While a great deal of uncertainty still exists as it relates to the future of healthcare policy, it was quite engrossing to read reports this week that physicians, both in the field and in key leadership positions, are determined to make sure that the core elements of value-based purchasing and accountable care continue to push forward.
One example of this came in a Jan. 25 letter to President Trump, Vice President Mike Pence and Congress from leading hospitals, health systems and industry associations, which delivered a message calling for a renewed effort to move to value-based, patient-centered payment models that reward improved quality and cost-effective care.
As I reported earlier this week, the letter read, “Healthcare has been operating in a fee-for-service system designed more than 50 years ago. Over the years, the regulations governing this system have grown extraordinarily complex. This complexity hampers efforts of clinicians and other healthcare providers who have been diligently working to measurably improve quality, reduce costs and take accountability for populations of patients. Despite these impediments, organizations have made significant investments in building and testing alternative payment models that are designed to move healthcare forward to promote value.” The organizations in the letter further noted that the bipartisan journey toward value-based care began more than 15 years ago with pay for performance, bundled payment and accountable care organization (ACO) models. Healthcare providers, clinicians and insurers have invested significantly in moving healthcare in this direction.
A second instance of providers’ opinions on healthcare policy this week came in the form of a random survey of 426 primary care physicians from the American Medical Association’s (AMA’s) database. These findings were part of the broader study that explored PCPs’ feelings on the Affordable Care Act (ACA). The research, published also on Jan. 25 in the New England Journal of Medicine, revealed that 62 percent pf PCPs “strongly agree” with the idea of paying physicians for value rather than volume. (This figure even caught the attention of former National Coordinator for Health IT, Dr. Farzad Mostashari, who tweeted about the statistic, as seen below).
— Farzad Mostashari (@Farzad_MD) January 26, 2017
What does all this mean? Leaving the ACA part out of it (you can surely get your opinions on Obamacare from many other places), I think it’s especially noteworthy that key healthcare leaders are expressing these thoughts right now, just days after Trump’s inauguration. In the letter to Trump and Pence, the healthcare organizations wrote, “This work has been spurred by nearly two decades of bipartisan leadership and was most recently accelerated by this Congress’ overwhelming passage of the Medicare Access and CHIP Reauthorization Act (MACRA). Through private and public sector alignment, the move toward value-based care is succeeding, measurably improving healthcare quality and contributing to historically low costs. Now is not the time for policymakers to signal a shift away from value-based care, either through action or inaction.”
Of course, it largely remains to be seen what the new administration’s thoughts are on value-based care. It’s hard to get a clear grasp on anything related to healthcare policy until Trump’s nominations for Health & Human Services (HHS) Secretary and Centers for Medicare & Medicaid Services (CMS) Administrator, Rep. Tom Price, M.D. and Seema Verma, respectively, get confirmed, both which are expected to happen in the near future. As we have noted several times since Trump’s election victory, it’s important to remember that MACRA is supported by most members of Congress, irrespective of political party.
As far other value-based purchasing and accountable care programs, the picture could be a bit murkier as mandatory bundled payment models and ACOs have their fair share of skeptics. Nonetheless, the organizations who penned the letter this week mentioned that “Medicare ACOs have collectively generated $1.29 billion in savings since 2012 while improving quality.”
It’s no secret that many hospital CFOs have enjoyed living in the fee-for-service world. I recently spoke to a senior healthcare executive at Deloitte Consulting who told me that while hospital CFOs “did well and knew how to manage that [fee-for-service] world, but when you ask them about the big picture as human beings, they know that those incentives are not right and it’s not sustainable. But with their CFO hats on, those were good times.”
Leading members of the organizations in the letter had their own statements relating to the need to push value-based care forward. Michael O. Leavitt, chairman and co-founder, Leavitt Partners, three-term governor of Utah and former U.S. Secretary of HHS, said “I am confident that the migration toward value-based care will continue regardless of what happens in the next few months. There is a remarkable amount of bipartisan agreement when it comes to payment and delivery reforms, as evidenced by legislation like MACRA, and the Republican Congress has established a clear pattern of supporting the transition from fee-for-service to value payment.”
Added Jeff Micklos, executive director, Health Care Transformation Task Force (HCTT), an industry consortium that brings together patients, payers, providers and purchasers, “Our member organizations have committed to moving 75 percent of their business to value-based models by 2020, a move that has required a significant investment and planning. With so many organizations on the cusp of meaningful, long-term change, we need clear signals of support and a strong commitment to move value-based care forward—now and in the future.”
That 75 percent number in the above statement might seem daunting to some, but keep in mind the goal that HHS set under the watch of Secretary Sylvia M. Burwell two years ago—tying 30 percent of traditional, or fee-for-service, Medicare payments to quality or value through alternative payment models, such as ACOs or bundled payment arrangements by the end of 2016, and tying 50 percent of payments to these models by the end of 2018. HHS also set a goal of tying 85 percent of all traditional Medicare payments to quality or value by 2016 and 90 percent by 2018 through programs such as the Hospital Value Based Purchasing and the Hospital Readmissions Reduction Programs.
So again, while we don’t know how new leadership at HHS feels about these goals, many of which were called aggressive at the time, it’s significant that vital healthcare leaders believe in the process. Indeed, it’s becoming increasingly clear that most doctors, on the front lines and in the trenches, are supporting a healthcare ecosystem that pays for quality over sheer volume of services. This week was a critical one to hammer that point home.