CMS just announced a $3m gift for longevity and functional medicine

Hot off the press! The Centers for Medicare and Medicaid just announced a new model - called Elevate - as part of the Make America Healthy Again (“MAHA”) agenda.

What we know so far:

• CMS will make available $100 million of total funding for up to 30 disease prevention and health promotion pilot projects.
• These projects must not already be covered by Original Medicare.
• The programs must be evidence-based and cover “whole person” care and then assess the data related to cost, quality, impact and scalability for older populations.
• Each pilot will get up to $3 million over three years.
• All proposals must incorporate nutrition assistance or physical activity as part of the design.
• Cooperative agreement funds can be used to support hiring dieticians and nutritionists or for nutrition counseling and classes, but not for purchasing food.

Bottom line: Countless companies in digital health could potentially quality, inclusive of all the players in the nutrition category, those in functional medicine and also in longevity. It’s a gift for an industry that has struggled to find reimbursement sources for prevention, particularly in Medicare where the impact can be massive if an intervention can reach a senior in the mid-sixties and seventies before they become vulnerable and chronically ill.

What we don’t know: How CMS will define “whole person” care, as well as the requirements around how this data will be tracked are an open question. What is clear is that it must be used for services that Original Medicare does not cover, and must be backed by evidence.

What else: This is particularly important for venture-backed early-stage companies that need every penny they can get to extend their runway. $1 million a year is significant. And there could be potential for more funds, assuming the pilots go well.

Keep an eye out for CMS to issue a Notice of Funding Opportunity in February. Companies can submit multiple applications, according to the FAQ released by CMS. CMS has said that companies that submit applications must include scientific evidence to prove that these programs do, in fact, work. Follow along for more policy updates.

A smart take: “Because Medicare is a statutory benefit program that only advances as Congress moves the needle incrementally forward, the way the program approaches “whole person health” is really decades behind. Services like health coaching, health education, and nutrition support are evidence-based approaches to lowering the cost of care, but pathways to cover and pay for these services through Medicare are clunky and limited (think limited chronic care management codes),” said Manatt’s Ross Margulies. We know already that these evidence-based lifestyle approaches work – and dozens and dozens of innovative (and often tech-enabled) companies are already delivering these services. These pilots will offer the opportunity to really cement this evidence-based and the limited nature of the model suggests to me that CMS would be open to future expansion, including permanent coverage of some of these services.”

More information is available as of today on the MAHA ELEVATE.

I’ll keep you updated at Second Opinion, and any investors, entrepreneurs and operators reading: I’d love your take! I’ll share a more extended analysis on how operators, legal experts and funders are thinking about this new program for any premium subscribers. To read more about another CMS model, the ACCESS program, check out our prior coverage.

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