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Experts discuss how managed healthcare executives might benefit from the ACA repeal and other healthcare reforms.
Upon taking office on January 20, President-elect Donald Trump will have the power to begin the process of repealing the Affordable Care Act (ACA)-which tops his agenda. Here, experts discuss how managed healthcare executives might benefit from its repeal and other healthcare reforms Trump has touted.
Among the Trump campaign’s stated goals are to allow the re-importation of cheaper prescription drugs from overseas. “Although the U.S. pharmaceutical industry benefits from federal funding for research and clinical trials, it has long been recognized that these same drugs cost more in the United States compared to other countries,” says Bill Denton, MBA, RN, chief operating officer, Novia Strategies, Inc., a national healthcare consulting firm. “Therefore, allowing the re-importation of the same drugs-at a lower cost to payers, providers, and consumers-could lower the medication management costs for many acute and chronic diseases.”
Regardless of the outcome of current merger challenges, Harry Nelson, managing partner of the healthcare law firm Nelson Hardiman LLP, expects to see some additional consolidation among insurers, which should lead to even greater negotiating power. “The bottom line is that plans will be able to dictate terms and rates to doctors and hospitals because plans will control access to patients, by and large, and because Trump is handing insurers more of the regulatory reins,” he says.
One of the central market reforms of the ACA imposed community rating and limited medical underwriting based on factors including age and tobacco use. “These underwriting restrictions make the young and healthy bear more than their fair share of the costs of individual health insurance and have contributed to huge premium increases,” says Morgan Tilleman, JD, an associate with the law firm Foley & Lardner LLP, which has a niche in health and insurance law. “Under the ACA, insurers are unable to appropriately price health risk, which puts the entire individual market at risk of collapse. If Trump and Congress remove the ACA’s restrictions on underwriting, they will make a big contribution to restoring a healthy individual health insurance market.”
Per Trump’s healthcare position, access to health insurance will be affected by driving participation and enrollment through the principles of free market competition, says Denton. In addition to allowing enrollment in insurance coverage across state lines, the federal government may provide incentives for private insurers to make coverage more affordable, which could substantively change payment models.
Further, the government may offer tax incentives rather than penalties to encourage individuals to purchase insurance, Denton continues. For example, health savings accounts may be expanded to offer a more attractive and accessible option for individuals to fund healthcare coverage.
Free market principles and increased competition among payers, combined with potential quality-related incentives, may hasten the speed at which providers focus on quality-improvement initiatives. “Competition usually leads to benefits such as decreased costs and improved quality,” Denton says. “Broadening the playing field to include a larger number of contributing thought leaders and looking to proven experiences and lessons learned, along with the hope of market share gains and increased profits, could yield overall benefits for patients-especially in terms of quality of care.”
Various quality-related measures are already in place, including The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and the most recent iteration of CMS’ star ratings. “Given their broad bipartisan support, it is expected that Trump will continue these initiatives,” Denton says.
“States already have some opportunities to reshape the Medicaid program, including dual-eligible programs, and they have partnered with health insurers with administrative and population health expertise on those opportunities,” Tilleman says. “Insurers will have the opportunity to work with states in developing and implementing new Medicaid programs with block granted money; these programs could advance the use of medical homes and quality-driven healthcare that could pay dividends well beyond Medicaid in the future.”
Karen Appold is a medical writer in Lehigh Valley, Pennsylvania.