CMS Changes and the Future of Value-Based Care
Jennifer Houlihan and Jennifer Gasperini of Advocate Health discuss the impact of new CMS and CMMI leadership, current challenges in value-based care, and the future of ACOs, ECQMs, and Medicare Advantage. A timely conversation for anyone navigating the evolving policy landscape.
Welcome to the Move to Value Podcast, powered by CHESS Health Solutions.
In this episode, we’re joined by Jennifer Houlihan, Vice President, and Jennifer Gasparini, Director of Policy, from Advocate Health’s Population Health Team. Together, we unpack the implications of the recent administration change, explore what new leadership at CMS could mean for value-based care, and hear their perspectives on the legislative priorities they hope to see take shape.
Thomas Royal
Jennifer Houlihan, Jennifer Gasparini, welcome to the move to Value podcast.
Jennifer Gasperini
Thanks for having us.
Jennifer Houlihan
Happy to be here.
Thomas Royal
So you both just attended the NAACOS conference?
Can you tell us what are some of the hot topics that folks were talking about?
Jennifer Gasperini
I can get us started.
I think it’s always great to see colleagues at the NAACOs conference and was also great to see Kim Brandt, who is the deputy administrator and COO at CMS, come and share some of Doctor Oz’s priorities. For CMS and I think a lot of those priorities align really well with value based care. So they they really spoke a lot about tackling fraud and abuse. And as you know, ACOs are really the early identifiers of fraud.
And so really was pleased to see them talking about that and also using technology and better data really for beneficiaries and providers to advance care. And I think ACOs obviously are very focused on that goal as well.
Jennifer, do you have anything else to add there?
Jennifer Houlihan
Yeah. There, in addition, there were some really good sessions on the new team model, the transferring Episode Accountability model as well as guide and a lot of thoughtful conversation around how to integrate these models into the ACO and a clearer path for outcomes there. So I think there was a great discussion and got to give kudos to Jennifer. She was part of a really well attended and fantastic panel on how ACOs are adapting ECQMs and MIPCQMs and some of the kind of demands and multiple issues that are impacting ACOs on how to do all payer adjustments leveraging some of these requirements. So a lot of really timely topics and I think then the kind of final was Specialty Care integration, I think continued to be a recurring topic that we need to think more deeply about that and and how those get nested within cost, so hopefully we’ll see more about that in the future.
Thomas Royal
So there is new leadership in place at HHS, CMS and CMMI.
What does NAACOS think this might signal for the future of value-based care?
Jennifer Houlihan
Sure, I I can. I can jump in on that one first, so I think you know, looking at Abe Sutton, you know, as as Jennifer mentioned, Kim Brandt was there from CMS. But we’ve also seen with Abe Sutton’s appointment, who’s been a strong supporter of value-based care. I think the mood was mostly positive, that there has been sort of a lot of statements, whether it’s in some of the confirmation hearings, or direct statements that value-based care and the need to achieve savings is is one of the priorities. I think there’s gonna be some different thinking about more aggressive requirements for more savings and as as as we’ve seen already, some of the model review that’s already taking place. The ability to kind of end models early if they’re not achieving the outcomes and the savings. So I think the mood in general is Value is still a strong part of CMS and CMMI’s agenda just the way some of the models will shape up and some of the strategic priorities, I think we’re still waiting to see what that looks like. And Jennifer, I don’t know if you have more to add on that.
Jennifer Gasperini
Yeah, Ditto on all those points. And of course the new leadership is very focused on MAHA or making America healthy again. and I think value really fits in that lens.
And so hopefully we’ll see more focus on prevention and Wellness and maybe even some new models that are introducing new concepts around prevention and Wellness as well, hopefully, but we do expect to see more from the new leadership team at CMMI on their strategy in the coming months and that will be really telling, I think, in terms of what their spin on value and their focus will really be.
Jennifer Houlihan
And I’ll just talk.
I mean, we did one of the first signals we saw was in the new the the 2026 proposed inpatient rule and team. The team model is is remaining as a mandatory model.
And so I think there were, there are some early signals, but as Jennifer said, we’re really waiting for that strategic refresh and then more really frankly announcements on any what the, the future model changes will be.
Thomas Royal
Interesting. So. So my next question is a bit duplicative, but I’d like to know what stands out to you about the new head of CMMI and how do you see his vision shaping programs like ACO REACH?
Jennifer Gasperini
Yeah.
Yeah, I think like you said, you know, I’ll be a little repetitive here, but I think well, Abe Sutton, you know does have experience in value models. So that is very helpful and has experience working in the first Trump administration. But I I think his knowledge of value based care will help shape the new strategy at CMMI and the agenda at CMMI and tying that work obviously back to Maha goals is something that we really expect.
Jennifer Houlihan
I mean, you asked specifically about ACO reach and I think we’ve been hearing lots of rumors. We’ve heard everything from the could ACO REACH be extended.
Will it be replaced by something like the a revised Geo contracting model?
