Despite the Supreme Court's decision to uphold the Patient Protection and Affordable Care Act two months ago, a cloud of uncertainty has hung over the healthcare industry, as major players have tried to read the tea leaves and determine what a Romney-Ryan victory in November would mean for the reform law. This past weekend, the sky began to clear when Mitt Romney stated in the clearest terms of the campaign that he does not intend to "[get] rid of all of healthcare reform."
Mr. Romney has stated that he'd keep key protections for people with pre-existing conditions, but he has been a bit vague about what other provisions may survive if he wins the election. For hospitals, some of the most important provisions of the PPACA are incentives that tie how much a hospital is paid to it how well it is able to meet certain standards for quality care. Mr. Romney and Rep. Ryan have both advocated for the kind of incentive reforms that are a reality under the PPACA, and these reforms are likely to survive in some form, regardless of who wins the White House in November.
Led by Mr. Romney and Rep. Ryan, conservatives have attacked coverage expansions, health insurance mandates and new taxes brought on by the healthcare law. Many of these controversial provisions will not be implemented for years, but other provisions that incorporate ideas that both members of the GOP ticket have defended are going into effect this fall. Starting in October, the PPACA will introduce a new payment system that rewards hospitals that implement clinical best practices and meet other quality standards. Those who do not make the cut will be punished.
Even in a polarized presidential contest, these measures are not regarded as controversial — but as necessary. Pay-for-performance or the concept of holding hospitals to clinical standards and rewarding them based on the ability to achieve them has received relatively little attention from the media. Even so, it has catalyzed a dramatic transformation in how hospitals approach delivering high-quality care. For the first time, many hospitals are focusing on reducing preventable hospital readmissions through better care coordination between doctors, nurses and other healthcare providers. This lowers the overall cost of care, which both Obama and Romney agree is a good thing.
The democratic and republican contenders for the White House also agree about the important role of technology in driving improvement in healthcare outcomes. Rep. Ryan in particular, has been vocal on this point in the past. "IT is a big deal," he said back in June 2008 congressional hearing on healthcare costs. "IT, best practices and seeing very clearly what value you get and then rewarding based on outcomes."
Still, industry-wide action to implement initiatives to meet the PPACA's new criteria have not proceeded as quickly as expected, driven in part by lingering uncertainty in the marketplace over the future of the law. Many hospital executives are still on the fence when it comes to aligning their management strategies with the law's standards. "[T]he results of the November election will surely influence our direction, regardless of what the Supreme Court does," wrote Virginia Mason Hospital CEO Gary S. Kaplan earlier this year.
Zachary Silverzweig, founder of the healthcare technology firm CipherHealth disagrees, saying "Hospitals facing millions of dollars in potential penalties can't afford to gamble on a Republican win and a repeal of Obama’s healthcare law. Republicans and Democrats both believe that pay-for-performance is a good thing, and we've already seen the government's incentive structures for improving hospital quality copied in the private sector. No one in either party is planning on increasing reimbursements to hospitals."
Mr. Romney and Rep. Ryan largely disagree with President Obama on healthcare, but, on the subject of creating pay-for-performance incentives and increasing the use of healthcare IT, their statements suggest that they would follow his course. Mr. Romney wrote in his book "No Apology" that, "Healthcare can't function like a market if it doesn't have incentives like a market. Fixing healthcare begins with fixing incentives." Mr. Romney's running mate, as one of the GOP's foremost authorities on healthcare policy, has repeatedly articulated a vision for quality-based incentives that is remarkably similar to the one put forth by Obamacare. Like Obama, Rep. Ryan emphasizes health industry input on appropriate standards for quality care. Like Obama, Rep. Ryan endorses paying physicians and hospitals based on how well they meet industry-approved measures. Like Obama, Rep. Ryan recognizes the importance of information technology to drive improved outcomes.
The pay-for-performance system is a reality. The bar has been raised, and it's now time for hospitals and other players in the industry to meet the new standards. Hospital executives may think it safe to wait for November before taking these standards seriously, but Obamacare repeal roulette is a risky game. Lose, and you'll be behind the curve. Win, and chances are that a Romney-Ryan system for paying hospitals would look an awful lot like the one written into the healthcare law they have vowed to repeal.
