WASHINGTON—The health insurance industry is calling for a more organized, cooperative approach to build on the Affordable Care Act. But large barriers stand in the way of getting to any kind of kumbaya moment—especially during an election cycle that has been fraught with partisan pandering and bitter attacks.
America's Health Insurance Plans, the industry's largest trade group, emphasized to its members during its annual policy conference that they must be more vocal in convincing the government they can help with payment and delivery-system reforms. AHIP CEO Marilyn Tavenner also said groups must work with other competing healthcare stakeholders if they want to see further reforms enacted.
“The real muscle behind this effort is the boots on the ground,” said Tavenner, who previously was the CMS chief in the Obama administration. “It's each of you that will be providing the impetus for change.”
The ACA has encouraged the healthcare system to work more together to reduce costs and improve clinical outcomes, but it has rarely led to consensus on policies. Heightened pressure to rein in the growth of the nation's healthcare spending means everyone's revenue is fair game. Hospitals, doctors, insurers, employers, drug companies and medical-device manufacturers, therefore, continue to advocate and lobby for their own interests, which are often at odds with each other.
“Everybody is supporting value-based reimbursement providing they define it,” said Chip Davis, CEO of the Generic Pharmaceutical Association. “That is not going to be an insignificant hurdle to overcome.”
The health insurance industry has faced its own internal struggles. Aetna and UnitedHealth Group recently left AHIP, creating turmoil in the opening phase of Tavenner's tenure. But she told executives this week that she's confident the private sector will shape policy discussions around insurance coverage and value-based payments.
A lot of work remains on the payment side. HHS has touted value-based successes in Medicare thus far, saying this month that 30% of all fee-for-service Medicare payments are now tied to alternative models that reward quality over quantity. That goal was reached almost a year ahead of schedule.
Yet aggressive value-based models are not nearly as prevalent in the commercial market, and very few plans and providers participate in full-risk, capitated payment systems. Not all of the private models have been successful, either. Health plan executives said at an AHIP event last year that many private accountable care organizations have not saved costs or improved quality.
And although it's not discussed often, many in the industry agree the current reimbursement structure that pays for every test, procedure or drug will never be completely eradicated.
“Even with all these changes, we're not going to move that far away from fee-for-service,” said Chip Kahn, CEO of the Federation of American Hospitals, the trade group representing for-profit hospitals.
Hospitals and insurers have teamed up on emerging models like ACOs, but the two sides still have a long way to go. AHIP has long argued provider consolidation inflates healthcare costs, while the hospital industry has heavily criticized the pending insurance megamergers. AHIP has been mostly silent on Anthem's $54 billion takeover of Cigna Corp. and Aetna's $37 billion acquisition of Humana, turning most of the attention back to provider deals.
Dan Durham, a former AHIP executive vice president who bolted for the Biotechnology Innovation Organization this year, broadly defended the health insurer deals to Congress last year. But if the deals are approved, it may not necessarily benefit the system or AHIP, which would lose membership dues from two large members.
“We've always said we're very pro-competition,” Tavenner said at this week's conference.
Dr. John Bennett, CEO of Capital District Physicians' Health Plan, a large local insurer based in Albany, N.Y., has been a vocal critic of drug companies and called their recent pricing schemes “unconscionable” and “immoral.” At AHIP's conference, he said insurers should do more on their end to keep drug spending down, but they also should proactively fight for laws that force drugmakers to disclose their pricing process.
“We really have to double down on our focus on price,” Bennett said. “I think we have to keep pushing hard on transparency.”