The Center for Medicare and Medicaid Innovation ("CMMI") is set to reshape value-based care. In the second of a three-part series highlighting this new direction, this summary is focused on CMMI's efforts regarding digital health and artificial intelligence ("AI").
As discussed in more detail in our first Alert, CMMI has signaled a new direction for value-based care in its May 13, 2025, white paper, "CMS Innovation Center Strategy to Make America Healthy Again." The new strategy relies heavily upon the expansion of digital health opportunities, the implementation of AI technology, and a particular focus on new technology for value-based care organizations, such as accountable care organizations and other alternatives.
Statements from Centers for Medicare & Medicaid Services ("CMS") Administrator Dr. Mehmet Oz and CMMI Director Abe Sutton, and a corresponding public request for information ("RFI") on digital health, further highlight the critical role of digital health tools and AI in driving two of the strategy's foundational pillars: empowering achievement of health goals and protecting federal taxpayers. The CMMI materials highlight a number of changes in CMMI's approach to digital technology:
- Expansion of Virtual Care: As a key component of plans to empower patients, CMMI emphasizes patient freedom in choosing the form of care and states that future models will expand the scope of virtual care.
- Mobile Applications: As another element of patient empowerment, CMS is focused on the use of mobile applications, including health and care management apps, and is seeking input on whether certification of specific health-focused applications and inclusion of such applications in Medicare may be appropriate.
- AI's Role in Expanding Care: CMMI Director Sutton specifically highlighted that AI can and should be utilized to "massively increase our supply of health care" and plans to create a clearer pathway to reimbursement for AI technologies and devices.
- AI Regulation: Sutton simultaneously cautioned that AI systems, such as scribes and billing technology, may increase health care costs by allowing providers to capture more services and noted the need for "targeted reform" and focus on technologies that both increase the supply of health care and lower costs.
Overall, CMMI and CMS have signaled an expansion of digital health technology in federal health care programs is to come, with a particular focus on innovation in this space. Comments in response to the RFI are due on June 16, 2025.
