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The Keckley Report

Re-setting Value-based Care: Two Voices Need to be Heard

By August 16, 2021March 1st, 2023One Comment

In a Health Affairs blog posted last Thursday, leaders of CMS laid out plans for the agency’s approach to value-based care and the role its innovation center (CMMI) will play. Given what’s been leaked for six months from the Biden administration, “Innovation at the Centers for Medicare and Medicaid Services: A Vision for the Next 10 Years” offers few surprises but it’s no less significant.

The leaders reviewed 50 alternative payment models (APMs) including 28 still operating. “We learned something from every model launched to date. So far, 6 models have generated statistically significant savings to taxpayers and Medicare… 4 models have met the requirements to be expanded in duration and scope.”

Ironically, the same day as the CMS Blog, a new study about the effectiveness of the Bundled Payments for Care Improvement–Advanced (BPCI-A) program launched by CMS in 2018 was published in the New England Journal of Medicine echoing lackluster results in most APMs. The finding: “The BPCI-A program was associated with small reductions in Medicare payments among participating hospitals as compared with control hospitals.”

Not surprisingly, the quartet of senior CMS leadership (Brooks-LaSure , CMS; Fowler, CMMI; Seshamani, Center for Medicare, Tsai, Center for Medicaid & CHIP) concluded that the “next 10 years will focus on expanding successful models and launching fewer new ones.”

In framing their aspiration “for a health system that achieves equitable outcomes through high quality, affordable, person-centered care,” they lay much of the responsibility on the Center for Medicare and Medicaid Innovation (CMMI) under Capitol Hill veteran Liz Fowler and assert key design principles to guide its efforts:

  • “make equity a centerpiece of every model.”

  • “re-evaluate how it designs financial incentives in its models to ensure meaningful provider participation. “

  • “address affordability”

  • “partner to achieve system transformation”


In essence, this CMS team concluded what others including this scribe have noted for several years: the alternative payment programs (APMs) have by-and-large been a bust except for a handful of opportunistic provider organizations with deep experience in managing financial risk with payers. The real winners have been the lawyers and consultants who promoted them, not the Medicare and Medicaid programs nor patients themselves.

And the timing of their Blog posting is unfortunate. The nation’s attention is on the Delta variant and the Taliban’s takeover of Afghanistan. Transformational change in healthcare is not dinner table talk.

But as CMMI undertakes its challenge, two additional design principles merit its attention while the country braces for Delta and hot spots like Texas and Florida see record hospitalizations:

The Voice of the Consumer

Hearing the voice of the consumer is a deficiency in health policy. CMMI would be well-served to take a fresh look APMs through the lens of consumers—what they value, trade-offs, and practical levers specific to population groups that should be reflected in APM performance incentives. The avalanche of special interests and trade groups that purport to represent the “voice of consumers” often distort consumer reality or offer a self-serving narrow perspective. Affordability matters and timely access to needed services paramount. But being treated as chattel, taken for granted and disrespected lends to unnecessary costs and suboptimal outcomes. Hiding prices and inside-baseball business practices is intolerable to the majority. In a new value-based care strategy, the ability to harness direct active engagement of consumers will be key. Ignorance about the health system should be met proactively with solutions rather than dismissed as an insurmountable challenge.

The Voice of Employers

Alternative payment programs have been built to appeal to providers and change the ways they interact with seniors (Medicare) and lower-income populations (Medicaid, CHIP). They’ve worked to improve care coordination and enable private insurers to profitably manage care, but they’ve done little to lower unnecessary health costs born disproportionately by employers that pay higher insurance premiums and consumers who pay more out of pocket. And employers are keenly aware they pay hidden taxes to hospitals, drug companies and physicians who mark-up what Medicare pays up to 300% or more. Employers want more than lower cost: they want a productive workforce whose wellbeing is managed by a health system geared to whole person care. And they’re tired of paying hidden taxes believing it not a fair tradeoff for the tax exemptions they get for providing employee health benefits.

