U.s. Health Care Policy

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Issue In 2014, the U.S. health care spending increased 5.3% to $3.0 trillion, or $9,523 per person, a faster increase than the 2.9% in 2013. The spending increased due to extensive coverage expansions under the Affordable Care Act (ACA) (Centers for Medicare & Medicaid Services, 2014b). In 2014, Medicare spending grew 5.5% to $618.7 billion and represented 20% of the national health expenditure, a faster increase than the 3% growth in 2013. The spending increased due to prescription drugs, physician and clinical services, government administration, and insurance (Centers for Medicare & Medicaid Services, 2014b). In 2014, Medicaid spending grew 11% to $495.8 billion and represented 16% of the national health expenditures, a faster increase…show more content…
The overall goal of Financial Alignment Initiative or two Financial Alignment Demonstration (FAD) models is to develop, test, and validate fully integrated delivery system and care coordination models that can be applied in other States (Centers for Medicare & Medicaid Services, 2011b). The first model to integrate Medicare and Medicaid dual eligible beneficiaries is the capitated model. The second model to integrate Medicare and Medicaid dual eligible beneficiaries is the managed fee-for-service (FFS). Under the capitated model, a State, CMS, and a participating health plan enter into a three-way contract, and the health plan receives prospective capitation payments to provide comprehensive and coordinated care. Under the managed FFS model, CMS and a state enter into a contract, which the state would gain from savings resulting from the initiatives that improve quality and decrease costs for both Medicare and Medicaid (Centers for Medicare & Medicaid Services, 2011b). On May 30, 2012, twenty-six states submitted proposals to CMS Financial
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