Financial Alignment Initiative for Medicare-Medicaid Enrollees

The Financial Alignment Initiative was designed to provide individuals dually enrolled for Medicare and Medicaid with a better care experience and to better align the financial incentives of the Medicare and Medicaid programs. Through the Initiative, CMS partnered with states to test two new models for their effectiveness in accomplishing these goals. This initiative was possible through the collaboration of the CMS Innovation Center and the CMS Medicare-Medicaid Coordination Office.
 

Background

Today there are over 12 million Americans enrolled in both the Medicare and Medicaid programs. The Financial Alignment Initiative sought to increase access to high quality, seamless systems of care that better coordinated benefits and services for the dually eligible enrollee population. 

Initiative Details

In 2011 CMS announced two new models to support care coordination for dually eligible individuals through the Financial Alignment Initiative. Through this initiative, CMS worked with States to test two models to integrate primary, acute, behavioral health and long-term services and supports for dually eligible individuals and better align the financing of the Medicare and Medicaid programs.

The two models were:

  • Capitated Model: A State, CMS, and a health plan enter into a three-way contract, and the plan received a prospective blended payment to provide comprehensive, coordinated care.
  • Managed Fee-for-Service Model: A State and CMS enter into an agreement by which the State would be eligible to benefit from savings resulting from initiatives designed to improve quality and reduce costs for both Medicare and Medicaid.

CMS also partnered with Minnesota to implement an alternative model testing Medicare and Medicaid administrative alignment activities, building on the longstanding Minnesota Senior Health Options program.

Participating States

When CMS approved a state proposal for a demonstration under the Financial Alignment Initiative, CMS and a State developed a Memorandum of Understanding (MOU) to establish the parameters of the demonstration prior to implementation. States which had an MOU are listed below:

Additional Information

Evaluation Reports

Savings Reports

Additional details of this initiative are found on the CMS.gov Financial Alignment Initiative home page run by the Medicare-Medicaid Coordination Office (MMCO)

 

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