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The chances for further policy changes in healthcare over the next several years are expected to be minimal, said panelists during a roundtable discussion at the 2016 National Comprehensive Cancer Network annual conference. The exception may be the Medicare Part B demonstration project for provider reimbursement for infused and injected drugs.
“The actual substance of what will happen over the next several years, I think will be fairly constrained within…a set of boundaries that will not allow necessarily for really significant policy change but will stimulate some important change in a few targeted areas,” said Lanhee J. Chen, PhD, JD, Research Fellow at the Hoover Institution, Los Angeles, CA. The majority of healthcare issues will be viewed through the lens of cost, he said.
One question that policymakers may be willing to tackle is whether organizations are ready to handle the innovation coming out of the health sector, said Dr Chen.
The Affordable Care Act (ACA) is encouraging more collaboration in care delivery, said Elizabeth J. Fowler, PhD, JD, Vice President, Global Health Policy, Johnson & Johnson. “You are starting to see different players in the healthcare system work together in ways that we have not ever seen before,” Dr Fowler said. The missing pieces include data-sharing across the different stakeholders in the healthcare system, including industry, providers, and patients.
Payment reforms under consideration are “various forms of capitation,” such as bundled payments, said Scott Gottlieb, MD, Resident Fellow, American Enterprise Institute. “Those are terribly flawed models…swapping one bad payment system for another bad payment system, and doctors are going to be given an inordinate number of incentives to try to clamp down on costs and use of technology,” Dr Gottlieb said.
Consolidation in the delivery system, much of which is driven by payment reform, is another concern, said Dr Gottlieb, and “will be very hard to unwind.” In effect, healthcare monopolies are being created by consolidation, and this may ultimately reduce competition, drive up healthcare prices, and reduce physician productivity.
Narrowing of provider networks and drug formularies may soon become a market standard and represent another concern, because they leave consumers underinsured for drugs, Dr Gottlieb said. However, Dr Gottlieb is optimistic about the pace of technological change.
The Pace of Innovation: Does CMMI Foster or Hinder It?
The Center for Medicare & Medicaid Innovation (CMMI), as established in the ACA, ensures the role of government in driving innovation, but should the government be driving innovation, Dr Chen asked.
“The idea behind CMMI was to put money into a system to test ideas in the private sector,” said Dr Fowler. “What innovations are out there that Medicare ought to be looking at? And if it works in Medicare, maybe we ought to think about expanding it. It was supposed to be more of a feedback loop.”
Because healthcare is a local endeavor, with the characteristics varying by different regions, an innovation that works in one part of the country may not be successful in a different area, said Dr Gottlieb, who argued that CMMI may actually be hindering innovation.
“It would seem to me that this is an opportune time for private capital to come into the market to consolidate physicians as an alternative to doctors selling their practices to hospitals, yet there is no capital coming into the market to do it,” Dr Gottlieb said.
Medicare Part B Payments
Boutique issues, such as drug pricing, within healthcare are more likely to become issues in an election year as opposed to general policy, said Dr Chen. “I am one of those who think that this Medicare Part B demo will be a campaign issue. What is the appropriate role for government in setting payment policy in influencing the kind of care and routines of care and episodes of care?” he asked.
The sweet spot in payment innovation has eluded lawmakers, said Cybele Bjorklund, MHS, Distinguished Visitor and Senior Fellow, Georgetown University, Washington, DC. Capitation may incentivize undertreatment, whereas fee-for-service may encourage overtreatment, and “right sizing” these incentives will be challenging.
The Medicare Part B demonstration project is an aggressive play to propose payment reform nationally, and is potentially an overreach, Ms Bjorklund said. At the same time, the average sales price (ASP) system for Medicare Part B drug payment is not good policy, including the ASP plus 6% and any changes to this formula.
“I think this is a chance to fundamentally rethink how we pay for Part B drugs, and maybe move it into a different kind of schema,…rather than just how we change or tinker with the existing rule, or change the percentage,” said Dr Gottlieb.