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Letter to Marilyn Tavenner, Acting Administrator of the Centers for Medicare and Medicaid Services


Location: Washington, DC

A program providing home-based health care for the most chronically-ill veterans, saved the Veterans' Affairs Department more than 24 percent on the overall cost of caring for those patients, yet a similar program scheduled to be tested as part of Medicare has largely gone ignored by the Centers for Medicare and Medicaid Services (CMS).

The Independence at Home pilot program -- originally authored by U.S. Senator Ron Wyden (D-Ore.) and U.S. Representative Edward J. Markey (D-Mass.) and passed into law as part of the Affordable Care Act -- is supposed to start in three weeks, yet CMS has yet to issue guidelines for the program making it impossible for interested providers to sign up to take part. Markey and Wyden today sent a letter to the new Acting CMS Administrator Marilyn Tavenner urging CMS to release guidelines as soon as possible.

Wyden and Markey have been pressing the administration to expand eligibility for the Independence at Home program in order to maximize its potential for Medicare savings, but as they state in their letter failure to give health care providers adequate time to sign up would set even the pilot program up for failure.

"This would be a disastrous outcome given that IAH utilizes a proven delivery model, which has been shown to dramatically improve patient care and satisfaction while significantly reducing costs for chronically ill individuals," Markey and Wyden wrote in the letter.


The Independence at Home pilot program will provide high quality home care for roughly 10,000 of the millions of Medicare patients suffering from multiple chronic diseases. Beneficiaries in this group are among the highest-cost segment of the entire Medicare population -- making up roughly 5-8 percent of beneficiaries but accounting for more than 50 percent of total Medicare costs -- because they suffer from multiple and costly chronic illnesses. As demonstrated by the VA program, better coordinating care for this group of patients not only results in better patient care, but substantial system wide savings. The VA program, for example, reduced costly hospital stays by 62 percent, nursing home days by 88 percent and overall costs by 24 percent.

Experts have argued that if applied to the entire Medicare population with multiple chronic conditions, an IAH program can result in significant savings and better health outcomes.

The full text of the letter follows:

Ms. Marilyn Tavenner
Acting Administrator
Centers for Medicare & Medicaid Services
Department of Health and Human Services
Baltimore, MD 21244-8013

Dear Ms. Tavenner:

We would like to extend our sincere congratulations on your nomination by President Obama to be the Administrator of the Centers for Medicare and Medicaid Services (CMS) and ask that you place a high priority on the implementation of Section 3024 of the Affordable Care Act, the Independence at Home (IAH) delivery model.

By law, the IAH must be operational by January 1, 2012. Yet with three weeks remaining in the year, CMS still has not released guidelines for providers that wish to apply for participation, much less indicate that this model should be expanded beyond the 10,000 beneficiaries limitation specified in statute. We are concerned that this significant delay may cause providers that have expressed interest in participating in IAH to apply for other shared savings programs. This would be a disastrous outcome given that IAH utilized a proven delivery model, which has been shown to dramatically improve patient care and satisfaction while significantly reducing costs for chronically ill individuals.

We believe IAH will be successful in lowering costs among the sickest, most expensive Medicare patients. IAH is targeted to serve a high-cost segment (5-8%) of Medicare beneficiaries who account for approximately 50% of Medicare costs and whose care is most emblematic of the fragmentation, unsafe practices and wastefulness under the current system. Furthermore, IAH can make a difference immediately because there are programs in every area of the country that can implement IAH with relatively little start up time or cost. And it is proven because the model has consistently reduced health care costs by %24-60% and produced better outcomes among Medicare, Medicare Advantage, Medicaid and private insurance patients in hundreds of programs operated for decades by the Department of Veterans Affairs, and numerous other health care practitioners and providers across the county.

In June 2011, we sent a letter to CMS (enclosed) laying out the criteria that we felt were necessary for IAH to succeed and were consistent with congressional intent. Dr. Berwick responded that they agency would take them into consideration as staff developed for the model. We reiterate our support for the inclusion of the design mentioned in that letter, and we would like to know when we can expect the release of guidelines for this much needed delivery model.

We appreciate the enormous task that you and the CMS staff face in transforming healthcare in this country from a fragmented system to one that encourages coordinated, patient-centered care. We feel that IAH has a vital role to play in that transformation, and we look forward to working with you to implement the model quickly so that is can benefit the seniors -- and the system -- that need it so urgently.

Sen. Ron Wyden Rep. Edward J. Markey

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