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Senator Calls on HHS to Refine Financial Alignment Initiative

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Senator Calls on HHS to Refine Financial Alignment Initiative

July 19, 2012

In a letter dated July 10, Senator John Rockefeller (D-WV) calls on U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sibelius to halt the capitated model of the Financial Alignment Initiative (FAI) so that it may be reevaluated and redesigned to meet the standards outlined in the Affordable Care Act.

One provision of the ACA is the creation of a Federal Coordinated Health Care Office, whose purpose is to more effectively integrate benefits for individuals with disabilities and seniors who are dually eligible for Medicare and Medicaid. One of the initiatives the office has launched is the FAI, which is comprised of two test models that states can use to better align the financing of care for dual eligibles.

One of the two models, the capitated model, is set up as a three-way contract between a state, the Centers for Medicare & Medicaid Services, and a health plan, in which the plan receives a prospective blended payment to provide comprehensive, coordinated care.

Rockefeller is concerned that this model, as currently structured, counters the intent of the ACA, in that it may:

  • Prioritize cost-savings over quality of care;
  • Be used as a model for all dual eligibles within a state rather than being used as a test demonstration, which could result in ambiguous conclusions about whether it is a useful vehicle to deliver quality care; and
  • Dilute the rights and choices of Medicare beneficiaries by restricting their ability to choose to not participate in this demonstration.

Rockefeller concludes the letter by urging Sebelius to "reject state proposals that are not designed as careful pilots, to assure full protection of beneficiaries' rights and access to high quality medical care and to thoroughly evaluate the effectiveness of new models of care before expanding them on a larger scale."