In my view, the Center for Medicare and Medicaid Services (CMS) has rightly concluded the alternative payment models were too many, too confusing and marginally effective. By designing value-based care around design principles that integrate more effectively the voices of consumers and employers, its aspiration for a system that’s equitable, affordable and person-centered is more achievable. Lacking these, their effort to re-boot APMs and turbocharge value-based care will be moot.


P.S. An important perspective on the pandemic from the Atlantic: “It’s time for a data-driven reset on the basic knowns and unknowns of this pandemic, a task that must be undertaken with great humility. The virus keeps changing, and so does our understanding of the social and biological components of the pandemic. But in exploring both the knowns and the unknowns, we can see how complex the pandemic has become—and that we’re still lacking crucial data because of the failings of state and federal government.”

Alexis Madrigal “The Messiest Phase of the Pandemic Yet”; August 15, 2021; The Atlantic


Chiquita Brooks-LaSure, Elizabeth Fowler, Meena Seshamani, Daniel Tsai “Innovation At The Centers For Medicare And Medicaid Services: A Vision For The Next 10 Years”; August 12, 2021; Health Affairs

“Tracking the Emotional State of Americans”; August 13, 2021; Morning Consult

Joynt Maddox et al “Year 1 of the Bundled Payments for Care Improvement–Advanced Model”; August 12, 2021; New England Journal of Medicine

“Pay-for-Performance: A Promising Start,”; Alliance for Health Reform

Mullen, Kathleen J., Richard G. Frank, and Meredith B. Rosenthal, “Can You Get What You Pay for? Pay-for-Performance and the Quality of Healthcare Providers”; National Bureau of Economic Research


Covid-19 Resources, Delta update (CDC, WHO, Johns Hopkins)

  • U.S.: 36,633,631 total cases; 620,812 total deaths

  • Last 2 weeks: 1,617,126 confirmed cases (+78%), 7,893 reported deaths (+80%)

  • The Delta variants now accounts for more than 97% of all new cases

  • Vaccinations: 58.7% of the total U.S. population has received at least 1 dose of a COVID-19 vaccine, and 50.1% of the population has been fully vaccinated

  • 1.1 million people have received an unauthorized third dose of either Pfizer or Moderna’s COVID-19 vaccine.

Washington Post Analysis: Low Vaccination Counties have 4-times Higher Hospitalizations

Two-thirds of Americans living in counties with high vaccination rates are now also considered at high risk for COVID-19, according to a Washington Post analysis.
The Post classified the highest top quarter of counties as high vaccination, with at least 54% of the population fully vaccinated vs.40% or less in the lowest quartile. Analysis:

  • On July 4, only 4% of residents in highly vaccinated communities lived in hot spots, compared to 13 % of people in low-vaccination areas.

  • Hospitalization rates in states with less than 40% of their population fully vaccinated are 4 times those in states that are at least 54% vaccinated.

Nirappil et al “Spread of delta variant ignites covid hot spots in highly vaccinated parts of the U.S., Post analysis finds”; August 12, 2021; Washington Post

Jarrard Poll: Almost 1 in 6 Refuse Vaccination

Communications firm Jarrard, Philips, Kate and Hancock conducted an online poll of 1200 US adults ages 25-plus August 4, 2021. Highlights:

  • 58% were fully vaccinated, 11% received one does of a two-dose vaccine, 15% had not been vaccinated but may be in the future, and 16% do not intend to get the vaccination.

  • Of the 31% who are not vaccinated, 39% say they would be more willing if the vaccine received full FDA approval vs. 30% who said it would not matter and 39% who are unsure.

  • Of the 69% who are fully/partially vaccinated (one dose), 61% say they are more upset with those unvaccinated than before.

Related: The Kaiser Family Foundation’ survey shows 14% who say they will definitely NOT get a vaccination—proportionately higher among young adults (21%) and Republicans (20%).

