Health Care Reform: Where Is the Trump Administration Headed Next?
On December 3, 2018, the US Department of Health & Human Services (HHS), in collaboration with the US Department of the Treasury and US Department of Labor, published a 119-page report in response to President Trump’s October 2017 executive order to reduce health care costs through increased competition. The report, “Reforming America’s Healthcare System Through Choice and Competition,” refers to areas where the administration believes federal law prevents competition and stifles choice, as well as suggests policy changes, making 56 recommendations across 20 broad areas.
First Report Managed Care reached out to its team of experts to analyze these suggestions and prognositicate which will gain traction first. The experts narrowed their focus to 12 recommendations that address health savings accounts, health care consolidation, scope of practice, electronic medical record (EMR) interoperability, and telehealth services.
Expand Health Savings Accounts (HSA)
HHS recommends:
Congress expand consumers’ abilities to benefit from health savings acounts (HSAs) by increasing the number of plans that qualify, raising contribution limits, allowing consumers to use funds to pay their premiums, permitting certain Medicare beneficiaries to contribute to an HSA, and enabling HSA funds to be used under direct primary care arrangements; and
The Trump administration explore ways to expand HSA use, including offering a wider interpretation of preventive services that would enable HSA use for treatment of chronic diseases.
Expanding the use and usability of HSAs is a concept the public can easily understand, similar to its understanding of efforts to control the rising price of prescription drugs. Norm Smith, a principle payer market research consultant in Philadelphia, told us in 2016 that under a Trump presidency, HSA expansion could gain traction very quickly. “[It]would not require a large outlay of dollars and would be easy to administer,” Mr Smith said at the time. “Plus, it appeals to the middle class. People like it and it makes sense.”
Now, 2 years later, the Republican-controlled Congress did not advance significant health care legislation and the Democrats have taken back control of the house. Mr Smith explained, “HSAs are [still] a middle-class benefit. The rationale for the Democrats to oppose HSA growth is their base doesn’t use HSAs to the same extent as [those in the] the Republican base.”
Barney Spivack, MD, national medical director of Medicare case & condition management at OptumHealth, New York, agreed. “There is more likely to be bipartisan support on other issues, especially those tied to high health care prices.” Moreover, if HSAs are expanded, “states will be looked upon to take action to regulate in this area, such as addressing surprise medical bills.”
Expanding HSAs is only half the equation, noted David Marcus, director of employee benefits at the National Railway Labor Conference in Washington, DC. “Consumer-driven health care is nothing new, but for the most part it has not lived up to its promise. Consumers can only act like consumers if they are able to evaluate quality and compare costs.” For this reason, Mr Marcus believes Congress should couple HSA expansion with efforts to make health services and prescription drug costs transparent to consumers.
Gary Owens, MD, president of Gary Owens Associates in Ocean View, DE, said he sees HSA expansion as relatively noncontroversial. “It’s an area that can get bipartisan support.” However, he pointed out that even though the public can more easily understand the concept of HSAs, that does not diminish their complexity. Congress will need to the consider the consequences of the moving parts of lost tax revenue.
F Randy Vogenberg, PhD, RPh, principal of the Institute for Integrated Health care in Greenville, SC, added, “The Trump administration needs to build bridges where possible, and find opportunities through meaningful alignment on issues such as HSAs.”
It is worth noting that HHS’ recommendation to the administration to expand its interpretation of preventive services so that HSAs could be used as a form of payment could be a double-edged sword. On one side, it allows consumers more choice. On the other, it undermines a basic tenet of the Affordable Care Act (ACA), which guarantees coverage for numerous preventive services with no cost-sharing. The HHS report notes that “the ACA’s coverage mandates, while certainly providing some benefit, increase premiums, as well as lead to unnecessary utilization.”
Address Health Care Consolidation
HHS recommends that the administration:
Continue to monitor market competition, particularly in less competitive geographic areas; and
Ascertain how horizontal and vertical integration among provider practices impact competition and prices.
Just last month our experts delved into why consolidation is not likely to met with as much vigor as, say, the rising costs of pharmaceutical medications (see “Are Efforts to Reduce Health Care Costs Misplaced?” December 2018, page 18).
“Consolidation is prevalent and gaining momentum among some of the largest players in the industry,” explained Dr Owens. “I don’t see anything in this set of recommendations that will delay that. Only the courts can prevent consolidation if they think it is anticompetitive.”
Mr Marcus agreed, “HHS is recognizing that consolidation contributes to increased costs, but so far it is unwilling to take concrete steps to ensure adequate competition.”
“There is no question that market consolidation drives up prices, but further monitoring does little, if anything to address the issue,” added Dr Spivack. But Dr Vogenberg said the effort has to start somewhere. ‘“Monitoring’ and ‘ascertaining’ means gathering information in preparation to do something.”
While it is difficult to know what that something might be, accountable care organizations (ACOs) and other alternative payment models (APMs) could be a target. The HHS report notes that while such models are intended to increase care coordination and align financial incentives, they could have the unintended effect of encouraging provider consolidation, thus decreasing competition and driving up prices in certain markets.
The report states: “This may occur as hospitals purchase physician practices, or through mergers between hospitals or between physician practices.” Thus, “the administration should focus on identifying [APMs] that allow free markets and patients to define value, rather than rely on technical and burdensome definitions invented in Washington.”
Dr Vogenberg said looking at APMs established by commercial payers could be instructive. “ACO-like organizations and approaches are gaining momentum in the private sector. If such momentum can be transformed into the public sector, then some traction could occur in 2019 that impacts 2020.”
