What Will CMS Do Under the Biden Administration?

Bolstering the ACA and addressing healthcare inequities perhaps through Medicaid waivers may top the agenda. Experts see a continuation of support of ACOs and growth in enrollment in Medicare Advantage plans.

During President Donald Trump’s time in office, Seema Verma headed the CMS, and carried out Trump’s mission of defunding the ACA health insurance exchanges and did her part in fighting against the ACA altogether.

With Joe Biden now in office, the way CMS is run is expected to be quite different, although the new president has yet to announce his nominee for CMS administrator.

Theresa Hush, CEO of Roji Health Intelligence, a Chicago-based technology company, notes Biden campaigned on an agenda of universal access and reduction in healthcare inequities, along with recovery from the pandemic.

“His health policy platform is diametrically opposite from the Trump healthcare positions,” she says. “The Trump Administration favored privatization (including in Medicare, through better benefits for enrollment in private Medicare Advantage plans), lower cost coverages for employers that restricted benefits and provider networks, and value-based healthcare models that put providers at financial risk.” Hush observes that CMS' focus for the past four years has been cost control. Key regulatory changes have targeted removal of incentives for increasing volume in provider fee-for-service reimbursements, redirecting provider accountable care organizations (ACOs) toward financial risk and even capitation, and requiring price transparency of providers so that consumers could make financial decisions about healthcare.

“Biden will come into a healthcare system in financial distress and still battling a pandemic,” Hush says. “We can expect a swift activation of CMS to implement a new plan.”

Ash Shehata, national sector leader for healthcare & life sciences at KPMG, believes that President Biden will, first and foremost, assert a greater federal role in the response to COVID-19 that has been delegated to the states, which have had varying degrees of effectiveness in distributing vaccines and exercising infection control programs. There are already indications of a larger federal role in the COVID-19 vaccine plan that Biden issued last week.

Related: ICYMI: The Biden Administration's Five-Point COVID-19 Vaccination Plan

Rick Kes, partner and healthcare senior analyst at RSM US LLP, an audit and consulting firm, expects that the focus on the growth of Medicare Advantage will continue under the Biden Administration, as it is very popular with seniors as the demographics of U.S. change in terms of the number of Medicare-eligible individuals.

“Value-based care will likely continue to be an area of focus by the Biden Administration,” he says. “However, we think Biden’s administration will focus on more providers participating, and thus will allow providers to participate in up-side only, or at least with little downstream, value-based reimbursement models.”

Maria D. Garcia, a partner at Miami-based Kozyak Tropin & Throckmorton, expects to see an increased effort to support and preserve the ACA, as this was seen as a signature piece of President Obama’s administration and part of Biden’s legacy as well.

“With the nomination of California Attorney General Xavier Becerra, who is an experienced lawyer, to lead HHS, the new administration may also be positioned to try to counter any future challenges to ACA,” she says. But Garica says it is also likely that the Biden administration will continue to support the Trump administration’s efforts to increase price transparency for patients through congressional legislation and CMS rulemaking.”

Watch for waivers

Biden’s priority will likely be to enhance coverage through additional Medicaid expansion, and the addition of a public option to cover more low-income Americans.

“There’s plenty of data to suggest that COVID-19 has exposed inequities in the health care system-whether along racial or socioeconomic lines,” says Joe Ganley, vice president and government affairs for Athenahealth, a Watertown, Mass.-based health cloud computing company. “Given Biden’s personal history and his political narrative, I think we can expect CMS to use its regulatory and market clout to continue try to close those gaps.”

He notes one key area to watch will be Section 1115 waivers, which permits the Secretary to allow states to use federal Medicaid and CHIP funds in ways that federal rules do not otherwise allow.

“Waiver priorities vary from one administration to the next, and there’s a lot of policy change that can be affected through the criteria and the approach to these waivers,” Ganley says.

Hush believes CMS is likely to begin evaluating Medicaid restructuring as part of a health equity, quality and financial package.

“Such a strategy could eventually result in centralizing particular health care policies and operations, such as reimbursement programs and payment models through Medicare,” she says. “CMS will have a strong role in organizing the forces of health care reform, including the development of regulations and payment models for the future.”

Hush says that ACOs are the only significant provider-based value-based strategy (contrary to Medicare Advantage Plans, which are insurer-based) and she thinks the new administration will get behind them.

“The Biden Administration is likely to support ACOs that have strong network capacity and resources for expansion, while evaluating changes that need to be made,” she says. “ACOs may still benefit from risk-based reimbursement (as will CMS), so it is unlikely that we will see immediate changes in the ACO reimbursement model.”