CMS State Innovation Model (SIM) Test Award - Tennessee

Program Location: 
Nashville, TN
Payer Type: 

As a result of the SIM design process, stakeholders agreed to move forward on multiple PCMH strategy elements, as detailed in Tennessee's Health Care Innovation Plan. Tennessee’s major payers have agreed to a charter on population-based models. The initiative will seek SIM grant funding to launch a multi-payer PCMH project with providers in one or two geographic areas in Tennessee, expanding to additional areas if successful. Following a thorough review of outcomes-based health care reform strategies and with the input of Tennessee stakeholders, the initiative will pursue three payment and delivery system reform strategies that together will comprehensively transform the health care payment and delivery system:

  • expansion and alignment of patient-centered medical homes and other population-based models to reward health care providers who care for their patients on an ongoing basis, promote prevention, treat chronic conditions, and coordinate care over time;
  • episode-based payment that rewards providers for delivering high-quality and efficient care for an acute health care event;
  • payment and delivery system reform to address the specific needs of populations that require long term services and supports. 

For more information, see the Tennessee project narrative.

Payment Model: 

Providers will be rewarded for delivering high-quality, evidence-informed, coordinated and efficient care. Payers will reward outcomes rather than volume of services. Through implementation of this State Health Care Innovation Plan, the state anticipates cost avoidance of approximately $1.1 billion after delivery system reinvestments during the three-year grant period across the health care system compared with baseline projections, and cost avoidance of approximately $7.7 billion versus baseline in the period through 2020. Three-year projections include cost avoidance of $385 million to Medicaid and $323 million to Medicare after reinvestments.

Last updated June 2015
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