(Story updated at 4:45 p.m. ET)
President-elect Donald Trump's selections for the top healthcare posts in the federal government signal an appetite to move aggressively to repeal and replace the Affordable Care Act, overhaul Medicare and give states more control over Medicaid.
U.S. Rep. Tom Price, a fierce ACA critic, was nominated to be HHS secretary, and Seema Verma, who helped craft Indiana's conservative Medicaid expansion, was nominated to lead the CMS. Both nominations are subject to Senate confirmation.
Price, an orthopedic surgeon from Georgia, currently has a powerful position as chairman of the House Budget Committee. The Republican is also on the Health Subcommittee of the House Ways and Means Committee.
Verma, a consultant, worked with Vice President-elect Mike Pence, the governor of Indiana, on Healthy Indiana 2.0, a Medicaid program that requires monthly contributions to health savings accounts.
"Together, Chairman Price and Seema Verma are the dream team that will transform our healthcare system for the benefit of all Americans," Trump said in a statement.
Democrats reacted with alarm, though they lack the power to block Price because of a change to filibuster rules they orchestrated when controlling the Senate.
"Congressman Price has proven to be far out of the mainstream of what Americans want when it comes to Medicare, the Affordable Care Act and Planned Parenthood," said incoming Senate Minority Leader Charles Schumer (D-N.Y.) "Thanks to those three programs, millions of American seniors, families, people with disabilities and women have access to quality, affordable health care. Nominating Congressman Price to be the HHS secretary is akin to asking the fox to guard the hen house."
Price has been a staunch ACA critic and was one of the first to put forward his own replacement plan in the form of the Empowering Patients First Act.
It involves age-adjusted tax credits to help people buy insurance as well as increased reliance on health savings accounts and high-risk pools at the state level. It would allow people to opt out of Medicare, Medicaid or Veterans Affairs benefits and receive the tax credit to buy an individual plan. Critics say the plan would fail to keep pace with inflation and force higher out-of-pocket costs like deductibles and co-payments. The legislation has not been scored by the Congressional Budget Office.
Experts have also guessed he would concentrate on state reform efforts and noted he has worked across the aisle. Price has been a strong supporter of looking to state governments for proposals of how to spend their healthcare dollars, even if the ideas are more left-leaning than he might personally advocate.
He would likely encourage states to seek waivers for using Medicaid and other federal healthcare dollars their own way.
Price has recently touted the healthcare plan spearheaded by House Speaker Paul Ryan, which has many of the same elements.
Prospects would be unclear for federal initiatives underway that are intended to move Medicare and the entire industry away from fee-for-service reimbursement and focus on paying for the value and quality of care.
Price voted in favor of the Medicare Access and CHIP Reauthorization Act, which put Medicare payment for physician services on a path toward value-based reimbursement. Recently, however, he has criticized some aspects of the law's implementation. He has specifically said reporting requirements are a burden to physicians and should be streamlined.
Price has said the Center for Medicare & Medicaid Innovation, which develops and pilots value-based payment models and has been a frequent target for conservatives, has too much authority and should defer more to Congress. He has called on the Obama administration to end its most aggressive demonstration projects.
In September, Price requested the CMS “cease all current and future planned mandatory initiatives under the CMMI,” in a letter to CMS acting Administrator Andrew Slavitt and Deputy Administrator Dr. Patrick Conway co-signed by 178 other members of Congress.
Those initiatives include a mandatory bundled-payment model for hip and knee replacements, which took effect in April; a proposed Medicare Part B drug payment model; and a cardiac bundled-payment model slated to take effect next July.
The letter not only slammed the CMS Innovation Center as having “exceeded its authority (and) failed to engage stakeholders” but also criticized its policies and proposals as having “potentially negative effects on patients,” especially seniors, because they could limit access to care by fostering consolidation and reducing doctors' participation in Medicare.
Previously, CMMI's models were voluntary and on a small scale, the letter pointed out. But the newer programs were large-scale and mandatory. The joint replacement bundled-payment model affects over 800 hospitals in 67 metropolitan areas, while the cardiac bundle would apply in 98 randomly selected metropolitan areas.
“We insist CMMI stop experimenting with Americans' health and cease all current and future planned mandatory initiatives within the CMMI,” the letter concluded. “We look forward to your response detailing next steps as to how the agency plans to ... refrain from pursuing any future initiatives that exceed CMMI's scope of authority.”
Price also co-sponsored legislation to block the proposed Medicare Part B payment model.
But Price might turn out to be a strong advocate for value-based initiatives, according Blair Childs, senior vice president at Premier, a company that offers performance-improvement services for hospitals and health systems. “The Republicans want MACRA to succeed. It's their baby,” Childs said.
Childs also said Price is likely to support voluntary experiments with alternative payment models, but with more opportunities for waivers and innovation.
“He was concerned (with the Innovation Center) when Democrats were in charge,” he said. “I think he'll be less concerned when the Republicans are in charge.”
Price joined Congress in 2004 after four terms in the Georgia state Senate. He worked in private practice for nearly 20 years and has taught residents at Emory School of Medicine and Grady Memorial Hospital in Atlanta.
Health professionals have been a major source of donations to Price throughout his political career. Individual and political action committees in the healthcare sector have donated more than $4.8 million to him. The American Association of Orthopaedic Surgeons is a top donor group.
Industry groups, who will soon rely on Price to consider their interests as the Trump administration puts the industry in flux, generally came out in support of his nomination. They were particularly pleased to see a doctor in the role. The last HHS secretary with a medical background was Dr. Louis Wade Sullivan, who served during President George H.W. Bush's administration and was founding dean of the Morehouse School of Medicine.
Organizations that sent out statements of support of the nominations included the American Medical Association, American Hospital Association and America's Essential Hospitals.
"Particularly noteworthy about both nominees is their experience caring for low-income and other vulnerable people, shaped by their work at hospitals with a safety net role— essential hospitals," said Dr. Bruce Siegel, CEO of America's Essential Hospitals.
Several advocacy groups, however, decried the choices and said they would be especially problematic for women's healthcare.
Price has called for defunding Planned Parenthood and has supported many pieces of anti-abortion legislation. In 2015, he co-sponsored a bill that would ban abortion after 20 weeks.
He also has opposed the ACA provision that requires plans to cover birth control as a no-cost preventive measure.
Planned Parenthood President Cecile Richards called Price an “extreme opponent of women's health.”
“Fear of a Health and Human Services secretary like Tom Price is why Planned Parenthood has seen a significant increase in in online appointments for birth control, with a more than ten-fold increase in people seeking IUDs the first week following the election,” Richards said in a statement. “People are worried they will lose their health care.”
Center for American Progress CEO Neera Tanden, who worked on Hillary Clinton's campaign, sent out a statement denouncing Price as “not qualified” and saying he “shows no concern for improving the health and livelihood of working Americans.”
Price would likely work closely with Paula Stannard, a former deputy general counsel and acting general counsel at HHS, who reportedly has been tapped by the Trump team to work more broadly on health reform initiatives. Stannard oversaw the food and drug, civil rights and legislation divisions of the 450-attorney HHS Office of the General Counsel. She also provided legal advice and counsel to senior HHS officials, including secretaries Tommy Thompson and Michael Leavitt.
