CMS has announced the creation of the Medicare-Medicaid Accountable Care Organization (ACO) model, aiming to improve care coordination for beneficiaries who are enrolled in both programs.

In current CMS models, like the Medicare Shared Savings Program, dual-eligible beneficiaries can be attributed to ACOs, but often don’t have financial accountability for their Medicaid expenditures. The new model will allow ACOs to be accountable for both Medicare and Medicaid costs for this population’s care.

“This model aims to provide improved care coordination for those enrolled in both Medicare and Medicaid, allowing providers to focus more on providing care for their patients rather than administrative work,” said Patrick Conway, MD, CMS acting principal deputy administrator and chief medical officer. “CMS continues to partner with and leverage the best ideas from states to transform our health care system to improve quality and care coordination. In the long run, this partnership will result in healthier people and smarter spending.”

The first step to implementing the model is asking states to submit letters of intent to CMS. Up to six states will be chosen and then applications will be accepted from ACOs and provider in those states.

States will be able to choose when the first performance period begins, opting to start in 2018, 2019 or 2020. For those which want to jump in as soon as possible, letters of intent will be due by Jan. 20, 2017.