What Does the Trump Presidency Mean for Your Independent Medical Practice?

By Tom Giannulli  |  November 16, 2016

Many health IT vendors and medical practices have been gearing up for continued Affordable Care Act (ACA)-driven regulation over the past year based on the assumption that we would have a democratic president and split congress for another four years. Many were surprised to find that the republicans swept the election, and the table is set for significant change in healthcare policy.

Looking at early policy commitments and recent announcements as they relate to healthcare, a path seems to be materializing, although not highly specific, that offers some directional guidance on what might happen.

ACA repeal or modification is clearly a top priority for the Trump administration in the first 100 days in office. The repeal process can be achieved without democratic intervention, however actual replacement may be a challenge. While passing a new law requires 51 votes, if there is a filibuster, it requires 60 senate votes to overcome the filibuster and force a vote.  Given the 54 seats held by senate Republicans, and the probability that the senate democrats will filibuster, this path is less likely. Instead, a set of modifications to the existing law may be the path of least resistance and the best option for both parties.

We are likely to see a set of changes around several key areas that relate to reducing Medicaid expansion, dropping the insurance mandate, and expanding the use and flexibility around high deductible plans (HDPs), health savings accounts (HSAs), and purchasing insurance across state lines. There could also be a huge win for consumers in the form of improved pricing transparency, and options to buy drugs from other developed countries at significant savings.  

On the heels of the MACRA final rule, these potential changes lead to the following question: What impact will anticipated ACA adjustments have on the current shift to value-based care? 

This is an important question, as it will significantly affect the payment models for both large and small practices across the US. At this point, there isn’t any evidence that the shift to value-based care will be significantly impeded by the Trump presidency or congress.

Despite the ACA being the sentinel legislation for value-based care, follow-on legislation such as the bipartisan MACRA law cemented the path to value-based reimbursement for all Medicare providers over the next five years. This is driven in large part by the pending insolvency of Medicare by 2025, and the need to slowly but consistently mitigate this risk by moving away from fee-for-service (FFS).  

The Trump administration will likely seek to make a set of changes that do not restructure the fundamental shift to value-based care, as this will not result in fiscal improvements nor address top priority items within their stated plan. Many industry thought leaders seems to agree with this, including Marc Probst and John Halamka. "In my conversations with Washington DC career staff (not political appointees), there is a sense that the Quality Payment Program will go forward as written," Halamka said in a recent article.

If these assumptions are correct, then what changes are in store for the independent practice? 

First and foremost, the shift away from FFS should still be anticipated over the next 12 to 24 months as the MACRA Quality Payment Program is put in to place and begins to effect actual practice revenues beginning in 2019.  This translates into the need to drive better patient outcomes, as practice revenues will increasingly be a function of reported quality scores.   

Second, the move towards consumerized healthcare may continue to accelerate, as HDPs become even more pervasive, and patients have significant transparency and choice when it comes to routine healthcare services. This could place a new premium on customer service, convenience, and reputation for the independent medical practice. 

It is important to note that the increased use of HDPs is somewhat at odds with existing value-based care initiatives. High deductible plans tend to increase out of pocket costs associated with patient compliance. However, it is imperative that patients comply with physician-directed care plans designed to reach positive clinical outcomes. Without sufficient discounted or free outcome-linked services built into each HDP, outcomes, and therefore provider revenues, will suffer as this multi-dimensional transition occurs. The challenge is to find the correct balance to drive the patient towards better outcomes while providing clear value in the process.

While this analysis is based on early information, and a minimum of hard data, there are some clear directional signals as to how the independent practice should be preparing for the next 12 months. The most notable is that there is no indication that MACRA will be changing or going away, and that success with value-based programs may become more challenging in the years to come. So, while we watch to see what will happen with the ACA, continue to prepare for participation in MACRA.

Look for additional updates on changes in healthcare policy on this site as well at the Kareo MACRA Resource Center.

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