While the implications for healthcare coverage remain hard to predict heading into the new administration, industry experts largely expect a carryover of efforts to encourage innovation in payment and care delivery.
Rolling back legislation once it’s been fully implemented is “unique in our history,” said Gail Wilensky, PhD, healthcare economist and Project HOPE senior fellow, during a recent HFMA webinar. Yet that’s precisely the scenario now developing as President Donald Trump and the Republican-led Congress move to repeal the Affordable Care Act (ACA).
“Just attempting to unwind and then rewind something as significant as the extension of health care to some 20 million Americans will be a different experience for those of us who have either watched or participated in Washington,” Wilensky said.
During the webinar, sponsored by HealthStream, Wilensky, the former administrator of Medicare and Medicaid; Gov. Mike Leavitt, chairman of Leavitt Partners; and Joe Fifer, FHFMA, CPA, president and CEO of HFMA, discussed the changes the healthcare industry can anticipate during the Trump administration. Topics included the transition to outcome-based payments, possible structural changes to Medicaid, the future of the Center for Medicare & Medicaid Innovation (CMMI) and state-based payment reform, and how upcoming changes are likely to alter the number of Americans with insurance.
“It’s very clear that we’re going to see a lot of demand for change, and an appetite for change,” said Leavitt, formerly the governor of Utah.
As efforts to repeal the ACA advance, questions and concerns are mounting about how many of the roughly 20 million people who became covered under the law will remain so.
Webinar participants were asked to weigh in on the issue via real-time online polling, and the results were split. Twenty-seven percent of participants predicted that less than a quarter of those who gained coverage under the ACA will keep it, for example, while another 27 percent said they anticipate that between 51 and 75 percent will do so.
“[That] would speak to the uncertainty of the coverage side of this,” Fifer said.
The Value Push
More certain, both participants and the speakers concluded, is the future of the industry’s implementation of value-based payment reforms.
Wilensky doesn’t expect the tide to turn under the new administration, in part because of the momentum that has built up in the private sector. She also noted that Rep. Tom Price (R-Ga.), Trump’s nominee to lead the Department of Health and Human Services, was “very involved” with the legislation that became the Medicare Access and CHIP Reauthorization Act (MACRA). That law “is pushing the physician portion to more outcomes-based measures,” Wilensky said.
Leavitt concurred with Wilensky’s assessment, adding that there are three things both parties in Congress and the administration can agree on: that fee for service has to be transitioned to value-based payment, that coordinated care is better than uncoordinated care, and that the shift has to happen in a way that will not create deeper budgetary problems.
“There is no place on the economic leaderboard for a country that spends 22, 24, 25 percent of its gross domestic product on health care,” Leavitt said. “There’s an economic need for this to occur, and the market is responding to that.”
CMMI pilot projects that were initiated to test improvements to care delivery and payment are expected to continue under the new administration as well.
“Let’s remember that Republicans in particular, and past administrations in general, have supported pilot projects and demonstrations,” Wilensky said.
What’s more, CMMI does a lot of the modeling that’s essential for the functionality of MACRA, which has broad political support, Leavitt said.
While innovation is expected to continue, the speakers noted that the time has likely come to limit the number of pilots underway. The volume of projects initiated during the Obama administration has begun to burden physicians and hospitals, they said, and perhaps even muddled the results.
“I hear from our members frequently that sometimes it’s so confusing because these programs overlap each other, and it’s difficult for them to calculate the profitability at a patient level, or even a payer level, with overlapping incentives and overlapping programs,” Fifer said.
Going forward, experts anticipate that the ACA’s 1332 Medicaid waiver will be an important tool for state-based payment reforms, with the Trump administration likely to be more liberal in its interpretations of the guidance process than the Obama administration was. Medicaid block grants will be another aspect, although Wilensky said governors are likely to be more interested in per capita block grants to protect against financial exposure in an economic downturn.
Leavitt added that widespread interest in state-based payment reform, particularly among Republicans, is another reason to expect CMMI’s authority to be maintained in the Trump administration’s HHS.
“They will find that they are likely to achieve all the flexibility that states request more easily through authority granted in waivers and demonstrations than they will if they have to go through Congress,” Leavitt said.
Medicaid managed care is also expected to increase, meaning hospitals will have to be part of some managed care networks. And a new set of skills to address a broader range of issues, including behavioral health, housing, child care, and transportation—the social determinants of health—will be needed to succeed.
“The days of Medicaid paying on just a fee-for-service basis are rapidly ending,” Leavitt said.
But Leavitt conceded that Medicaid represents a complex political issue for Republicans. Sixteen states that expanded coverage under the ACA are now led by Republican governors. Those that didn’t expand are likely to begin rethinking their position.
“I’m guessing that we will see not just continued payment, but I think there will be a lot of states that will now begin to look at ways of expanding Medicaid or reforming Medicaid using this new authority and new flexibility,” Leavitt said. “And that will be a complicated equation for the Republicans to balance.”
Replacing the Mandate
Another sticking point for Republicans has been the ACA’s individual mandate, a feature that is unlikely to survive in its current form, experts say, although an alternate mechanism to encourage enrollment will be included in any replacement plan.
Wilensky pointed to Medicare as a model for lawmakers to consider.
“Nobody has ever accused Medicare of having a mandate, and yet, there’s a very powerful financial incentive to sign up when it’s first offered,” she said. “I never understood why the previous Congress didn’t at least try that.”
As for any significant reforms to Medicare, Wilensky said she takes Trump at his word when he promised he wouldn’t touch the program—a message other GOP lawmakers have echoed, at least with respect to the near term.
Lisa Zamosky is a healthcare journalist who covers health insurance, healthcare policy, the Affordable Care Act, Medicare, Medicaid, and consumer health and finance concerns.