With the transition to a new administration well underway, the fate of the Affordable Care Act is weighing on everyone's mind. We've all heard the rhetoric of repeal and replace, but what will a new system look like? One thing remains clear: The challenges haven't changed. Healthcare costs continue to soak up budgets in families, states and the federal government.
We must come together to find ways to continue to improve quality while safely reducing costs and building on gains achieved over the past several years. Here are a few things to consider:
Congress needs to hit the ground running. The new Republican-controlled Congress will be sworn in on Jan. 3. Look for both chambers to begin work immediately on healthcare-related issues—starting with Senate hearings on Cabinet nominees, including Dr. Tom Price for HHS secretary. Once confirmed, Price will be among those working on a repeal-and-replace strategy for the ACA focused on vouchers to purchase high-deductible, catastrophic plans, coupled with health savings accounts.
It is likely he will advocate keeping the restriction on pre-existing conditions, provided coverage is purchased and maintained. While broad strokes are clear, the details will be more complex. Like a game of Jenga, Republicans will need to balance the pieces to ensure anything they jettison doesn't cause unintended consequences.
Coverage expansion limbo can't go on for long. Because most of the ACA is in place, it will be difficult to roll back benefits—and Republicans certainly are not united around the best path forward. We can expect at least a year of consensus-building around coverage expansion issues, e.g., individual and employer mandate, Medicare Advantage, Medicaid expansion, exchanges, subsidies, high-risk pools and insurance regulations. There will also be debate around eliminating or reducing device, pharmaceutical, insurance and other taxes that fund the ACA expansions. However, Congress can't wait too long. Insurers will be hesitant to participate in the exchanges for 2018 without some certainty.
The move to pay-for-value will continue. The move toward alternative payment models and provider accountability in the shift toward a value-based system is bipartisan. MACRA, which passed with support from both sides of the aisle, solidifies and extends the move to new constituents. This means there is a vested interest in seeing these models succeed. The fiscal imperative to rein in healthcare spending while improving quality will require lawmakers to continue to press for changes that pay for value, promote increased consumer responsibility and increase transparency of costs and quality. This is not up for debate—it's clear that value is the new healthcare economy and measures are the currency.
Increasing pharma competition must be a top priority. The pressure to contain health spending will only increase. At this time, Republicans don't appear to be looking to curb spending by placing regulatory constraints on pharmaceutical or device pricing. However, we do need solutions that drive market competition to keep pharmaceutical and other costs down, such as faster approvals from the Food and Drug Administration, more biosimilar approvals, ending pay-for-delay and turning toward value-based contracts. Without greater choice and competition, providers could be caught between increasing costs and constrained reimbursement.
More power to the states. Look for Congress to empower the states to determine localized directions for Medicaid and their healthcare systems. Governors will be important advocates for change, and we expect more states will seek Medicaid waivers. This is an opportunity to move Medicaid payment to align with other population health models such as accountable care organizations. Moreover, providing states with increased authority will help conservative governors advance Medicaid expansion using more incentives for people to take better care of themselves.
Healthcare remains the top social and economic issue facing our country. We must continue to address pressures in our system through delivery system transformation. This includes regulatory relief from policies that prevent integrated, coordinated care; increasing access to data for providers in alternative payment models; introducing a streamlined hospital pay-for-performance program; and fixing the shortcomings in the ACO programs. Now is the time to introduce changes that will provide a better chance at a healthier life for all Americans.