How Tennessee’s Medicaid Program is Leading Statewide Payment Reform and Promoting High Value Care

Abstract

Tennessee is one of many U.S. states and territories that have received federal funding to design or test health care reform models under the State Innovation Models (SIM) Initiative sponsored by the Centers for Medicare and Medicaid Services (CMS).  As a grantee state, Tennessee has committed to improving health care value by reforming its delivery and payment systems.  This paper describes the Tennessee reform model and five key design and implementation factors that have contributed to early cost savings and improved value.  It also offers lessons learned that may be helpful to other states engaging in or planning for a similar reform.

Key Words:  Health care reform, organizational innovation, Medicaid, delivery of health care, value-based purchasing, health expenditures, health policy, state government.