Patient and doctor shaking hands

Medicare has shown no fear of embracing change. As in many recent years, 2016 will find it hugging experimentation a little tighter.

Coming off a banner year, Medicare will likely see changes made to telehealth, the inception of new payment models and some alternations to programs governing Medicare’s poorest, sickest populations.

Election year politics will sap Congress’s desire for big changes. After 2015, when Congress fixed the sustainable growth rate formula that hung over Medicare physician reimbursements for a generation, major legislative changes will wait until 2017. Even as the cost of new blockbuster drugs have increases clamor for Congress to explore Medicare prescription drug price controls (a non-starter for the pharmaceutical industry) there won’t be a word until 2017 or later.

One area where bipartisanship will move the needle is telemedicine reimbursement for Medicare Advantage. A proposed bill would make telehealth and remote monitoring of patients’ basic benefits under Medicare Advantage, as well as removing telehealth and remote monitoring restrictions for providers for alternative payment models. This legislation is uniquely suited to hurdle obstacles of election-year politics and we predict it could get traction.

Since the Affordable Care Act went into effect, Medicare has been on an experimental streak. In 2016, CMS will outline new payment model pilots developed by the Center for Medicare and Medicaid Innovation, CMS’s research & development office. CMS’s slate already includes a valued-based insurance design model that debuts in seven states in 2017.

With CMS willing to throw anything at the wall in hopes of it sticking, it will undoubtedly hurl a few new quality initiatives in 2016. The shape those will take is hard to discern, but CMS is eager to augment Medicare Advantage with more innovation and extend quality and innovation pilots to areas such as Medicare Supplement.

The agency recognized that what works in California does not work in Montana or South Carolina, so it will continue to test a broad menu of quality and alternative payment models. Medicare is building a continuum of payment models from fee-for-service to ACOs and global risk. There are many models it can still slot into that range.

We predict there will be some changes to Medicare’s dual-eligible initiative and how star ratings address special needs plans covering duals. The notoriously tough-to-manage population has proven even tougher in the managed care initiative playing out in 12 states. Further states could drop out if the program continues to fall short of expectations.

Tim Englehardt, director of the CMS Medicare-Medicaid Coordination Office, has said that the initiative is not a biology experiment, and CMS won’t hesitate to make mid-course corrections. With states such as California experiencing opt-out rates above 70 percent, CMS won’t shy away from tinkering or adopting best practices implemented in individual states.

Although star ratings have become the standard gauge of Medicare Advantage quality, CMS will review and possibly change the way it weighs measure for special needs plans. Those SNPs deal with much more complex patients than standard Medicare Advantage plans. While CMS does weight those plans differently, there is a general feeling it isn’t enough, so a change will come sooner rather than later. Dual eligible are a fraction of the Medicare population, but its most expensive segment, so don’t expect the agency to hold back on tweaks in 2016.

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