As the holidays approach, I have been thinking about the last year on a personal and professional level. I’ve also reviewed what has happened on the national and global front around health care. For many of us, the election and ensuing transition are foremost in our minds. But, aside from those events, quite a lot of significant activity colored the health care landscape this year.
New public health crises: At the beginning of the year, the Ebola crisis – the infectious disease epidemic that had dominated international public health news for several years – seemed to be waning. But, as that problem moved out of our sight, we began to worry about Zika – an insect-borne and sexually-transmitted illness with the potential to cause serious birth defects. There were even concerns about Olympic athletes’ contracting the disease. Though no significant illness was reported around the Olympics, we may not have seen the end of Zika.
Another, less global, public health crisis that rose in the public’s awareness in 2016 has been the opioid epidemic. It stems from many converging trends – from income inequality to treatment patterns around chronic pain. Although we have learned more about effective treatment programs and states have developed better surveillance to prevent some aspects of this problem, we are just beginning to understand how to address the root causes. Opioid abuse’s presence in health care will likely not go away any time soon. The 21st Century Cures legislation included new programs and funding to tackle this problem.
Intense CMS activity around value-based care: Between the final rule for the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and multiple announcements of new payment initiatives, CMS has kept health systems and clinicians busy transitioning to new payment arrangements and program designs. Up to now, these programs have been voluntary. But, barring any major regulatory or legislative changes, the next wave of bundling programs will not be. Early adopters have learned many lessons about bundling, various forms of accountable care organizations (ACOs), and patient-centered medical homes (PCMHs) that the broader health care community can learn from.
- The final MACRA rules were published in early November. Comparing the proposed and final rule, CMS took steps to give health systems and clinicians a transition period before some aspects of the program start. Clinicians now can report fewer measures for a shorter period to avoid negative pay-for-performance adjustments. CMS also removed cost measures for the first year and excluded more clinicians from the program.1
- The second evaluation of the Bundled Payments for Care Improvement (BPCI) initiative found statistically significant savings among participants, especially for joint replacement procedures.2 Whether organizations will be able to consistently find these types of savings from other types of bundles is the next big question in bundling. We examined this question in the forthcoming Deloitte Center for Health Solutions paper, “Do bundled payments produce savings?” which will be published next month.
Increased focus on drug value: In 2016, the debate about drug prices continued. The focus shifted to specific products with high launch prices and price increases. Meanwhile, surveys of consumers flagged affordability of health care as a major concern, and many consumers identified drug prices as part of this issue.3 As consumer concern and attention about this issue rises, industry leaders have been focused on how to bring payments for pharmaceutical and medical device products into alignment with the value that they bring to better health outcomes. As a result, this year saw increased activity in value-based contracting between life sciences companies and purchasers, which have the potential to align payments with value. This is another area that the 21st Century Cures legislation tackles, offering policy direction to change how the government reviews and approves drugs (see the December 6, 2016 Health Care Current).
Exchanges: Citing losses, many large health insurance companies announced their plans to leave the public health insurance exchanges, and consumers saw fewer choices and higher premiums in some areas of the country. Premium subsidies help to insulate low-income consumers from some of these premium increases. Deloitte’s own consumer research found that people who obtain health insurance through the exchanges continue to act like savvy shoppers. They are showing signs of increased confidence in coverage affordability and are just as satisfied with their coverage as people with employer coverage.
Despite all of the progress we’ve made throughout the year, we need to remain committed to improving performance and value in health care, even as the policy direction for the new administration and Congress takes shape. Health care spending is beginning to accelerate again. Part of that is expected as more people have coverage.4 Moreover, longevity among the US population appears to be on the decline.5 Part of the problem is that we still haven’t figured out what it takes to maintain healthy habits and healthier living. Chronic conditions related to diet and exercise persist even though there are lower rates of smoking. As excited as I am about the promise of wellness programs leveraging new digital technology and lessons from behavioral economics, I continue to wait to see something really work for large populations over a sustained period of time.
On a personal level, I am happy to be able to continue to run and hike with my dog Toby, and am plotting my strategy around holiday eating – a necessity given how much I love to cook and eat, the amount of treats this time of year, and the natural tendency for my body to want to dig in and eat since it is cold outside. I need an app for that!
As we close out the year on the Health Care Current, wishing all our readers a healthy and happy 2017 – and better value in the health care system going forward.
1 Deloitte Center for Regulatory Strategy, “CMS locks in January 1, 2017 start date in final rule on new Medicare payment tracks under MACRA,” Reg Pulse, October 17, 2016.
2 The Lewin Group, CMS Bundled Payments for Care Improvement Initiative Models 2-4: Year 2 Evaluation & Monitoring Annual Report, August 2016.
3 Kaiser Family Foundation, Kaiser health tracking poll: September 2016.
4 CMS, “National Health Spending: Faster Growth In 2015 As Coverage Expands And Utilization Increases,” Health Affairs, December 2016
5 Lenny Bernstein, Washington Post, “US life expectancy declines for the first time since 1993,” December 8, 2016