As 2016 draws to a close, it's hard not to reflect on what a tumultuous year this has been for health care.
And looking ahead, 2017 seems poised to be even more eventful. So I sat down to reflect on the biggest changes that affected accountable payments this year, as well as offer a few predictions on what to expect for value-based care in the coming year.
MACRA (almost) tops the list as the most impactful moment of the year
If I had written this on November 7th, the Medicare Access and CHIP Reauthorization Act (MACRA) would have been the single most influential health care event of 2016. But the results of the presidential election came as a surprise to many, and we anticipate the new administration will make significant changes to health care. Therefore, the election deserves the title of most impactful moment of 2016.
With that caveat in place, we believe MACRA will remain intact under the Trump administration and still deserves a top spot on the list of most impactful moments of 2016. Here are a few thoughts on MACRA:
In a recent poll from the Medical Group Strategy Council, 70% of respondents said they were "concerned" or "totally freaked out" over MACRA. Smaller practices are feeling especially anxious since the infrastructure needed to report on their performance will be beyond what most can afford. We expect to see more physicians seeking an aligned partnership – "refuge" – with an organization that can provide the capital and reporting infrastructure needed for success in a reimbursement environment with more Medicare patients and at risk revenue. The three most likely partners are health systems, well-capitalized medical groups, and even some insurers.
CPC+ and mandatory bundled payments are also changing the game for accountable payments
The size and pace of Comprehensive Primary Care Plus (CPC+) took a lot of people by surprise. To give you a sense of scale, the Medicare Shared Savings Program has paid out $1.3B since it began in 2012, and we estimate CPC+ will pay out $1.1B to providers in its first year alone. Given the significant multi-payer support for the program and the amount of money the government is willing to invest, I think CPC+ markets are in for some profound shifts away from fee-for-service despite any changes in health policy from Washington.
The rollout of mandatory bundled payments (first joint replacement bundles and then the announcement of the cardiac bundles) has also put a lot of pressure on providers that many weren't expecting. While many of the organizations that have participated in voluntary bundled payments have done well, those who opted out due to a lack of resources and/or physician alignment will find it particularly challenging to succeed under mandatory bundled payments.
More shake-ups to come under the Trump administration
Since we're on the topic of mandatory bundled payments, I think these programs will see significant changes even as momentum for bundled payments continues. Trump's nominee for secretary of Health and Human Services, orthopedic surgeon Representative Tom Price, is known to be a harsh critic of the Affordable Care Act (ACA) and has been particularly critical of CMS's mandatory bundled payment models. Rep. Price will likely target mandatory bundled payments as one of the first payment models to see significant revisions. I also believe that the Medicare Shared Savings Program's upside-only model could be at risk given some doubts about the program's mixed record of success to date.
In addition, by 2018, I think the individual health insurance marketplace will have unraveled in many states—particularly smaller states. Now that repeal or a significant revision of the ACA is on the horizon, insurers will continue fleeing the individual insurance market. Since healthy patients will no longer have to worry about hefty individual mandate penalties, they'll stay away from the exchanges and plans will become even more unaffordable. While this may decrease narrow network pressures in some states, it will likely strengthen the position of big national insurance carriers.
Providers can still make progress on existing improvement strategies
Regardless of possible legislation changes, there are a number of no regrets strategies that will lead providers to success. Two in particular stand out: strategic growth by enhancing access to care, and reduction of unwarranted care variation to improve quality and accelerate margin enhancement.
First, strategic growth encourages providers to acquire and retain as great a share of health care dollars as possible by focusing on consumerism and access to care. Consumerism requires us to see patients on their terms, and thus enhance access to our providers – whether in person or in asynchronous ways, like web portals and email.
Second, while many health systems have captured cost savings in areas like supply chain and labor, it's now time to turn our attention to the more difficult work of reducing un-warranted care variation. Many health systems have tried to tackle care standardization, but have taken a project-by-project approach that yields only a minimal system-wide impact. Success depends on a consolidated, comprehensive approach to align physicians, define care standards, and embed them into the daily workflows of care delivery teams via the EHR.
With these no regrets strategies, health systems can yield important financial gains in 2017 that will prepare them for any health policy curveballs to come.
The views, opinions and positions expressed within these guest posts are those of the author alone and do not represent those of Becker's Hospital Review/Becker's Healthcare. The accuracy, completeness and validity of any statements made within this article are not guaranteed. We accept no liability for any errors, omissions or representations. The copyright of this content belongs to the author and any liability with regards to infringement of intellectual property rights remains with them.