The Centers for Medicare and Medicaid Services (CMS) announced on October 11 that 37 states and the District of Columbia have submitted letters of intent to participate in pilot programs to test new payment and service delivery models designed to coordinate care for Medicare/Medicaid “dual eligibles.”  CMS asked state Medicaid directors on July 8 to provide letters of intent by October 1. CMS will test a new capitation model, using a three-way contract among states, CMS, and health plans to offer integrated Medicare-Medicaid benefits to such individuals. CMS will also test a “managed fee-for-service” model under which states will coordinate care for dual eligibles across both programs in exchange for incentive payments from CMS to achieve Medicare savings and quality of care goals. Dual eligibles are only 16 percent of Medicare beneficiaries but they represent 27 percent of Medicare expenditures and 39 percent of Medicaid expenditures due to their often complex medical conditions and the fragmented service delivery that they often endure. The CMS announcement on October 11 commends Massachusetts and Oklahoma as leaders in developing innovative approaches to integrate acute care, behavioral health, and long-term services and supports for this vulnerable population. States will be working intensively over the next several months to develop and launch pilot programs to better serve these individuals.