Scope of Practice Changes HHS recommends that states consider:
Changing scope-of-practice statutes to allow clinicians to fully utilize their skills up to the top of their license;
Eliminating requirements for rigid collaborative practice and supervision agreements (for instance, between physicians, nurse practitioners, and physician assistants) that do not pose health and safety concerns; and
Ways to increase licensure and scope of practice for “emerging health care occupations” such as dental therapy.
Additionally, HHS suggests federal and state legislative and administrative action that would allow nonphysicians and nondentists to be paid directly for their services, as long as it can be demonstrated that their care is being provide safely and effectively.
“It’s about time,” said Dr Spivack. “Scope of practice barriers that are outdated should be eliminated.” Particularly in the face of a growing number of older individuals who often have multiple chronic conditions, “a broader, more capable, and diverse health care workforce [needs to be] prepared to address the key challenges of our society.”
Similarly, Dr Vogenberg said he is encouraged that the federal government is asking states to tackle these issues. “It allows geographically aligned change and innovation to occur at a more local level. This can lead to more savings than traditional top-down federal actions that have occurred over the past 8 years.”
“I think it is inevitable that we will need to expand access by using alternate providers as primary entry points,” observed Dr Owens. He went on to question whether this will really drive down costs.
“On one hand it can improve access, which is good. On the other hand, it can increase costs in a predominantly fee-for-service environment. The more providers available to bill for services, the more services will be provided,” Dr Owens continued. “Medicine just works that way—it is the only place where increased competition leads to increased demand. If you build it, they will come—and pay!”
Even if states do change scope-of-practice statutes — malpractice, credentialing, and other factors will limit how close to the top of a license some practitioners can practically get, said Dr Owens.
Improved EMR Interoperability and Open Data Exchange
HHS recommends that:
The administration implements provisions of the 21st Century Cures Act to—among other things—make it easier for patients to access their health information;
Centers for Medicare & Medicaid Services (CMS) continue to (1) emphasize EMR interoperability, and (2) continue with efforts to make more data available to patients;
CMS and the Office of the National Coordinator for Health IT (ONC) work to reduce documentation burden in order to make electronic medical record messaging less boilerplate and more informative; and
ONC make EMR standards more comprehensive and robust.
All our experts agreed that there needs to be meaningful movement in this area while acknowledging the challenges of achieving successful change.
“Interoperability has been a challenge to the industry for a number of years,” noted Mr Marcus. “Several organizations have attempted to provide workable solutions, but not successfully.” He said he hopes CMS stepping to the fore will help, but admits the issue’s complexity means nothing is likely to happen soon.
Dr Vogenberg said he thinks the best option is to let the market continue to figure things out. “Private sector initiatives are moving faster than [those of the] government. Interoperability is being addressed by new outside ventures, mostly from the IT business world.”
Dr Vogenberg continued, “There is no question that the market feels the dysfunction and economic pain in a way that has identified business innovation opportunities that have already led to significant investments or business restructuring.” He pointed to initiatives undertaken by the likes of Apple, Google, and Amazon, as well as mergers such as CVS/Aetna and Cigna/Express Scripts.
Dr. Owens pointed out that EMRs as currently structured can create reminders, maintain prescription medication lists, and track lab parameters, but the benefits stop there. Providers are forced to work with multiple screens, cannot summarize data or create shortcuts to get to meaningful information, and are unable to share information with other systems. “However, I am not sure how much regulation will help. My experience is that regulated systems often create more work, not less.”
Dr. Spivack suggested that regulations must have “teeth,” referring to “meaningful penalties for data blocking.”
Telehealth Services
HHS recommends that states allow providers and payers to mutually determine if and when delivery of telehealth services are safe, as well as appropriate, including for instances where that has not been a previous in-person visit.
Dr Owens noted that most payers already pay for appropriate telehealth services. Others agreed, but added that they see opportunity to do more. While emerging data validates telehealth’s safety and high value, explained Dr Spivack, other studies “show that these services have not penetrated deeply, especially within smaller individual practices.”
“Telehealth offers great promise but has underperformed for years,” added Dr Vogenberg. His reason being, “Health care has remained a cottage-like industry compared to other economic sectors that have large industrial operations with great efficiencies.” The good news is that “we are now in a period of seeking efficient health care delivery that can optimize outcomes—both economic and clinical.”
Still, Mr Marcus said he worries about handing the reins to providers and payers. Currently, states find it challenging to formulate and administer consistent policy, not only for general telehealth, but for telederm and telepsychiatry services. He said, “Leaving all of this to health care providers and payers is fraught with peril.” Ultimately, though, Mr Marcus said he sees the sector growing as patients better understand what is covered, how much less it is likely to cost, as well as the convenience factor.
What to Look for in 2019-2020
Mr Marcus said he does not think any of the recommendations will have impact over the next two years. Still, he suggested keeping an eye on administrative measures that address consolidation. Even though it’s hard to tell exactly what can or will be done, consolidation is gaining momentum that he believes the government will want to check. He also said suggestions that enable more consumer-driven care will likely be on the front burner.
Dr Owens said he thinks payers should keep an eye on measures that increase the use of alternate and mid-level providers. “If these clinicians begin to practice autonomously, payers will have to develop systems to manage them in some way.” He remains skeptical that the rate of consolidation will be stemmed anytime soon. “Our divided Congress will never find a middle ground to agree upon.”
With over 100 pages of recommendations to the admistration, it is highly likely that conversations surrounding the suggested policy changes will begin in 2019. However, to where those conversations lead, our experts believe we will need to wait to see now that power has shifted.
