The center has been controversial because of its authority to conduct demonstration project that waive any applicable Medicare law. Some have argument that this is an unconstitutional delegation of authority from Congress to an agency. Others have raised concerns that a "demonstration project" is not defined and could be of nearly unlimited scope and duration. On September 29l, 2016, several dozen members of Congress wrote the current (outgoing) head of CMS that they had serious concerns about the behavior of CMMI (here).
See also a November 2016 21-page white paper from the Healthcare Leadership Council on "Accountable Innovation: Reforms to Strengthen and Sustain the CMMI." White paper here. With HLC funding, the white paper was created by the consultancy Xcenda, a division of AmerisourceBergen.
Subscription coverage at Pink Sheet, November 21, here.
One of the most unusual aspects of CMMI policy is the way neither supporters nor opponents have squarely faced the way its enabling authority is written. This is a special section of SSA statute at 115A (here). Section (a) creates the CMMI. Section (b) gives it authority to "test delivery and payment models" for "where there is evidence" that for a "defined population" there are "poor clinical outcomes or avoidable expenditures." Then, CMMI "shall focus on" test models that reduce program costs while preserving or enhancing care. There follow 20 possible topics for CMMI, although it is not restricted to this topic list. In Section (c), CMMI may extend the tested models to permanent status by rulemaking, IF the model was shown to preserve quality with equal or lower costs.
Finally, and here is the kicker, Section (d) gives CMMI the "authority to waive requirements" of law (Medicaid Title XI or CMS Title XVIII) "as necessary SOLELY for the purpose of carrying out this section WITH RESPECT TO testing models in Subsection (b)."
In plain English, this appears to restrict CMS waivers of other Medicare laws solely to "test projects." This is why the waivers apply "solely to subsection (b)" and not to extensions under subsection (c). You could even argue that section (b) and (c) are separate sections to allow Congress to designate that section (d) applies only to section (b).
The Healthcare Leadership Council shares my reading, stating on page 15, "A plain reading of the CMMI statute suggests the ability to waive provisions of the law only applies when CMMI is testing models." (PDF here).The simple interpretation is reasonable. First, CMS can alter programs in many ways without changing statute; it issues thousands of pages of rulemaking per year to do so already. CMMI was given authority to run test promising programs that do or don't require a waiver of some existing law. Then, CMS can make permanent on its own recognizance those test programs that don't require a waiver of law. When CMS finds something valuable during a test, but it requires permanently changing Medicare law, CMS can't waive that law permanently, but presumably Congress would be happy to do so in its annual Medicare fix bills.
Opponents of CMMI don't cite the interaction of sections (b), (c), and (d) because they often want to portray CMMI has have unconstitutionally broad powers, powers that would not be so unusual if limited only to demo programs ("solely for testing models in subsection (b)").
Proponents of CMMI also don't cite its limited ability to waive law, and in fact, CMS in November 2016 used rulemaking to make a demo program permanent, and explicitly under subsection (c), and explicitly waiving two existing laws permanently through its authority to waive law at (d).
Aware of objections that it can only waive law for demo programs, in November 2016, CMS stated that its written authority to waive law in demo programs (and "SOLELY" in demo programs) implied the authority to waive the same laws permanently (see 81 Fed Reg 80463, November 15, 2016.) While CMS has taken that stance for now, it is less clear it would hold up under further challenge since it seems so inconsistent with the plain language of its waiver authority (d). If Congress had had the intention inferred by CMS (for the waiver authority to apply to both (b) and (c)), Congress could have used vastly clearly language than restricting waiver authority solely to (b). Even allowing CMS's current interpretation, it's less clear that Congress originally would have or even could have given CMS authority to waive any Medicare law, anywhere, for any length of time, and its own discretion.