March 9, 2017

What 81 health care CEOs think about the ACA debate

Daily Briefing

    C-suite health care executives are anxious about Republican efforts to repeal and replace the Affordable Care Act (ACA), with many worrying that it will harm access to care and their organizations' bottom lines, according to Modern Healthcare's most recent CEO Power Panel survey.

    Modern Healthcare surveyed 81 CEOs of health care organizations—most respondents represent large hospitals and health systems, but some lead insurance companies, suppliers, and technology companies, as well as associations that representing sectors across the industry. Modern Healthcare also conducted follow-up interviews with several senior executives who responded to the survey. The survey was conducted before Republican lawmakers on Monday released a proposed ACA repeal bill.

    Why major doctor and hospital groups are opposing the House GOP ACA replacement plan

    Concerns about ACA repeal, replacement

    In the survey, executives said they feared that "a new GOP-crafted [ACA replacement] would reduce premium subsidies and Medicaid funding, drive up the number of uninsured Americans, spike uncompensated-care costs, and threaten their organizations' financial viability," Modern Healthcare's Harris Meyer writes. About 78 percent of respondents said they did not support repealing the ACA, even with a transition period and the promise of a replacement.

    Health care executives also weighed in on several current ACA provisions and some proposals for notional replacements related to the ACA's health insurance exchanges. Specifically:

    • 65.4 percent said such plans should be subsidized so no family or individual pays more than a set percentage of their income in premiums;
    • 61.5 percent of executives said exchange plans should still include essential health benefits established under the ACA;
    • 56.4 percent said exchanges should also include low-cost high-deductible or catastrophic plans linked to health savings accounts;
    • 37.2 percent said such plans should come from any state and be subject to that state's regulations; and
    • 2.6 percent of executives said uninsured individuals should be required to purchase exchange plans.

    More broadly, nearly 80 percent said they want to keep Medicaid expansion under the ACA. While 55.7 percent of respondents said they would support converting Medicaid into a federal block grant or per-capita allotment program "only on the condition that current funding levels are maintained," Meyer writes. As Rick Pollack, CEO of the American Hospital Association, put it, "If we're going to use the restructuring of Medicaid as a vehicle to achieve big budget reductions, leaving lots of people uninsured, that's not a productive discussion."

    CEOs who responded to the survey also signaled cautious support for creating state-based high-risk pools for uninsured individuals, with 18.2 percent supporting the idea outright and 61 percent supporting such pools if they were adequately funded.

    Drug prices and interoperability

    CEOs who responded to the survey also said drug prices were a major concern. Specifically:

    • 78.2 percent of respondents said when there is only one source of a generic drug, Congress or the administration should allow imports from countries that meet recognized regulatory standards;
    • 74.4 percent said Medicare should be able to negotiate prescription drug prices with drugmakers;
    • 64.1 percent said CMS should let Medicare Part D drug plans exclude drugs from their coverage as long as they cover therapeutic alternatives;
    • 46.2 percent said Congress or the administration should ban direct-to-consumer ads of pharmaceutical drugs;
    • 42.3 percent said CMS should cut the current markup on Medicaid Part B drugs, or replace it with a separate drug-administration fee;
    • 35.9 percent said Congress should pass legislation restricting price increases on drugs that have already received approval to 10 percent per year or less; and
    • 34.6 percent said Congress or the administration should prohibit or restrict the use of drug coupons offered by drugmakers to consumers to curb or eliminate the cost of co-payments.

    Warner Thomas, CEO of Louisiana-based Ochsner Health System, told Modern Healthcare that the rate of drug price increases is unsustainable. "This is the No. 1 issue in the industry today, and it hasn't been addressed in a diligent enough fashion," he said.

    Shift toward value-based payment models

    While almost all respondents expressed support for CMS' shift from fee-for-service to value-based payment models, 65.4 percent of respondents said participation in value-based payment models should be voluntary. In addition, 70.1 percent of respondents said it should be easier for physicians to qualify for alternative payment models under Medicare's new physician reimbursement system.

    CMS launches three new mandatory bundled payment models

    At the same time, however, some executives told Modern Healthcare that they understood why making demonstrations run by CMS' Center for Medicare & Medicaid Innovation mandatory was helpful.  As Catherine Jacobson, CEO of Froedtert Health, put it, "If they want those programs to get traction, they have to make them mandatory."

    Many health care executives also told Modern Healthcare that when HSS drafts rules called for under the 21st Century Cures Act to promote interoperability, increase patient access to EHR data, reduce physician documentation burdens, and discourage information blocking, the agency should make those rules mandatory, with some qualifications. Specifically:

    • 62.5 percent of executives said such rules should be mandatory;
    • 67.5 percent of respondents said such rules should be implemented over several years;
    • 42.5 percent of respondents said such rules should include financial penalties for failure to comply; and
    • 25 percent of respondents said such rules should include exceptions for small practices, critical access hospitals, and other groups (Meyer, Modern Healthcare, 3/4).

    What you need to know about the House GOP's repeal and replace plan

    Our experts have dug into the GOP's new plan to understand how it will affect you, including its potential big changes to the individual insurance market and Medicaid program. 

    Join us for a webconference on March 17 to learn the details and hear how you can prepare for changes to the ACA. Our last webconference on the politics of health reform filled up in record time, so reserve your spot today. 

    Register now

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