CMMI: A Costly Failed Experiment in Government-Run Healthcare

Background

The Centers for Medicare and Medicaid Innovation (CMMI) was established in the Affordable Care Act (ACA or Obamacare) in 2010. It was supposed to test and create new models to save money and improve healthcare quality in Medicare, Medicaid, and the Children’s Health Insurance Program, but instead has cost taxpayers money and failed to help patients or generate savings.

CMMI is a case study in government inefficiency, waste and bureaucratic overreach into personal healthcare decisions. The program burns through hard-earned taxpayer dollars and fails to deliver on the unattainable promises made by its big-government proponents.

CMMI has repeatedly pursued sweeping nationwide policy changes instead of the limited tests that are supposed to be performed in its demonstrations and models. These projects have no accountability to Congress or taxpayers and often serve partisan objectives that only benefit special interests. This unchecked power takes decision making away from healthcare providers and patients.

CMMI’s only “success” has been to increase government control over healthcare. For the sake of American patients, seniors, families and taxpayers, this costly and wasteful program must end.

CMMI is Classic Big Government Waste

A September 2023 Congressional Budget Office (CBO) study found that instead of saving an initially projected $2.8 billion between 2011 and 2020, CMMI cost American taxpayers $5.4 billion. CMMI created more than 50 models for 28 million patients and more than 528,000 healthcare providers, only six of which did not increase spending or reduce the quality of healthcare. The remaining programs were not only costly but also created significant administrative and legal burdens for doctors and healthcare systems.

CBO’s projection for 2021-2030 shows another $1.3 billion will be lost, and that is likely a low estimate since it is based on efficiency improvements that CMMI has never been able to achieve.

Under the ACA, CMMI gets $10 billion in mandatory funding every decade. This unaccountable slush fund has consistently failed to achieve its objectives. And the reported losses are likely higher since CMMI does not calculate the administrative burdens its policies place on healthcare providers.

CMMI’s Past Failures and Concerning New Direction

In March 2025, CMMI was forced to terminate four failed models that could not be fixed: Primary Care First (PCF), Making Care Primary (MCP), End Renal Stage Disease Treatment Choice (ETC), and Maryland Total Cost of Care (TOC).

While these models are being repealed, others are still wreaking havoc, and several new CMMI initiatives are raising even more concerns. The new models are intentionally complex and structured in ways financially favorable to special interests. And these new one-size-fits-all programs are designed to sideline private sector alternatives and innovations at the expense of patients and taxpayers.

CMMI has taken another intrusive step encroaching on patient and provider choices. Effective January 1, 2026, there will be significant levels of prior authorization for Medicare fee-for-service patients in six states under a new Wasteful and Inappropriate Service Reduction (WISeR) model. Treatments for Parkinson’s disease, sleep apnea, arthritic knees, and incontinence are on the list that will require bureaucratic “prior authorization.”

Support for Accountability

Lawmakers and leading health policy voices have called out the lack of accountability and lack of transparency in CMMI’s operations:

“There’s no question CMMI lacks transparency. Worse, since its creation, it has failed to improve Medicare and Medicaid for beneficiaries.” – Rep. Adrian Smith (R-Neb.)

“Created under ObamaCare, CMMI has been allowed to operate and increase direct spending by billions of taxpayer dollars a year without congressional approval or any meaningful oversight for far too long.” – Rep. Vern Buchanan (R-Fla.)

“Although CMMI has disappointed expectations, it continues to wield broad powers. It can create programs that are unlimited in duration and unbounded in scope. Congress has, in effect, invested legislative authority in CMMI” – National Taxpayers Union

“... [We] don’t need [more] bureaucratic micromanagement cloaked under the mantle of innovation. Which is why Congress should do away … with the Center [sic] for Medicare and Medicaid Innovation.” – James Capretta, American Enterprise Institute

Government Intervention Should Be Replaced with Private Sector Innovation

CMMI project spending should be suspended, and all current and planned models and demonstrations should be re-assessed to determine their impact on patients, healthcare providers and taxpayers, like the Trump administration has done with other agencies.

Congress should conduct additional oversight hearings and provide the evidence needed to eliminate or modify the program, including clear guardrails with patient protections, increased oversight, accountability, and transparency, and clarification of CMMI’s authority and operations.