“National Consumer Survey: Delta Variant Edition”; August 2021; Jarrard

“KFF COVID-19 Vaccine Monitor”; Kaiser Family Foundation

Survey: Small Business Confidence Drops as Result of Delta Variant

According to a survey of more than 560 small businesses for The Wall Street Journal by Vistage Worldwide Inc…

  • 39% of small-business owners expect economic conditions in the U.S. to improve in the next 12 months, down from 50% in July and 67% in March.

  • 22% of small-business owners said their business has already been affected by the rise in Covid-19 cases tied to the Delta variant.

“Delta Variant Drops Small-Business Confidence to Lowest Level Since March”; August 13, 2021; Wall Street Journal

FDA Authorizes Third Vaccine Dose for Immunocompromised

Thursday, the FDA authorized another dose of the mRNA Covid-19 vaccines for certain immunocompromised people — including solid organ transplant recipients, certain cancer patients, others — amid mounting evidence that they may not get enough protection from the typical two doses of the Pfizer-BioNTech or Moderna vaccines. The advisory applies to an estimated 3% of the U.S. population.

U.S. Food and Drug Administration

Study: Depression Among Youth Doubled in Pandemic

In this meta-analysis of 29 studies including 80,879 youth globally, “..the prevalence of depression and anxiety symptoms during COVID-19 have doubled, compared with pre pandemic estimates, and …prevalence rates were higher when collected later in the pandemic, in older adolescents, and in girls.”

Racine et al “Global Prevalence of Depressive and Anxiety Symptoms in Children and Adolescents During COVID-19A Meta-analysis”; August 9, 2021; JAMA Pediatrics


Census Bureau 2020 Report: U.S. Population Growth Slowed in Last Decade

Last Thursday, the U.S. Census Bureau released preliminary results of its 2020 census report. Select highlights:

  • The US population grew by 7% between 2010 and 2020 to 331.45 million.

  • The adult population has grown from 237 million to 261 million, and the proportion of adults is now 78%, up from 76% at the previous count. Population growth mostly occurred in metropolitan areas, while about half of US counties saw their populations shrink.

  • People of color represent 43% of the total US population in 2020– up from 34% in 2010.

  • The population of U.S. metro areas grew by 9% from 2010 to 2020, resulting in 86% of the population living in U.S. metro areas in 2020, compared to 85% in 2010.

  • 52% of the counties in the US had declines from 2010.

  • 312 of the 384 U.S. metro areas gained population between 2010 and 2020; 72 U.S. metro areas lost population.

“2020 Census Statistics Highlight Local Population Changes and Nation’s Racial and Ethnic Diversity”; August 12, 2021; U.S. Census Bureau

Bipartisan Policy Center (BPC) Analysis: Telehealth Use during Pandemic Highest among Older, Rural Adults, Technical Challenges Persistent

The Bipartisan Policy Center commissioned the survey of 1776 patients conducted June 28, 2021–July 18, 2021. Highlights:

  • 31% of American adults (including 44% of Medicare enrollees) had a telehealth visit for themselves or a dependent in the last year.

  • 63% of telehealth visits were for a preventive service, routine visit for chronic illness such as diabetes, or for prescription refills.

  • 45% reported some type of technical issue as an obstacle to accessing telehealth.

  • 42% of older adults and 35% of rural residents said access to high-speed internet/ broadband was an obstacle.

“New Survey: Virtual Care Could Keep Low-Acuity Cases Out of Emergency Department”; August 2021; Bipartisan Policy Center

Poll: Consumers Trust Nurses, Pharmacists and Physicians, Believe Nurses are Underpaid

According to a new survey of 1071 adults from the University of Chicago Harris School of Public Policy and The Associated Press-NORC Center for Public Affairs Research:

  • Most say they trust nurses (79%), pharmacists (75 %) physicians (70%) and at least most or almost all the time to do what is right for them and their families vs. 22% who say they trust hospital executives.

  • 59% believe nurses are underpaid, and 61% believe healthcare aides are underpaid vs.11% who think doctors are underpaid and 70% who believe insurance and hospital executives are overpaid.