I think there’s a lot of what if scenarios right now. So it’s hard to say. But as Jennifer said, Abe Sutton does have a lot of experience. He was the architect of some of the kidney care models. And so I think that’s where we’re wanting to also see what’s next for full risk models, but again also with an eye towards how are we thinking about specialty integration and some of these full risk models. And so I think there might be some good alignment opportunity there as well.
Thomas Royal
So historically, how has leadership turnover at HHS impacted innovation models and payment reform initiatives?
Jennifer Gasperini
Yeah, I think so, the impact has been pretty minimal in the past. There’s always a period of reorganization, of course, when new leadership comes on, they identify new priorities. They typically issue a lot of RFI’s or requests for information to gather feedback from stakeholders, and we’re really already experiencing those things now.
I do think we’ll have a lot of opportunities to share input on future direction and maybe what we feel hasn’t been working, especially in the vein of regulatory relief. That’s an area they’ve been really focused on initially, but you know, obviously we are losing some staff that is has a lot of institutional knowledge. And so, I think.
Time will tell in terms of, you know what the the true impact is on the programs.
Thomas Royal
Yeah, ’cause, there’s definitely been a wave of layoffs across the healthcare policy space. And so how are these reductions in force impacting value based care programs, especially ACO reach?
That’s one thing that’s that’s come up as as we’ve been out having conversations with folks, boots on the ground and how that’s going to be impacted.
You have any thoughts about that?
Jennifer Houlihan
I mean some of the impacts in addition to staffing are coming through changes or directives from the executive orders. So I think that is having an impact and maybe that is to the extent that we’re seeing it now, maybe that’s a difference between previous administration turnovers and transitions versus now is the amount of executive orders and some of the directives. I mean I think for ACO REACH, I’m not as directly involved with it, and I know Jennifer is more so maybe can speak more directly, but I think some of the staff is definitely still there and they’re trying their best to follow like new leadership direction executive you know.
Executive order implementation and so I think there was some pause and communications early on, but I don’t know, Jennifer, from your standpoint if that seems to have kind of resolved and it’s business as usual, of course.
Again, waiting for any, you know that model I suspect is under review. Like all the other models have been under review and we could expect to see more changes.
Jennifer Gasperini
Absolutely. And you know, like MSSP, they have lost some staff with a lot of institutional knowledge. And so I think there will be a transition period.
Will they hire up then and hopefully get some some new smart folks into those roles.
They’ve also done, you know, some pulling back of the ACO coordinator positions in an effort to centralized so most of those positions were in the regional offices, previously and we’re seeing CMS move to a more central approach and and therefore we’ve lost a number of ACO coordinators and so for MSSP and and ACO reach but as Jennifer mentioned, I think we’re starting to see things level back out and I hope to see some return to normal programming.
Thomas Royal
Only time will tell. What do you see as a major driver, particularly in MA and MCR from a policy and financial standpoint?
Jennifer Houlihan
Yeah. So I mean MA I think has is one of those hot policy topic areas where we’re watching. We know some of the new policy leadership within CMS has a lot of experience and thinking around how MA should evolve and this administration is also considered to be very MA friendly. But that being said,
there have been some signals, such as doctor Oz mentioning in his
Confirmation hearing that up coding is a key factor in cost, and we know that medpac their latest report shows that MA enrollees spend more than traditional Medicare.
And then of course, we can’t forget denials and some of the big concerns that we’re seeing across health systems and down coding and denying both on and patient and AD perspective.
So there’s a lot of swirling, I think policy within that MA space and that’s where we’re trying to understand even within the new rule making there were a lot of pieces deferred.
So what will this mean for the future of some of CMS or CMMI models? Will we see more alignment between traditional Medicare and Medicare Advantage?
Will we see some significant changes around some of the coding intensity?
Benchmarking risk capture methodologies. I think all of those seem to be up for conversation. And again, I think time will tell of of how the administration continues to move forward on that. We we do know for some of the policy briefs out there through groups like Project 2025 and Paragon, who’ve written extensively on MA that there are a lot of proposals to strengthen MAs presence in the healthcare landscape. So at this point, what we’re doing is kind of watching and waiting and looking for signals such as, you know, the the recently reduced rules and and what we might expect. And Jennifer, any anything to add on your end?
Jennifer Gasperini
I think just that, you know, Jennifer mentioned earlier the geographic direct contracting model that we saw under the the first Trump administration, which is very MA friendly and we we do expect to see a resurgence of that type of thinking or that type of model in this administration as well.
Thomas Royal
Well, as, as we’re all aware, there’s been quite a flux in the economy recently, do you think the current economic pressures, or reshaping how health systems think about pop health investment?
Jennifer Houlihan
You know, we’re we’re still in a time of I hate to use the phrase two canoes, but given all the progress we’ve made, we’re we’re still in my opinion, in very much in a fee for service world with fee for value but fee for service still very much dominating the the reimbursement space. And I think we’re also just in general in a time of, you know, tremendous change and transition with so many other policy lovers outside of pop health impacting where healthcare systems may be going, site neutral changes on the horizon potentially around Medicaid space. So I think I think in one hand pop health is viewed as still as the future forward of how do you get away from Fee for service. But on the other hand, we’re we’re still sort of a component in a very large health system that has a large footprint of hospitals and we have to balance between the revenue models.
