House committee substitute makes the following changes to the 1st edition:

Changes the short and long titles. 

Sets out intent and goals of the General Assembly to transform the state's Medicaid program from a traditional fee-for-service system into a system that provides budget predictability for the taxpayers of this state while ensuring quality care is provided. Sets out six goals the system should be designed to achieve, including slowing the rate of cost growth and improving health outcomes for the state's Medicaid population.

Sets out four building blocks of the Medicaid transformation, including a delivery system that builds upon the state's primary care medical home model and strong performance measures and metrics to hold providers accountable for quality.

Directs the Department of Health and Human Services (DHHS), Division of Medical Assistance (Division), to lead and begin the statewide restructuring of the state Medicaid program by transitioning the traditional fee-for-service system into a system of provider-led capitated health plans. Requires the new system to meet the above specified goals and integrate the building blocks.

Directs the Division to integrate stakeholder input into the development of a detailed plan for the Medicaid transformation and requires providing for a phased-in implementation of changes to the Medicaid system that must include five items, including proposed time frames for system transformation on a phased-in basis, with recommended effective dates, and proposed legislation that makes the necessary amendments to the General Statutes to enact the recommended changes.

Requires the Division to report the plan to the General Assembly by March 1, 2015. If a detailed plan cannot be reasonably completed by that date then the Division must (1) inform report recipients by February 1, 2015, that the March 1 report will be a progress report only and (2) provide by March 1, 2015, an update on the progress made toward completing the plan, and report which portions of the plan have been completed. The report/update is to be submitted to the House Appropriations Subcommittee on Health and Human Services, the Senate Appropriations Committee on Health and Human Services, and the Fiscal Research Division.

Beginning September 1, 2015, and every six months thereafter, until a final report on September 1, 2020, the DHHS Secretary must report to the Joint Legislative Oversight Committee on Health and Human Services on the State's progress toward completing the Medicaid transformation.

Directs the Division to work with the Centers for Medicare and Medicaid Services (CMS) to maintain existing Medicaid-specific funding streams. If not possible, then the Division must advise the General Assembly of necessary modifications to maintain as much revenue as possible within the context of Medicaid transformation. Specifies process and procedures for when if such funding cannot be maintained.

Directs DHHS to apply to CMS for any necessary waivers or state plan amendments as may be necessary to implement and secure federal financial participation in the transformation, especially Section 1115 waivers.

Provides that the General Assembly is committed to allowing the time and funding necessary to implement the Medicaid transformation as required by this act.

Directs the Division to develop a pilot program for single payment for Medicaid services provided to recipients of services provided under the 1915(c) Medicaid Waiver. Provides that the purpose of the pilot project is to determine if approved and operating LME/MCOs can provide and manage both physical and behavioral health care for recipients with recipients of services under the 1915(c) waiver, subject to three requirements, including that only LME/MCOs that have successfully managed the 1915(b)/(c) Medicaid waiver for at least five years and are meeting contract and SL 2013-85 requirements are eligible to operate the pilot.

Requires the Division to report to the Joint Legislative Oversight Committee on Health and Human Services no later than November 1, 2015, on the initiation of the pilot. Additional status reports are required annually for the following three years, being submitted no later than November 1 of each year.