  • Most Americans support increased government funding for lowering out-of-pocket costs for patients (74%) and for expanding government health insurance coverage for low-income people (59%).

  • More than two-thirds of those who support a public option (69%) favor increasing the number of doctors, compared to 40% of those who oppose a public option.

  • Nearly three-fourths of the public (72%) supports allowing the federal government and private insurance to negotiate for lower prescription drug prices.

The Associated Press-NORC Center for Public Affairs Research

Study: Hospital Prices for Colonoscopy Vary Widely

Researchers analyzed median commercial negotiated prices for colonoscopies in 1,225 hospitals that disclosed prices as of July 27, 2021. Findings:

  • The median commercial negotiated price varied widely among the 1,225 disclosing hospitals. The price was at least $3,677 for the top 10% of the hospitals (120 hospitals in total), approximately 4.6 times the national average Medicare reimbursement rate ($793). We categorized these 120 hospitals as “high-price hospitals” to differentiate them from remaining hospitals whose median commercial negotiated prices are below the 10th percentile.

  • Among the high-price hospitals, the median commercial negotiated price for colonoscopy ranged from $3,677 to $27,679 (average: $5,005); among the remaining 1,103 hospitals the median commercial negotiated price for colonoscopy ranged from $44 to $3,676 (average: $1,656).

Jiang et al “Where Are the High-Price Hospitals? With The Transparency Rule In Effect, Colonoscopy Prices Suggest They’re All Over The Place”; August 11, 2021; Health Affairs


Administration Lays Out Plans to Challenge Drugmakers

Last Thursday, the White House asked Congress to include strict controls on prescription drug prices in its $3.5 trillion reconciliation budget bill specifying 3 actions: Medicare should be granted power to negotiate lower drug prices, pharmaceutical companies should face penalties if they raise prices faster than inflation (up to 95%), and a new cap on how much Medicare recipients spend on medications. In the same statement, the President praise drugmakers for their “life-saving work developing the COVID-19 vaccines” but noted that U.S. prescription drug costs were higher than any other nation in the world by two to three times.

“Fact Sheet: President Biden Calls on Congress to Lower Prescription Drug Prices”; August 12, 2021; The White House

Study: States that Set Opioid Prescribing Limits Saw Reductions

The Wayne State-University of Michigan researchers compared opioid prescribing in states with restrictions and those without. Highlights:

The mean number of days of opioid prescribed per enrollee decreased by a mean of 11.6 (4.7) days (from 44.2 days in 2013 to 32.7 days in 2018) in states exposed to duration limits compared with a mean (SD) of 10.1 (2.9) days in control states (from 43.4 days in 2013 to 33.3 days in 2018). Primary care physicians had the largest decrease in opioid prescribing.

Cramer et al “Association of State Opioid Prescription Duration Limits with Changes in Opioid Prescribing for Medicare Beneficiaries”; August 9, 2021; JAMA Internal Medicine

U.S. Senate: Infrastructure Bill Passes 69-30; Reconciliation Bill Passes 50-49

The U.S. Senate passed both bills sending them to the House for debate:

  • The $1.2 trillion infrastructure bill appears less controversial and is likely to be signed into law by Labor Day. It includes a few healthcare provisions i.e. funding for broadband improvements that will directly improve telehealth infrastructure, a new “refund” on certain Medicare Part B drugs and changes some COVID-19 related tax programs.

  • The $3.5 trillion Budget Reconciliation bill is likely to be contentious in the House where Democrats hold a narrow 6-member margin. It includes extension of the childcare tax credit, universal pre-K education, paid family and medical leave, tuition-free community college, lower prescription drug costs, Medicare expansion to include dental, hearing and vision coverage, lowering the eligibility age for Medicare, expanding the Affordable Care Act, additional funding for climate, energy programs, immigration, border security and the IRS among others.

“Updated Fact Sheet: Bipartisan Infrastructure Investment and Jobs Act”; August 2, 2021; The White House

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