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Spending to Save: Innovation Challenge Grants Seek Better Outcomes at a Lower Cost

Posted in Accountable Care Organizations, Health Care Reform, Home Health & Hospice, Hospitals & Health Systems, Long-term Care/Skilled Nursing Facilities, Uncategorized

Written by Jared Alves and Kevin Kappel

Stakeholders across the health care spectrum will soon compete for $1 billion in grants offered by the Health Care Innovation Challenge. The initiative, funded as part of the Patient Protection and Affordable Care Act, was announced by the Centers for Medicare and Medicaid Services (CMS) on November 14th in an effort to solicit the best ideas to promote both immediate cost savings and improved patient care. Spokespersons for the Center for Medicare and Medicaid Innovation, the Center administering the Challenge, anticipate that the best applications will look to utilize budding health information technology, may revolutionize workforce training, and would likely encourage broad partnerships between private and public sector professionals. Winners will receive from $1 to $30 million to implement their proposals. 

Observers bill the competition as another Obama Administration effort to to unilaterally boost job creation.  In fact, the same day that the Challenge was announced, the White House posted on its blog an entry written by CMS Administrator Don Berwick,  noting that the initiative was part of the President’s “We Can’t Wait” jobs push.  That could explain the emphasis on Innovation Challenge proposals that can be implemented in six months – a dramatic time frame for stakeholders to mobilize and implement new models.  That means, above all, that they are seeking shovel ready and immediately deployable projects.   

Letters of intent are due in less than a month, with final applications needed by the end of January. Decisions are expected by March of next year. To be sure, applicants face a tall order – finding novel, measurable, and sustainable ways to manage spiraling Medicare and Medicaid costs without harming those who depend on their services. Perhaps the approach will yield those ideas, as a $1 billion open-ended grant program will surely receive numerous proposals.   However, it remains to be seen whether these projects will yield the kind of results that the White House is looking for.