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RTI International Report Finds that the SIM2 Initiative Transformed States’ Healthcare Systems and Yielded Favorable Impacts on Spending and Utilization

RESEARCH TRIANGLE PARK, N.C. — The RTI International, a nonprofit research institute, led report to the Centers for Medicare & Medicaid Services (CMS) evaluating the federally-funded Round 2 State Innovation Models (SIM2) Initiative found that states were largely successful changing health care delivery and improving health outcomes.

CMS awarded over 600 million dollars to 11 states—Colorado, Connecticut, Delaware, Idaho, Iowa, Michigan, New York, Ohio, Rhode Island, Tennessee, and Washington—to test innovative health care models between 2015 and 2020. The focus of these models was to transform states’ health care systems to incentivize better care and lower costs.

The SIM Initiative provided a unique opportunity for states to create and test novel strategies adapted to their state context and population needs.

“The states were essentially test laboratories to try new innovations that best fit their unique contexts – some building on years of prior healthcare transformation work and others with almost no prior work in this area,” according to Anupa Bir, the vice president of Comprehensive Health Innovation, Research and Policy division at RTI who served as project director.

The report evaluated how the states implemented delivery and payment reform activities and rigorously analyzed the impacts of these activities through a synthesis of in-depth interviews and focus groups with stakeholders and analysis of claims data.

The evaluation found that, overall, states increased the use of value-based payment (VBP) models, particularly in Medicaid, often through mandating these arrangements in managed care contracts. Although the initiative was designed as a multi-payer intervention, most states faced challenges with advancing specific models or measuring progress from multiple payers.

States invested in primary care transformation and behavioral health integration to increase access and provide more holistic care for patients. SIM funds supported technical assistance, care coordination payments, health information technology, and expanded clinical staff and community health workers. Stakeholders reported that SIM-funded programs promoted early identification of diseases, greater screening and referral, and improved integration or coordination between providers.

Most states sought to improve primary care through technical assistance to primary care providers, enhanced payment to practices that were patient-centered medical homes, or both. In many states, the evaluation found favorable impacts including reductions in spending and emergency department visits relative to comparison groups.  For example, total spending decreased by $73 per beneficiary per month more for those served by practices in Delaware’s Practice Transformation Initiative relative to the comparison group.

The study also found promising results related to emergency department and primary care use. In the quantitative analyses, 3 of the 6 states that implemented primary care models and 2 of the 3 states that implemented behavioral health integration models showed a decline in emergency department visits relative to comparison groups. Several states also showed an increase in primary care visits relative to comparison groups.

“Overall, the claims analyses reflect lower costs and more efficient utilization of health care services among participants in these models,” according to Dr. Sabina Gandhi, a senior economist at RTI who served as the deputy director of the evaluation.

Capitalizing on the flexibility of the SIM Initiative, some states used funds to build population health infrastructures to address health-related social needs at the community and patient level. In some states, this included systems for identification, screening, and referral of patients with high needs.

Stakeholders made clear that population health initiatives were highly valued, provided a bridge for patients between providers, and helped fill some gaps in care.  

As more states continue to look for effective ways to reduce health care costs and improve population health outcomes, the RTI evaluation team hopes that the report can inform policymakers with key state examples for advancing new payment models and supports for improved care delivery.

The SIM Initiative evaluation team included the Urban Institute, The Henne Group, and the National Academy for State Health Policy. The evaluation was led by Dr. Anupa Bir with Dr. Sabina Gandhi, Stephanie Kissam, and Dr. Joy Piontak serving as deputy directors.

To access the full report, including more information on states’ implementation successes, challenges, stakeholder responses, and impact analyses of specific delivery and payment models: Report and Appendix.

This work builds on prior RTI International-led evaluation findings from Round 1 SIM (SIM1) Initiative. To learn more about RTI’s involvement in CMS’ State Innovation Models Initiative, visit: https://www.rti.org/impact/state-innovation-models-impact