Healthcare leaders are eager for a modicum of clarity when it comes to the industry’s shift to value-based healthcare given the uncertainties of Congress and the new Administration. Fortunately, an analysis of three key pieces of information tells us value-based healthcare is likely here to stay: The 21st Century Cures Act (Cures). The Executive Order on reducing the “burden” of the Affordable Care Act (ACA). Tom Price’s comments at his confirmation hearings. It is a relatively safe bet that value-based healthcare delivery and payment programs will continue to be supported by federal law and regulation for several reasons: Bipartisan support: The success of Cures indicates that bipartisan cooperation will continue on key healthcare issues. Market-based innovation: The emerging evidence is that Congress and the Administration will support innovation in payment and delivery models. Support for Existing ACA Innovation programs: Although highly uncertain, there are some indications that not all of the ACA will be scrapped.

1. Is Value-Based Healthcare Here to Stay?
Looking for Answers in New Policies
Daniel Orenstein

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Is Value-Based Healthcare Here to Stay?
Looking for Answers in New Policies
The final days of 2016 were fraught with
uncertainty about what Congress and the
new Trump Administration would do to the
Affordable Care Act (ACA) and the
healthcare regulatory landscape overall.
So far, in 2017, we do not have much more
clarity. Repeal, repeal and replace, repeal
and delay, modify without repeal—there are
now even more questions than answers and
still no consensus Republican plan in sight.

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Is Value-Based Healthcare Here to Stay?
Looking for Answers in New Policies
Yet healthcare executives would
certainly appreciate some modicum of
clarity, at least on the narrower topic of
whether the shift to value-based
healthcare models will continue under
whatever new system is coming.
This presentation attempts to add
clarity by analyzing what we know so
far, as reflected in the limited actual
evidence that is available.

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Is Value-Based Healthcare Here to Stay?
Looking for Answers in New Policies
I will do my best to describe where things may be going for value-
based care (VBC) reform, as well as the analytic and other health
information technology (HIT) systems required to support it, by
analyzing the three key pieces of information we have so far:
1. Enactment of the 21st Century Cures Act (Cures).
2. Executive Order on reducing the “burden” of the ACA.
3. Tom Price’s comments at his confirmation hearings.

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#1 The 21st Century Cures Act
You may be wondering what Cures has to do
with VBC. The fact is, this wide-ranging bill
passed with almost universal bipartisan support.
Taken together with the reality that value-based
payment programs have historically enjoyed
broad bipartisan support, the passage of Cures
indicates that policies with bipartisan support
will continue to move forward.

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#1 The 21st Century Cures Act
Why did Cures happen even though the ACA
continues to be so politically contentious?
Because the ACA brings into play some of the
most entrenched ideologies of both parties—
the involvement of the public versus the
private sector in health insurance markets,
entitlements, and entitlement reform.
Cures is non-ideological, involving
commonsense policies on accelerating drug
discovery, helping providers and patients, and
requiring information to flow more freely.

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#2 The Executive Order
Widely viewed as mostly a symbolic
act to show action on “repealing”
the ACA, it asks the executive
branch and HHS to:
i. take steps to minimize the
“burdens” of the ACA, and
ii. waive, defer, grant exemptions
from, or delay provisions of
the ACA.
On January 20, 2017, President Trump
signed an Executive Order on “minimizing
the economic burden” of the ACA.

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#2 The Executive Order
Other provisions of the order tie these
actions to giving states “more flexibility and
control to create a more free and open
healthcare market.”
A subsequent provision also reiterates the
concept of creating a free and open market
for healthcare services.
The principle of market innovation is
therefore prominent in the Executive Order
and implies promotion of innovative
techniques and programs, including
innovation in payment programs.

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#3 Tom Price’s Comments
In his confirmation hearings nominee
Tom Price, made comments regarding
portions of the ACA that promote
programs aimed at innovation in
healthcare delivery and VBC.
Notably, Price indicated support in
principle the activities of the Center for
Medicare and Medicaid Innovation
(CMMI), which was established by the
ACA to test and promote innovative
payment and delivery system models
that have the potential to improve the
quality of care. TOM PRICE
U.S. Secretary of Health and Human Services

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#3 Tom Price’s Comments
While Price does not support all CMMI
activities, he supports the mission of
CMMI in principle, which is essentially a
test bed for VBC programs.
This provides another indication that
these programs may continue to enjoy
support in the Trump Administration with
Price as Secretary of HHS.
TOM PRICE
U.S. Secretary of Health and Human Services

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Pulling the Threads Together to Evaluate the
Status of Value-Based Healthcare
There is no doubt that this analysis still fits
squarely in the category of “reading the tea
leaves”—evidence of the shape of future
healthcare reform is scant.
But the evidence that exists appears to
support the principles that are preconditions
to value-based healthcare programs:
Bipartisan support
Market based innovation
Support for Existing ACA Innovation programs
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Pulling the Threads Together to Evaluate the
Status of Value-Based Healthcare
Bipartisan support:
The success of Cures indicates that
bipartisan cooperation will continue
on key healthcare issues,
notwithstanding the extreme
ideological divide on market and
entitlement related healthcare issues.
Value-based payment programs
have historically fallen into the non-
ideological, bipartisan category.

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Pulling the Threads Together to Evaluate the
Status of Value-Based Healthcare
Market-based innovation:
The emerging evidence is that Congress
and the Administration will support
innovation in payment and delivery
models, and flexibility in programs that will
be included for participation in federal
payment programs, which will flow through
to commercial payment programs.

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Pulling the Threads Together to Evaluate the
Status of Value-Based Healthcare
Support for Existing ACA Innovation programs:
Although highly uncertain, there are some
indications that not all of the ACA will be
scrapped.
And in this case, the innovative payment and
delivery programs, which are on the non-
ideological side, may be among those pieces of
the ACA that will survive and be supported in
some form.

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Value-Based Healthcare and Payment Programs
Are Likely Here to Stay
Looking at what has transpired to date in 2017 with
the new Congress and Administration, it is a
relatively safe bet that value-based healthcare
delivery and payment programs will continue to be
supported by federal law and regulation.
It is also worth observing that, even without federal
support, there is tremendous momentum for VBC
in the private healthcare market.
Therefore, it appears likely that, whatever the
ultimate shape that healthcare reform takes, value-
based healthcare (and the infrastructure required to
support it) is here to stay.

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For more information:
“This book is a fantastic piece of work”
– Robert Lindeman MD, FAAP, Chief Physician Quality Officer

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More about this topic
Link to original article for a more in-depth discussion.
Is Value-Based Healthcare Here to Stay? Looking for Answers in New Policies
Why the 21st Century Cures Act Is Great News for Healthcare
Daniel Orenstein, General Counsel
The Key to Transitioning from Fee-for-Service to Value-Based Reimbursement
Bobbi Brown, VP of Financial Engagement; Jared Crapo, VP
Why You Need to Understand Value-Based Reimbursement and How to Survive It
Bobbi Brown, VP of Financial Engagement
Healthcare Interoperability: New Tactics and Technology
Sean Stohl, Analytics, SVP
Healthcare Information Systems: A Look at the Past, Present, and Future
Larry Grandia, Consultant

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Prior to joining Health Catalyst Dan Orenstein was at athenahealth, Inc. (NASDAQ: ATHN) for
10 years, the last 7 as General Counsel and Secretary. Prior to that, Dan practiced in the areas
of corporate, intellectual property, and healthcare law with law firms in Boston and Washington,
D.C. He has written and presented on health care law and IT topics throughout his career. He
also served as a leader of the American Health Lawyers Association’s Health IT practice group.
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