The U.S. Department of Health and Human Services on Monday hit the brakes on several quality improvement initiatives in Medicare, a gift to health care providers and the latest in a string of industry-friendly moves by HHS under the Trump administration.
Monday’s move delays the debut of new and expanded payment models affecting reimbursement for cardiac care and broken hips. The large-scale pilot projects, finalized in the last days of the Obama administration, were pushed back three months to October and may eventually be postponed to January.
Regulators provided no explanation for the action, writing only that they will study “if modifications are warranted” to the models. But the rollback was unsurprising, as HHS Secretary Tom Price — when still a congressman in September — fired off a letter asserting that HHS’ Center for Medicare & Medicaid Innovation had acted improperly by making the models large and mandatory.
“As evidenced by [the] recently proposed mandatory models, CMMI has exceeded its authority, failed to engage stakeholders, and has upset the balance of power between the legislative and executive branches,” wrote Price, who later criticized the models at his confirmation hearing.
Deborah Gersh, co-chair of the health practice at Ropes & Gray LLP, told Law360 on Monday that the postponement directly aligns with Price’s mantra of not requiring vast numbers of doctors and hospitals to participate in untested payment programs.
“I think what he’s doing is hitting the pause button to determine how his tenure at HHS will be remembered,” Gersh said. “My guess is that he wants to really study this and ease the burden.”
Easing burdens for industry has been HHS’ modus operandi since the start of the Trump administration. Last month, it proposed that health insurers be allowed to sell less generous policies and offer slimmer provider networks. On Friday, it delayed a revised approach to oversight of off-label drug promotion.
Separately on Monday, it made a promise of upcoming administrative actions to “relieve the burden” of the Affordable Care Act. Those actions will include “providing relief from the burdensome regulations” in insurance markets and granting more leeway for states to administer Medicaid programs, HHS said.
The payment models affected by Monday’s delay include three models related to heart attacks, bypass surgery and cardiac rehabilitation. Also affected is a fourth model that applies to hip fractures and expands a program known as Comprehensive Care for Joint Replacement. Price, a nonpracticing orthopedic surgeon, introduced legislation last year to suspend the CJR.
Experts say that HHS could make a variety of changes to the models. Options include completely scrapping the models, making them smaller or optional, or altering their payment structures. The new CJR model, in particular, could be dialed back because of Price’s professional experience with joint replacements and surgery.
“He’s probably more empathetic to that community than others, given his own background,” said Miranda Franco, a senior policy adviser at Holland & Knight LLP. “So I could definitely see there being a change from mandatory to voluntary.”
The models for cardiac care haven’t yet begun. The model for hip fractures also hasn’t started, but it would be part of the CJR program, a five-year demonstration that kicked off last year. It’s possible that Price will ultimately feel more comfortable about targeting nonexistent models than trying to undo programs that are already underway.
“It’s much easier to get rid of the ones that haven’t started,” Gersh said. “If it hasn’t, and he can find a way to get rid of it, he may very well.”
When HHS finalized all the models in December, the American Hospital Association voiced sharp criticism that echoed commentary from Price.
“Hospitals should not be forced to participate in complicated new programs if the government has not already proven that they will benefit the patients we serve,” the AHA said at the time.
On Monday, the association was more subdued. It said that the delay “will provide additional room for hospitals to prepare,” but it also signaled a desire for HHS to act decisively one way or another.
“We would be concerned if the start date becomes a moving target, towards which hospitals continue to expend significant investments of time, effort and finances, but that never comes to fruition,” Joanna Hiatt Kim, the AHA’s vice president for payment policy, said in a statement.
It’s possible that the desire for the new administration to revisit certain regulations is being tempered by Republican efforts to repeal and replace the ACA. Repeal could cause significant disruption for hospitals, and the AHA has opposed the efforts in their current form.
“There’s so much uncertainty right now in the health care space — especially for hospitals as we look at ACA repeal and replace — that having some certainty, even if it is a mandated program, is something I think folks would welcome,” Franco said.
That certainty could take a while to develop, as HHS on Monday said that it may engage in formal rulemaking, which is usually time consuming. On the bright side, most health care providers fully expected the Trump administration to shake up health care policy, and while that shake-up may be turbulent, it may ultimately be good for business.
“Many are taking a much more wait-and-see attitude right now. I think there’s a lot of uncertainty, and I think there’s overall an expectation that pieces of this will be overhauled,” Gersh said. “And there’s also going to be rulemaking, so the rulemaking may allow more clarity, more flexibility. Who knows?”
Date: March 19, 2017