David Sayen

Global Warming Comes to Healthcare

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On June 7, the Health Subcommittee of the House Ways and Means Committee heard and responded to testimony about Medicare Advantage (MA) and, in particular, how the program can be an instrument to advance care coordination and integration. The tenor of this hearing, combined with the recent unanimous passage of the bipartisan Creating High-Quality Results and Outcomes Necessary to Improve Chronic (CHRONIC) Care Act by the Senate Finance Committee tells this reader ice isn’t just melting at the North Pole. There is a thaw in the chill that seemed to blanket parts of the healthcare industry since the election.

When the House pulled back from controversial Medicare changes in the American Health Care Act (AHCA), I wondered where we might be going with Medicare policy in the near term. My impression of the hearing is that the evolution of Medicare to a more sophisticated purchaser and public health program continues. It doesn’t belong to a political party – it is organic growth. Health plans that focus on providing the integration and coordination sought by the Department of Health and Human Services (HHS) and make the effort to be truly patient centered will be the winners.

A central theme that emerged was something John Gorman often points out: the route to better outcomes for Medicare beneficiaries with multiple chronic conditions is not high-tech medical interventions – it’s warm meals, grab bars, and a ride to the doctor. And no one seemed to disagree with this notion. The view that we can have a better healthcare program by investing in health through social services? Calling Doctor Berwick!

There was strong support for the value-based demonstration in MA, and particular value was placed on tailoring benefits around the individual, rather than focusing on identical benefits for everyone. Industry likes this idea, advocates are maybe lukewarm, but I’m concerned about execution. It will be more complicated to administer, manage, and monitor the program with all that flexibility. Which means more reporting burdens for plans. Similarly, the Special Needs Plan was discussed in a favorable light, and I think an extension beyond 2018 is likely. This is a great opportunity area for plans that can manage that level of risk.

One chorus of Kumbaya was devoted to the Program of All-Inclusive Care for the Elderly (PACE). The members couldn’t get enough of it, and Cheryl Wilson from the PACE Association really told the success story well. The members want more, especially in rural areas. Folks don’t always see that the government can’t create businesses: they put money on the stump and hope somebody picks it up. And we heard about the regulatory burden – like the requirements that applications have to be submitted by a certain date. I suspect this administration will make a strong effort to loosen those reins. There is a tremendous market opportunity in PACE, and there are investors who will provide capital if the barriers to entry are lowered.

I’m looking forward to a round of innovation in the MA world that is just what the doctor ordered.

 

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David Sayen

About David Sayen

David Sayen is Senior Vice President of Client Relations at Gorman Health Group (GHG). In this role, David guides GHG clients in developing strategies to respond to rapidly changing federal program opportunities. David recently joined GHG after a distinguished career at the Centers for Medicare & Medicaid Services (CMS), most recently as the Administrator of the San Francisco Regional Office. Read more

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