How Did They Decide to Award the $1B?

June 27, 2012

Grant writing is competitive. The greatest stakes are at the federal level where the awards are the largest and the competition is most fierce. Proposals I often find myself working on involve community healthcare which means coordinating between multiple entities such as community clinics, FQHCs, hospitals and community based organizations (CBOs). A substantial funding pie was divided into 107 slices this month as the CMS Innovation Center (created as part of the Affordable Care Act announced the awardees for the $1 billion Innovation Challenge competition. The program was well received by the national healthcare community involved with Medicare and especially Medicaid services. Approximately 3,000 proposals were received in a very tight 60 day window between November 2011 and January 2012 during the busiest holidays of the year. There’s a challenge! The ambitious timetable for processing and evaluating the avalanche of proposals in March was predictably extended another 90 days. Seventeen California proposals comprised the largest number of awardees among the 52 states, Puerto Rico and one site “not geographically defined.” Massachusetts and New York were next with 12 awards each.

An essential step in the grantsmanship process is to analyze how awards were funded, especially when your proposal is not funded. We know the odds of winning for the entire pool were 3.6%. However, with ~16% of all awards coming to our home state we wonder what the odds were for California. The CMS team provided comments by the evaluation group that reviewed our proposal which were helpful. We learned our Financial Plan was just fine. The Financial Plan had presented the greatest “challenge” to our team as specific formats were required that involved novel – albeit logical – calculations, i.e., cost per beneficiary per year.

I have prepared the following analysis of awards made in California using my own metrics for what I consider important. Congratulations to the winners.

BUDGET: The FOA suggested budgets no smaller than $1M and not greater than $30M in total over three years. Our proposal requested $12.7M in support. Compared to the 17 CA awards our budget was 6th largest. The average budget was $8.5M; the median was $7.3M. Eight of the 17 CA awardees were budgeted above $10M.

SAVINGS VS EXPENSES: The challenge in the Innovation Challenge was to propose a project that would increase Medicaid enrollments without increasing Medicaid spending. The net effect would be to accommodate the 14 million new Medicaid enrollees in 2014 without breaking the bank. Note that this post precedes the pending Supreme Court ruling regarding the Affordable Care Act. [editorial moment: It is this writer’s opinion that the court’s ruling will not alter the inevitable course towards universal coverage of all citizens, therefore, the projects proposed under this Innovation Challenge are here to stay.] The review committees compared the expected savings to the stated costs (the requested amount). It seems clear the review committees wanted to see plenty of savings for each dollar spent. The savings to expenses ratio for our proposal was 68.92% which was 15th smallest. The greatest savings ratio was 471.98% or approximately $5 in savings for each dollar requested in support. This incredible figure was proposed by a multi-state proposal that will create 43 new hires and train 155 workers. The CA proposal most similar to our own in terms of “numbers” – which was funded – had the 2nd highest savings ratio at 364%. The average was 144% and the median was 127%. Six awardees proposed to return $2 or greater for every $1 spent. Five of those six awardees budgeted more than $10M.

NEW HIRES: The first item under the FOA section titled Key Attributes (for the proposal to be prepared) was Workforce Deployment and Deployment. We rated jobs creation a high priority. We proposed to create 54 new hires which placed our proposal 5th among CA awardees. The largest number of new hires was 211. The average number of new hires was 45. The median for new hires was 27.

COST PER HIRE:
We thought this figure would be important to the reviewers. Our cost per hire was $224,147 which was in the middle of the pack. The median was $212,731.

TRAINEES: We considered trainees to be secondary to new hires. Our proposal to train 20 currently hired Community Health Workers was close to the bottom, ranking 15th. The proposal with the largest number of projected trainees was an impressive 10,926; also by a multi-state consortium that included California. The average was 683. The median was 60. A statewide multiple partner group including SEIU and LA CARE will train 6,900 workers without creating any new hires.

The Innovation Challenge is a good initiative. It addresses real-world high-priority “challenges” that threaten to collapse our healthcare system. We expect similar initiatives will be forthcoming no matter the election outcomes. Our healthcare system is that severely hamstrung. One of the benefits in preparing a wide-reaching proposal like this one is the likelihood that project features will be recycled in forthcoming projects. Our consortium of 13 community clinics and three hospitals proposed to train a new cohort of Community Health Workers to work with current and soon-to-be Medi-Cal enrollees. Among the principle goals was to reduce visits to Emergency Departments for non-emergent illnesses; a change that MUST take place. A unique feature in our proposal was that we actually created a curriculum that could be offered through a California State campus to certify the new workers.

Reduction of costly and needless ED visits is not going away anytime soon. Training people from the community in standard ways to help patients navigate our complicated health system is a good plan that extends an established approach. I am confident these ideas, backed with cell phone healthcare applications, will find their way into another proposal seeking to help solve a persistent challenge.

Your comments or questions about this process are welcomed.

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