Healthcare Reform: Where Is the Trump Administration Likely to Head Next?

The answer may lie in a report released in December by HHS. We recently combed through the 114-page document and asked our experts to analyze specific recommendations and predict which ones might gain traction soon

[A version of this article appears in the January 2019 issue of First Report Managed Care]

On December 3, the US Department of Health & Human Services sent a 114-page report to President Trump in response to his executive order to reduce healthcare costs through increased competition. The report refers to areas where the administration believes federal law prevents competition and stifles choice, and suggests policy changes. It makes 56 recommendations across 20 broad areas. First Report Managed Care reached out to our team of experts to analyze specific suggestions and tell us which ones might gain traction soon. We narrowed our focus to 12 recommendations that address health savings accounts (HSAs), healthcare consolidation, scope of practice, electronic medical record (EMR) interoperability, and telehealth services.

Expand Health Savings Accounts

HHS recommends that:

·      Congress expand consumers’ abilities to benefit from 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 

·      The Trump administration explore ways to expand HSA use, including by 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 latch onto and understand, in the same way that it grasps 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,” he said at the time. “Plus, it appeals to the middle class. People like it and it and it makes sense.”

Little did Mr Smith know just how much more divided and dysfunctional Washington would become, such that a Republican-controlled Congress would not advance any meaningful healthcare legislation. If it could not succeed during the first two years of Trump’s term, how will it now that Democrats control the House? “HSAs are a middle-class benefit,” explained Mr Smith. “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, agrees. “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.” 

Simply 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 healthcare 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 that reason, he believes Congress should couple HSA expansion with efforts to make health services and prescription drug costs transparent to consumers.

Still, Gary Owens, MD, president of Gary Owens Associates in Ocean View, DE, said he sees HSA expansion as relatively non-controversial. “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.

Added F Randy Vogenberg, PhD, RPh, principal of the Institute for Integrated Healthcare in Greenville, SC: “The Trump administration needs to build bridges where possible, and find opportunities through meaningful alignment on issues such as HSAs.”

It is worth noting the HHS recommendation that the administration expand its interpretation of preventive services so HSAs could be used to pay for them can be viewed as a two-edged sword. On the one hand, it allows consumers more choice. However, 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 Healthcare Consolidation

HHS recommends that the administration:

·      Continue to monitor market competition, particularly in less competitive geographic areas

·      Ascertain how horizontal and vertical integration among provider practices impact competition and prices

Phrases such as “continue to monitor” and “ascertain how” can be interpreted as HHS suggesting that the Trump administration kick the can down the road to be dealt with at a later date. Just last month our experts delved into why consolidation is not likely to be met with as much vigor as, say, the rising costs of pharmaceutical medications.

“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 anti-competitive.”

Mr Marcus said he agrees. “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’s 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. “This may occur as hospitals purchase physician practices, or through mergers between hospitals or between physician practices,” states the report. 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 and NPs and PAs) that do not pose health and safety concerns

●       Ways to increase licensure and scope of practice for “emerging healthcare occupations” such as dental therapy

Additionally, HHS suggests federal and state legislative and administrative action that would allow non-physicians and non-dentists 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 healthcare workforce [needs to be] prepared to address the key challenges of our society.”

Meanwhile, 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. The question is, will it really drive down costs, he asked.  “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.  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 realistically 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, thus, more informative

●       ONC make EMR standards more comprehensive and robust

All of our experts agreed that there needs to be meaningful movement in this area—and also acknowledged the challenges of achieving such.

“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. 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, including “meaningful penalties for data blocking.”

Telehealth Services

HHS recommends that states allow providers and payers mutually determine if and when delivery of telehealth services is safe and appropriate, including for instances where there 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. The reason? “Healthcare 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 healthcare delivery that can optimize outcomes—both economic and clinical.”

Still, Mr Marcus said he worries about handing the reins to providers and payers. As it is, states find it challenging to formulate consistent policy and administer it, not just for telehealth in general, but also so-called telederm and telepsychiatry services. “Leaving all of this to healthcare providers and payers is fraught with peril.” Ultimately, though, he said he sees the sector growing as patients better understand what’s covered, how much less it is likely to cost, as well as the convenience factor.

What to Look for in 2019-2020

Which of these recommendations are likely to be acted upon in 2019 or 2020? Dr Vogenberg offered a detailed assessment (see below). Meanwhile, Mr Marcus said he does not think any of them 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.” 

Which Recommendations to Watch

When we asked our experts to assess which recommendations from the US Department of Health & Human Services’ report are likely to be implemented soonest, F Randy Vogenberg, PhD, RPh, principal of the Institute for Integrated Healthcare in Greenville, SC, went one better and categorized the 20 broad areas contained in the missive. Here are the results of his work:

 Could happen at state level by 2020:

·      Broaden scope of practice

·      Facilitate telehealth to improve patient access

·      Streamline federal funding of medical education  

·        Repeal or scale back certificate of need and certificates of public advantage requirements 

·      Loosen network adequacy requirements 

 

Not likely to have an impact by 2020:

·      Ease restrictions on foreign-trained doctors

·      Amend federal trade commission jurisdiction over nonprofits

·      Scrutinize non-compete clauses and other restrictive covenants

·      Scrutinize any-willing-provider laws 

·      Loosen insurance rules and mandates replace restrictions on physician-owned hospitals 

·      Reconsider the Affordable Care Act’s nondiscrimination requirements 

·      Give patients more spending control 

·      Realign incentives, including expanding health savings accounts 

 

Not likely to have an impact by 2020, and the real opportunity lies in the private sector:

·      New alternative payment models to replace ones that are found to be lacking

·      Positively realigning incentives through payment reform 

·      Streamline quality improvement and quality measure reporting

·      Facilitate price transparency

·      Increase access to claims data 

·      Improve health IT, including interoperability 

 

Not likely to have an impact by 2020, but private sector movement could eventually lead to public sector change:

·      Address potential antitrust and provider consolidation  

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