diff --git a/states/helpers.py b/states/helpers.py
index 08d313a..c870690 100644
--- a/states/helpers.py
+++ b/states/helpers.py
@@ -3,6 +3,9 @@
 import collections
 
 
+INTERNAL_KEY = '@value'  # used to represent internal key in param hierarchy
+
+
 class FlatDictDiffer(object):
     def __init__(self, ref, target):
         self.ref, self.target = ref, target
@@ -40,7 +43,10 @@ def print_state(self):
 def flatten(d, pkey='', sep='/'):
     items = []
     for k in d:
-        new = pkey + sep + k if pkey else k
+        if k == INTERNAL_KEY:
+            new = pkey if pkey else ""
+        else:
+            new = pkey + sep + k if pkey else k
         if isinstance(d[k], collections.MutableMapping):
             items.extend(flatten(d[k], new, sep=sep).items())
         else:
@@ -55,7 +61,11 @@ def add(obj, path, value):
         if index == last:
             obj[part] = value
         else:
-            obj = obj.setdefault(part, {})
+            if part in obj and not isinstance(obj[part], collections.MutableMapping):
+                obj[part] = {INTERNAL_KEY: obj[part]}
+                obj = obj[part]
+            else:
+                obj = obj.setdefault(part, {})
 
 
 def search(state, path):
diff --git a/states/tests.py b/states/tests.py
new file mode 100644
index 0000000..c889531
--- /dev/null
+++ b/states/tests.py
@@ -0,0 +1,101 @@
+import unittest
+import helpers
+
+
+class TestFlatten(unittest.TestCase):
+    def setUp(self):
+        self.flatten = helpers.flatten
+
+    def test_flatten_single(self):
+        nested = {
+            "key": "value"
+        }
+        flat = {
+            "/key": "value",
+        }
+        self.assertEqual(flat, self.flatten(nested))
+
+    def test_flatten_nested(self):
+        nested = {
+            'qa': {
+                'ci': {
+                    'api': {
+                        'db_schema': 'foo_ci',
+                        'db_user': 'bar_ci',
+                        'db_password': 'baz_ci',
+                    }
+                },
+                'uat': {
+                    'api': {
+                        'db_schema': 'foo_uat',
+                        'db_user': 'bar_uat',
+                        'db_password': 'baz_uat',
+                    }
+                }
+            }
+        }
+        flat = {
+            '/qa/ci/api/db_schema': 'foo_ci',
+            '/qa/ci/api/db_user': 'bar_ci',
+            '/qa/ci/api/db_password': 'baz_ci',
+            '/qa/uat/api/db_schema': 'foo_uat',
+            '/qa/uat/api/db_user': 'bar_uat',
+            '/qa/uat/api/db_password': 'baz_uat',
+        }
+        self.assertEqual(flat, self.flatten(nested))
+
+    def test_flatten_nested_with_internal_values(self):
+        nested = {
+            'a': {
+                '@value': 'a_value',
+                'b': {
+                    '@value': 'b_value',
+                    'c': {
+                        '@value': 'c_value',
+                        'key1': '1',
+                        'key2': '2',
+                        'key3': '3',
+                    }
+                }
+            }
+        }
+        flat = {
+            '/a': 'a_value',
+            '/a/b': 'b_value',
+            '/a/b/c': 'c_value',
+            '/a/b/c/key1': '1',
+            '/a/b/c/key2': '2',
+            '/a/b/c/key3': '3',
+        }
+        self.assertEqual(flat, self.flatten(nested))
+
+
+class TestAdd(unittest.TestCase):
+    def setUp(self):
+        self.add = helpers.add
+
+    def test_add_single(self):
+        obj = {}
+        expected_obj = {'a': {'b': {'c': 'c_value'}}}
+        self.add(obj, '/a/b/c', 'c_value')
+        self.assertDictEqual(obj, expected_obj)
+
+    def test_add_with_internal_values(self):
+        obj = {}
+        expected_obj = {
+            'a': {
+                '@value': 'a_value',
+                'b': {
+                    '@value': 'b_value',
+                    'c': 'c_value',
+                }
+            }
+        }
+        self.add(obj, '/a', 'a_value')
+        self.add(obj, '/a/b', 'b_value')
+        self.add(obj, '/a/b/c', 'c_value')
+        self.assertDictEqual(obj, expected_obj)
+
+
+if __name__ == '__main__':
+    unittest.main()
\ No newline at end of file