As we reported in the December 15 issue of OpenMedicaidIT News, Andrew Slavitt, Acting Administrator of CMS, has openly discussed the opportunity offered by CMS' open Medicaid IT strategy in multiple blog posts and meetings. We have reported on this opportunity in an article titled CMS To Invest $5+ Billion a Year in Open Source and Cloud-based IT Infrastructure for Medicaid and recently started a newsletter provide our readers with news of the opportunities for tech companies as they emerge. We reprint here the article from the newsletter presenting that opportunity in Slavitt’s own words.
Back in May Slavitt keynoted a forum in Silicon Valley where leading representatives of high tech companies met with federal and state Medicaid for an open discussion on how to modernize Medicaid’s IT infrastructure. In a blog post Slavitt reported on the event:
Earlier this year, I announced a new effort to connect new, innovative companies and their investors to the state Medicaid program IT space. Since this announcement, I have been encouraged by the initial interest from companies that may not have otherwise ever thought about participating in this important health insurance program that covers more than 72 million Americans. That’s why I’m in Silicon Valley today to participate in a forum on bringing technological advances to Medicaid. The forum is convening states, innovative tech companies, and federal Medicaid officials on how to collaborate to improve the delivery of Medicaid health coverage in states.
These meetings will help in getting two very different cultures – state government and tech companies – speaking the same language and exploring opportunities to work together to continue to improve care delivery within Medicaid. While there are 56 different state, district, and territorial Medicaid programs, there is a lot of commonality in their IT needs. There is always new IT procurement and opportunities for new, innovative vendors in this space. This industry is primed for a new era — Software as a Service software– that has real time capabilities and requirements and Federal sponsorship for a 90 percent match on qualifying IT investments. Investment gravitates to needs and problems it can solve. There is no greater opportunity than bringing technical know-how, innovation and creativity to improve the health of Americans with health, social and economic challenges.
CMS is fully committed financially and operationally to partner with states and the private sector to improve state programs. The federal government alone invests more than $5 billion per year in Medicaid IT and matches up to 90 percent on new projects. Still, there may be some apprehension by IT companies – large or small, new or established – to engage in bidding for state government contracts. But, we’re working to tear down these barriers and taking it past the opportunity to make a new market.
Earlier in January Slavitt announced the new open Medicaid IT policy in this blog post. There he made the call for small, innovative, high tech companies to engaged with CMS in modernizing Medicaid. He stated:
Our new regulations require that states evolve their legacy Medicaid IT systems to leverage reusable solutions, and to practice industry-proven IT methods such as use of modularity, reuse, shared services (including Software-as-a-Service) by fundamentally shifting the financial incentives away from custom development. This opens opportunity to smaller vendors to develop focused solutions for use across multiple states or to introduce solutions from comparable sectors such as commercial insurance or large provider systems. We believe this approach will expedite states’ IT timelines, decrease overall costs, and ignite adoption of advanced technology solutions.
In that blog post, Slavitt presented three core reasons why “innovative companies and their investors” should “be attracted to the state Medicaid IT space.” Slavitt’s top reason:
The opportunity is big: Medicaid and the Children’s Health Insurance Program (CHIP) provide health coverage to nearly 72 million Americans, and are consistently growing as more states choose to expand coverage. With over 30 states currently redesigning their Medicaid eligibility and/or claims processing and information retrieval systems, 2016 will the most active year to date for Medicaid growth and new IT business prospects. CMS and states want to make the most of this opportunity. [emphasis in original]
Slavitt’s public statements help frame how OpenMedicaidIT News is going to provide critical knowledge to companies that want to take advantage of this extraordinary opportunity.