HHS sees Health Care Innovation Awards leading to savings

(Story updated with additional comments at 3:30 p.m. ET.)

A program to hire critical-care professionals to work in underserved areas in Georgia, a project to improve services for Rhode Island mothers who give birth to pre-term babies, and a plan to train paramedics and telehealth technicians to provide care for cardiovascular patients in Colorado are among the recipients of the first round of Health Care Innovation Awards that HHS announced Tuesday.

The CMS Innovation Center will administer the awards, which were created by the Patient Protection and Affordable Care Act and will provide up to $1 billion in grants to applicants who present the best ideas on how to deliver better care and lower costs for people enrolled in the Medicare, Medicaid and Children's Health Insurance Programs. This first set of 26 awards total $122.6 million, and HHS expects these projects will lower healthcare spending by $254 million over the next three years.

During a call with reporters, Dr. Rick Gilfillan, director of the CMS Innovation Center, said the size of the awards were based on both the scope and function of the proposed projects. And while some of these programs are expected to yield savings that will cover the cost of their project's interventions early on, others showed “savings in the third year and ongoing after that,” Gilfillan said.

HHS Secretary Kathleen Sebelius said HHS received more than 2,000 applications for the Health Care Innovation Awards, and that the selected projects will affect nearly 750,000 patients. “Our hope is that the most successful projects will become models for the rest of the country,” Sebelius said.

Meanwhile, the projects are expected either to hire or retrain “several thousand” workers, according to Gilfillan, who later said HHS will announce a second and final set of awards under this program in June.