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For Immediate Release: Wednesday, November 14, 2007
Contact: CMS Office of Public Affairs


Most people think about breakthroughs in biomedical science and information technology when they think about 21st Century medicine, and that’s certainly part of it.  Overall, however, health care in the 21st Century is about getting the right care to every person, every time. 


The right care for every person, every time, is a goal embodied in the Institute of Medicine’s (IOM) principles of quality health care—care that’s safe, effective, efficient, timely, and patient-centered.


The right care for every person, every time, is the goal of Secretary Leavitt’s Four Cornerstones of Value-Driven Health Care.  These are:  (1) being able to measure and compare quality and (2) cost; (3) a network of standardized, interoperable electronic health records, and (4) financial incentives to achieve the other three.


The right care for every person, every time, is the goal of the resolution you presented this morning, to promote evidence-based care; chronic disease management; better use of health information technology; prevention, and transparency.  All of the objectives in the NASMD resolution reinforce the IOM’s principles and the Four Cornerstones as well.  CMS and NASMD agree on these elements of 21st Century health care, and we need to work together to achieve them.  


We can’t talk about the federal role in isolation from states’ roles or vice versa when we’re talking about Medicaid.   Ours is a shared responsibility—the achievements and the challenges—and I want to talk about some important milestones we’ve recently cleared on the road we’re moving down together.

One of the most groundbreaking milestones is the one launched at this conference yesterday.  The National Quality Framework for Medicaid and SCHIP is new, joint effort by state Medicaid directors and CMS to extend the value-driven health care movement to Medicaid and The State Children’s Health Insurance Program (SCHIP).


The Framework’s goal: to develop a consensus-based, visionary, actionable, Medicaid Quality Framework.   It will incorporate the Institute of Medicine’s principles and the cornerstones of value-driven health care, with the objectives of the American Public Human Services Association/NASMD resolution.


The Framework will lay out the basic tenets of a comprehensive program to improve quality and increase the value of health care for people with Medicaid and SCHIP.  It will address care from birth through end-of-life and emphasize prevention and wellness, building on the experience of trailblazing states like Indiana, California, Michigan, New York and Louisiana, to name a few, with pay for performance, outcomes measurement, and IT information exchanges.   


The CMS point person on the Framework is Jean Moody-Williams.  She and her staff in the Center for Medicaid and State Operations are here today; I’ll hope you’ll try to find them and say hello.


Another milestone: $150 million in state Medicaid Transformation Grants—real money CMS is putting up to spur innovation and improve Medicaid services.   We think of this as venture capital to explore how to deliver health care more effectively and efficiently to people with Medicaid and one more opportunity to bring Medicaid into the 21st century.


From our vantage point, NASMD is investing well, with your new multi-state, 14 grantee collaboration on electronic health records and health information exchanges, supported by Transformation Grant funding.


CMS considers this to be a major, positive step forward in making interoperable electronic health records the normal course of health care business. We’re looking forward to seeing your joint requests for proposals, and we’ve been pleased to hear you’re drawing the interest of other states as well. 


One more challenge the federal government and the states face together is how to meet Americans’ growing need for long-term care.


We reached an important milestone toward accomplishing that goal with the President’s New Freedom Initiative.  We took a very important step to rebalance Medicaid and truly focus it on the people it serves, with the signing of the Deficit Reduction Act (DRA) two years ago.


The range of New Freedom Initiative programs--including Real Choice Systems Change grants, Direct Service Worker grants, Medicaid Infrastructure grants and the Demonstration to Maintain Independence in Employment—have moved us closer to the day when people with disabilities will have real opportunities to live, learn and work as full members of the community. 

The DRA dramatically expanded community services with new funding for self-directed home and community based services, new support for long-term care insurance, and new demonstrations to gain experience with “person-centered” long-term support systems that enable people to retain their independence.

One of these changes: $1.75 billion in competitive grants to enhance the federal match rate for Money Follows the Person.  This will provide the foundation for flexible financing for long-term services, and let financial assistance and other support change with a person’s long-term care needs. 

