Nine ways Trump will change healthcare


A Trump administration is expected to have far-reaching impacts on healthcare. Here are nine changes to keep on your radar.



President-elect Trump’s strategies for changing healthcare will have significant implications for insurers, according to industry experts.

“We expect that the new administration may have wide-reaching impacts on healthcare-yet significant uncertainty remains to the magnitude, timing and in some cases, direction, that policy and other dynamics may take to impact how healthcare is purchased, paid for, accessed and delivered,” says Greg Maddrey, director and value-based care practice leader, The Chartis Group. “It is incumbent on any actor in the healthcare landscape to pay close attention over the coming months as more clarity emerges to begin to understand the implications of the new administration on the healthcare economy broadly, as well as on specific lines of business or markets.”


Nick Vennaro, executive vice president and co-founder of Capto Consulting, shares a similar viewpoint. “It is especially important for managed care executives to keep Trump’s decisions on their radar because the situation is fluid and uncertain-characteristics anathema to business planning,” Vennaro says. “For example, if payers have to sell insurance across state lines, they will have a huge undertaking on their hands. This would mean they need to negotiate with many, many more hospitals and health systems-than they currently do-and drive significant technology changes to support such an effort.

“Significant policy changes will transform healthcare business processes yet again and lead to tectonic technology changes to support such an effort,” he continues. “Almost without exception policy changes cause a ripple effect, where a seemingly small change from the federal government begets major business and technical upheaval. Especially for the chief information officer who must contend with brittle legacy applications while building/buying/integrating new systems.”

Dan Hughes, managing director of sales at Softheon adds, “It is already apparent that president-elect Trump is finding himself in a complicated position regarding his stance on healthcare. During the heat of the campaign cycle, Trump had frequently referred to the healthcare law as a ‘total disaster’ and pledged to his supporters that if elected he will immediately repeal it and replace it with ‘something much better.’

"However, since being elected he has made the definitive claim that certain elements of the law will remain in place,” he continues. “As always with politics, it can be difficult to determine what is simply rhetoric and what will actually make its way through Congress and onto the desk of the president.”

With that, here are nine ways Trump will change healthcare.

Next: Affordability focus



1. Continue the focus on affordability-but pursue different means to achieve it.

“Healthcare in the United States is too expensive for households, employers and the government alike,” says Maddrey says. “The imperative for cost containment persists, regardless of who was elected. That said, the set of solutions that [Trump] and his leadership team bring to the table at their core may seek to address this same issue-but through meaningfully different mechanisms and at different points of control.”

Next: Healthcare's biggest challenges


2. Tackle healthcare's biggest challenges.

“We can expect to see a significant shift for the areas of the plan that were suffering from challenges, such as insurance premium increases, rising out-of-pocket costs, physicians dropping out of the exchange as well as decreasing reimbursement rates,” says Alan Portela, CEO at AirStrip.

Portela predicts a strong improvement in the areas of healthcare IT investments and market opportunities as the movement to value-based reimbursement continues under the new administration with strong support for MACRA as a bipartisan effort.

“The upcoming planned transition from the ACA to a more efficient model will also force vendors to be able to demonstrate an ROI case that is not explicitly tied to government incentives or massive structural changes in reimbursement,” he says. “In other words, vendors will need to play nice with other vendors and show their financial, clinical, organizational, and social value to stay relevant. Collaboration around shared value ecosystems is the only way forward and clinical workflow optimization tools will need to take a center stage to improve caregiver-patient communication.”

Next: Repeal and replace


3. Repeal and replace Obamacare.

There’s much uncertainty about the future of the Affordable Care Act (ACA), experts agree. “After all, Trump made repeated campaign promises for a full repeal,” says Vennaro.

In a recent interview with The Wall Street Journal, Trump said that he is willing to keep parts of Obamacare, including the measures on pre-existing conditions and keeping children on parents’ policies.

“However, you can’t just choose to keep the popular parts intact because some of the more unpopular portions of the healthcare law are what make it work,” Vennaro says.

For example, he says, if insurance companies are required to cover everyone, prices rise to cover the cost and healthy people exit. “Prices then go up more, and the less-healthy people leave resulting in sky-high prices,” he says. “Trump could incentivize healthy people to stay in the pool with subsidies, but that would require even more government spending which is unlikely for his Republicans to pass.”


In addition, says Jay Sultan, vice president, TranZform Product Management, TriZetto, a Cognizant Company, believes that the individual mandate and the luxury tax are certain to be repealed.

“The most financially impactful areas of the law, such as Medicaid expansion and the subsidy, are likely to stay in effect, with some modifications,” he says. “If the subsidy stays in place, then the marketplace or something like it will also stay in place.”

While the dismantling of the ACA may roll back coverage expansions that led to a decrease in the uninsured rate, thereby increasing the number of uninsured individuals, projected economic growth would likely lead to increases in the number of individuals covered by employer-sponsored insurance, according to Maddrey.

