Why Medicare Advantage is more potent than meaningful use for driving reform

MA caters to consumers, primary care doctors and payers, while delivering superior results.
By Frank Ingari
10:41 AM
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Earlier this year, the Centers for Medicare and Medicaid Services (CMS) announced increased 2016 rates to Medicare Advantage (MA) – changes that will continue to strengthen this growing industry program. Some are saying that this change is a result of the lobbying efforts of payers. But what if CMS was actually kinder to MA because the model has proven to work so well?

Popular across the healthcare ecosystem, the MA program caters to consumers, primary care doctors and payers, while delivering superior results for today’s society as opposed to a fee-for service program. Specifically with MA, consumers often get the benefits of high-end Medicare Supplement for zero premium, primary care doctors have the opportunity to increase their income significantly in a good Medicare Advantage risk-sharing contract, while payers have the chance to reap substantial profits or surplus for managing chronically ill populations.

In my view, MA is the only national program that engages payers, providers and consumers to support all three elements of the Triple Aim. It does so by means of a consistent set of value-based economic incentives and closed-loop information flows that reduce cost, increase quality and improve the patient experience. 

How are payers and providers able to be so successful in MA? First, payers must ensure that quality care is delivered through their network. To do so, they have to offer contracts to providers that reward the proactive management of the chronically ill. Successful payers also share significant population health information and support functions with providers who can’t afford their own population health infrastructure. Finally, payer success must be renewed each year by meeting the challenging set of Star Rating metrics that ratchet up each season to advance the clinical quality agenda.

In addition to meeting metrics, payers must also deliver a superior consumer experience, and that’s where consumer feedback comes in. Consumers are interviewed directly without the involvement of payers or providers through the Consumer Assessment of Healthcare Providers and Systems (CAHPS) survey process. This annual survey requires that payers and providers communicate well with members and engage them in real conversations. Bad feedback on support impacts both CAHPS and Star ratings.

As a result of payers’ successes in MA contracts, providers can also reap these benefits financially and through the job satisfaction that comes from the ability to spend more time with patients – which is the very reason they became doctors in the first place. Moreover, on a national level, the tasks required of providers in MA programs are increasingly central to the new U.S. healthcare model: prospective health status assessments, care planning, coordination of care and honest end-of-life dialogue.

Despite these many benefits, MA does have its critics. Some are ideologically opposed to private insurers being part of Medicare and others are concerned that insurers can game the system, for example, by inflating Hierarchical Condition Category codes illegally. Although this concern is valid, CMS has every regulation, incentive and resource needed to strongly enforce the law.

Given this criticism, Meaningful Use (MU) has often been portrayed as a tool for driving reform, especially given its vast funding by the HITECH Act and emergence of hundreds of electronic health record vendors over the last few years. Compared to MA, however, MU lacks the structural mechanisms necessary to drive reform. First, MU success depends on HITECH funding and its power declines as HITECH expires. More importantly, since MU’s power does not derive from the inherent economics of accountable care, it fails to motivate both payers and consumers who both play a role in sustainable reform.

According to Farzad Mostashari, MD, former national coordinator at ONC and currently the founder of Aledade, consumer demand is the key to driving reform and interoperability. In our view, hospital-based delivery systems do not have a deep history of consumer engagement and proactive health, while EHR vendors have little motivation or experience connecting directly with consumers. Therefore, both hospital-based delivery systems and EHR vendors targeted by MU are not equipped to influence consumer behavior. On the other hand, MA payers have the budget and the motivation to market directly to consumers while also influencing their behaviors.

For example, when it comes to the electronic delivery of discharge information to patients, MU attempts to impose, on both hospital systems and EHR vendors, a percentage of patients for whom such delivery is enabled. However, most hospitals report zero consumer demand and are excluded from the requirement as a result. If this goal was in place for MA Star Ratings criteria, payers would put the goal into their provider contracts, pay for the technology to deliver it and market the benefits to MA members and their caregivers.

With CMS’ improvement of the MA program incrementally across the Clinton, Bush and Obama administrations, MA has become the most powerful instrument we can use to drive national healthcare reform. The program reflects the true economic underpinnings of the Triple Aim, and through its Star Rating system, provides an engine to enable the entire industry to become the “learning system” that ONC’s Interoperability Roadmap has envisioned. All the players in the healthcare ecosystem – payers, clinicians, vendors as well as academic, clinical and policy leaders – need to leverage the power of MA as a reform tool that is sharp, proven, sustainable and continuously improving. This is the future.