Now states have greater control over both the design and the administration of their Medicaid programs. No longer do you have to get federal approval to waive Medicaid rules before you can upgrade your state plan. 


You don’t have to prove that someone needed an “institutional level” of care in order to offer that person community-based services.  Now, services can be based on a person’s functional need and the bar for entry into an institution is higher. 

You aren’t limited to a psychiatric residential treatment facility when placing a child who needs mental health services. The DRA offers new support for home and community-based alternatives so families can stay together.

And, you no longer need to take the extra step of an 1115 demonstration waiver to offer self-directed care.  Moreover, family members, friends, and health care professionals now may help to create individualized plans and budgets that will give people with disabilities greater opportunities to control their own lives.

But we need to work together to transform long-term care funding as well.  Despite our progress rebalancing Medicaid from institutional to community-based care, it is still the largest public source of funding for long-term care in the United States.


Long-term care financing is really the “elephant in the middle of the room.”  There’s a widespread misconception that Medicare pays for long-term care.  As you are acutely aware, it does not. 


In 2004, Medicaid paid for 49 percent of the total amount spent on long-term care services in the United States, and institutionally-based care still accounts for 70 percent of long-term care spending in Medicaid nationwide.

The DRA included $15 million in new funding over five years for the National Clearinghouse for Long-Term Care Information.   CMS already has joined governors in sixteen states to encourage people between the ages of 45 and 65 to plan ahead for their long-term care needs with the Own Your Future Campaign.   

We can’t achieve any innovations in Medicaid unless people who can afford to plan ahead for their long-term care needs.  Better long-term care planning not only means less pressure on Medicaid, but more importantly, more people will have the ability to choose the long-term care services and care settings that are best for them. 


I want to say a few words about program integrity, and the importance of working together on this. 


We believe in the integrity of our programs and we want them to work.  When considering fraud and abuse reduction efforts in the Medicaid program, it is critical to remember that this is a joint Federal-state effort and both levels of government have people and systems devoted to preventing and addressing fraud. 


The Medicare-Medicaid—Medi-Medi—data matching program is now in ten key states and soon will be expanded nationwide.  Medi-Medi has referred over 50 cases to law enforcement.  As much as $15 million in overpayments have been referred for collection, and $25 million in improper payments have been denied before payment was made. 


On the tamper-proof prescription pad law, we’ve listened to your concerns, staggering implementation and working to be flexible where the legislation allows us to be.  For example, CMS guidance now allows emergency fills as long as a prescriber provides a verbal, faxed, electronic, or compliant written prescription within 72 hours.  This allows the patient to leave the pharmacy with an emergency fill, and the pharmacy time to follow up with the prescriber to get the documentation it needs.  


However, we need your help reaching out to doctors and pharmacists now, so they will be ready for the first phase of implementation next spring.


Finally, I want to assure you that as part of CMS’s commitment to program integrity, promoting transparency begins with us.   One of the small, but important changes we’ve made since I took this job has been that we’re now making major announcements before the close of business.  It’s something we need to do if we want our partners to continue to work with us to make 21st Century health care the best it can be.


I want to close by expressing CMS’s appreciation for Medicaid directors’ open door policies, and to let you know that we value your perspective. 


Effectively serving over 50 million people covered by Medicaid and SCHIP demands open lines of communication, and we at CMS value your willingness to work with us on the issues that matter to them.


A brief word about SCHIP:  The Continuing Resolution assures SCHIP funding through December 14, and we are committed to working with you to make sure that state funding levels are right.


State Medicaid agencies have often led the way in exploring innovative methods of improving quality for the nation’s most vulnerable populations.  You’ve done it with home and community based services, with long-term care financing, and with health information technology.  You can continue to lead with value-driven health care.  


So much is changing in Medicaid now, and I am looking forward to working with you to make sure it is positive change.


Thank you again for the opportunity to be here today.




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