Thomas Royal
Well, so looking back at ACO reach, under the current administration’s first term, what progress was made and what programs or policies do you expect will be continued or changed under the second term?
Jennifer Gasperini
That’s a great question.
So, you know, I mentioned that the first Trump administration originally released that Geo Direct contracting model. It came under a lot of scrutiny and and was later cancelled, you know, under the Biden administration as a result of that scrutiny. And I think there was a lot of pushback.
I think it’s likely will see a return of a similar model under this administration. What that looks like exactly, I do not know. I think there’s a a lot of questions unanswered right now around that, but I do expect I think a lot of others expect return of a similar type of model under this administration.
Thomas Royal
Well, can you tell us about the legislative efforts to reinstate and extend bonuses for providers participating in risk based models? And they view these incentives as essential for sustaining and expanding value based care? What is the latest?
Do you think this push has any momentum?
Jennifer Houlihan
I it was definitely one of our policy priorities and there was, I guess, was at the end of last year, Jennifer, Bell introduced to extend the APM bonus? But the latest that we were hearing again, this could now be outdated information was that it is not currently part of reconciliation, but that it may be brought back up in the fall, Jennifer, I don’t know if you’ve had any latest updates, so it’s it’s still out there as a priority, but overall not seen a lot of traction right now.
Jennifer Gasperini
Yeah. And I know it was devastating to see that bipartisan agreement come together end of last year and then really fall apart at the at the last moment and not get passed so that the bonus has expired as of today. But it is still a really big priority for Advocate and for a lot of stakeholder groups like NAACOS and others.
I think there are spending pressures in Congress that are really going to make it difficult given the current environment.
But I do think Congress is still committed to tackling the issue of broader reform of incentives and payments for value. Even the MIPS program is something that has been highly criticized over the years, is not living up to its intended goals, and, you know, having a lot of regulatory burdens associated with it.
So I think there is appetite for broader reforms, but the timing for this year in particular I think are going to be difficult, so.
But I am hopeful that maybe in the in the coming years we’ll see a turn to attention on a broader reform.
Thomas Royal
That’s great.
Well, back in January, bipartisan legislation titled The Health Care efficiency through Flexibility Act was introduced in the US House, and this bill proposes delaying the mandatory ECQM reporting requirement for ACO’s until January 1, 2030.
What’s your take on this delay? Is it necessary breathing room or a missed opportunity?
Jennifer Gasperini
Yeah, that’s a great question. And I know Advocate has committed a lot of resources to making ECQms a reality it takes an enormous amount of time and money and work, even ongoing work to to to do this. And in talking to other ACOs, I think there are a lot of ACOs that do need more time. And what dawned on me at the NAACOS meeting is that I think frankly, we’re still debating the details because there were many very smart people at NAACOS.
And some discussion and differing opinions about how can you report ECQMs the technical details of you know what the file has to to be, for example, and what constitutes data completeness. So as some examples, I think this really signals there’s still some confusion out there and lack of clarity around these requirements. So I think having a backup or more time is not a bad thing for anyone. Given the uncertainty. However, I think it’s important that we don’t lose momentum since so many people, including Advocate, have already invested a lot into making this transition. And I do think looking to a less manual, more digital quality reporting process is a good goal for the future and we want to continue to make those.
Investments. So it’s about getting the details right, making sure there are reasonable expectations, so exclusions that allow for, you know, really kind of common sense exclusions that allow for things that we can expect to happen during the year, like transitioning to a new EMR or other challenges that do pop up realistically to not really take down your whole effort.
Thomas Royal
Was quality reporting broken? I mean, what’s working? What’s not? How do we fix it?
Jennifer Gasperini
So I can I can start here. I think so quality reporting is extremely costly and time intensive. Even when you’re reporting ECQMs.
So I think there are a couple of camps of thinking on this topic, though some think we should move to a REACH approach or model where ACOs are only evaluated on a small number of mostly administrative claims measures. Those don’t revolve involve any reporting. But others think that that wouldn’t accurately measure the quality of care that we’re providing to patients.
So I think yes and no. Is it? Is it broken?
I think it can be improved for sure.
How to fix it? I don’t have those answers, but I I do wanna note that the proposed 2026 inpatient rule did include an RFI on this topic and so I think that signals that CMS is open to hearing what’s working now. What some of these challenges are and and where we think we wanna go in terms of the future, and I’m really interested to see what the new leadership at CMS is thinking on this topic.
Thomas Royal
Well, we’ve come up against time, but there’s still so many unanswered questions that I have for the both of you.
Would you be willing to stick around for a few more minutes so that we can continue this conversation?
Jennifer Gasperini
Sure.
Jennifer Houlihan
Yeah, yeah.