“Employers will continue to look for solutions to address healthcare spending for their employee populations as they have been for the past several years, for example through benefits designs and shifting cost-sharing to employees, but a more competitive labor market could also mean that employers will seek to maintain competitive benefits packages,” Maddrey says. “During the campaign Trump also floated ideas about how to foster competition-for example through selling insurance across state lines-but until more specificity emerges on this and other proposed approaches, it is hard to foresee what impact it may have on payers, providers or consumers alike.”

Next: What takes center stage?




4.     Make interoperability and cybersecurity take center stage.


Trump has the opportunity to leverage some of the work of President Obama in this area, and improve on what didn’t, according to Portela.

“One thing that President Obama didn’t prioritize was interoperability-his administration didn’t recognize the importance of interoperability in support of value-based reimbursement incentive programs,” Portela says. “A clear example was the Meaningful Use program from the ONC which concentrated primarily on the adoption of electronic health records and did not include interoperability and cybersecurity as part of the vendor’s certification process, creating the biggest data blocking and vendor control siloed environment ever experienced in healthcare. There was a lot of talk around interoperability during Obama’s second term, but all around very weak interoperability standards and with a 10-year roadmap that was going to cause the system to implode.”

According to Portela, the roadmap has to take into consideration that current standards do not provide immediate support for clinically relevant workflows. “The Trump administration has the opportunity to force legacy vendors to open up the data and increase requirements around cybersecurity, creating a path to personalized and precision medicine,” he says. “I believe that the both the government and healthcare providers do not understand the high risks of cyberterrorism that go way beyond the hackers trying to obtain PHI information. We need to learn from what it is currently done by the military health system in this area.” 

Next: Selling healthcare across state lines



5. Selling healthcare across state lines.


Trump repeatedly stated throughout the campaign that part of the reforms he would put into place would be to ‘get rid of the lines between the states’ according to Hughes.

“More specifically, this is referring to the current inability of insurers to offer plans across state lines due to the varying insurance regulations that exist in each state. Legislation to this effect could very likely gain traction as it is a healthcare reform proposal that has long been raised by Republicans,” Hughes says.

“The Trump administration may opt to lower healthcare costs to allow individuals and families to purchase health insurance across state lines,” Vennaro says. “This has the advantage of increasing competition and people living in rural areas would have more choices. Additionally, the Trump administration is likely to invest in and promote telehealth technologies and processes. Again making healthcare less expensive and more accessible.”

Next: Medicare, Medicaid, FEP


6. More efforts to reform Medicare, Medicaid, and the Federal Employee Program (FEP).

“There will likely be Medicaid cost shifting to the states, especially those that enacted expansion under Obamacare,” says Sultan. “Under the banner of ‘reform’ or ‘privatization,’ legislation is likely to modify Medicare and FEP to make them more like commercial insurance.”

Maddrey agrees. “We expect even more variability than is currently in place today between states in terms of what is covered, for whom, and with what requirements for beneficiaries,” he says. “For Medicaid managed care, there may emerge some real opportunities in select states, while in other states, there may be some significant challenges.”

Sultan also expects fraud, waste, and abuse enforcement will increase, along with audits and other compliance measures.

“Expect all programs to see increased use or impact of increasingly complex risk adjustment methodology,” he says. “There will be a continuation and acceleration of payment reform efforts to make providers accountable for the quality and efficiency of healthcare. This will impact both government-funded and commercial healthcare broadly.”

Next: Federal government: A limited role



7. A more limited role for the federal government, including CMS’s role in driving to value-based reimbursement.

“Under the Obama administration, CMS has pushed toward goals of moving to value-based reimbursement and alternative payment models,” Maddrey says. “While we expect that the Republican leadership may also support the concept of performance-based payment, they are likely to do so more through private sector and state-led efforts, as well as voluntary programs, rather than mandates. We expect Medicare Advantage plans likely will have increased opportunities for growth under the new administration.”

Next: ACO outlook



8. Uncertain future for ACOs.

“With the election of Trump, there might be a shift away from ACOs toward bundled payments, especially since ACO results have been mixed,” Vennaro says. “The key takeaway here is that both providers and payers need to continue to work together to better understand the true cost of care and negotiate accordingly.”

Next: Individual market overhaul


9. An overhaul of the individual market.


“In some regards, this restructuring may be to the benefit of payers, given our expectation that the new administration will create a more permissive regulatory environment,” Maddrey says. “The ACA offered limited flexibility to payers offering products on the individual market, with its requirements around the type of coverage that could be offered and how products could be priced, for example, through the essential health benefits requirements, the metal tiers, and limits on rating-to age, tobacco use, family size and geography-as well as the guaranteed issue provision and other specifications.”

According to Maddrey, this effectively limited the levers that a payer could pull to differentiate its products or keep premiums low, and as it has been reported, several prominent payers, such as UnitedHealth and Humana, have exited the exchange marketplaces.

“However, while we anticipate that payers may have more degrees of freedom in a restructured individual marketplace, we may also see the number of lives in the individual market diminish, for example if subsidies are removed,” Maddrey says.

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