Doug McPherson is a policy analyst at CipherHealth with experience in federal and state healthcare legislation. Mr. McPherson has worked with elected officials, government agencies and private sector stakeholders on issues related to Medicare coverage and pay-for-performance incentives. At CipherHealth, he serves as an advisor and consultant to hospitals and hospital systems across the U.S., helping them reduce readmissions and improve patient satisfaction.
Mr. Romney has stated that he'd keep key protections for people with pre-existing conditions, but he has been a bit vague about what other provisions may survive if he wins the election. For hospitals, some of the most important provisions of the PPACA are incentives that tie how much a hospital is paid to it how well it is able to meet certain standards for quality care. Mr. Romney and Rep. Ryan have both advocated for the kind of incentive reforms that are a reality under the PPACA, and these reforms are likely to survive in some form, regardless of who wins the White House in November.
Led by Mr. Romney and Rep. Ryan, conservatives have attacked coverage expansions, health insurance mandates and new taxes brought on by the healthcare law. Many of these controversial provisions will not be implemented for years, but other provisions that incorporate ideas that both members of the GOP ticket have defended are going into effect this fall. Starting in October, the PPACA will introduce a new payment system that rewards hospitals that implement clinical best practices and meet other quality standards. Those who do not make the cut will be punished.
Even in a polarized presidential contest, these measures are not regarded as controversial — but as necessary. Pay-for-performance or the concept of holding hospitals to clinical standards and rewarding them based on the ability to achieve them has received relatively little attention from the media. Even so, it has catalyzed a dramatic transformation in how hospitals approach delivering high-quality care. For the first time, many hospitals are focusing on reducing preventable hospital readmissions through better care coordination between doctors, nurses and other healthcare providers. This lowers the overall cost of care, which both Obama and Romney agree is a good thing.
The democratic and republican contenders for the White House also agree about the important role of technology in driving improvement in healthcare outcomes. Rep. Ryan in particular, has been vocal on this point in the past. "IT is a big deal," he said back in June 2008 congressional hearing on healthcare costs. "IT, best practices and seeing very clearly what value you get and then rewarding based on outcomes."
Still, industry-wide action to implement initiatives to meet the PPACA's new criteria have not proceeded as quickly as expected, driven in part by lingering uncertainty in the marketplace over the future of the law. Many hospital executives are still on the fence when it comes to aligning their management strategies with the law's standards. "[T]he results of the November election will surely influence our direction, regardless of what the Supreme Court does," wrote Virginia Mason Hospital CEO Gary S. Kaplan earlier this year.
Zachary Silverzweig, founder of the healthcare technology firm CipherHealth disagrees, saying "Hospitals facing millions of dollars in potential penalties can't afford to gamble on a Republican win and a repeal of Obama’s healthcare law. Republicans and Democrats both believe that pay-for-performance is a good thing, and we've already seen the government's incentive structures for improving hospital quality copied in the private sector. No one in either party is planning on increasing reimbursements to hospitals."
Mr. Romney and Rep. Ryan largely disagree with President Obama on healthcare, but, on the subject of creating pay-for-performance incentives and increasing the use of healthcare IT, their statements suggest that they would follow his course. Mr. Romney wrote in his book "No Apology" that, "Healthcare can't function like a market if it doesn't have incentives like a market. Fixing healthcare begins with fixing incentives." Mr. Romney's running mate, as one of the GOP's foremost authorities on healthcare policy, has repeatedly articulated a vision for quality-based incentives that is remarkably similar to the one put forth by Obamacare. Like Obama, Rep. Ryan emphasizes health industry input on appropriate standards for quality care. Like Obama, Rep. Ryan endorses paying physicians and hospitals based on how well they meet industry-approved measures. Like Obama, Rep. Ryan recognizes the importance of information technology to drive improved outcomes.
The pay-for-performance system is a reality. The bar has been raised, and it's now time for hospitals and other players in the industry to meet the new standards. Hospital executives may think it safe to wait for November before taking these standards seriously, but Obamacare repeal roulette is a risky game. Lose, and you'll be behind the curve. Win, and chances are that a Romney-Ryan system for paying hospitals would look an awful lot like the one written into the healthcare law they have vowed to repeal.
Doug McPherson is a policy analyst at CipherHealth with experience in federal and state healthcare legislation. Mr. McPherson has worked with elected officials, government agencies and private sector stakeholders on issues related to Medicare coverage and pay-for-performance incentives. At CipherHealth, he serves as an advisor and consultant to hospitals and hospital systems across the U.S., helping them reduce readmissions and improve patient satisfaction.
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