Primary Care Practice Demonstration, will test the effectiveness of doctors and other health professionals working in teams to treat low-income patients at community health centers. The demonstration is expected to operate in up to 500 health centers and provide care to about 195,000 people with Medicare.