Un-Boring Stuff

“The ACA Did Not Increase Spending Growth, so We Can Expand Coverage Further” Health Affairs, October 28, 2024

TL/DR: ACA critics said it would increase spending. Instead, the Compound Annual Growth Rate (CAGR) has dropped. Uninsured numbers have also dropped to historically low levels. The authors argue this trajectory has to continue, along with the further building out of value-based care models and advanced primary care.

Potential Election Implications:

Some believe the ACA subsidies are at risk of not being renewed or of being significantly altered when they expire at the end of 2025 given the election results. The subsidies were funded through the Inflation Reduction Act and will need ongoing funding. Over 8 million Americans were able to obtain health insurance through these subsidies.

Kaiser Family Foundation writes about the subsidies and the potential impacts if they are are allowed to expire here. This is a nifty chart from this 2024 article 👇️ 

A great place to read about President-Elect Trump’s potential health policy positions is through the work of the Paragon Health Institute. It was formed in 2021 by Trump’s health policy advisors, and could be a place he looks for healthcare leadership roles in the administration.

If you are interested in their policy recommendations on the ACA subsidies, you can read about them here.

(Paragon might be? a place the Trump Administration looks for appointees to his second Administration-we will see soon enough!)

Physician Payment Reform in Medicare: Putting the Pieces Together Health Affairs, October 9, 2024

J. Michael McWilliams authors this piece in Health Affairs. Truth be told, I’m a fan of Dr. McWilliams, a physician and Harvard professor, since his work was first introduced to me by one of the handful of people who helped me continue in my professional journey from healthcare provider to public policy professional, Tim Gronniger.

In this article, Dr. McWilliams lays out how physician payment reform and population-based payments should not be assessed on their own, but in how they interact to make up two pieces of the policy reform puzzle needed to achieve longer-term goals.

He reminds readers that fee-for-service doesn’t work well for activities that are not transactional services, a foundational concept supporting the need for reform.

We must move to a system where providers who contribute to reductions in unnecessary and avoidable spend (while prioritizing high-value services that often aren’t billable) are rewarded financially for their important work. This is the case for much of primary care.

My more nuanced take: 

Providers whose relative value unit (RVU) weights yield the lowest fee-for-service reimbursement and where providers regularly engage in non-billable services to support their patients (as is the case for primary care providers, behavioral health providers, and physical therapists) are at the greatest risk of no longer accepting third-party payer rates.

Newsflash: access to care will suffer. I also wrote about that in my article on Direct Primary Care

Dr. McWilliams also reviews flawed fee-for-service proposal “fixes” and points out that alternative payment mechanisms should be paired with accountable care programs.

Potential Election Implications

The Biden Administration has focused on primary care models and payment incentives, both through the Innovation Center and through updates to the Medicare Shared Savings Program. They have also added new primary care and behavioral health code types for all of fee-for-service.

The article is a great read. If you don’t have time for it today, it’s a great pick for your read-later app. (I use Notion for this, of course!)

We’ll have to watch and see if the Trump Administration will continue particularly the test models like ACO Primary Care Flex that haven’t launched yet. Here’s one clue 🕵️ 👇️ 

Paragon’s Joe Albanese responded to Senator Whitehouse and Senator Cassidy’s Request for Information in response to their Pay PCPs Act. The legislation by these two Senate Finance members proposes a new hybrid payment methodology for primary care providers in fee-for-service. He points to the lack of evidence of success in prior models. (Note the proposed legislation would not require accountable care organization participation, but merely a different mechanism for paying primary care providers.)

Bonus!

If you want to hear J. Michael McWilliams with Alan Weil on a podcast discussing his research showing how lower lengths of stay in skilled nursing facilities do not have a negative impact on Medicare beneficiaries, you can click to hear the audio below. You can also find it online here.

Opportunities To Enhance Design And Implementation of ACO REACH’s Core Payment Model Design Elements Health Affairs, November 7, 2024

Published just week, this article is authored by six members of the Duke Margolis Center for Health Policy, including by its founding director, physician and economist Mark McClellan.

These health policy experts offer recommendations for to consider as we policymakers to consider as we enter the final two years of the CMS Innovation Center’s ACO Realizing Equity, Access, and Community Health (REACH) model.

Participants in ACO REACH are generally some of the more advanced and experienced in accountable care. It has three tracks, and is home to one of my own favorite sub-models, the ACO REACH High Needs Track. (See the Summary Table on page 94 of the Request for Applications of the ACO REACH program to view the differences between the three program tracks.)

This model is markedly different than its closest comparison, the Medicare Shared Savings Program (MSSP), which is the statutory program administered by CMS. ACO REACH allows organizations to take up to 100% financial risk on a patient population, in exchange for more flexibility, simplified quality reporting, and potentially significantly greater revenue if total cost of care can be reduced while quality is improved or maintained.

This model was born out of a re-tooled Trump Administration model called the Global and Professional Direct Contracting Model. Here’s the comparison doc. Yeah, it’s hard to read here. I attached the file below for the policy nerds among us who want to read the fine print 🤓 

Here’s a link to another Health Affairs article in 2022 about the then new ACO REACH model by some of these same authors and others. It’s Part one of two and is itself a masterclass in the program at its start.

This article in Fierce Healthcare summarizes the (mostly political) reasons GDPC had to be re-imagined into ACO REACH.

From the article:

Sen. Elizabeth Warren, D-Massachusetts, called for CMMI to drop the model during a hearing earlier this month. She charged that the model would help privatize traditional Medicare and turn the program over to “corporate profiteers.”

Critics have claimed that direct contracting would employ similar tactics used by Medicare Advantage plans to glean overpayments from traditional Medicare. Warren and others have claimed that some plans work with providers to add unnecessary diagnoses to inflate risk scores of MA beneficiaries, thus inflating the patient’s risk scores and getting a higher payment from Medicare.

Warren said that under the capitated payment model providers would be able to pocket any profits, creating an incentive to lower the quality of care.

TL;DR

Some Democrats in Congress and Secretary Becerra argued that GPDC should be terminated. The CMS Innovation Center, supported by value-based care allies, redesigned some elements of the model to make it more acceptable to parts of their own party and the head of HHS. Notably, they incorporate health equity components like a health equity plan and a health equity benchmark adjustment payment.

Potential Election Implications

With the test ACO REACH model’s end date looming (December 31, 2026—just around the corner in policy terms), participants and allies have feared REACH participants would have no “home” that would meet their needs. Many of these participants had the same concerns with end of the Next Generation ACO model.

If Trump’s Republican Party controls CMS, CMMI, and both Houses of Congress, it would be reasonable to think they re-might re-launch the GPDC model or something similar, and/or extend the ACO REACH model in the short term.

The bottom line:

Some organizations serving the Medicare population, especially in advanced primary care, are already taking some or full delegated risk from Medicare Advantage plans. ACO REACH allows them to transform how care is delivered and paid for in similar ways, whether an individual is in Traditional Medicare (FFS Medicare) or Medicare Advantage. For these organizations, going back to shared savings alone or straight FFS would be very difficult.